Tuesday, 24 June 2014

The NHS needs more than “reform”

For several years now, I have been arguing the case that the NHS, as currently configured, is financially unsustainable (see blogs below). This issue really became clear to me some ten years ago with the publication of the first Wanless report which effectively indicated that the only way that the NHS, as currently configured, could become financially sustainable in the longer term was through the achievement of a series of objectives which most informed people regarded as unachievable. Wanless was effectively a political document designed to support Gordon Brown’s views about leaving the NHS alone as opposed to Tony Blair’s view that this was unsustainable.

Fast forward eight years and we hit the era of the Great Recession and financial austerity. Although the NHS was “protected” from the pressures of austerity, it was left with a tiny amount of growth in resources each year.  I will not enter the complex debate, as to how big or small that tiny amount actually is but let us just recall that it was light years away from the substantial levels of growth the NHS has achieved throughout its history and even further away from the growth it received in the Brown/Blair years.

As a consequence of financial austerity, the NHS was given a target of making £20 billion of efficiency savings over a four year period which would release resources that could be ploughed back into new services, particularly those related to the needs of an ageing population. Many of us argued, at the time, that this target was also unachievable and was a challenge which no health system in the world had ever achieved. Despite valiant efforts from NHS managers and staff, it is becoming quite clear now that these efficiency savings will not be delivered to the required level and that the NHS is running into serious financial trouble pretty fast. Indeed, in my opinion the financial problems facing the NHS have taken longer to materialise that I expected four years ago when austerity commenced. This must be due to the sterling efforts of NHS managers and staff in making some progress on the cost savings front

Not surprisingly, the clarion calls are now starting to come out of the various London think tanks etc that the NHS needs another round of “reform” as a consequence of these financial problems. As someone who can remember, and was personally involved, in the “reforms” of the NHS which took place in: 1974, 1982, 1984, 1991, 1997, 2013 etc perhaps I can be excused a little weariness and cynicism about reforms which involve such things as: structural changes, reform to the commissioning process, changes to the internal market etc etc. I think we are well past that point and the types of changes needed to the NHS at this point in time and far more radical that has been the case in the past.  

I would suggest that some of the key founding principles of the NHS, in 1948, were:-

·         Comprehensive – the NHS was charged with delivering a comprehensive range of health services provision at the local level which, to a large extent, it still does.

·         Free – NHS services were to be provided free at the point of consumption. Although charges have subsequently been introduced, over the years, for some purpose, the services provided are still largely free

·         National – the NHS was to be a national service. At the time of its inception, Aneurin Bevan emphasised the importance of having a national system with uniformity of standards and not a series of local systems with variations in standards. In practice, and in spite of being subject to endless centralised control, the NHS has become a system with significant variations in standards across the country. Although attempts have been made to decentralise the NHS, these always seem to fail. Indeed as Chris Ham noted recently, (Public Finance Blog, 11 June 2014) the government’s recent NHS reforms which were meant to devolve power away from Whitehall have not done this and the NHS still remains one of the most centralised health systems in the world

·         Tax funded – the NHS is financed almost entirely from the proceeds of taxes levied by central government with relatively small amounts from other sources. It must be emphasised that the NHS is financed from the general pool of taxes collected by Government so that individuals see no link between the taxes they pay and the amount spent on the NHS. In the past, polls have suggest that people do not want to pay more in general taxation (the tax burden is constantly raising) but are more open to a tax levied specifically to fund the NHS.

What I am about to say will probably cause apoplexy in some quarters but it has to be said. The originating principles of the NHS were wonderful principles at the time (nearly 70 years ago) but the world has changed radically and these principles now need amending if the NHS is to survive. The NHS as currently configured is broken and needs to be fixed. I say this as someone brought up in a strong Labour Party family and born not ten miles from where Aneurin Bevan lived.

There are five things I would emphasise regarding the sorts of changes needed:

·         Funding – the NHS needs more money and always will. It is not going to generate the level of savings needed and we just as well stop pretending that it will. People don’t want to pay more in general taxes and so we must look elsewhere. There are two obvious candidates which space only allows me to mention here. Firstly charges need to become a much greater source of income for the NHS. I know this breaches the “free at the point of consumption” principle but it is something that many developed countries operate without the sky falling in. Moreover, any charges levied must be able to raise a substantial amount of money. We don’t want something like (English) prescription charges where you exempt a huge proportion of the population such that the volume of funds raised is limited. Secondly we have to, at least consider the merits of introducing some form of health insurance or earmarked taxation model for funding health services where people pay according to what they earn and they know the money raised goes towards the NHS. At the point when health insurance is mentioned, many people default to the view that “we don’t want to end up like the Americans”. In my experience, most Americans don’t want to end up like the Americans but they don’t know the way out of the mess. The reality is that there are several countries who operate health insurance models (private and/or public) which work well and deliver better health services than in the UK. We must at least consider them. Whether we want the health insurance model to also incorporate some sort of premium penalty for those undertaking risky health behaviours is also a point of debate. It must be remembered that a basic principle of “insurance” is that premiums should reflect risk.

·         Prevention – it is well known that a huge proportion of NHS expenditure is spent on treating medical conditions which can be prevented by changes to individual’s behaviour and lifestyles (e.g. smoking, obesity, alcohol consumption etc). Changing such behaviours in millions of people appears a herculean task of public policy. In my inaugural professorial lecture in 2009, I speculated that one aspect of public policy under austerity was that government would probably need to become more authoritarian in its attitude towards certain of its citizens. To some extent this has already happened in areas of public policy such as “troubled families” and social welfare benefits.  In relation to health such an approach might involve a greater element of sanctions for pursuing unhealthy behaviours rather than incentives to adopt healthy lifestyles. One example such as this (referred to above) would be higher premiums under a social health insurance model.

·         Diversity – the NHS has often been described as the last great public sector monopoly in the UK. Through policies of contestability, there have been changes in the involvement of private providers in NHS services the proportion is still pretty small. In many other countries we find a much greater diversity of provision in involving: government, religious orders, not for profit organisations and for-profit organisations. Maybe further diversity of provision needs to be encouraged.

·         Decentralisation – I have already noted the extreme centralisation of the NHS as a health system and the failure to achieve de-centralisation. To be honest, I have no idea how this could be achieved other than significant constitutional change in the UK (Malcolm Prowle, Public Finance Blog, 12 June 2014)

·         Political consensus – Nigel Lawson once observed that the NHS is the national religion of the UK with an unchallengeable theology. My observations of the last forty years are that when any political party is in government it tries to achieve some reforms and changes in the NHS. However, when in opposition, political parties of all colours fall back on policies which, by and large, comprise the following: spend more public money on the NHS, employ more doctors and nurses, reduce the number of NHS managers and administrators, not close any hospitals (however decrepit, unsafe and ineffective they may be) and not change anything. Unsurprisingly these sorts of policies are almost universally supported by health professional representatives and trade unions. Coupled with strong publicity from the media this makes it incredibly difficult to achieve the level of change actually needed in the NHS. Moreover, this sort of mentality often blocks reforms which are needed to improve health care. Unless we can achieve some sort of political consensus on health (as we have in some policy areas), we face an endless cycle of political parties in opposition promising things which go down well with the electorate (even though the electorate is wrong) and when in government trying to reform the NHS but being opposed by other political parties, the media and the health professions. A recipe for stagnation.

Although we live in an era of austerity I suspect that the worse NHS finances get and the closer we move towards the election then the more likely it is that the Chancellor will find some additional funding from somewhere to tide the NHS past election day. However, post-election the NHS will return to the existing unsustainable position facing the same choices.

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Monday, 16 June 2014

Local Government in Wales: Merger or Re-design

The issue of reform of the local government system in Wales has been a hot topic for discussion for many years but the debate was fuelled some months ago by the publication of the Williams report which suggested that local government services could be delivered more efficiently by fewer councils and suggested a new local authority map for Wales.

At its annual conference later this week, the Welsh Local Government Association (WLGA) is due to discuss (among other things) the issue of prospective local government reform in Wales. The latest contribution to the debate has come from the Shadow Welsh Secretary Owen Smith who has urged council leaders in Wales to "pick up the baton" and take the lead in reforming local government. He argues that councils should be trusted to drive any possible mergers on, presumably, a voluntary basis, rather than be forced to do so by diktats from the Welsh government.

Such a suggestion seems, to me, to display a certain degree of naivety and lack of understanding of the issues involved, a situation not uncommon in opposition politicians lacking the support of teams of experienced civil servants of researchers and forced to make up policy “on the hoof”.

Firstly, can we be sure that any voluntary mergers are undertaken on the basis of what is best for services users and the general public and not for political reasons. It is easy to see how possible mergers could be developed on the basis of which political party would exert control over the merged authority and rejected where a political party realised it was unlikely to gain political control.

Secondly, can we be sure that any mergers proposed by existing local authorities would constitute the “right” merger. It is important that there is a clear strategic rationale for the merger and it must be seen that merger is a means not an end. However, this is not always the case and quite often the merger undertaken is the “wrong” merger and thus the benefits are just not realised. I have been involved in the examination of many possible mergers of public authorities and although alternative merger options were sometimes available but these were just not considered. Sometimes this is just a case of inadequate consideration and analysis of the options available but sometimes it is just a party political issue. Also, while it may seem astounding, I have seen examples of mergers where the merger partner was chosen for opportunistic reasons such as there being a vacant chief executive post which was felt to be an easier merger option than one where a choice has to be made between two chief executives for the posts in the merged organisation.

It is also important when we talk about local government reform to be clear about whether we are talking about “merger” or what I call “re-design” - the terms are not necessarily synonymous. By merger, we are probably talking about bolting existing local authority units together in groups of 2 or 3 and then fashioning a new organisation structure for a local authority now covering the area of the original 2/3 authorities. In the 1996 local government reorganisation in Wales, this is essentially what happened. The then county councils were abolished and the then district councils were merged into larger units at the same time taking over the county council functions. At the time, some of us involved in the merger process in Wales, whimsically commented that it seemed to us that the then Welsh Office must have had “flat maps”. This is because some of the mergers that were taking place seemed to pay no cognisance to the physical geography of the constituent parts. For example, the merger of Cynon Valley and Rhondda Valley into the new authority (RCT) seemed to ignore the fact that there were high mountains between the two valleys and poor transport links.

Re-design is a far more difficult exercise and involves starting with what is effectively “a clean sheet of paper” as far as Welsh Local Government is concerned. A new pattern of local government would need to be developed which, effectively, ignores what currently exists and focusses instead on what will best meet the needs of the people of Wales over the next 2-3 decades. Such an exercise is complex and would involve taking account of a range of factors when considering how future local government boundaries should be drawn. Some of the factors to be considered include the following:

·         Population – there is no need for all local authorities to be of the same population size but there, needs to be some idea of what would constitute an optimum size. Also consideration needs to be given to the structure of the population, particularly in relation to age structure and the impact of the ageing population and numbers of children being born.

·         Demographic changes – demographic changes in area can take place for a number of reasons including: growth in residences, changes in employment patters, ageing populations etc. Any re-design of local government needs to consider possible demographic changes in the years ahead

·         Need for services – based on a range of factors such as population size, population structure, physical environment etc, consideration would need to be given to the need for local government services and the ease of delivery of those services in the years ahead.

·         Equality of resources – like many parts of the UK, there are large variations within in Wales in terms of income and wealth. This has implications for a local authority’s ability to raise revenues through council tax and charges. Many parts of the current Welsh local government system bring together some of the poorest parts of Wales with the consequent dearth of resources. Consideration should be given to options for new local authorities which provide some degree of equalisation of income and wealth by combining richer and poorer communities in one local authority.

·         Physical geography – this has already been touched on and in redesigning local government the physical geography of possible local government units and the ease of transportation between different parts of the area need to be considered.

·         Community cohesion – potential new local government units will probably comprise a number of different communities with different cultures and backgrounds. The extent to which these various communities might cohese or fragment needs to be considered.

·         Employment and travel to work patterns – changes in the labour markets mean that travel to work patterns from different residential areas have changed and will continue to change in the future. For example, in the South Wales valleys many of the travel to work patterns of local communities now operate in a North-South manner whereas existing local government units operate on an East-West basis. Future changes in travel to work patterns are a key consideration in any re-design of Welsh local government.

Not surprisingly, most debate on local government reform tends to focus on the merger of existing units because this is a relatively easy thing to do. I say relatively since although such mergers could be easily done in most commercial organisations, the political and consultative nature of local government still makes it a difficult exercise. However, re-design of local government from a zero base is a very complex exercise which needs analysis and consideration of a large volume of data and imaginative ideas about future options. However, although more difficult, if done properly it is likely to generate a more robust configuration for local government than the merger approach.

Wednesday, 11 June 2014

Scottish Independence: The problem is London

Less than 100 days to go now to the Scottish referendum on independence and panic is starting to set in among the political elites, particularly in those parties supporting retention of the union. Never in their wildest dreams did they expect the Scots to vote for independence and the polls seem to suggest a strong majority for retention of the union. However, the former Prime Minister Harold Wilson once said “a week in politics is a long time” and indeed this is the case. The latest polls suggest a very tight race with a serious possibility of the Scots voting to leave the United Kingdom.

So what has gone wrong? Well on the one hand it was bad luck or bad planning for the Scottish referendum to be proffered by a Conservative government. Toryism is still  toxic brand in large parts of Scotland and a vote for the union is increasingly being seen as a vote for the Tories even though the “Better Together” campaign represents all main UK parties and is chaired by a former Labour (and Scottish) Cabinet Minister, Alistair Darling. Arguably, the more David Cameron appears on television urging Scots to vote for the union the more the Tory-hating Scots are going to vote for independence. If it had been a Labour Government that had offered a referendum then things may have been different. However, that is the way the cookie crumbles.

Then, there is the general backlash against the established UK political parties of all colours. In England, if you are completely disillusioned (as many are) with the existing Con/ Lib/Lab trinity, there isn’t much you can do about it other than stay at home on voting day or vote for UKIP which millions have already done. Those of us in Wales and Scotland have the luxury of being able to vote for established nationalist parties (Plaid Cymru and the SNP). Thus many Scots voting for independence may really just showing two fingers to the established UK political parties.

However, I suggest there is another issue. The roots of this problem are deeper and are based on the dominance of London in the UK. Firstly, the population of London dominates the UK population to an extent rarely seen in other developed countries. Secondly, London (and the rest of the South East) dominate the UK economically as a consequence of the concentration of financial, business, government and third sector organisations based in the capital. Thirdly London dominates the UK politically with most of the levers of political power being based in London. For most of the UK, public services are planned and managed via a strongly top-down command and control process driven from Whitehall and Westminster with limited regional or local discretion and this creates alienation from government coupled with large scale dis-satisfaction about the effectiveness of public policies.

In 1992, the then Leader of the House of Commons, the late Robin Cook (also a Scot), stated that “Britain was the most centralized state in the EU”. Many also argue that the UK is one of the most centralised states in the world. Indeed the Economist journal once suggested that the UK was the second most centralised country in the developed world after New Zealand which is, after all, a tiny country. By contrast in most developed countries the capital city is not even the largest city and so only in the UK does the largest city dominate politically, economically and demographically to such an

Fifteen years ago the Blair Government initiated a policy of devolution which led to the creation of devolved Assemblies/Parliaments in Scotland, Wales and Northern Ireland. Devolved administrations for English regions were also toyed with in some places but were rejected by the local electorates who saw not true devolution to the local level but the imposition of another tier of government at additional cost to the taxpayer. The devolution approach adopted in the UK was very limited in that it only applied to certain areas of Government policy and, by definition, only applied to the 15% of the UK population in Wales, Scotland and Northern Ireland. Moreover the whole process of devolution has been messy with add-ons to the original devolution settlement taking place every few years. Not surprisingly the whole devolution process suffers from a huge failure of understanding. A recent poll showed that in Wales almost half of those old thought the Welsh NHS was still the responsibility of the UK Government as opposed to the Welsh Government.

I wish, therefore, to put forward a view that one of the main reasons for increasing support for Scottish independence is not a rejection of England per se but a rejection of London based dominance in public affairs. Many people in Scotland, Wales and indeed in many parts of England dislike intensely the dominance, arrogance, and patronising attitude of the London based  elites in politics, the media, the arts etc with which they have nothing in common. To Scots, achieving an independent Scotland would be seen as an end to London dominance whether or not that would be the case.

Rather than limited devolution to the celtic regions, a solution to this problem might have been the conversion of the UK into a proper federal state with the powers of the various tiers of government defined and enshrined in a written constitution. At the moment the continued existence of the devolved administrations is not constitutionally protected but is in the gift of the UK parliament and could, in theory, be repealed at any time.

Under a federal structure, the federal government based in London would have responsibility for certain policy areas best organised on a UK basis such as defence and foreign affairs. Responsibility for other policy areas would be devolved to regional based governments (e.g. Wales, Scotland, Northern Ireland and English regions however configured). Policy in areas such as education and health would be developed and implemented at the regional level without interference from the federal tier and this would also be constitutionally protected. Clearly the size of the federal government, in terms of elected representatives and civil servants, would be vastly smaller than the current UK government but regional government structures would need to be developed in the regions of England.

What are the chances of such a federal arrangement being considered let alone implemented in the UK? I would say approximately nil. The same London based elites referred to above would ensure that it never happened since their loss in power and influence would be enormous. Consequently, I think the break-up of the UK is very much on the cards. First Scotland may well go independent and, if it did, then Wales, on a me-too basis, might demand a similar referendum which might also lead to Welsh independence. However, I may be wrong – let’s remember the old adage “It ain't over till the fat lady sings” and there are less than a hundred days to go to the referendum. We live in interesting times.

This blog was first published on the Public Finance blog site:



Wednesday, 4 June 2014

Here we go again: The UK housing market

I don’t normally find myself agreeing with the European Commission but their recent intervention concerning the UK housing market seemed to me to be both timely and relevant given the frightening level of house price inflation in the UK and particularly in London. Amazingly, the response to its sensible suggestions have resulted in a furore of criticism from many quarters including, Tory MPs, Vince Cable and quite amazingly that Europhile-in-chief, Nick Clegg. What is going on?

Housing has always seemed to me to be the UK disease. Why is it  that housing seems to be the only purchase item where, if the price goes down people say “oh dear” or “how terrible” whereas if the price of food, energy, transport, wine, foreign holidays, consumer goods etc etc goes down people usually say “great”? Doesn’t anybody ever learn the lessons of economic history – asset prices can’t continue to increase indefinitely and will go down as well as up. Unfortunately, Governments tacitly reinforce this view. After a period of economic bad news (and we have had much of this in recent years) they like to trumpet rising house prices as a sign that things are getting better and good times will be back soon. Unfortunately, I see it as a sign that a new housing bubble is being created which will, in due course, bring the economy, once again, crashing down on all our heads.

In the UK we have had many property booms and busts most recently in the early 1990s and the later part of the 2000s just prior to the great recession and the huge collapse in property prices. After a frenzy of buying and escalating house prices a property market collapse usually ensues. Over the previous years of the cycle some people will have made large financial gains from buying and selling houses but many who bought at the peak of the market suffered major financial losses and end up in negative equity and possibly bankruptcy, homelessness or both. Economic history shows us endless example of people believing that asset prices could only go up and not come down (e.g. South Sea bubble, 1929 crash etc)

 For the last twenty years or so I have always argued strongly against treating housing as an investment asset instead of being a purchase item essential for civilised life. However, in the UK, in choosing a house, many people still look at the financial gain they were likely to make, if they sold the house in a few years, and not its suitability as a place to live and raise a family.

If financial losses on housing were just an individual matter then we might not need to give it too much attention since it is up to people how they invest their money and what risks they wish to take. However it is not as simple as that and these booms and busts in housing have a number of major economic and social consequences some of which include:-

 ·      Many people and families have their properties re-possessed and are made homeless
·       In some parts of the country (e.g. London) even though there can be a shortage of appropriate housing while some property stock is kept vacant since landlords are happy making capital gains without the bother of having tenants

·         The rapid escalation in house prices in an area makes housing unaffordable to many people especially first time buyers.

·         Borrowers, encouraged by irresponsible financial institutions, take on completely unaffordable mortgages, in order to get on the housing ladder, and ending up in calamitous financial situations

·         Investment funds applied to property purchases are diverted away from more productive forms of investment

·         Perhaps most importantly the financial crises that have occurred in many countries have led directly to: collapsing economies, unemployment and major reductions in public services and infrastructure.

Somebody said that the seeds of the next financial crisis are already being sown in the backrooms of banks and other financial institutions by people thinking up the next dodgy product range which can be sold to naïve people at a profit. This may or may not be the case but the question I would ask is whether now is the time to think about how we might avoid yet another housing market boom and bust with its dreadful consequences.

 In its recent report, the measures suggested by the European Commission involved;

 ·         Increasing the rate of building of new houses – increasing supply should keep down hose price inflation provided the hoses are built in the right places. Either houses are built in areas where jobs are available (i.e. the South East) or Government must find a way to increase job creation in other parts of the UK and increase house building accordingly

·         Curtail Help to Buy – this policy was always seen as politically shrewd but economic madness if the supply of housing could not be increased to deal with the increased demand the policy would create. The surge in house prices is now a case of “chickens coming home to roost”.

·         Council tax – raising the rate of tax on higher value properties which would raise a lot of revenue which could be ploughed back into house building
The above measures seem to me to be sensible but I would like to go further and advocate that the Government considers applying capital gains tax to all domestic property transactions including first properties. Firstly, this would give a signal that housing should not be seen as an investment asset but a human right. Secondly the tax would also reduce the attraction of housing as an investment by reducing the possible gains and thirdly raise additional funds for HM Treasury.

Obviously the present government which has to face an election next year is never going to introduce such a radical tax policy. Their aim is to convince us that the UK economy is on a path of long term sustainability (which it isn’t) and that rising house prices means the good times are back (which they are not for the majority of people). They will not do anything that will destroy that illusion so close to an election. All we can hope is that some future government, with a five year term in front of it, might see the need to bring some degree of stability, affordability and sanity to the UK housing market both in the South East and the rest of the country. Clearly the details would have to be worked out in terms of rates of tax, exemption limits etc and the policy would need to be harmonised with other policies such as accelerating the house building programme.

But what would people do with their spare funds if they couldn’t speculate on the housing market. Well they could invest in the equity markets but the perhaps the Government might also think of establishing some form of national speculating competition involving much larger sums than the National Lottery so that people could speculate without damaging the real economy.(I jest of course).

This blog was first published on the Public Finance blog site:


Tuesday, 3 June 2014

A return to community hospitals in the NHS???

In a recent interview, Simon Stevens, the head of the NHS  n England, seemed to mark a change in
with new models of care built around smaller local hospitals. In some ways this sounds radical but closer examination might suggest that it is just a step on an evolutionary pathway.

For 60 years, the bedrock of the NHS was the district general hospital (DGH), which delivered a range of hospital services, other than specialised tertiary services at university hospitals, to a local population of perhaps half a million people. However, in recent years this process has started to change with a more varied pattern of services developing, incorporating DGHs specialising in particular aspects of healthcare, expanded primary care centres, walk in centres and community hospitals.

Community hospitals are well placed to support patients on their complex journeys of care through the health and care system. They can be seen as a local hub for a range of easily accessible health services and might also provide signposting to other services such as those provided locally by the third sector. Community teams can also help to prevent emergency admissions to acute hospitals and can play a significant role in supporting the reduction of hospital delayed discharges.

However, this does not mean a return to an era where hospitals were often staffed by matrons who ruled with a rod of iron and where general practitioners popped in to do a bit of routine surgery. Neither does it mean that many existing, and much loved, community-based hospitals will not be closed where they are found to be obsolescent, inappropriate or just plain outmoded. This will undoubtedly generate a lot of local opposition but, personally, I have seen situations where the public opposed the closure of a hospital which was not just unsuitable but unsafe.

However, new community hospitals will continue to be built. Throughout the country it is possible to find examples of where an old community hospital has been closed and replaced, a few years later, by a new one nearby.

Complex medical and surgical care will still be provided at large hospitals, where doctors can specialise in particular aspects of medicine and can have better clinical results than in hospitals where no such specialisation takes place. However, other services such as care of older people, long-term care and patient rehabilitation might be better undertaken in the much calmer environment of a community hospital. In some cases, diagnostic and some treatment activities for acute patients might also be provided at a location more convenient to the patient.

Some will argue that smaller community hospitals are inherently less efficient because of their size but this might not be the case. Often larger organisations (such as a DGH) can have inefficiencies that are found in many largeish bureaucracies and small hospitals can have greater scale and flexibility. It is, therefore, a debateable point as to whether community hospitals will cost more to run and will require additional funding.

There will be strong barriers to the concept of more community hospitals. Not all healthcare professionals will be happy to work in such units and may see them as boring since they are not working at the cutting edge of healthcare. Consequently, they may see this as a block to their individual career prospects.

Many people, including myself, will look on community hospitals favourably as a place for elderly relatives to spend the last years of their life. The calmer environment and the greater degree of familiarity with nursing and other staff will be a welcome change from the hustle and bustle of the large hospital.

One may wonder why Simon Stevens has chosen this controversial topic to mark one of his earliest interviews as head of the NHS. Could it be that community hospitals are very popular with the public and that this will generate good news for the NHS even though, as already noticed, the type of community hospital being proposed is very different from that of the romantic past? Alternatively, is it just a means of distancing himself from the previous NHS regime by a significant change in policy? Time will tell how far the configuration of the NHS will change as a consequence.

This blog was first published in the Guardian Health on 3 June 2014. http://www.theguardian.com/healthcare-network/2014/jun/03/community-hospitals-nhs-simon-stevens-support

Tuesday, 20 May 2014

Welsh GCSEs: Another Welsh Government fiasco

An article by Vivienne Russell’s (The Silk Road, Public Finance, April) discussed differing views on the merits of extending devolution to Wales. One of the main arguments against further devolution, discussed in the article, is that the Welsh Assembly and Welsh Government have performed poorly over the past 15 years regarding the public services already devolved, and that improvements should be seen before further devolution is considered.

A specific aspect concerns the fiasco over school examinations. This came about following the publication of the results of the second unit of a new modularised GCSE paper in English language issued by the Welsh examinations board, the Welsh Joint Education Committee (WJEC). The alarm was raised by head teachers who described shock at how poor were the published results from exams taken in January this year, with some schools expecting 60%-70% of their pupils to get a C grade or better and finding only 27% actually did so. There were also many individual examples of children achieving a result three to four grades lower than that predicted for them. Not surprisingly, this created a furore among parents, teachers and pupils. Thus, this is not just a bureaucratic issue – it affects the lives of thousands of young people. GCSE English is also the cornerstone for judging overall GCSE performance for schools, along with GCSE Mathematics.

The backdrop to the fiasco is the inadequate state of the Welsh schools system for the past 15 years (and more) – and something akin to sheer panic. The situation can be described in terms of poor PISA scores, failing LEAs, sharply increasing numbers of schools in special measures, a lack of confidence in teacher assessment practices (with lower than average GCSE results compared to England) and a school curriculum some would say over-burdened with experiments in social engineering at the expense of educational attainment. That Welsh schools are also comparatively underfunded compared with the rest of the UK is a matter beyond dispute.

This was not the first exam controversy. Back in August 2012 the Welsh Education Minister Leighton Andrews commissioned a review into the performance of candidates in Wales studying for a GCSE in English Language. As a result of the review, Andrews ordered WJEC to remark the English Language papers of all Welsh entrants because he felt that thousands of pupils had been the victims of an ‘injustice’. In that instance, the WJEC said it had complied with a requirement from exams regulators in England and Wales to make the boundary between grades C and D ‘more severe’.  Some accused the Welsh Government of trying to disguise the lower performance of Welsh pupils compared to English pupils in taking the same WJEC examinations.

This all started with the hawkish English Education Secretary, Michael Gove, who proposed a raft of reforms to the school examination systems in England including the use of a single examination (the English Baccalaureate) for GCSE examinations in England.  Gove’s proposed reforms caused turmoil and furore, in equal measure in Wales, particularly in relation to the proposed abolition of GCSEs. The Welsh education minister described it as a ‘backwards step’ and a ‘solution designed for the 20th Century’. Several people (including one of the authors) warned against a ‘go it alone’ strategy for Wales, since it was vital that Welsh qualifications were not seen as ‘second rate’ by English universities and employers with the consequent negative impact on young people in Wales.
Nevertheless, the Welsh Government put forward a number of changes designed to improve and strengthen the Welsh GCSE concept. In 2012 general reform was also announced for all Wales-based qualifications for 14-19-year-olds following a national review. The problems of 2014 relate directly to the 2012 decisions.

It was, appropriately, on April Fool’s Day 2014 that the Welsh Government published the findings of its report into this year’s controversy. This followed an earlier report in March by the WJEC, which concluded that with the exception of one examiner there was no evidence to suggest that WJEC did not follow correct procedures and so no comprehensive remarking exercise was needed. The Welsh Government’s feverishly produced report in no way sheds light on the fiasco for a number of reasons discussed below:

Statistical analysis
The report discusses a number of causal factors for the sharp drop in examination performance including: early entry and over-estimation of grades by teachers. However, there is little point in just suggesting causal factors for the results unless you can pin down, by statistical analysis, the contribution of each causal factor. Otherwise all you are doing is muddying what is already dark water. This analysis has not been done and presumably never will be. The WJEC and the Welsh Government both have an interest in no more questions being asked of their roles in the incompetence that has affected Welsh schools once more.

Visits to schools
A government inquiry team made visits to 32 schools over a four-day period. This is clearly a Herculean effort, but we have no overall summary of what were the responses to questions asked, the discussions held and the views of the schools. The civil servants did the usual job of elegant summarising. How much depth did the investigators go into with such a broad and hurried sweep? While we don’t expect the views of individual schools to be released, a more comprehensive summary of the discussions would have provided greater transparency. Lastly, why was the criticism from the schools concerning the lack of WJEC support minimised in the report when it was clearly a strong issue for schools? We have the exam board roundly rubbished by its schools and yet all the minister and WJEC conclude is that a ‘few lessons need to be learned’.

The fractured relationship between Government and WJEC
 Information obtained under Freedom of Information has clarified the deteriorating relationship since 2012 between the Welsh government and WJEC. The situation reached its nadir after the publication of the GCSE results of 2012. It is no exaggeration to characterise the relationship between the minister at that time and the chief executive of WJEC as very poor. GCSE war broke out that late summer not just between Wales and England. The evening before the January 2014 unit’s results became public, the WJEC pinned the blame squarely on government haste in changing the exam specification. This is what their email said: ‘Outcomes for foundation tier candidates dropped compared with the previous specification and examiners felt that this was due to the increased demand of the new specification which had been requested by Welsh Government (our italics).’

Culpability and accountability
 On the assumption that everyone agrees that this fiasco is a consequence of human actions and not natural forces, then the report sheds little light about who was at fault and how things might have been done differently. One is left with a feeling that everyone and yet no one is to blame, which is bizarre because the evidence suggests that the schools have little culpability in this area. The fault lies somewhere on the axis between WJEC and the Welsh Government.

Welsh school standards
 If, as the report seems to suggest, the latest GCSE English results are regarded as broadly correct, where does this leave the Welsh schools system in its key priority of literacy?  One purpose of introducing revised GCSEs was presumably to set a more robust challenge and higher standards for Welsh pupils that could be seen as comparable with the revamped examinations in England.
Do these latest results mean then that Welsh pupils are completely ‘off the pace’ in relation to tougher GCSEs? If this is the case, what on earth do we do about it? The Welsh Government cannot have it both ways. Either the examination system is flawed but the pupils are performing satisfactorily or the examination system is not flawed and hence the problem must lie with the children and teachers.

Future actions
The Welsh Government report incorporates an action plan covering intermediate and longer-term actions for Welsh Government, WJEC and consortia. It looks that the bulk of these actions places, by far and away, the biggest burden on WJEC. The question to be asked is whether WJEC, as currently organised, has the capacity and capability to meet these challenges in a meaningful manner while at the same time dealing with a wide range of other issues.  It could be another terrible summer for WJEC. Its fitness for purpose is in jeopardy. What we have described above is an example of systemic failure by the Welsh Government. This is not the first case of such failure and probably won’t be the last.

However, the report on the GCSE fiasco just cannot be regarded as independent and unbiased. It has been prepared by the Welsh Government itself even though the Welsh Government is itself a party involved in the controversy. It is rather as if there were three possible defendants in the dock (the Welsh Government, WJEC and schools) but one of the defendants is also the judge and jury. Hence, the Welsh Government, potentially one of the culpable partners, is investigating itself. Furthermore, the statistical analysis undertaken for the report has not been signed off by the Welsh Government’s own statistical unit and so there must be some doubt about the veracity of the figures shown.

What is hard to understand is the way in which the findings of the Welsh Government report seem to have been accepted by the Welsh public with hardly a murmur of dissent. Given that 90% of candidates have been reported as opting for a June re-sit, this is depressing apathy. Moreover, a report that is deeply flawed and severely lacking in independence was just accepted by a compliant Welsh media. The teaching unions in Wales, who are not always averse to protest or even industrial action on matters like, pay, pensions or curriculum content, have been largely silent about the report and seem to have accepted the findings that nothing really went wrong. The unions that represent head teachers, received the minister’s review and statement almost perfunctorily.

In France, we would probably have seen thousands of pupils (and their parents), who have been done down by this fiasco, marching on the streets, but we have heard little continuing protest, apart from schools seeking compensation for the costs of re-sits.

As a result, there must be some concern about the nature of Welsh civil society. A serially incompetent Welsh Government, largely one party in nature, seems to be able to get away with repeated calamity with hardly any dissenting protest or electoral punishment.

The Greek philosopher Plato commenting on politicians warned that ‘those who seek power are not worthy of that power’. We need a bit of that more inquiring attitude in Wales. Otherwise, our disgruntled but voiceless 15-year-olds will grow up with even more inertia than their parents and schools are now showing.

Malcolm Prowle is professor of business performance at Nottingham Business School but resides in Wales. Terry Mackie is director of educational consultancy EmpathiCymru and a former head of school improvement and inclusion for Newport Council.

This blog was first published on the Public Finance website: (http://opinion.publicfinance.co.uk/2014/05/gcse-fiasco-learning-lessons-for-wales/
A fuller analysis of the failings of the Welsh Government report can be obtained by contacting Malcolm Prowle on malcolm.prowle@ntu.ac.uk

Tuesday, 11 March 2014

Wales: the devolution debacle

Since the early days of its creation, the mantra of the European Union has been that of ‘ever closer union’.  If we look at the situation regarding devolution in the UK it appears that a similar mantra exists, but is unsaid, and that is ‘ever more devolution, but not for England’. 

Back in 2000 there was no area of UK public life where policy was devolved to sub-national tiers of government. However, the impact of the 1998 devolution referendums was the creation of a devolved parliament in Scotland and a devolved assembly in Wales (the Northern Ireland Assembly was created some years later), while 84% of the UK (i.e. England) had no form of sub-national government and all aspects of public policy were driven from London.

The former Secretary of State for Wales, Ron Davies, was quoted as saying that ‘devolution is a process not an event’. Davies was presumably implying that devolution would not stop at the 1998 settlement but would continue and evolve. 

In theory, this could have meant that the boundaries of devolution would be adjusted so there was a smaller amount of devolution to Scotland, Wales and Northern. But, in reality, the pressure has been in the opposite direction of greater devolution. Since the creation of the assemblies and parliament, there seems to be a path of ‘ever more devolution, except in England’.
The situation regarding Scotland is well known and may end up in Scotland leaving the UK or, at the very least, having substantially increased devolution (the so-called devo-max option). In Wales, however, we have also seen a creeping devolution taking place.

Following a referendum in 2011, the primary law-making powers of the Welsh Assembly were enhanced making it possible for it to legislate without having to consult the UK parliament, nor the Secretary of State for Wales in the 20 devolved areas. Proposals have also been mooted for the Welsh Assembly to have, in due course, powers of taxation.

In 2001, the Commission on Devolution in Wales (the Silk Commission) was established by the UK government and supported by the Welsh government and by all four political parties represented in the National Assembly for Wales. The commission’s remit was in two parts. Firstly, to review the case for the devolution of fiscal powers to the National Assembly and, secondly, to review the assembly’s powers in light of experience and to recommend modifications to the present constitutional arrangements.

In all of this, there had been little consideration as to how well devolved government in Wales has actually worked in terms of on-the-ground public service improvement. Instead, there was lots of waffle about national status and identity. 

Consequently, in 2013, I presented written evidence to the Devolution Commission concerning its work on extending the powers of the National Assembly. The thrust of my argument, which was quoted by the Commission in its Part 2 report published in March 2014, was:
‘The evidence suggests that the Welsh Government has not performed well with regards to the two key public services of schools education and health, and a similar situation may exist with regard to other public services. It would be best to concentrate on improving core public services and return to the issue of further devolution of responsibilities towards the end of this decade provided the situation has improved.’

In response to my evidence and similar comments from others, the Silk Commission’s report stated that: ‘It is not our function to assess the performance of the Welsh Government in this or any other field… our task is to consider where power should be held rather than the policy decisions of a particular government.’

While this may be true in terms of the commission’s terms of reference, it seems a strange position to take such that decisions about granting enlarged powers should take no cognisance of past performance with regard to existing powers. This must really cast doubt on the workings of such commissions.

Not surprisingly the Silk Commission has gone on to recommend further devolution for Wales. Its 61 recommendations include the devolution of police, youth justice, energy projects up to 350MW and water as well as the limited tax devolution that was recommended in its Part 1 report. This also called for the current conferred powers model to be replaced with a reserved powers model, which is currently the case in both Scotland and Northern Ireland.

To those of us who strongly supported the concept of devolution in Wales, what has subsequently happened has come as a huge surprise. What we expected was a ‘largish’ county council for Wales (after all Wales is not that much bigger than Birmingham or Manchester) with a considerable degree of devolved authority from Whitehall on public policy development and implementation issues.

Instead we got a bloated organisation with many of the trappings of Whitehall and with an executive arm populated by individuals who, in another incarnation would have been local councillors but now bear the grandiose title of ‘minister’, with all that goes with that title. Imagine if the Cabinet members in Birmingham City Council started calling themselves ministers.

In the past 14 years the Welsh government has presided over a significant decline in the standards of health services and schools education in Wales. This situation is compounded by the fact that Wales is essentially a one-party state with the government being various combinations of Labour, Labour-LibDem or Labour-Plaid Cymru, so there is little chance of implementing radically fresh policies that might reverse the decline. 

Fast forward to last weekend and we see yet another catastrophic policy failure. Consequent on the poorer GCSE examination results in Wales compared to England, over many years, the Welsh government decided to introduce new courses in English and several other subjects designed to boost Wales' disappointing exam results. Publication of the examination results of the first pupils to take the new English examination produced a set of results that could not be believed let alone explained.

Pupils predicted to get grade A* in English received a grade D or unclassified. Schools where 60% to 70% of the children were expected to get a grade C or better in English obtained rates of 27%.Typically, the Welsh government has ordered an enquiry and no doubt there will be endless buck passing taking place, but the truth must be that something has gone catastrophically wrong with the implementation of the new examinations to get discrepancies of this magnitude. Fiascos like this are getting increasingly commonplace and follow a previous fiasco last year where thousands of scripts had to be remarked.

Devolution has been a huge disappointment for Wales, and yet the Silk Commission is calling for more powers for the National Assembly. We should not be giving greater responsibility to an already bloated and ineffective institution