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  • Writer's pictureAndrew Laird

Public Sector Focus article – Brexit mustn’t be allowed to stall public service reform

Updated: Apr 6, 2021

Writing for Public Sector Focus, MV’s Andrew Laird discusses the potential implications of Brexit for public service reform.

“A widely held fear following the EU referendum is that for the next three to four years the Brexit process will totally monopolise government time and energy. This is doubly troubling as we are only now emerging from a substantial period of public service reform stasis following last years’ General Election and spending review.

A further period of stasis would threaten things like the devolution agenda. Substantial effort has gone into areas like Liverpool and Manchester who are making huge strides towards taking control of local services and thinking differently about how these services are delivered.  We have heard of ambitious proposals to join up children’s services across council boundaries, which would create a more seamless service for young people. Also delicately placed are reforms like the integration of health and social care. This work is critically important as our population gets older and services face an ever increasing squeeze.  This is all ground-breaking stuff but these initiatives are in a state of semi-reform and the momentum must be maintained or the early progress will be lost.

However, there are reasons to be cheerful. Having been faced by a summer dominated by the Conservative Party leadership race, we are now in the position where Ministers are in place and have been able to “read in” and get started over the summer recess. The looming threat of an emergency budget and an early election have also been quashed. It’s also good news that several new ministries have been created to handle Brexit and what comes next. This should help stop this activity from overly interfering with the work of other departments. Finally, Theresa May has made it clear she wants to spend the coming months setting out her domestic policy agenda. Given where we were a few months ago, this all looks very positive.

So what might the domestic agenda look like? The PM has made “an economy that works for everyone” a key ambition so let’s consider a key part of the economy where the government has significant influence i.e. the public services market place. Taking out benefits, pensions, servicing debt and EU contributions, each year various government bodies deliver or commission about £450bn of services. Quite a bit of this channels through councils and other local services so a really interesting appointment is Sajid Javid at DCLG. Some have challenged the logic of sending a business specialist to work with councils but Theresa May is a fan of a mixed public service market place. She has previously argued that we should allow “thousands of organisations to provide public services”. Plenty of these services (such as children’s and adult’s social care etc.) are delivered through councils. Supporting councils to enable this mixed market will require a Secretary of State with a business mind –Sajid Javid is the right person.

Picking up on another of the new PM’s themes, the gap between bosses and front line staff in the public sector can be as big as anywhere else in the economy – probably bigger in some cases. So what to do about it? Over the last five or so years there has been an emergence of a new breed of organisation formed by services transferring out of the public body to form independent social enterprises (often called public service mutuals).  These organisations have the strong public service ethos of the public sector but also employ the entrepreneurialism and commercial discipline of the private sector. Crucially they are focused on empowering staff and many are collectively owned by staff. What better way to close the gap between bosses and frontline staff than giving staff an ownership share?

They aren’t perfect and a small number have been unsuccessful – but overwhelmingly they have been a revelation. Staff are happier and productivity has increased (e.g. fewer sick days) and service user satisfaction has increased. They are also delivering savings to their public sector commissioners through staff actively identifying waste and also through selling their services elsewhere.

Speaking in Birmingham just before taking office, Mrs. May voiced her support for this exciting agenda saying “as the Government reforms public services, we should encourage public sector workers to set up mutuals.” This is enthusiasm is genuine and fits perfectly with one of the PM’s key themes of giving people genuine control of their lives and work.

Public service mutuals are a growing force in the public service market place – but with the momentum now building (not to mention support from the PM), they could be set to play an even bigger role.

A less publicised but highly significant appointment is the PM’s choice of George Freeman to Chair her Policy Board. One of his final actions as Life Sciences Minister was to call for an end to the “apartheid” between the public and private sectors in the funding and provision of health and care services. This again sings to the new PM’s tune of a mixed market place for public services.

Drawing all of this together, we can expect the encouragement of a more mixed market place for public services – but we can also expect to see the market players being required to engage more with staff and service users.

Once into the formal Brexit negotiations, we can expect the process to absorb significantly more government time and energy than it currently does. So it feels like the PM has the remainder of this calendar year to kick start her reform agenda – for once Article 50 is triggered we are in uncharted territory.”


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