Tuesday, 25 November 2014

Welsh local government and voluntary mergers

At the time of writing, local authorities in Wales are considering whether to submit proposals to the Welsh Government for them to merge, on a voluntary basis, with a neighbouring local authority. Some Welsh local authorities have already rejected the idea of voluntary merger but a few seem likely to put forward merger proposals.

Such voluntary mergers have some advantages, over forced mergers, in that the two parties involved are committed to the merger and, presumably, have some affinity to each other. However, experience elsewhere (http://www.malcolmprowle.com/2012/11/mergers-of-public-sector-organisations.html) suggests that such mergers usually end up being the wrong merger. It is clearly important that there is a strategic rationale for any proposed merger and that the merger is seen as a means not an end.  However, this is not always the case and quite often mergers are undertaken for opportunistic or purely political reasons rather on merit. The possible voluntary mergers in Wales seem likely to fall into this category.

A related point is that proposals for reorganising local government arrangements in Wales usually involve some sort of process of joining together existing local government units. The problem is that the socio-economic geography of Wales has changed enormously over the last 40-50 years in terms of: population size and age structure, patterns of residence, employment locations and travel to work patterns, distribution of income and wealth, educational needs etc etc. Consequently, the existing local government units in Wales are probably, themselves outmoded and not fit for purpose in 21st century Wales. Just joining them together does not improve the situation

What is needed is a root and branch re-design of local government in Wales starting with the current situation and projecting ahead for the next 20-30 years. This would be very disruptive but, at least, we can expect a local government structure which will meet the needs of Wales for the foreseeable future.

To establish what such a revised structure might look like requires considerable thought and analysis. However, my initial ideas are as follows:

Greater Cardiff
Cardiff, Vale
West Glamorgan
Swansea, Neath/PT, Bridgend
North Wales
North Gwynedd, Conway, Anglesey, Denbigh
Newport, Torfaen, Monmouth, Blaenau Gwent
Caerphilly, RCT, Merthyr
West Wales
Carmarthen, Pembroke,
North East Wales
Wrexham, Flint
Mid Wales
Ceredigion, Powys, South Gwynedd
Greater Cardiff
West Glamorgan
North Wales
West Wales
North East Wales
Mid Wales


A number of points should be made about these proposals:
·         The above options have been developed on the basis of the following key parameters (in order):
o   Population size
o   Main travel routes
o   Equalisation of resource base
o   Natural communities
·         Some further adjustments might be desirable around existing boundaries with Powys and some population figures might change slightly
·         It is not necessary for all councils need to fall within a narrow population range but I think they should have a minimum population of around 200,000
·         Intuitively I suspect the Mid Wales authority would have to have very different organisational arrangements because of the large area, sparse population and lack of a major population centre
·         In doing this analysis, no consideration has been taken of any proposals to transfer responsibility for certain services (e.g., health, social care, education) from local government to Welsh government or vice versa.
·         Although these proposals are highly rational, it is probable that the proposals would completely unacceptable to all four main political parties.

Friday, 31 October 2014

Child abuse inquiry: Why we will never know the truth

If evidence was ever needed that the Government is not serious about investigating child-abuse in this country it is now clear for all to see. Concerns are continually expressed that this investigation: should be thorough, should “shine a light” in all sorts of dark places and should not be an establishment cover-up. Unfortunately it doesn't look like this is going to happen.

The first nominee for chair was an outstanding judicial figure with extensive relevant experience. Unfortunately, it turned out that she was compromised because of family relations and was intelligent enough to realise that her position was untenable so she dropped out of the reckoning.

The second nominee for chair, although having many strong qualities, is currently under huge pressure to stand down for a number of reasons:

·       She doesn’t seem to have much in the way of relevant experience – her experience seems to be in privatisation

·       She is clearly an establishment figure in all sorts of ways

·        She has personal links to some of the key people who are subject to investigation

This seems a damming list of negatives. You would think it in a country of some 60 million people, it would be easy to find someone who has relevant experience, is not an establishment figure and has no personal links. The sheer fact that the Home Secretary is desperate to support the current nominee suggests that such a person is NOT what they want to chair this committee. They are clearly scared about what might come out of the woodwork. Why else, did Leon Brittain not pursue the investigation all those years ago – he could probably and clearly see what and who was involved?

 I would suggest that whoever chairs this enquiry should have all of the following key attributes

·         They should NOT be a lawyer – legal advice can be provided to the chair and the committee as needed

·         They should NOT be living/working in London – this is too close to the establishment in this country and there are 53 million other people living outside London

·         They should NOT hold any form of honour (e.g. MBE, Peerage etc) and should indicate that they would not be prepared to accept any such honour in the future. The honours system in the UK is a malignant and malign system designed to turn people who are normally independent in nature into establishment cyphers

·         They must be intelligent and shrewd enough to be able to see through all of the obfuscation and dishonesty that will continually come their way

·         The investigating committee should have its own budget to enable it to acquire its own research and support staff. It is NOT acceptable for support to be provided by Home Office civil servants. The loyalties of those civil servant are to the Home Secretary who will be fully briefed about what is happening and will try to interfere. Forget “Chinese Walls” etc – they always fail.

·         They must have some experience of work in a relevant field (e.g. children’s services) although they don’t, necessarily, have to be an expert. The committee itself will be full of experts.

·         They should be able to demonstrate a background of independent thought and have a skin as thick as a rhinoceros. They are sure to face an immense amount of pressure and bullying from a variety of sources

·         They should have a good life insurance policy

Of course, there is not a “cat in hells” chance of this happening. There are reputations, fortunes and goodness knows what else at stake here and it is seen as far too dangerous to let the truth come out.

Friday, 24 October 2014

Where on earth are we going with public expenditure

In my inaugural professorial lecture at Nottingham Business School in 2009 I discussed the situation of UK public finances and the future of public services. (www.ntu.ac.uk/document_upload/92234.pdf)
One point I made was that the current situation was such that it should not be seen as a blip in the long term trend of increased expenditure on public services. Instead I suggested that it might be seen as a watershed in our social and economic history and something which should require a radical reconsideration about the way public services are organised and financed.

Since 2010, the present government has embarked on a “so-called” policy of austerity designed to eliminate the public sector deficit, reduce annual borrowing and stop the continually increasing mountain of public debt now around £1trillion. Originally the government aimed to eliminate the deficit and associated borrowing by the end of this parliament but this has not proved possible and, at the current time, it is unclear when the deficit might be eliminated. Thus the government is still borrowing billions of pounds each month which will have to be repaid ultimately by our children and grandchildren.

Until recently, at least the government could claim that its borrowing was being reduced even if not as quickly as would be desired. However, this week there came a sharp jolt. Government figures showed that government borrowing for September 2014 was £11.8 billion which was £1.6billion than for September 2013. This was much higher than expected and caused by a failure of limited economic growth to deliver higher tax receipts.

One particular point I mentioned, in my inaugural lecture, was that the constraints on future public spending were such that if the government wished to try and change people’s behaviours in some positive manner they would probably need to think more about sanctions for bad behaviour and less about financial incentives (which cost money) to encourage good behaviour. An example here might be actions to try and encourage people to adopt healthier lifestyles and subsequently reduce the burden on the NHS – this could be approached by using sanctions or incentives.

Imagine my surprise, therefore, to read that in the same week as the bad news about government borrowing was announced, the government has come up with two new and expensive schemes designed to try and change individual behaviour by the use of financial incentives. These were

·         Dementia – proposals were announced to pay general practitioners £55 for every dementia patient they identify. Leave aside the ethics and practicality of all this, it seem surprising that in these financially constrained times we are using public money to pay GPs to do what I thought they were already supposed to do under their existing contract
·         Obesity vouchers – suggestions, from government sources, have been made that the NHS might use its limited resources to offer financial incentives in the form of shopping vouchers to individual citizens in return for them losing weight.
These items come on top of a party political conference season where the main political parties competed with each other to see who could promise to spend the largest amount of public money (which we haven’t got and must borrow) on the NHS. 

It seems to me that the radical reconsideration of public services, which I referred to earlier, just hasn’t happened and the “chickens will shortly be coming home to roost”. Expect more large scale cuts in public spending after the general election irrespective of whoever wins. Also, the problems of the Eurozone and the World economy mean that another major economic crisis can’t be ruled out.

Saturday, 13 September 2014

What will become of Scotland after this?

Five days before the Scottish referendum on independence, I look at what I see as a very bleak picture. For one thing, it seems inevitable that the result of the referendum, whichever way it goes, will be tight and, secondly, there seems huge polarisation in Scotland regarding independence – the young support it more than the old, men support it more than women, poorer people support it more than better off people and some parts of Scotland support it whereas others don’t. Thus whatever the results, I see huge divisions in Scottish society which will take years to heal and recriminations with cries of traitor, liar etc echoing throughout Scotland for a long time.  

If the result is a close “no” then many in the nationalist movement will be outraged about having come some so close yet so far from independence. Cries of treachery and selling out will abound, in some circumstances resulting in violence because of the passions aroused. Blame will be levied against the UK government, the media, international organisations etc. However, particular furore will be reserved for those businesses and banks who, close to referendum day, indicated their possible withdrawal from Scotland in the event of a “yes” vote. From outside those business organisations themselves, it is difficult to say whether these threats are real or not. Maybe they are real but, however, it is, of course, also possible that these banks and businesses were “persuaded”, by the Westminster government to issue these threats given the stakes involved. One of the most controversial aspects of UK society is the honours system whereby people in high places can be persuaded to do or say almost anything in return for a peerage or a knighthood. Make no doubt the London elite will stop at nothing to keep Scotland in the UK because the loss of Scotland could be the start of the break-up of the UK. No doubt, in years to come, when some businessman or politician decides to published memoirs, the truth will be revealed. Also, I have no doubt that a close vote in these circumstances, coupled with an inability by Westminster governments, to learn the lessons of this campaign, will just fuel a demand for a further referendum in years to come

On the other hand if the result is a close “yes” then, in years to come, the government of an independent Scotland will have the complex and difficult task of negotiating a good settlement, with the rest of the UK, on many many issues, and this may be difficult if the loss of Scotland leads to a surly and unhelpful attitude among politicians and the public in England (as it well may). This may result in a very difficult relationship between Scotland and its closest neighbour. Also, the promises made by the “yes” campaign, at the time of the referendum, to the people of Scotland (e.g. the NHS, welfare etc) may turn out to have been wildly optimistic and/or uncertain. In the eyes of the Scottish electorate these promises made at the time of the referendum may turn out to be hollow and a political and societal backlash can be expected.

The French Revolution is often dated by historians as having taken place between 1789 and 1799 but clearly its effects lasted for much longer. At the time of the bicentennial celebrations in 1989, the then Chinese Premier Chou en Lai was asked what he thought was the lasting impact of the French Revolution (some 200 years earlier) on human society and history. Mr Chou’s pithy response was “It is far too early to tell”. The point being made by Mr Chou was that major events like the French Revolution have implications that keep echoing for many centuries into the future.

Maybe this is true of Scottish independence and its impact on Scotland and the rest of the UK and even on Europe. Many decades from now, historians may be pointing to the closely fought referendum campaign with all its passion and deceits as having been the trigger which set in force changes which ricochet through to the present time. Clearly it is not just something which just effects the present day Scots.

Wednesday, 3 September 2014

Whither the UK after Scottish independence

With less than two weeks to go to the referendum on Scottish independence, the final result still seems in doubt with the yes campaign seemingly getting a surge of support while a strong proportion of people are still undecided which may to vote. One thing we can be sure of is that if the vote is a yes for independence then this will be the start of a long process of negotiation with the rest of the UK about a huge range of topics such as: the pound, national debt, border controls, armed forces etc etc. Equally if the vote is to stay in the union we can also be certain that this will result in further devolution of powers to the Scottish Parliament.

The United Kingdom is the term used to describe the union of the four parts of the UK namely England, Scotland, Wales and Northern Ireland (It is also referred to as Great Britain and Northern Ireland). The background to each of these UK entities is clearly different with Wales being annexed and absorbed into England as far back as the sixteenth century while Scotland was united with England (including Wales) via the Acts of Union in 1706 (England) and 1707 (Scotland). Consequently, Scotland retained much of the trappings of an independent state with its own legal system, its own money notes etc. Northern Ireland is different again. While the island of Ireland was a British colony for many centuries, Northern Ireland came into being in 1921 with the partition of Ireland into the Irish Free State (and ultimately the Republic of Ireland) and the six counties of  Northern Ireland  which remained part of the UK.

In the latter part of the 20th century, devolved government was given to Wales, Scotland and Northern Ireland with a Scottish Parliament in Edinburgh and Assemblies in Cardiff and Dublin. However, the term devolution is an umbrella term and the scope of devolution varies between the three countries. Although England comprises over 84% of the population of the UK, no devolution of government has been applied in England and indeed the abolition of regional offices and regional development agencies in England would seem to suggest the opposite trend to that in Wales, Scotland and Northern Ireland.

In the light of this background it is interesting to speculate what a vote for Scottish independence might mean for the other parts of the UK.

Northern Ireland

Northern Ireland was created basically because the people of Northern Ireland wanted to remain in union with the rest of the United Kingdom rather than be part of an independent Ireland. Hence one now has to ask the question what happens when the union itself is changing through the loss of Scotland. Union with the Republic of Ireland is probably unthinkable and maintaining the existing union in the absence of Scotland may also not be seen as desirable. Northern Ireland might consider becoming an independent state itself (this has been postulated in the past as a possible solution to the Irish troubles) but it would be a very small state similar in size to Estonia. Another possibility suggested is that Northern Ireland might seek some sort of union with an independent Scotland. After all, a large part of the population of Northern Ireland are descendants of Scottish immigrants of the 17th century and share many cultural similarities.


At the time of writing there is no real appetite for full independence in Wales with about 12% of the population supporting the idea and 74% opposing it. However, history shows that this situation can change. In 1979, the Welsh people were strongly against any form of devolution but by the time of the 1989 referendum a majority were in favour.

Welsh opinion on this matter can be influenced by any number of factors such as the performance of the Welsh economy, the attitude of the UK government towards Wales etc. A largely English government angered by the loss of Scotland, and seeing this as a form of betrayal, might (however unwittingly) react badly against the remaining parts of the UK including Wales.  Moreover, consideration must also be given to the “me too” effect with some Welsh people saying to themselves that if independence can be offered to Scotland then why not Wales as well. A key issue here will be the attitude of the UK government towards Scotland on the details of the negotiation of independence. If the UK government is seen to be unfair to Scotland then this may result in sympathy for Scotland from inside Wales.

Finally, the issue of the Welsh language must also be mentioned as this is not really an issue in Scotland or Northern Ireland. Too many people in Wales, a vote for independence for Wales will be seen as a vote for further promotion of the Welsh language which is a controversial issue. Perhaps the key issue here is the extent to which the independence movement can keep itself separate from the Welsh language movement in Wales


Scotland will be independent but as already noted the details of what constitutes an independent Scottish state will probably take many years to resolve. Aside from the detail perhaps the key issues are the political and economic relationships with other countries. Starting first with the remaining parts of the UK, the relationship with Northern Ireland has already been mentioned with closer ties and possible union with Scotland being a possibility. Ties with Wales might be strengthened in some ways but is difficult to see this being significant.

Scotland has expressed a strong interest in becoming a full member of the European Union (but presumably not the Eurozone in the light of its strongly expressed wish to retain the pound). Whether this comes to fruition, what form it might take and when it will happen seems to me to be a big exercise in crystal ball gazing and could take many years to achieve, if at all.

Perhaps the key issue is the relationship between Scotland and England. This means the attitude of an independent Scotland towards England (meaning the UK government and English society) COUPLED WITH the attitude of England towards an independent Scotland. To me, it seems this relationship could vary from constructive and welcoming to strongly adversarial and antagonistic.  If the relationship leans towards the latter then trouble could be brewing for both countries.


I think there are two issues here:-

·         The attitude of England towards the remaining parts of the UK

·         The attitude of the UK government towards the English regions

The first point has already been touched on and it will be interesting to see the attitude of England towards the other parts of the UK on a number of issues. Firstly the numbers of Welsh and Northern Irish MPs will come under stronger scrutiny as will their involvement in English issues (the so called West Lothian question). Also, under scrutiny will be the allocation of public resources to Wales and Northern Ireland which is traditionally well above the UK average.

Following independence, the proportion of the UK population which is English will rise from 84% to 92%.  In another article I have argued that much of the impetus for Scottish independence comes from their dislike of over-centralised and London based government rather than Englishness in general. Observations I have made suggest that this anti-London feeling is also strong in many of the English regions particularly in the North of the country. What will be the reaction of those regions to Scottish independence (particularly if it is seen to be a success) while the regions themselves with populations similar to or greater than Scotland’s continue to be ruled by an isolated and unrepresentative London elite with whom they have little in common. Might there be an upsurge in support for English devolution.


We must wait to see what happens but if Scotland goes independent the future of the union doesn’t look good.

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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