I posted this thread on Twitter this morning:
The crisis in the NHS is overwhelming this week. It has reminded me of conversations I had with my late father on how to manage within the state sector. I think they're worth sharing.
My father worked for the nationalised electricity industry from the late 1940s to late 1980s. He spent much of that time as a fairly senior engineer. He was committed to what he did. He believed electricity supply was a human right. And he sought to delver it.
He left the industry and retired when he realised that privatisation challenged what the believed in. The priority was no longer supply. It was, instead, profit. He had a clear example of the difference this made. It was about emergency management.
In his day the state electricity boards ensured that they had all the capacity they needed to manage emergencies to keep supply going as well as possible, come what may. It meant there was excess capacity. But it wasn't wasted - maintenance and training was done instead.
Privatisation saw that excess as waste, and it went. It was assumed contracts could buy in support when needed. My father believed that was dangerous - because when demand was strongest the most inexperienced people would be put to work on the job.
We can see the same logic now in the NHS. Instead of having capacity to deal with an emergency a decade of cuts have delivered a survive reduced to the most basic level possible. And what we've seen is that outsourcing cannot make up the slack. And that is dangerous.
The NHS is now being overwhelmed. Coronavirus was predictable - and predicted. What was also predictable was that an NHS with reduced beds, staff, equipment and even training because of a lack of slack to let it happen would not be able to cope. And that's happening.
People are going to die now, because of a failed management ideology - that lower cost is always best when what is at stake is the supply of essential public services. So, some questions are appropriate.
Were the tax cuts to big business and the well off worth the deaths we are now seeing from coronavirus?
Was the goal of a balanced budget worth having people die for?
Could we have done better by committing to a universally high standard of basic public services - supplied by an integrated NHS?
Will we learn the lesson now and provide a properly resourced, staffed and trained NHS in the future?
Or are people still going to have to die in pursuit of an economic dogma that puts profit before people, and cutting government spending above people's lives?
This is not the time to delay asking these questions. This is the time to ask them. Now is when we have to decide. We need commitment to care, not commitment to cutting deficits, and we need it now. It's time for politicians to deliver that, now.
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I had been musing on public sector this morning and how it operates – often quite poorly and not all of that is down to resources. I do believe that business can offer solutions to public sector operations, but not in the way politicians think or allow.
It is the lack of freedom to innovate, refine and improve which is more often seen in the private sector simply because the people who do these things for the most part have that freedom. Any developed organisation starts to build in something that is brittle and inefficient – that seems to be human nature – and yet humans are incredibly adaptable, resourceful, task motivated.
I suggested to a newly qualified teacher that the county could easily draw together the teachers best able to deliver online lessons and to provide those online across the county. The teaching would be shared and multiplied – think two or three teachers collaborating to make some good content, but no one person having to do it all. This freeing teachers to contact pupils and students by phone and online to provide support, having been freed from the burden of having to provide all of the content for their class.
The teacher said that when she was at a local school, teachers were forbidden from sharing lesson plans and all teachers had to do their own. To me that is bonkers – think not of teachers being lazy and not doing their own work (which could happen), think instead of the better teaching plans that could be developed. Think how many happier teachers there could be if the mindset was changed.
Back to your point which is when the private sector gets involved it is not the enablers, collaborators or the creatives that get injected into the system, it is as you say the profit takers. The current examples of PPE supply demonstrate exactly the problem.
FWIW I do think that e.g. hospital cleaners should be on that hospital payroll – being part of the team in a very real sense. It should not be beyond the wit of management to recruit suitable managers, team leaders and the like to effectively carry out these very important roles.
And, yes, more money put into resilience in the system is a must.
“….It should not be beyond the wit of management to recruit suitable managers,……”
Good (“suitable”) managers are the product of nature and nurture. I’ve always thought they were thin on the ground. I’ve worked for a few ………and some dreadful ones.
“It is the lack of freedom to innovate, refine and improve which is more often seen in the private sector simply because the people who do these things for the most part have that freedom” Mazzucato’s The Entrepreneurial State shows that the State is far from being the sluggish leviathan while Private is the go-getter breaking through to new horizons. In fact, it’s often the other way round with private unwilling to take risks while the state, with all the money, can afford to take risks.
If public sector is sluggish then it’s because Government has set the parameters to ensure failure, appointed the kind of people at the top to make sure it fails and prepare the ground for privatisation. That is how the Westminster Govt has set up the NHS in England.
Spot on.
Whatever neo-liberals tell you, markets cannot deal with “tail risk” properly. In a catastrophe the risk always falls to the State. Banking crises are the obvious example but energy (your father’s field), too…. and not just the UK – take a look at the US.
Some years ago when we had our last major snowstorm, the local authority I work for was able to use its ‘outdoor’ staff to keep its major city running & get essential services such as meals on wheels through.
Now while there are a number of significant differences both geographical and organisational, I live in a two tier area my District Council which is basically a branch of Capita shut everything, locked up its car parks effectively closing the town centre, citing ‘Insurance’ and waited for the snow to melt. It could not use its contractors to do anything as it wasnt ‘in the contract’
Think of what that might mean in a serious emergency.
Exactly! It was city council Works Department construction workers who usually spent most of the year building houses, schools, etc. who switched to city centre snow and ice removal, particularly pavements, when the temperature was to low to lay bricks, even concrete. It was Thatcher who hated Works Depts and the provision of council housing who put a stop to that. The bankers who funded the Tory Party and made most of their money from private house mortgages had a word in her ear!
‘Totally agree with everyone’s comments.
Private sector practice depends to me on creating opportunities to raise prices during crises in order to make profit.
It’s the same on the railways. with no spare rolling stock and breakdown trains around anymore, the rolling stock in use will be carefully stipulated by a contract and replacements at short notice will be charged accordingly as ‘extras’ if their are breakdowns and derailments.
If you watch the documentary ‘Smartest guys in the Room’ about Enron, their energy traders got the Californian grid to close down, reduce capacity and put up prices to consumers. There were also rolling blackouts as energy was exported off the Californian system to elsewhere in the U.S. for a higher price!! For a system that had never had these problems before until it was de-regulated!!
“…Private sector practice depends to me on creating opportunities to raise prices during crises in order to make profit…..”
The essence of private sector business is to maximise profit all the time though, isn’t it? This conflicts with what we regard as the essence of public sector activity which is to provide (essential) services. That requires a whole different mindset and that mindset is what the privatisations (Thatcher and post-Thatcher) were all about destroying – and have done so pretty thoroughly.
In theory good public sector provision of essential services makes the ideal platform for the private sector businesses to thrive doing what they do well. I don’t see that particular wheel coming round full-circle any time soon, but I expect it will eventually.
Andy
The point I’m making is that capitalism has not always been as so narrow in defining success as just the profit motive. There was a time when capitalists (some anyway) even for self interested reasons wanted to sell good good products and services and have a happy work force; to have a sense of place and commitment to where they were located and focus on quality and re-investment .
The over-financialization of business, share holder value being put first, limited liability status, rampant short -termism and the stock market have all put paid to that just when we need longer term points of view and a growth in the recognition of ‘social value’.
I still cling to the idea that there can be a ‘good capitalism’ in our world alongside an effective State. It needn’t be this way.
I think there could be such a thing – or maybe good markets withoutt capitalism
Water privatisation is an example of a natural monopoly being treated as a cash cow for the owners but with abysmal consequences for others and is another example of profits over health. Water quality is notably very poor in England & Wales but very high in Scotland where water has not been privatised.
https://www.theguardian.com/environment/2020/jul/01/england-privatised-water-firms-dividends-shareholders
https://www.theguardian.com/environment/2020/sep/17/rivers-in-england-fail-pollution-tests-due-to-sewage-and-chemicals
https://www.ft.com/content/5c1a33e4-8939-11e9-97ea-05ac2431f453
I agree with your thoughts Mr Murphy. The NHS has been starved of funds where it really matters – beds, equipment, human resource and along with that the required, essential skills – for over a decade. There is no ‘slack’ in the system. It is operating all year round close to max. capacity and that is not a good thing. We see the effects every single winter and through the last year in particular.
I’m not saying the NHS is/was perfect. It had its flaws but in general it worked in the public’s interest and was supported in that by a shared ethos that put people before profit. Innovation was promoted and there was a willingness to share ideas and developments. I could ring people up in different parts of the country and they’d willingly share ideas, information, etc. Staff were willing to put the extra hours in (often for no pay). That changed towards the end of my career (as privatisation and competitive tendering was ramping up) and the reality of ‘National’ was fracturing under increasing privatisation, morale plummeting and always, always, having to make more and yet more ‘cost savings’. I heard many a manager say ‘we’re cutting into the bone now’.
I’m no longer working in the NHS and I am concerned by how public hostility towards it seems to be gathering pace. That hostility should be directed to the Govt, not those who are trying to respond to the horrendous demands placed upon them. However, I guess that’s just what Govt. want – to tarnish the ‘national treasure’ status of the NHS so that we let it go the more easily. More fool us, I say.
You are absolutely correct that ‘now’ is the time to be asking those questions because ‘now’ is running out. It’s not just lives now that are at stake, it’s our future health and wellbeing.
The NHS has been operating at over its capacity for the past 5 years. Hidden by that excess patient load existing in outside-NHS hospitals.
My cancer care, previously 30 miles away, is now 70 miles away, by virtue of new contracts. In the middle of London (AKA Covid-Central).
Eye care is still local for consultations, but the consultants come from Moorefields and the surgery at a local private hospital.
Cardio-pulmonary is still 30 miles away, but I doubt that will stay the same for long.
MSK ditto.
Local hospital 370 covid patients. Mortuary is full, but there is a refrigerated trailer.
1 MRI suite out of action, no maintenance staff. Ditto CT suites.
That’s market efficiency for you
If the Tories were designing a human they would design it with one lung, kidney, eye, ear, testicle, hand etc on the basis that two was inefficient and the work could be carried out with single components. Clearly this would make the human species more vulnerable and prone to being wiped out but in Tory speak that would be acceptable. There are many areas where over engineering is practical and rational especially where safety is concerned or the supply of essential goods and services. The market operates on the margin and so unexpected shocks cause it to fail. Only the very stupid rely on market efficiency when it comes to potential catastrophic events. But that is where the neo-cons have driven us.
Actually, they would design it as you said, but added organs would be optional extras. And expensive.
This reminds me of my late father’s experience.
He once told me that during his apprenticeship as a gas fitter at the NW Gas Board, in St. Helen’s, he was shown the difference between formerly municipal and private gas companies.
St. Helen’s was a municipal gas provider. Gas pipes entered a house, and were routed safely and hidden until they reached the point of use. One day, his trainer took him to a house originally piped up by the privately owned gas provider in Liverpool. At the house about to be re-piped safely, the gas pipe entered through the front wall into the living room, where it ran along the top of the skirting board, up over the fire place, then back down to continue running into the kitchen.
As my father described it, ” Cheap and Cheerful, and a “bomb”, just waiting to go off.”
He also observed that after nationalisation, many of the the senior positions in the NW Gas Board seemed to go to Liverpool Gas Co. managers.
So the principle of profit-before-people has been given a new lease of life by the modern Conservatives Party.
Off topic for the blog Richard but do you have a view on Rishi Sunak’s claim yesterday that the UK is not doing worse than other comparable countries economically?
Annaliese Dodds spoke about the UK having suffered the worst recession of any major economy. Sunak replied that “when making international comparisons between the performance of our economy and others, it is important that we are careful because everybody calculates things in very different ways” and according the OBR and ONS “in this country we calculate public sector output very differently from almost any other country. It is very clear that the way in which we calculate that output flatters other countries and disadvantages us when it comes to making such comparisons. As those independent forecasters have pointed out, when corrected for that difference, we find that our economic performance is actually very much in line with comparable countries. It is not the worst, and I do not think that it is good for confidence or for people’s understanding of the situation for that to be propagated.”
According to Andrew Sparrow on the Guardian liveblog yesterday this was explained in this recent thread and article by Ed Conway.
https://www.thetimes.co.uk/article/britains-economy-is-healthier-than-it-looks-3lvrtp7zg
https://twitter.com/EdConwaySky/status/1345050498076958724
I notice the difference in certainty between Sunak and Conway. Conway says we report things differently so we don’t know if we are the worst or not. Sunak says we report things differently so that means we definitely aren’t the worst.
I am aware of this issue
I have to say that the ONS did make some absurd assumptions last spring
But that said, we still rate badly
I suggest we can’t know the full story as yet, but we seem to be wasting a great deal more than other countries and that is a concern
Hang about..according to MMT tax controls inflation so when we have no inflation or fearing deflation tax cuts are needed?? Or are you advocating tax increases come what may? I’m confused and so are you it seems
My argument is that these were the wrong people to get cuts.
And that the logic behind them was wrong too – after all the NHS cuts were claimed to be because there was no money even if that was not true
@ Billy Whitehurst
When new money is created either by government or private sector banks productive output in the economy doesn’t remain static as right-wing politicians and media try to pretend. The additional money creates demand and inventory is therefore drawn down, additional labour gets hired for increased output both for goods and services including new companies created if increased demand is created. The new companies may work even more productively because of new technology and better organising processes. All of these factors are ones which help to contain inflation, they even God forbid reduce prices! This is all part of the benefits of market capitalism conveniently forgotten when it comes to government creation of money!
The right wing claim.
It is as if they believe there is no such thing as financial capital.
Can you imagine if the design of humans had been privatised?
Surely we wouldn’t have two eyes, two ears, two lungs, two ovaries/testes or even as big a brain -that most people don’t utilise. Would we even have two hands? Surely a lot of waste.
So either the divine over engineered us with excess capacity deliberately or evolution decided this was the best design for survival of the fittest.
Either way there seems to be a lot of contingency planning here just in case you have an accident and lose the use of one half of the pair. Apparently, “you are worth it” after all.
So you got to think that many companies see efficiency in a very blinkered mindset.
In Tribute to your father I can add a story about planning the electrical supply in a PFI hospital.
The private builder ensured that the spec was just as required by the hospital. And delivered one as cheaply as possible. The requirement increased as the work in the hospital increased (contrary to the expectations in the modelling which assumed more hospital care would be transferred into the community- the lie that had to be told to build the hospital) and an upgrade was required. This was enormously expensive and the hospital couldn’t afford it so they had a permanent back up generator available and electricians on permanent on call to make sure it worked as required. The service often collapses requiring more and more call outs for the electricians who all tell the managers to install an upgrade urgently.
in the meantime the backlog maintenance bill in the NHS has just risen 40% over the last year.https://digital.nhs.uk/data-and-information/publications/statistical/estates-returns-information-collection/england-2019-20
Chickens are coming home to roost ; but somehow its all the fault of the EU.