Friday, 26 January 2018

It isn't public versus private, it is small versus big...

Let me start with a story, which has to be a little obscure to protect the innocent. The government has a Voluntary Repatriation Scheme for asylum-seekers and refugees who find their home has changed, and who get employment back there. The scheme is administered by the Home Office, who hang on to the passports of those involved until the very last minute, in case they skip away.

It so happens that a friend of mine has applied to go home under this scheme. He is vulnerable because, after the traumatic scenes he witnessed, violence to his family back home, he has very little functional sight. The Immigration Service promised to return his passport at Heathrow before his scheduled flight.

They failed to do so. My friend was found after a day wandering around Heathrow in despair, having given up his home and everything he needed to exist in the UK. The police very generously drove him back to another friend’s house in Croydon. The Immigration Service said they would try again later in the week. It remains to be seen if they will succeed.

I tell this story partly because it makes me so angry and partly as an example of how the public sector can undermine people’s lives when the institution involved is too big to care about individuals. It is also a balance to the story of the collapse of the outsourcing giant Carillion.

Political discourse in the UK has been stuck on the issue of whether public works better than private or vice versa, and clearly both can rise to a challenge with the right kind of leadership and the right kind of scale. But it is scale that tends to be the deciding factor. And until we realise this, it s hard to see how we can do much to tackle the trail of incompetence at the heart of these stories.

It so happened that, as the Carillion story broke last week, there was more confirmation of this, in the latest Which? survey of customer satisfaction with energy supply. The biggest (Npower) came out worst, the next biggest came out next worse and so on – with the smallest rated best.

Here is the problem. When we hand over our services to machines, which are too big to care, then we hand them over to incompetence.

The problem with privatisation, which was supposed to make services more flexible, is that the services were normally handed over to deeply inflexible machines. That is the story of Carillion and so many other outsourcing giants which became expert at providing Whitehall with the data they craved but at little else.

For that reason, it seems to me that we are at an important turning point. The Carillion collapse marks the moment we will look back and see how the government began to re-examine their assumptions about economies of scale, and realised that – although they did exist – they are very rapidly overtaken by the diseconomies of scale which too often renders services so inhumane, so inflexible and so expensive.

This column first appeared on the New Weather blog.

Thursday, 11 January 2018

Vindication at last! Thank you, National Audit Office

It is a strange thing, vouchsafed to few of us, to find ourselves vindicated by the National Audit Office of all people.

Yet I have been. I have explained here and elsewhere that the reason why the Govia Thameslink and Southern rail franchise had been such a disaster was that they did not, and still do not, employ enough drivers.

It is true that industrial action has hardly been irrelevant, but the Secretary of State's (Chris Grayling) claim on the radio yesterday that it was all the fault of the unions has no foundation. It is based on a report he commissioned himself with a remit designed to look no further back than the start of the strikes. That was the purpose of the remit: so that, later, he could go on the radio and say precisely that.

No, the NAO report confirms, not just that GTR failed to employ enough drivers but that - as I have also explained here and elsewhere (see my book Cancelled!) - the franchise was so badly designed that GTR could only earn extra money by undermining passengers.

None of that was Grayling's fault. He arrived when the problems seemed overwhelming. The reason he really should have been shifted to pastures new is that he appears to be a tramline thinker, predictable and unimaginative - except in the dull, playground way that our political classes seem to do politics.

Why are the railways performing so badly? Why was Virgin given a huge extra payment for the East Coast franchise? Why was Govia so badly organised? The answer to all of them is the same - there are far too few private operators prepared to bid. And they are still dwindling.

This isn't just a rail problem either. A combination of shrinking budgets, giant contracts and monopolistic concentration has led to a similar issue across most privatised services.

To face this challenge, most of UK government - and Grayling in particular - go into battle, blaming the unions, spreading money to the remaining operators, and pretending there is no fundamental problem. Personally, it seems to me that the problem goes some way beyond private versus state - it includes why so few individuals want to run giant schools or hospitals just to be the punchbags of regulators.

In any case, this is unlikely to be a problem solved by re-nationalisation. Especially in rail transport, when those of us who remember the third-rate service provided by a state-run national British Rail, would prefer a more imaginative, democratic and devolved solution - probably mutualised too.

But if Grayling and his colleagues can think no further than blaming the unions, as they turn a blind eye again to the fundamental problems of market concentration, re-nationalisation is exactly what we will get.

Wednesday, 3 January 2018

The new radical centre requires new radical ideas

A version of this post first appeared yesterday on the Radix blog...

Cast your mind back, if you can, about 160 years to the end of 1858 – when the European crisis was emerging that would have a profound effect on politics in the UK.

There was the revolution under way that would see Garibaldi uniting Italy, and incidentally coining the word ‘Liberal’ (also the name of the patron saint of Treviso, by the way). There was tension with France that was leading to major rearmament on both sides (including the launch of HMS Warrior, still with us in Portsmouth).

As a result of this, and a combination of other factors, there was an increasingly close-knit alliance of political groups at Westminster. who were beginning to look to each other for support. In 1859, this was to emerge as the Liberal Party. The original meeting to form the new party, held in Willis’ Rooms in St James’ Street in London, and included well over two hundred Whigs, Radicals, Peelite Conservatives and pioneer Liberals like John Bright. When Lord Palmerston helped Lord John Russell up onto the platform, there was a huge burst of cheering.

At the end of 1858, to other intellectual giants were preparing their work for publication, which would emerge within weeks of each other. John Stuart Mill was putting the finishing touches to On Liberty; Charles Darwin was doing the same to On the Origin of Species.
So when we look ahead to our new year, 2018, we may see the beginnings of what may emerge as a new political tradition, born out of a realignment of the centre – and as the least sane members of the Conservative Party urge their leader to fling out Michael Heseltine, there may be some very big beasts indeed. But we should remember as that happens – and this is, I hope, the primary message of this blog for the year ahead – that new political alliances need new ideas if they are going to break out of the past.

In 1858/9, the ideas arrived as the party did. In practice, they were in the ether as the new grouping began to formalise itself and work together. The new party was not – because it could not be – some kind of compromised amalgam between Tories and Radicals. Nor did it really involve the humane elements of small-scale Liberalism that were to emerge within the first decade, but it was fuelled by the twin ideas of evolutionary progress and maximising liberty.

And when Radix co-founder Joe Zammit-Lucia said, in a letter to the Financial Times within the last few days, that the intellectual struggle for the new radical centre can’t be to defend the status quo, for example of the existing trading system, he was saying something similar.

It is, he said, “between those who cling to 20th-century thinking and refuse to address the shortcomings, in a 21st-century world, of the current international trading system and multilateral institutions that underpin it, and those who believe that survival of an open, peaceful world order depends on wholesale, radical reform…”
New political traditions require new intellectual underpinnings. In fact, I believe that one reason the Lib Dems found coalition such a bruising experience was that the intellectual underpinnings of the party needed renewal. They do so even more now.

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