How will the voluntary and community sector fare under a choice based framework for public services?

Giving users of public services a choice of provider is one of the central pillars of the Government’s ‘Open Public Services’ agenda.

The recently published update paper (“Opening Public Services 2012”) set out new measures to increase choice and control for service users. As a minimum the Government will be commissioning an “independent review” of the barriers to and, promoting the availability of choice to users. At the same time, the Government has launched a call for evidence to potentially go further than this by establishing whether there is, or might be in the future, value in enshrining a ‘right to choose’ into legislation.

But, how does a market-based approach to public services play with the Government’s strategic aim to facilitate the ‘Big Society’ where, community action leads the way rather than the state?

A key part of creating that bigger society is the role that the voluntary and community sector plays in public and community life. Far from all voluntary and community organisations are involved in the delivery of public services, but the vast majority are least concerned about, or are seeking to influence their quality and delivery. So how will increasing choice for public service users, impact on the voluntary and community sector? This is one of a number of questions on public service choice which will be explored at a London Civic Forum seminar later this month.

For a start, it will mean the power to choose and purchase services will shift from public sector commissioners to service users; significantly changing the operating environment for VCS organisations whether or not they regard themselves as service providers.

While, VCS service providers might not feel that they are currently operating in a stable environment. In a choice-based operating framework income will be less assured and cash flow less predictable. Instead of marketing themselves to one or a handful of commissioners providers will have to attract users and clients directly and individually themselves – by the tens, hundreds or even thousands. Consequently, there will be some significant practical challenges in adapting systems and processes to costing as well as delivering and managing individual packages of services. The dynamics of their financial model will change; economies of scale may well be lost, cash flow disrupted and the risk profile shifted upwards.

It is likely to mean a shift in demand for certain type of services; providers will need to respond and adapt accordingly. This will be welcomed by many in the sector as an opportunity to develop the kinds of services they always believed in, but were never commissioned to deliver. At the same time, some will find out that they are not as in-tuned with user needs as they might have thought.

For those VCS organisations which do not provide public services, but act as an advocate for users, providing information and support, the terrain will become a lot more complicated to navigate. Consequently, their services will be sought after. But will they have the capacity to respond? And, will their knowledge still be valid in a different environment?

While, it is not assured that everyone in the sector will welcome the shift nonetheless, it will mean considerable change in the short and medium term and, not all VCS organisations will be able to cope with that change.

That will depend to a significant part upon the design of the new service framework the Government is aiming for and the journey of change it is taking towards that reform. Here, the Government will need to fully understand and embrace the dynamics and drivers of the services that they are reforming and those of the VCS sector itself. They will need to decide upfront and conclusively whether they really want the VCS sector (and I do not just mean the larger charities and social enterprises) to be central to these reforms.

I believe this means taking an approach which is nuisance and is personified by the phrase ‘personalisation’ rather, than a sweeping one purely grounded in market economics. In that way the sector’s capabilities, aspirations and energy can be fully utilised for the benefit of public service users.

Mark Upton, Consultant, Public Policy Strategies
Opening Public Services – a real choice for citizens? Tuesday, 12th June 2012, 10am – 12.30pm Venue: Amnesty International UK, the Human Rights Action Centre, 17-25 New Inn Yard, London EC2A 3EA
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5 Responses so far.

  1. Matt Scott says:

    Hi Mark – I’ll be speaking at this event tomorrow and Deirdre sent me your blog – should be an interesting debate. I note in your blog that the VCS will need to decide if it wants to be central to these reforms. This begs a lot of questions. For example – what part of the VCS? Can we even consider them to be ‘reforms’? Given that the VCS has never spoken with one voice and never got remotely close to having made a decision to go for something the demand that the VCS decides what it wants re these reforms ain’t gonna happen. This rather lets government off the hook: all hail this new iteration of hegemony 🙂

    • Policy Wonk says:

      Thanks Matt,

      Something that I didn’t mention today is that in as far as choice & control in social care is concerned, the personal budgets model was “invented” by and campaigned for by the VCS sector and in particular, user-led organisations.

      Today, some of those pioneers have taken the form of an organisation called In Control, who remain very influential in terms of the roll out of these reforms. It is inadvertently that Government has to “take over” implementaton, but the Dept of Health have adopted a partnership model. So given that local government was initially against PBs, it would seem that the user-led movement won the day.

      The roll out of social care PBs has not so far been commercially driven. User buying trends have so far been very niche – gardeners, (dedicated and shared) personal assistants, even football season tickets (cheaper than day centres), and dogs (there is a health logic). VCS providers are nervous of the journey. They have become dependent on state funding and contracts. Choice is a different ball game and, perhaps not the ideal time to roll out PBs. But if they don’t do it now, we may lose the opportunity forever.

      Yes, individuals will get “smaller” personal budgets. But don’t forget, around 20 to 30% of current budgets are (commissioning) overheads that are longer (totally) required. So the individual is likely to get the same value of funding. Though, the overall funding envelope for social care needs addressing – we await the White Paper on that.


      • Matt Scott says:

        Hi Mark

        Interesting points; apols for delay in following up. 2-3 quick points: the voluntary sector did not campaign for this model – simply because most groups are far too busy doing community work to notice this agenda – 9 out of 10 voluntary groups are unfunded associations. It is important not to make sweeping claims that they support an agenda when in fact a small vocal minority may have done some lobbying (big difference). Secondly there will be some inspirational work done by some groups, as you mention, but I think the real story is that politicians and policy folk have become adept at using the language of empowerment to push through cuts to services which is anything but empowering to the most vulnerable in society. My instinct on personal budgets is that it sounds great but its the same old cuts agenda – more responsibility, less money. Hats off to those who do manage to get something from this agenda but I feel they may be swimming against the tide. Finally you mention groups who have become ‘dependent on state funding’ – I see nothing wrong in the state funding voluntary action, in fact it is a social justice imperative. The market will and does look after itself, trying to graft it on to the VCS will create contracts for SERCO but probably not a lot else. My concern is that these policies lead to a more isolated society

  2. Policy Wonk says:

    I am afraid I will have to take issue with you on one point, Matt. Members of the VCS – the disability rights campaigners, and user led movement around older people specifically – did campaign for direct payments and personal budgets. That dates back to the 1990s. Their first victory came with legisation in 1996 on direct payments and, since have worked effectively to learn from early experimentations and widen the rights to individuals and press for take up by commissioners.

  3. Matt Scott says:

    I suspect you are right on the disability campaigning point – would be great to meet up to discuss further, I’m based around SE4 but happy to travel, all best