This is going to be fascinating to watch:
Now Suffolk county council is taking an even more radical approach to public sector reform by proposing a \”virtual\” authority that outsources all but a handful of its services.
The Tory-controlled county\’s \”new strategic direction\”, set for approval tomorrow, could see virtually every service outsourced to social enterprises or companies. The aim is to turn the authority from one which provides public services itself, to an \”enabling\” council, which only commissions them. The council hopes offloading services could shave 30% off its £1.1bn budget, as part of the government\’s drive to reduce the fiscal deficit.
Although councils have outsourced chunks of their services before, these proposals are regarded by experts as the first time a local authority has considered not directly providing any services at all.
Services would be offloaded in stages. While some \”early adopter\” services could be outsourced as early as this autumn, the rest would be divested in three phases from April 2011. Libraries, youth clubs, highway services, independent living centres, careers advice, children\’s centres, registrars, country parks and a records office are among the first services that could be divested.
Ultimately only a few hundred people could remain directly employed by the council, primarily in contract management. At present, the council employs around 27,000 people, 15,000 of whom work in education, which is set to be taken away from local authority control as the government converts schools to academies and free schools. Many of the remaining 12,000 could face either redundancy or be transferred to a social enterprise or the private sector.
I don\’t know whether this is going to work, you don\’t, the council doesn\’t and nor do the unions.
Which, of course, is why they should go ahead and do this. Because if it does work, \”work\” here being defined as offering the same or better services for a 30% cut in the bill, then we\’ve just found out something hugely valuable. That we can in fact deliver these public services at a 30% saving in the bill.
That 30% saving could be used to cut tax rates: it could be usde to provide more services. Which happens isn\’t the important point though. What is that important point is that we want to undertake the experiment to find out whether it actually works.
A 30% increase in efficiency, in productivity? Who wouldn\’t want that?
Well, OK, maybe the people being made 30% more efficient aren\’t going to be all that happy about it but then just as we don\’t and shouldn\’t run the market side of the economy for the benefit of companies but for consumers so we shouldn\’t be running the public services for the providers but for the consumers.
And for the consumers the same or better at 30% off is a wondrous deal.