July 30, 2014
Rethinking received wisdom
Received wisdom is knowledge or information that people generally believe to be true, which in reality often proves to be false. One example of this from the field of economics is the idea that scaling something up, automatically brings about efficiencies and in particular cost savings. While that might apply to the production of widgets, there’s little evidence that it works with public services. In fact, quite the opposite. Some research by Locality has concluded that we need to turn this received wisdom completely on its head.
Overview
At a time of austerity cuts and mounting demand, the challenge for communities and the organisations that serve them has never been greater. How do we ensure that key public services meet people’s needs and support thedevelopment of communities we all want to live in?
The response by some government departments and local authorities to this challenge is clear – they feel thatsavings can be made by standardising community services and up-scaling local delivery to multi-million pound contracts, delivered by multi-million pound organisations. While this approach has had some major high profile set-backs, the underlying assumption – that the difficulties facing the funding of public services will be met through scale and standardisation – is not being challenged.
Locality and Vanguard have been working together to examine the issues and are able to demonstrate that big services and scale are incredible wasteful and damaging to local communities.
At a time of austerity cuts and mounting demand, the challenge for communities and the organisations that serve them has never been greater. How do we ensure that key public services meet people’s needs and support the development of communities we all want to live in?
The response by some government departments and local authorities to this challenge is clear – they feel that savings can be made by standardising community services and up-scaling local delivery to multi-million pound contracts, delivered by multi-million pound organisations. While this approach has had some major high profile set-backs, the underlying assumption – that the difficulties facing the funding of public services will be met through scale and standardisation – is not being challenged.
Locality and Vanguard have been working together to examine the issues and are able to demonstrate that big services and scale are incredible wasteful and damaging to local communities.
Increased administrative burdens and costs
A TSO in the North West was an experienced and successful business support provider, but recently found itself at the bottom of a long supply chain. Three separate organisations subjected the TSO to three separate but similar audit processes. Overall unit costs for the service were much higher than previously, but the organisation only received 40-50% of those unit costs to actually deliver the service, with the remainder invisibly swallowed up through complex management chains above them.
Creating silos and disjointed services
A TSO in the South West was able to integrate youth provision into a seamless, family-oriented approach, which started with the birth of a new baby, continued through childhood, teenage years and into adulthood. When the local authority decided to move from working with 65 local providers to nine large contracts, the TSO lost the contract to provide youth and play services. Vital information and deep-rooted relationships with children and their families are now lost. Under the new provision fewer activities are taking place, and the closely related web of informal local support has unravelled.
The report ends with a call to action. We know how to improve the lives of individuals and communities and the good news is that it doesn’t take any more resources to do it. But it does take courageous people who arewilling to follow evidence and abandon old beliefs. We are looking for community and statutory partners to work with us.
Our four key recommendations
1. Local by default : Commissioning and delivering public services should take place at a neighbourhood level.
2. Help people to help themselves: build strength not dependency People are the solution not just the problem. This is a massive resource which is often overlooked.
3. Focus on what people need: Predetermined targets start from the wrong place. A focus on underlying purpose is what will make the difference.
4. Value people over unit cost: The only way to drive down costs is by focusing on value. In other words, designing services that address problems early.
For the full report: click here