On 26 February Phil Swan attended the Service Transformation Summit in London hosted by the Public Service Transformation Network.

This was a useful day which including discussion on the big picture by Treasury, devolution in Greater Manchester and examples that highlighted the direction of future local government.

Some of the headline messages:

The current Government is working towards 35% of GDP on public services. Only 3 other countries do this in the developed world and one is Australia. However if the UK is to emulate this model it needs to spend much less on benefits, particularly pensions, and slightly less on education and health.

The sector has to move to a “big society” type model (delivering “with” not “to”) but at present there is little central Government policy leadership on this.

The local government finance system needs a complete overhaul with the devolution of NHS funding in Greater Manchester to a new combined governance model showing the way.

On the Transformation Challenge Panel Report (http://publicservicetransformation.org/service-transformation-challenge-panel): Govt response will be in budget including the request for £5b of joined up funding to enable transformation. Work is happening on how inspection regimes could be joined up, how budgets could be better formed, digital opportunities and more. Keep an eye on the Transformation Network website [link]

From Philip Colligan, NESTA: How are you authorising people to innovate? There is too much effort going making up ways to innovate. There are good methodologies on innovation and people shouldnt reinvent it. Funding should be skewed towards replicating things that work. “We are nowhere near effectively using data to inform good decision making”. Common standards a key element of this.

From Joe Tuke, DCLG, on Troubled Families:
An additional 400,000 families are being brought into Phase 2 of this work because the first programme successfully incentivised integration. Challenge to councils is to understand the cost of their services and their efficiencies much better. TF unit calls this “transparency based accountability” and is building on the cost modelling work of New Economy on enable this.

From Kathryn Francis, Treasury:
Financial crisis put back the countries rate of GDP growth by 16% and it isnt catching up. Taxation isnt coming to the rescue and it isnt picking up. In order to meet fiscal targets non protected spending, including local government, has to decrease by approximately 16% in 16-17 and 13.5% in each of 17-18 and 18-19 against a 15-16 baseline.

From Sir Derek Myers, Transformation Challenge Panel:

– Transformation exists in pockets
– Transformation takes times
– We’re too keen to reinvent

An action plan from Government responding to the recommendations from the Transformation Challenge Report is expected shortly.

What this might mean for people:

– Collaboration becomes the norm, pooled sovereightly the assumption, agreed leadership necessary (this is very difficult)
– Government needs to promote, allow and fund change
– We need to fully understand and exploit data
– And whilst we must take pride in innovation, we need to be ready to prove the success of models developed elsewhere in our localities.

From Mike Emmerich, New Economy, Manchester:
Devolution and H&SC in Manchester has been a 12 year journey.
The Chancellors personal involvement has been critical – the Mike Jenkins article in the Guardian details this and how important the relationship between Sir Howard Berstien and George Osborne has been.
What were some of the key factors:

– Luck – monocentric geography, boundaries, type of area, creation of supporting institutions.
– Institutions – Driven by Manchester Independent Economic Review and a resulting desire to greater agglomeration – you have to build together and drive better outcomes.
– Prioritised investment based on this.
– Collaboration.
– Leadership.
– Open dialogue with Government has been the biggest element, enabling much better conversations on research, politics, and economic reform.

Final points on making devolution happen:

– Get the data together to make the case. Use every technique in the book.
– Worry about recidivism and some Govt depts trying to back out.
– The relationship with Treasury and the Chancellor is critical.
– Biggest problem going forwards is likely to be a more uncertain political environment.