Wednesday, 29 June 2016

BREXIT: An opportunity to re-balance the UK economy


Some years ago, I wrote a paper entitled “The problem is London”. In this paper, I argued that London dominated the UK: demographically, politically, economically and culturally to an extent not seen anywhere else in the developed world. I wrote other pieces on a similar vein, in particular, one of which argued that the growth in support for Scottish independence was driven, largely, by hostility to London.

The domination of London in the UK has hugely detrimental effects on the rest of country and leads to the concept of the two nations – a prosperous London (and the South East) and an impoverished rest of the country. While this is an oversimplification (since there are pockets of affluence and poverty in any region), the reality is that London is ahead of the rest of the country in terms of income, wealth, health, employment and virtually any other indicator you can name. This is also exacerbated by the dominance of the London based financial services sector on the rest of the UK economy. In another paper published in 2010, Roger Latham and I pointed out the dangers of this unbalanced UK economy both in terms of geography and by sector.

This point has been only too clearly illustrated by the huge divergence in voting patterns between London and the rest of Wales and England. In London 60% voted to remain in the UK while in the rest of England and Wales the figure was only 47%.

We now see scare stories that BREXIT will impact negatively on the London based financial services sector and may lead to significant job losses. At the same time, I see quite a bit of optimism among small-medium enterprises (SMEs) that freedom from EU bureaucracy coupled (possibly) with greater interest in SMEs by a UK government traditionally more concerned with the London financial sector.

It suddenly struck me that perhaps BREXIT will provide the UK with an opportunity to re-balance its economy in such a way as to reduce the over-domination by London and the City. The decline in financial services in London may be an unavoidable consequence of BREXIT but this might be mitigated by a strong focus on SMEs across the UK. It is not always realised that in the UK, SMEs:

  • make up 99.9% of total number of businesses in the UK
  • provide 59.1% of all private sector jobs
  • generate 48.7% of private sector output

If a policy of growing the SME sector were successful, it would automatically re-balance the UK economy to some extent.

However, this will not be easy. The UK (and indeed the EU itself) have a poor record of SME productivity, which lags behind that of SMEs in the USA. This may, in part, be to do with EU bureaucracy but there are other factors at play. Last year the Government published, its productivity plan which outlined a number of wide ranging initiatives to improve our productivity record. While such initiatives are to be welcomed, I still have a feeling that the main driver of productivity concerns the quality of leadership and management within the SME itself.

Although the Government has published a productivity plan, it remains to be seen whether it will follow through, with gusto, what it has proposed. Perhaps it is time to end the love affair with the City and place a much greater focus on SME growth and sustainability.

Monday, 27 June 2016

Labour and the EU negotiations: Keeping an eye on the ball


Throughout the Referendum campaign, the Remain camp managed, with varying degree of success, to paper over many of the significant differences between them concerning the EU. While most of the Labour and the Conservative parties supported Remain, the reality is that many in the Labour Party will have a very different view as to what the EU should look like compared to many parts of the Conservative Party (especially those who may be in senior Government posts). Hence, the refusal by Jeremy Corbyn to appear on a platform with Conservative speakers

The campaign is over and both main parties will now be looking at the potential outcomes of the Brexit negotiations from their own political and ideological positions. This negotiation process will be long and tortuous and will probably involve the passing of UK legislation in many different policy areas. However, it is the Conservatives who are in government and it is they who will drive the negotiations, while the Labour party will have very much a watching and commenting role.

Unfortunately, the Labour Party seems to be engaged in civil war with no real idea where it will all end. This poses the great danger that it will take its eye off the ball in relation to the Brexit legislative programme. This is dangerous because the role of effective opposition is very important to ensure the new legislation is adequate and that it protects the interests of Labour voters. Political vanity cannot not be allowed to interfere with this role.

When Jeremy Corbyn (or whoever hold the Leader’s post) reconstitutes the shadow cabinet in the aftermath of the mass resignations, how about appointing a senior person (with a supporting team) to focus on the Brexit legislative programme going through Parliament – a shadow spokesperson on the EU. Better this than having it spread out across several different portfolios. Should the person involved be a Remain or Leave person? It doesn’t really matter provided they have an eye for detail and the tenacity to follow though points of concern. Is there another Robin Cook out there or perhaps an experienced barrister?

Friday, 24 June 2016

The EU referendum result: A second referendum?


Well the EU referendum is over. The votes are counted and the decisions made. What can we conclude? Well, not a lot if we are wise, particularly with regard to our membership of the EU? There are too many large vested interests in our society, and in the EU itself, which will not just go away and will not take this result lying down. The conspiracy theorists among us expect them to find ways and means to circumvent BREXIT.  

The EU seems keen for the UK to invoke article 50 (which starts the process of withdrawal) as soon as possible. However, we also hear talk, among some politicians, about “taking our time” and having a process of “informal” negotiations with the EU prior to taking this irreversible step.

I suspect that UK withdrawal from the EU will have a bigger negative impact on the rest of the EU itself than on the UK. Hence, I see such negotiations as a last chance for the EU to get serious about reform and give the new UK prime minister something to show the electorate in preparation for a possible second referendum. This time around, the prime minister can make it clear to the EU that if serious concessions are not obtained then UK withdrawal must happen whatever the cost to them and us. The EU Commission itself may wish to be stubborn and stand on its pride but it is up to the member states (especially the East Europeans) to make it clear that is they who are the EU, not the Commission.

If there is something substantial on offer then maybe a second referendum will be the way out. However, the EU needs to remember that the UK is the second biggest economy in the EU, a major contributor to the EU budget and the strongest military power. When Russian bombers are invading the airspace of the Baltic countries, the RAF provides the interceptor jets to dissuade them from going any further. What would happen if these jets “were no longer available for operational reasons”? If the EU wants to play dirty then the UK can play dirty too.

So in advance of a possible second referendum in a few years’ time, what else can we learn and what might be done in certain areas?

  • London and the rest – several years ago, I wrote a piece entitled “The problem is London”. This outlined the over-bearing influence of London on the economic, social, political and cultural life of the country a scenario not seen elsewhere. The consequences of this are clearly shown in the huge disparity in the Remain vote in London compared to the rest of England and Wales. The culprit here is the metropolitan elite (aided by the London media) who have tried for decades to force their values and views of the world on the rest of the country and have ignored issues which are most relevant in non-London communities. Their inability to understand the difference in lifestyles outside of London and the problems faced in places like the Northeast, the Midlands and Merseyside have meant a growing divergence in views, between London and the rest, about what is important in the UK. One of the pet projects of the elite has always been UK involvement in the EU a view which has now come unstuck. Something has to be done about this state of affairs such as, for example, English devolution, massive regional investment, a large number of seats in the House of Lord reserved for people living outside of London etc.
     
  • The future of the Labour Party – the vote suggests to me that the views of many parts of the (London dominated) Labour Party are just completely out of kilter with the views of people who traditionally support Labour.  In Wales (where I live), many party workers were shocked by the amount of resentment to the EU in Labour strongholds like the Rhondda and Ebbw Vale. I am sure similar situations will be seen in other Labour strongholds. I am also sure that research into this issue will show Labour voters saying that the party is too obsessed with issues such as: Trident, Syria, immigration and minority rights etc and not interested enough in bread and butter issues like housing, schools, poverty etc that are their concern. In the 1950s, the late Anthony Crosland wrote the famous book The Future of Socialism that became the Labour bible for decades. If ever there was a need for a new 21st century Labour bible, it is now. Once again, I am afraid there is a need to reduce the malign and over-bearing influence of London on the Labour Party nationally and its policies.
     
  • The Conservative Party – if Remain had won, I imagine there would have been ructions in the Conservative Party about the way David Cameron conducted the campaign. He had already alienated large swathes of his party over the introduction of gay marriage a policy that was anathema to many party members. He got lucky with the unwise Scottish referendum and then chose, unwisely, to placate his party with an EU referendum. Then he enraged them again with, in their view, the biased and mendacious way he led the Remain campaign. However, he will be gone soon and maybe George Osborne with him. I suspect Boris Johnson is too polarising a character to lead the party in this environment and a calming influence is needed. My money would be on Teresa May who while showing loyalty to Remain during the campaign made it clear that she was not at all happy with the EU as it is. Such a calming influence is needed to bring the two strands of the party together.
     

These are early days in the post-Referendum era and to quote the famous phrase, this is probably the end of the beginning not the beginning of the end

Friday, 20 May 2016

The record NHS deficit: What happens now???


Today brings the, not unexpected, news that NHS providers have overspent by £2.45 billion in 2015/16. This brings back memories to me of a similar event in 2006 when I was part of the turn-round teams brought in to investigate a deficit of around £1bn. As a consequence of this, the chief executive of the NHS, Nigel Crisp, fell upon his sword.

Today’s deficit is two and a half time the size of the 2006 deficit so what will happen now. Well we can be certain that the current chief executive, Simon Stevens won’t resign – he hasn’t been in the job that long and can’t be held responsible for this.

In the longer term, there are tough decisions to make about the future of the NHS. Clearly it is never going to generate the level of efficiency savings expected of it but who, in their right mind, ever thought it could. The culture of the NHS just isn’t focused strongly enough on efficiency and value for money and the Francis Report with its (understandable) emphasis on patient safety coupled with a culture of risk-averseness has made the situation worse. In the longer term, it seems to me that the Chancellor will have to stump up more cash or suffer a catastrophic reaction from the electorate.  After all, the NHS is said to be the national religion and UK spending on publicly financed healthcare as a % of GDP is well below Western European levels. Even Greece spends a larger part of its GDP than we do on health.

In the short term what can we expect? I suggest:

·         Lots of attempts to alter accounting practices in order to reduce NHS Trust deficits and help the Department of Health to avoid breaching its vote – a capital offence in Whitehall

·         The decimation of health promotion and public health care

·         Big reductions in capital investment to shore up the revenue side

·         Mothballing of innovative projects

·         Cutbacks in training and development

·         Freezing of vacancies

·         Cutbacks on buildings maintenance etc

How do I know this? Well we have been her many times in the past but not, perhaps, on the same scale as at present. Clearly this is not a sustainable situation but short-termism rules in Whitehall

Thursday, 21 April 2016

BREXIT: Are the Eastern Europeans mad to let the UK leave


So at last commentators are beginning to wake up to the fact that if the UK votes to withdraw from the EU, then while this might be bad news for the UK but it will be even worse news for the EU itself. The Italian finance minister, Pier Carlo Padoan, has said that Britain’s departure could cause a domino effect in which Eurosceptic parties and electorates feel emboldened, while the German finance minister, Wolfgang Schäuble, claimed an out vote would be “poison” to the EU and world economies. Catherine Mann, the chief economist at the OECD recently said, “a vote against remaining in the EU would be “bad for the UK, bad for Europe and bad for the global economy” while Dr Jenz Zimmerman, a German government MP said “The departure of Britain from the EU would deprive the union of a “strong voice” from across the English Channel, he said. “Also, it would be more difficult for us in Germany who are strong European voices because France and the southern states might become more powerful.” These sorts of concerns are now increasing as it dawns on the Europeans that BREXIT might actually happen. Expect panic to break out as we get closer to 23 June

Imagine if you are a member of a club, which has rich and poor members and is threatened by outside parties. You are known as the strongest member of the club and also the second richest member. You are also the second most generous contributor to the poorer members of the club.  If you decided to leave the club, do you think the other members would just cheerily wave goodbye and let you go. Of course, not, they would do everything they could to persuade you to stay with them.

 If we turn to the UK and the EU, the situation is that the UK is:


In this situation, why on earth weren’t the other EU member states prepared to do much much more to persuade the UK to remain in the union.

What I find especially strange is that the biggest difficulties to the UK renegotiations were caused by the EU member states from Eastern Europe who gave David Cameron a really hard time. Now let’s recognise the following:

  • Economics - These eastern European states are poor countries and get huge amounts of EU financial aid. In addition, the size of the UK market and the free movement of labour, which enables their citizens to get work in the UK, assist them hugely. All of this will change if the UK as a major contributor to the EU budget were to leave and this will impact negatively on them
  • Security - these states are threatened by a resurgent Russia. Last year I visited the Baltic States and noticed they were terrified about what the Russians might do. Equally the other Eastern states know, from recent memory, what it is like to live under the Russian yoke and should think a bit more carefully about their actions. The UK is the only military power in Europe that Putin would worry about. Why do think he send his bombers to test our air space? – he wouldn’t waste the fuel to test the air space of Holland, Greece Latvia to name but three. If the UK decides to leave the EU on 23 June, expect Putin to celebrate and to raise the stakes in Eastern Europe and the Ukraine.

What is amazing is that these Eastern European states are prepared to let the UK leave the EU over a relatively small amount of money concerning benefits paid to its UK-based citizens. A man from Mars would look at this and think they were mad.Let us hope they do not have cause to regret that action

Monday, 11 April 2016

The UK steel industry and why I disagree with the Economist


I am sure I am not the only person who is a long time subscriber and reader of the Economist journal but who disagrees profoundly with most of what it says. The online comments section of the journal show just that. For example:

  • The Economist is socially liberal whereas I am socially conservative.
  • The Economist strongly supports uncontrolled free market forces whereas I (who also strongly support free market forces) also like to keep an eye on market failure and monopolistic tendencies.
  • The Economist uncritically strongly supports globalisation whereas I am sceptical.
  • The Economist only sees one way to measure the success of a country and that is GDP growth whereas I would like to look at other measures including how that growth is shared out

Basically,  the Economist takes ideological positions while I try to look at problems from a pragmatic perspective. Nevertheless, it is a good read and I do enjoy the books section.

So it is with the steel industry where (surprise, surprise) I again disagree with the Economist. Maybe it is because I was born after the Second World War and was brought up in South Wales where the two giant industries of coal and steel dominated. Subsequently I saw the death of the coal industry and I may now see the death of the steel industry if nothing is done.

So what is the issue with steel? Well, in summary, Tata steel, which is the dominant player in the UK steel industry, has recently posted a £68 million loss for the last quarter. This equates to about a loss of million pounds a day, which, if true, is clearly an unsustainable position in the longer term. As an accountant, I know only too well that such figures are often manipulated to justify an action that you wanted to take anyway

To make matters worse the whole economics of steel is in disarray with low global demand for steel coupled with huge spare production capacity in China, which is keeping prices low. Accusations are also made that China is dumping steel on world markets and below cost.

Clearly, this situation is unacceptable to Tata. Furthermore, Tata does not see any “cloud with a silver lining” on the horizon in the form of a significant global economic recovery, which will improve the fortunes of the steel industry and, in my view, they are right to think this. Consequently, Tata is left with three main options although, clearly, there are several sub-options in each case:

  • Restructuring/Reinvestment
  • Sales to a third party(s)
  • Outright closure

Restructuring/Reinvestment

The first option is to somehow restructure Tata’s UK steel operation in the UK in such a way that is can become profitable and compete in world markets. Inevitably, any such restructuring will required advances in production technology and substantial levels of capital investment, plus a range of associated costs.

It is well known that a plan was put before the Tata board drawn up managers and unions in the company. The plan would involve around £100 million investment to transform the plant into a producer of high-quality steel for advanced industries and aimed to achieve cost savings of some £350 million per annum, which would allow the company to return to profit. However, it would require 750 job losses. The plan would take several years to implement and the investment costs plus the need to finance the losses that would be incurred over the period of transition would be in excess of £1bn.  Tata were unable to accept this plan possibly because it was seen as over-optimistic and/or the risks being too great to justify the huge level of investment involved. This is a huge amount of investment and if Tata are not prepared to accept it then it seems unlikely that any other commercial lender or investor would be prepared to do so.

Sale to a third party(s)

Tata is currently pursuing this option.  They will be selling-off the various bits of its UK steel operation to interested buyers who will have their own ideas about how they will utilise their new acquisitions and what sorts of changes they will make. It seems very likely that the UK government will need to have some financial involvement in this process in order to provide “sweeteners” and guarantees to potential buyers to go ahead with their purchases. What exactly the taxpayer will gain from this financial involvement remains unclear. The problem with this approach is that there are no guarantees that about what the end game might look like and whether what is left constitutes a viable UK steel industry.

Outright closure

In the current environment, if suitable sales of all or part of their steel business cannot not be achieved then it seems highly possible that Tata may decide to close down the whole UK business involving redundancy of its employees and sales of fixed assets.

There are examples in the UK (e.g., Ebbw Vale) where after many years of contraction, steel making ceased entirely and in Ebbw Vales, the plant was eventually demolished and the site used to create a modern learning campus. Clearly, such events involving huge redundancies are disruptive and cause great pain in the communities involved.

With this option, we would be facing a situation where the whole of the Tata steel operation is discontinued with significant and widespread implications for many

 Where do we go from here?

In the light of the above analysis, the question is where do we go from here and as the White Rabbit said to Alice it depends where you want to get to. I suggest that where we want to get to is a long-term viable steel industry in the UK with minimisation of job losses and social disruption. No doubt, the Economist will take a different view from this.  

In considering the above issues, I suggest there are three critically important points to keep in mind:

  • The UK’s manufacturing heritage and future – the UK has a long and proud heritage in iron and steel production, which goes back centuries. However, it should also have strong future as well. Writing about the unbalanced UK economy (http://www.publicfinance.co.uk/2010/04/double-trouble).  I emphasised the pressing need to focus on the role of manufacturing industry in the UK and to engender a resurgence in the sector.  This point was emphasised for many years by, among others, Sir John Rose, the chief executive of Rolls Royce (one of the few remaining UK examples of world-class manufacturing industry). However, this view usually seems to fall on deaf years because of the obsession by London-centric governments (of all parties) on London and its financial services sector. The steel industry in the UK should be important in its own right as a producer of high quality steel for many countries and as the source of steel for UK manufacturing industry.
  • The strategic importance of steel – in the last few days I have read many commentators including the Economist, The Financial Times etc argue that steel is not a strategic industry for the UK. They believe that we can always get what sort of steel we need from somewhere in this world whenever we want it. I would dispute this. Firstly, as I have argued above, a strong UK manufacturing industry needs a strong UK steel industry not relying totally on the continuity of global supply chains in unstable parts of the world. This seems to be especially important in the case in relation to the production of military hardware where I really do not like the idea of national defence having to rely on the delivery of steel from an unstable region the other side of the globe. Related to this is that many commentators such as the Economist seem to have disarming naivety and over-optimism about the state of the world. Those of us who have lived in the Middle East were extremely doubtful that the “Arab Spring” would result in any form of democracy in the Middle East and the experiences of Syria, Egypt, and Libya etc show that we were right.  However, until very recently, the Economist was still talking about the possibility of something positive coming out of the Arab Spring.  I was a child of the 1960s and remember the cold war and the Cuban missile crisis. The world I see today is far more dangerous and unstable than in the cold-war period with the potential for conflict all around us in many different forms. Hence, I would strongly argue that we need a strategically viable steel industry in the UK rather than put ourselves at the mercy of globalisation in a turbulent world.
  • Economic and social impacts – as already noted the closure of any steel plant has major social and economic impacts. The situation with the potential closure of several steel plants and even the complete closure of the Tata steel operation in the UK is of even greater significance. Not only will jobs be lost in the steel industry but further jobs will also be lost further up the supply chain and in local businesses who rely on steel workers’ wages to keep afloat. The normal way of assessing this is by the conduct of an Economic Impact Appraisal (EIA) and while such studies may have been conducted on the closure of individual steel plants, I am not aware of any study, which looks at the impacts of closure of the entire Tata steel business. I commented to someone that if such a study were undertaken, we should probably ensue we need a box of Valium at hand before we looked the results, which will be frightening. Such a study is needed before Government makes any decisions.

 When I consider the three factors discussed above, I draw three conclusions.

  • The UK needs to foster a stronger advanced manufacturing base and this will require high quality steel
  • The UK needs a viable domestic steel industry in a dangerous and unstable world.
  • The social and economic costs of closing Tata’s UK steel operation are not yet quantified but will probably be horrendous.

In the light of this, it seems to me that some form of nationalisation or state ownership of the UK steel industry must take place. Now before the right wing of the Tory party start crowing about “lame ducks”, it must be emphasised that I am not talking about old style Labour ideology of nationalisation to conquer the commanding heights of the economy. My suggested nationalisation is a pragmatic and non-ideological response to the situation I see evolving before me. In a paper entitled “Could state capitalism save the day” (http://www.publicfinanceinternational.org/opinion/2012/03/could-state-capitalism-save-day) I argued that the UK should learn from successful economies across the world, such as China, India, Malaysia and Brazil, where government involvement in business is accepted and has helped provide stability and boost business. Yes there will be risks and a cost to the public purse but there will be a certain costs involved in in providing sweeteners to private companies who might by Tata piecemeal and of paying benefits to redundant steel workers and their families which could also run into hundreds of millions of pounds per annum. And for those, in Treasury, who might suggest that they would find other jobs, I would say leave your Whitehall offices and visit Port Talbot.

So there we have it. In late 2015, I wrote a piece entitled “Ideological purity or people’s lives” (http://www.malcolmprowle.com/search?updated-min=2015-01-01T00:00:00Z&updated-max=2016-01-01T00:00:00Z&max-results=4). This questioned whether this Government puts ideological purity (i.e. against state ownership) above the needs of the economy and people’s lives and welfare. My final shot was whether this government is the party of One Nation Tories or Ideological Fanatics. Their response to this crisis will answer that question.

 

 

 

Saturday, 9 April 2016

Adult social care under the cosh: Where do we go from here?


Adult social care is the term used to describe a range of support services provided by local authorities to (in the main) elderly people. Although these services are commissioned and funded by local authorities, the actual provision of care may be undertaken by private sector, public sector or third sector organisations.

Why do I suggest that adult social care is “under the cosh”? Well firstly, we have the demand side. The success of medical science in extending both the length of life and the quality of life of older people, coupled with a reduction in the fertility rate of the population (meaning fewer babies are being born) means the structure of the population is changing. Thus, we see a continuously increasing trend in the proportion of our population represented by the elderly (65+) and the very elderly (80+). The impact of this is shown diagrammatically below where we see, clearly, a bulging of the elderly population bands


 

Secondly, because of “austerity”, it is well known that local government in England has been the hardest hit part of the public sector with over a third of its funding being cut since 2010 and with more cuts to follow. In other parts of the UK, the impact on local government has not been as savage.

Now, local government delivers a wide range of services and it might be thought that these cuts would have been focussed on areas other than social care for vulnerable people. However, as one senior local government officer once said to me “there are votes in parks, leisure centres, refuse collection etc but there are no votes in old people”. That may be cynical but it does illustrate why adult social care has had to take a large proportion of the financial “hit”.

Many local authorities have dealt with the levels of funding cuts heroically (http://www.accaglobal.com/content/dam/acca/global/PDF-technical/public-sector/tech-tp-tiosfl.pdf) thus minimising the damage to front-line services. More specifically, cuts in adult social care funding have also been dealt with by a variety of means but have probably now taken most of the “low hanging fruit” in the first phase of austerity from 2011 to2015.

 

What is now required is a much closer inspection of specific social care services  and one area of concern has always been that of residential care for the elderly  which consumes just under half of the adult social care budget.  Some authorities are concerned that the rate (per 100,000 population) of permanent admissions (65+) to residential homes seems high particularly when set against the rates in comparable local authorities, and what might be seen as the norm.

 

I have been looking at this issue recently, and there seems to me, to be three main factors, at play here and need to be investigated thoroughly.

Population characteristics

There are a range of population factors (morbidity, economic, socio-cultural and other) which will be drivers of the need for admission to residential social care for the elderly. Hopefully, the impact of variations in some of these factors will have been eliminated in making the choice of comparable local authorities a reasonable one but this may not be the case. Hence, a more detailed analysis would need to be undertaken of the socio-economic characteristics of the population of the various social care authorities being compared. This will aim to identify whether or not higher rates of admission can be justified on population characteristic grounds or whether further investigations are needed. Moreover, collaboration and sharing of data by a number of authorities should, through the use of data analytics, enable some sort of normative level of admission to be calculated for a particular population profile

Limited alternatives

Where there is a deemed need for social care for an elderly person, those responsible for making the decision about what sorts of care to provide have to take account of many factors but especially:

  1. The needs of the individual for care
  2. The wishes of the individual
  3. The alternative approaches to care that are available (usually locally)

Quite often it will be the case that the type of care required by a consideration of  a) and b) above will not be available locally and a choice has to be made based on what is actually available. In such circumstances, it is quite possible to see how a person who does not really need residential care ends up in residential care because that is the only option available. This could lead to a higher than needed level of admission to residential care

To deal with this, various alternatives might be made available. Some form of enhanced domiciliary care might be made available while a recently published report by the Centre for Social Justice (http://www.centreforsocialjustice.org.uk/UserStorage/pdf/Pdf%20reports/CSJ-Evermore-May-2013.pdf) speaks of a “quantum leap in improvement of what is available”.

The implication of this for local government is the need for greater innovation and flexibility in service provision for the elderly rather than “one size fits all”.  In turn, this may also have implications for the way in which those services are commissioned.

Decision making

The systems for assessing the needs of elderly people and identifying and deciding the most appropriate care approach is complex and involves representatives of health and social care (as well as the elderly person themselves and their relatives) individually or as part of a multi-professional and multi-agency team. Unfortunately the decision making approach often varies in the degree of robustness and transparency and many people sometimes report distressing experiences. Furthermore, the assessment and decision-making approaches often lack consistency between different social care/NHS organisations but also, sometimes, within the same social care/NHS organisation as a consequence of different perspectives by the various people involved.

Under the heading of decision making process we can incorporate a range of factors (such as: organisational structures, mechanisms, degree of autonomy, different professional perspectives, culture etc) which will impinge on the way in which care decisions are made and the outcomes. All of these will feed through into the decision making process and it should not be surprising that sometimes decision making is sub-optimal and inconsistent. Moreover, there are external factors to consider. The Francis report on the Mid-Staffs NHS Trust scandal rightly emphasised the importance of patient safety. However, many are now of the view that patient safety has, in some cases, become a byword for extreme risk averseness. In turn, this may be affecting decisions about adult social care.

This is a complex area but some attempt needs to be made to ensure that the decision making involved is being approached in an informed, consistent and reasonable manner given the limited resources available  and the need to optimise its use.

 

The issues discussed above are quite complex and need specialist skills. Understandably, hard-pressed local authorities may find it difficult to undertake the degree of analysis required. Nevertheless, in the context of the current (and future) financial situation, there may be an imperative for a greater degree of sophistication in addressing the issue of adult residential care