Five significant public sector trends

We are told that government is transforming itself. The public sector is changing into a ‘public purpose’ sector. More of the service outcomes we expect should be co-produced, across complex delivery chains, which are more connected and collaborative. Success often depends on nudging the behaviours of citizens, communities and businesses. Prevention is increasingly the mantra, empowering people with the tools they need, addressing problems quickly and providing services in settings that suit needs.

Rules are slowly being changed to harness technology in a way that works for everyone. The promise is that innovative technologies provide an opportunity to move past a choice between improving outcomes, shifting costs on to individuals or increasing pressure on staff. They are a catalyst for greater connectivity and empowerment. Not only saving time and money but enhancing public value.

But there still seems to be an inverse relationship between the transformation rhetoric and the reality. Many of the traditional government tools, which emphasise predictability, control and distinct accountabilities, struggle to address ‘wicked challenges’ that are fluid, interconnected and unpredictable.

Public services are struggling to adapt to new demands in a world characterised by speed, intensity and connectedness. They are driven by short-term demands for results and a political fix, which undermines the ability of government to make the larger system work more effectively.

Productivity has gone up mainly by doing ‘more of the same’ rather than through reform. The easiest savings have been made and choices are getting harder. As the Institute for Government recently commented, ‘governments cannot continue for long to provide the same services by simply muddling through, with dollops of emergency cash’.

What does this mean in practice? And what are the implications for the reform of public services?

First, progress has been made when using digital tools to improve many of the more transactional dimensions of government. Improvements have been made to the convenience, speed and efficiency. However, too often complexity is resulting in technology silos and a miss-match with business needs. Transformation demands more radical change across operations, processes and technology. Digital thinking and technologies have to be tightly woven into the fabric of government. Simply replacing an existing manual operation with a digital one is NOT a viable approach.

Second, new demands are being placed on the ability of public services to combine the best available skills, expertise and resources – inside government and outside in the business, academic and community sectors – and point that firepower at the right place to achieve a transformative shift. A more discerning conversation is required about the best way of achieving policy, regulatory and service delivery outcomes. Including the role of private and community sector organisations in reform of public services.

Third, we are now used to platform business models that respond to the potential of distributed networking with organisations, institutions and individuals. Yet government is constrained by an age-old culture of centralised or, at best, decentralised structures. It needs to work out which approach – centralised, decentralised or distributed – makes most sense for different tasks and contexts.

Fourth, we all want solutions that are simpler, integrated and responsive to people and their lives. So we need to reconnect policy making and delivery. Which means that delivery people are ‘in the room’ from the start of the policy process. In particular, government has to confront the reality that much of the most important information needed for good policy making is to be found through interactions with frontline staff, customers and citizens.

Fifth, trust in government is in short supply. And many private and community sector organisations appear out of touch. Being more open, responding to citizen and user concerns, becoming more transparent are all part of the solution. But the work of trust rebuilding is unspectacular and slow.  It relies on leadership, daily habits, and clear thinking.

Success will be difficult but not impossible.  It requires government to think about the long term. And then invest in more collaborative and evidence based ‘platforms’. This type of change depends on transparency, of purpose and approach, so that we do not just observe what is happening but at least want to know why.

Successful public service transformation – what works and why?

Everyday governments face the question – evolve or transform? Focus on well-defined shifts in ways of working within one department. Or radically transform government through new technology enabled business models.

Public service transformation was the subject of a recent Institute for Government (IfG) roundtable, sponsored by Sopra Steria, where senior civil servants identified principles for successful transformation. A lack of focus or clear objectives, inadequate resources, unrealistic timescales, departmental silos, limited insight from service users, unpredictable and changeable political agendas. The reasons for failed transformation programmes were many and varied.

But there were examples of successful transformation. Civil servants cited automatic enrolment to workplace pensions (more people are now saving for retirement), Getting it Right the First Time (reducing unwarranted variations in medical care) and Making Tax Digital (digitising the reporting of tax). There were also many examples – such as Universal Credit, NHS Vanguards and School Academisation – were it is just too early to reach a sound judgement. Transformation can take time.

In reality, high performing government agencies do resemble well-run companies. Both have worthy goals; well designed, rational processes; strict accountability; and effective leaders. But the profound differences in their purposes, their cultures and the contexts within which they operate conjure up different obstacles.

Transformation across government is arguably more difficult than the private sector. It is not possible to exclude a ‘difficult’ service user. Priorities change with new political leadership. Traditional structures tend to be hierarchical rather than flexible and agile. There is increasing political and media oversight. And there might be public opposition to novel efficiency initiatives such as remote video hearings or online pleas for minor offences or even divorce applications.

This means that transformation, through flexible new operating models designed around users and data, requires new thinking across government. Civil servants told us there was no ‘magic bullet’. Instead there is a need for empowered teams that deliver an agreed vision and work through a detailed plan. They have cross government support to remove systems and structures that undermine progress. There is a willingness to experiment, with pilots and early wins building credibility. And incentives, positive and negative, drive behaviours, including ‘invest to save’ schemes and the use of behavioural insights.

The suggestions made will play a formative role in the development of a ‘Transforming Public Services – 2020 and beyond’ research programme. I’d welcome comment on the this or any other issues raised in this post. And you might want to know more about our recent research with NIESR, where we asked whether the recent more upbeat assessment of the public sector finances was realistic.

The Promise of Platforms – Joined up outcomes and better value

One of the often-quoted benefits of digital transformation is the improvement in the ways government departments interact with citizens and business. Departments aim to use the same systems and shared data to avoid time consuming and repetitive tasks. But the reality often falls short of expectations. So, in this blog I take a look at why cross-cutting activity is rare and how digital platforms might help.

Why are public services so siloed?

The current departmental structure brings together and manages most areas of government business through a top down, vertical management structure. This approach is highly effective in delivering many of the government’s key priorities. It provides a single, clear line of accountability and keeps tight control over resources.

However, vertical structures also have many disadvantages:

First, issues or problems which straddle departmental boundaries are neglected. Budgets tend to be allocated on a departmental basis rather to policies that cross boundaries. And mechanisms for reconciling conflicting priorities are weak.

The result is that policy makers can take too narrow a view of the issues. They fail to look at problems from the perspective of the user. And they focus on what is easiest for government to supply, not what makes sense to the service user.

Second, departments also fail to recognise that local authorities have separate lines of accountability to local voters and may not share their priorities. So, departments tend to be overly prescriptive, in specifying the means of delivery as well as the ends.

And third, there are real obstacles to effective cross cutting working on the ground. It involves complex relationships and lines of accountability. Costs tend to fall on one budget while the benefits accrue to another. If appraisal systems are incapable of identifying and rewarding a contribution to a successful cross cutting project, the risks are one way.

So how do we join up government?

My experience is that cross cutting interventions work best when government makes clear their priorities and when champions at Ministerial and Permanent Secretary level (and / or chief executive and senior management team in local government) have a lasting effect on behaviour.

Also, with these supportive conditions, the adoption of digital technologies will enable cross-cutting work. For example, emphasis in UK government is now quite rightly focussed on how digital can support business transformation through, for example, the creation of shared components (such as Verify, Pay and Notify) and common workplace tools . The common link is, of course, information technology: co-ordination involving multiple providers that both depend on compatible IT systems and common data collection and architectures.

But perhaps just as significantly, digital approaches can promote dialogue with citizens and service users.

There are two aspects to this dialogue. First government needs to provide digital channels for information and views to reach them, which are not constrained to departmental silos – people and organisations should not have to tailor their views to fit Whitehall’s structure. People often want to be involved in shaping services, particularly at a local level, not just choosing between them. Open source methods that involve users in designing services have become commonplace in business and have always been common in civil society.

And second, government needs to shift the quality of the relationship between citizens and the state, so services are shaped around the individual’s needs rather than being too standardised. The commitment to make services more personal can mean little more than having someone – a teacher or a doctor – to talk to face to face. But it can mean a different curriculum and programme for every pupil. Or a different pattern or modular options of care for every patient.

Where are we see the benefits of joined-up government?

The harbingers of the future can be found where governments face the most intense pressures. This includes the increasing incidence of chronic conditions, as an ageing population and changes in societal behaviour are contributing to a steady increase in common and costly long-term health problems. Mental illness is equally significant, accounting for over 30% of all GP consultations and 50% of follow up consultations.

As a result, in the UK we now spend over £24 billion on disability and incapacity benefits for over 3.5 million working age people.

Chronic and other complex conditions are not easily administered or treated either through a traditional clinical lens or prescriptions. Much of the care is provided by families and friends and is too expensive to be provided by formal structures and by highly paid doctors. Most of the most important knowledge about how to handle these long-term conditions resides with other patients rather than just doctors.

So, part of the answer lies with giving people control over how money is spent and support structured to meet their needs. This means giving service users direct power over money and new structures of advice, often through simple but powerful online platforms/

At its best, these approaches bridge the bottom-up and top-down, paying attention to the worlds of daily experience rather than seeing people as abstract categories. Networks and platforms can help the state track behaviours, highlighting ‘what works’, and make it easier for people to band together and take control of their care.

Still making difficult decisions – the Spring Statement

In 2010 the coalition government started with the objective of eliminating the structural current deficit by 2014-15. It introduced a package of savings, a public sector pay freeze, welfare reforms and significant reductions to every department’s administration budget. There was still a desire to protect the most growth-enhancing capital spending.

The target originally set by George Osborne when he imposed austerity on public services was only achieved this year. Paul Johnson, director of the Institute for Fiscal Studies, said the deficit reduction was still ‘quite an achievement given how poor economic growth has been’.

What are the lessons of the last eight years?

As the Chancellor gives his ‘no frills’ Spring Statement this week, and prepares more far reaching plans for tax and spending through his Budget in the Autumn, it is worth drawing some conclusions on how the government eliminated the deficit and what aspects of the austerity agenda should remain:

  • The government maintained a clear and measurable fiscal target (the Chancellor has made a ‘pledge of fiscal responsibility, to borrow no more than two per cent of national income by 2020-21) and the Office for Budget Responsibility (OBR) should continue to assess publicly whether this is likely to be achieved.
  • The departmental spending review prioritised areas with benefits to a broad sweep of society – next year’s review should promote growth (like transport and education) and fairness and social mobility (providing routes out of poverty for the poorest, improving incentives for work and tackling ‘wicked problems’ such as the increasing public health hazards of air pollution).
  • Eliminating a sizeable deficit was not a normal budget exercise and a more open and inclusive approach is required – government should consult widely, beyond departments, asking public sector workers and the public to suggest ideas, convening expert advisory groups and holding regional events to listen to people’s views.

Of course, external conditions are now favourable and the reforms introduced in 2010 (including spending controls, back office shared services and commercial reforms) have been sustainable. But the United Kingdom cannot rely on external conditions to remain as favourable as they are now. Particularly as uncertainty lingers about the UK’s future relationship with the European Union and the economic costs of divergence with the EU become clear.

What needs to change? Meeting the UK’s future challenges

The squeeze on public services is showing up in higher waiting times in hospitals for emergency treatment, low satisfaction for GP services and a staggering decline in prison safety. The National Audit Office (NAO) warned that local councils are at financial breaking point. If they keep draining their reserves at the current rate, one in ten will have exhausted them in just three years’ time.

The improvement in the public finances gives the Chancellor some leeway to spend in his Spring Statement. But the expected £5bn to £10bn windfall is not going to transform the delivery of public services. It is not enough to solve the UK’s long-term fiscal challenges. For example, demographic change will demand either a significant increase in taxation or a radical change to the funding of health and pensions. There is an immediate need to put the funding of social care on a sustainable footing

Achieving better internal efficiency is a necessary but not sufficient part of public service reform. At the same time public services must come up with innovative, less resource-intensive and more effective ways of achieving the government’s aims. In the Spring Statement, the Chancellor should provide funding and direction:

  • To move away from the traditional tools of legislation, regulation and taxation – which can be expensive to design and implement – and develop and apply lessons from behavioural science (designing policy that reflects how people really behave).
  • To renew the transparency agenda, as a way of achieving ‘better for less’ – by consistently releasing data into the public domain, individuals are able to draw their own conclusions on the way public services operate, incentivising efficiency through accountability, and stimulating innovation through ‘information marketplaces’.
  • And, where appropriate, for public services being open to a range of providers competing to offer a better public service, with a greater emphasis on outcome-based contracts, and joint work with the private sector to access private capital and expertise to make fuller use of core public assets in an enterprising way.

A final thought – accountability and public services

I appreciate that the third suggestion is not shared by everybody. Over the past five or six years problems have emerged in the UK public service market, particularly in the commissioning of complex services. This came to a head with the liquidation of Carillion.

The reality is that the public are more pragmatic than the politicians. For example, sixty-four per cent of people do not think it matters who runs hospitals or GP surgeries ’as long as everyone has access to care (Populus poll, January 2018).

But we still need to recognise that one of the most important differences between a private and public service is the different and often enhanced levels of accountability for the delivery of that service to a broader range of stakeholders. Private sector organisations that want to deliver public services have to be aware of, and work within those boundaries.

There is an urgent need for a more transparent and robust way of measuring the quality of services provided by the public and private sector. The Chancellor should ensure the rapid implementation of Sir Michael Barber’s report into improving value in public spending.

Shifting from analogue to digital public services – citizens want joined up public services

I highlighted the positive view citizens have about digital public services in my last blog. And their appetite for more. I now want to address some of their concerns and why doubt the ability of government to continue to deliver.

The digital disruption brought about by new technologies is transforming the interaction between citizens, business and the public sector.

Citizens compare public services with innovative platform business models provided by digital trendsetters like Apple, Google and Amazon. I expect simplicity and even friendliness when I talk to Alexa or Siri.

What did we find? Government needs to join the dots

This year’s research shows that digital public services fall short of the best commercial services. While 64% of UK citizens said digital public services were advanced this falls to just 30% when they are asked to compare them to commercial services.

The UK Government can take some comfort from the comparison with France (18%), Norway (19%) and Germany (20%). And of course, we understand that governments face unique challenges, as ‘customers’ often have no choice when using public services that can be a last resort.  Governments need to address complex and long term needs like the reduction of re-offending or the treatment of chronic health conditions.

But citizens told us of their frustrations about the need to input information many times, including various passwords, the multiple steps needed to access services and an inability track progress. Some of these issues are being addressed by the UK Government, including through new platforms such as Verify and Notify. And they have flagged an intention to ‘improve citizen service across channels’ through a new Transformation (not digital) Strategy.

However, too often governments fail to meet citizen’s expectations when it reproduces its analogue bureaucratic procedures in a digitised way. Siloed service delivery approaches, with multiple websites and fragmented service delivery, organised around internal institutional structures are no longer acceptable. Which is why the number one priority for 44% of the UK citizens surveyed was the creation of a one-stop digital portal for undertaking interactions which need to be performed with multiple agencies (and this was a common priority across France, Norway and Germany).

Improving the experience of citizens in a revolutionary way

Citizens expect their public services to be designed with a user-driven perspective. And to adapt to different user profiles and needs. Through intelligent re-use of data and information previously generated or provided by citizens, governments can shift from reactive to proactive service delivery practices.

In a reactive service, the citizen is always responsible for starting the service demand, properly identifying herself and providing the required information. In a proactive service, the public sector knows its citizens, knows their life circumstances and current needs, and provides them the space to voice and signal their requests and preferences.

This enables the public sector to serve citizens in a personalised fashion about their rights, their duties and the services available. And to reach out to them to receive the authorisation to complete the service on their behalf.

This capacity to collect, combine and process data in a coherent way to better serve citizens must be a key feature of digital public services. And this needs a whole-of-government effort to exchange information across the public sector. With the key building blocks – common architecture, interoperability framework, digital identity system – in place to enable integrated service delivery.

Developing a user-driven approach also implies that the public sector’s capacities, workflows, business processes, operations need to be adapted to the rapidly evolving digital age. The challenge is not to introduce digital technologies but to integrate and embed them right from the start into efforts to modernise services.

I’d like to hear your views on how policies can be made digital by design, mobilising new technologies to rethink and re-engineer processes or open new channels of communication and engagement with citizens. And feel free to get in touch if you’d like more information on our research with Ipsos.

Citizens can feel the benefits of digital public services but are concerned about the ability of government to keep pace with their needs

As companies have transformed themselves with digital technologies, citizens are calling on governments to follow suit.

By digitising, the public sector can provide services that meet the evolving needs of citizens, even in a period of tight budgets and complex challenges.

This is the second year that Sopra Steria has asked the researchers at Ipsos to conduct a survey of 1000 citizens, from a broad range of social groups and across the United Kingdom, to understand their experience of and expectations for digital government. The same survey took place in France, Germany and Norway. So we have an opportunity to compare how citizens in the UK experience digital with others across Europe.

What did we find?

Citizens expect public services to be designed and delivered in a simple and intuitive way.

This year’s research shows that citizens recognise the efforts made by governments to use digital channels to streamline their interactions. 64% of the UK citizens surveyed described digital public services as advanced, compared to just 42% in Germany, 66% in France and 75% in Norway. The UK Government should seek to learn from experience of Norway, which has long used technology to streamline processes.

We asked citizens to describe the current degree of digital service development across Government

Citizens continue to support investment in digital public services. 75% of citizens surveyed in the UK said government should press ahead with plans to digitise public services. 25% described this as ‘an absolute priority’. Health is judged the most important public service to digitise in the future. 54% of citizens in the UK said health was the priority for investment, an increase of 5% in the 12 months since the last survey.

The research found that citizens also recognise the positive impact digital is having on the quality of public services. 58% of the UK citizens surveyed said that the introduction of online channels and services had improved the quality of public services, compared to 53% in France, 65% in Norway and 57% in Germany.

So far, so good – but what about the future of digital public service delivery?

Governments are working on simplifying access through the development of simple organisational hubs for digital government services. Fully developing this approach requires governments to achieve significant levels of interoperability of public sector information systems and, at times, cross-organisational service solutions.

Citizens are cautious when asked about the prospects of making further progress. 47% of the citizens surveyed said they did not believe the public sector had the necessary skills to make progress (which is similar to our own survey of civil servants last year). And France is the only country surveyed where citizens expressed confidence in their government’s will AND ability to continue to make progress.

We asked citizens for their views on the will and ability of governments to make progress with digital public services

The UK might learn from France and other countries that are seeking to introduce incentives across the public sector to help bring down cultural barriers in hierarchical and centralised administrative cultures. And develop a human resources strategy that helps develop, attract and retain vital data skills that facilitate collaboration.

In my next blog I will be looking in more detail at why citizens are so cautious about future prospects for digital public services. And how governments can address their concerns and shift away from the ‘vending machine’ model of service delivery.

In the meantime I’d like to hear your thoughts on the survey, including great examples of digital public services and how obstacles were overcome. And get in touch if you would like further details of the survey.

Using digital technologies to address complex problems – what can we learn from other governments?

It goes without saying that governments face incredibly complex challenges. Sustaining cohesive communities in the face of demographic, economic, security and other challenges will test the ingenuity of politicians and civil servants.

In recent blogs I’ve questioned the industrial-age organization of government and highlighted how the private sector is improving services through digital technologies. Now I would like to shift the emphasis and highlight how governments around the world employ digital technology to drive problem solving.

And I will start by looking at the one of the most significant problems facing individuals, families and communities – mental health.

Nearly one fifth of the UK population have a mental health condition

Mental health conditions cover a wide range of disorders and vary from mild to severe problems. The most common types are anxiety and depressive disorders (9% of all adults). More severe and psychotic disorders are much less common.

Recent research has found that a third of fit notes (they used to be called sick notes) issued by GPs are for psychiatric problems. The employment rate for people with mental health conditions is 21% compared with 49% for all disabled people and over 80% for non-disabled people.

Almost half of benefits claimants of Employment and Support Allowance in England are receiving payments as the result of mental and behavioural disorders. Recent independent studies estimate that cash benefits paid to those with mental health conditions are around £9.5 billion a year and administrative costs are £240 million.

This illustrates the financial costs of mental health conditions. But it fails to address the personal impact on individuals, their families and the wider community. That is why the NHS is putting mental health front and centre, in what was recently described as ‘the world’s most ambitious effort to treat depression, anxiety and other common mental illnesses’.

Using technology to create community solutions

Although overall spending on mental health will rise by over 4% in 2017/18, many areas of the country are under pressure to provide enough high quality services.

We also know that mental health is a very complex problem that goes beyond the capacity of any one organisation to understand and respond to. There is disagreement about the causes of the problems and the best way to tackle them.

Which is why Creating Community Solutions is such an exciting project.

In the US, following the Sandy Hook tragedy, the Obama administration launched a national dialogue on mental health. It soon became clear that, while mental illness affects nearly every family, there is a continued struggle to have an open and honest conversation around the issue. Misperceptions, discrimination, fears of social consequences, and the discomfort associated with talking about such illnesses all tend to keep people silent

The challenge facing the administration was how to convene a national participation process that would help Americans to learn more about mental health issues, assess how mental health problems affect their communities and younger populations, and decide what actions to take to improve mental health in their families, schools, and communities.

Officials from across the administration collaborated under the umbrella of Creating Community Solutions. They designed an online platform and process that integrated online / offline and national / local levels of collaboration. The platform has promoted a nationwide discussion on mental health. It has given Americans a chance to learn more about mental health issues – from each other and from research. For example, in December last year, and all over the country, hundreds of thousands of people used their mobile phones to get together in small groups for one-hour discussions on mental health.

What can we learn from the US?

Creating Community Solutions is an amazing example of how technology can be used overcome barriers, give access to relevant information and promote participation and mutual support. As a platform, rather than a conventionally structured project, it straddles traditional administrative boundaries and provides support in a distributed way.

I’d like to see our government adopting a similar approach, using technology to break down hierarchical barriers and using platforms to promote collaboration across public services and with communities.

I’ll be writing about other innovative ideas in future blogs. In the meantime, do you know of other innovative solutions to complex public problems? What are the exciting ideas informing your own work —particularly if you are working in the public sector – and how are you implementing them?

Let me know in the comments below or contact me by email.