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.

Scotsoft 2018. Smart people, community and trees

Last week I was proud to continue the tradition of Sopra Steria’s support of the Young Software Engineer of the year award, since its inception 20 years ago.  Once again the entrants were outstanding (though I confess the technicalities of some project went right over my head!).   Can Gafuroglu’s winning  project was entitled  ‘Joint prediction and Classification of Brain Image Evolution Trajectories from Baseline with Application to Early Dementia Diagnosis’.  Our industry is about solving problems and this project underlines the significance of what can be achieved by the smart use of technology by #smartpeople.

 

The buzz at the dinner was incredible and underlined the spirit of ScotlandIS – that of #community.   Our Sopra Steria table was no exception, with a mix of SMEs, customers and advisors. Plus Alison McLaughlin – now on secondment to Scottish Government Digital as part of the Digital Fellowship Programme.

And, #trees.  Lizzy Yarnold was an inspirational speaker on the evening and reminded us all of the importance of belief, ambition and team work.  She spoke about a book “The Inner Life of Trees”: What they feel, how they communicate.  A brilliant parallel to business life – the need for constant communication, mutual support and networking.

Well done to ScotlandIS.  The Scotsoft conference has once again reinforced our Smart Young People, Our Community and that we are a well-connected forest.


by Mags Moore, Head of Government for Scotland and Northern Ireland.

Harrow’s Heroes – A look into a brilliant evening

A splendid evening with around 250 people in attendance enjoyed a night of celebration of the volunteering community in the borough of Harrow.  Ray Baker and myself were fortunate enough to share a table with the Leader of the council, Cllr Graham Henson and his wife, and fellow councillor Maxine Henson, amongst others.   Canapés and bubbly were shared beforehand with a  photo booth and a rousing introduction from the exuberant, The Worshipful The Mayor, Councillor Kareema Marikar.

Dinner was delicious range of Indian food and the compere moved things along briskly as the awards started being presented.  Each group of nominees were called forward and the winner was invited onto the stage to receive their award from the guest presenter for the category.  Runners up received a certificate extolling the virtues and winners a rather lovely glass trophy.

The Sopra Steria sponsored award was presented to the overall winners of all of the categories, i.e. the Volunteers of the Year.  I was honoured to be invited on to stage to present this to the Infant Feeding Volunteers Peer Supporters.

Overall it was a fantastic evening that really celebrated the true nature of volunteerism and I’m proud that Sopra Steria can support this great work being done and I look forward to our continued involvement going forward.

By Lee Westwood

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.

Light at the end of the financial tunnel?

In March 2018 the government reached a significant economic milestone. It eliminated the deficit on its day-to-day budget. Tax revenues will exceed public spending. Public sector net debt will fall for the first time since 2001-02. It took eight years rather than five. But the primary target set by government in 2010, as the UK struggled to recover from the financial crisis, had finally been met.

The chancellor declared the nation was at a turning point in its recovery. He could see ‘light at the end of the tunnel’. Some commentators suggested the light might be an oncoming train, pointing out that economic forecasts rely on the government following through on ambitious plans for further spending cuts.

What does the economic evidence tell us?

We recently asked the National Institute for Economic and Social Research (NIESR) to help us understand if the upbeat economic message was justified.

They told us that if government is to achieve its ambitious target of a balanced budget by the middle of the next decade, public spending as a share of Gross Domestic Product (GDP) would need to fall to 36.6% in 2022-23. The post-war average is 39.3% of GDP.

Since 2010, significant savings have been made by transforming how government works, through commercial reforms and reducing the costs of major projects. However, the evidence is that public sector pay restraint and relatively low levels of public spending, rather than widespread productivity gains, explain the vast majority of deficit reduction.

What future do public services face?

We then asked NIESR to suggest how sustainable these savings might be. They told us government faces a daunting challenge. Why?

First, continued pay restraint is unlikely to have the same impact. The across-the-board 1% pay cap has already been lifted. And there are signs in health and education of recruitment and retention problems. Second, there are signs that low levels of public spending might be affecting the quality of public services. For example, the Institute for Government have noted a marked deterioration in key government targets for health and public safety. And third, most significantly, the pressure from further ageing of the population is gradually building. Significant extra resources will be needed to cover raising health and care costs and serve a larger number of pensioners.

NIESR used a series of scenarios to reveal the economic strain that government might experience over the next seven years. They warned that a public spending gap of up to £300bn could emerge, created by the cumulative impact of an ageing population and the cost of easing austerity.

Of course, it is possible that the economy will improve significantly, lifting tax revenues and providing an opportunity to increase public spending and reduce debt (the government still owe more than £1.6 trillion). But this cannot be counted on and it would be better to consider other options.

What options are open to government?

To meet this challenge, the government will need to embark on a transformation programme on a scale unprecedented in the post-war era. The combination of fiscal consolidation and rising expectations for service delivery represents both an opportunity and an imperative to radically redesign the services government provides to the public.

Government have already started digitising front-end interfaces, processes and workflows to improve cost efficiency and user experience. The next step is to reduce duplication of structures and resources between and within levels of government. And this requires a change of mindset – from government and industry. Rather than simply implementing bits and pieces of technologies on their own, there is a need for equally necessary organisational and service design changes. And this means joining up and trying to de-silo processes, creating new processes that do things once rather than many times.

In launching a new strategy for the government business last week, Sopra Steria commits to using our understanding of the public sector and emerging technologies to introduce a series of platforms for government, focussed on core government activities, which are standardised and repeatable. They will enable government to re-engineer, streamline and automate policy processes (including those enabling the UK’s exit from the EU).

Further information on the strategy launch and the NIESR research can be found on the Sopra Steria website. As always, I would be grateful for your thoughts and suggestions on how public services should be reformed.

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.