The Chancellor’s Spending Review

When Gordon Brown unveils the details of his latest spending review to MPs on Monday 12 July he must demonstrate that the government is serious about turning the aspiration of better public service management into reality. Without this it will be impossible to deliver the kind of improvements in service quality that taxpayers want.

Commenting ahead of publication of the review, John Philpott, Chief Economist at people management experts the Chartered Institute of Personnel and Development, warns that the time for simply talking a good game on modernising the public services is over:

Ministers are absolutely right when they say they want to champion the users of public services over public service producer interests, promote user choice and empower local communities - in the process adopting a mission rather than rules driven approach to service delivery and devolving decision making to front-line staff. Yet look at what is happening on the ground and there is a serious question mark over whether the government is pursuing a genuinely modernising agenda.

And despite some welcome moves toward so-called ’constrained discretion’, managers and workers at local level complain of too little discretion and too much constraint when it comes to how they go about meeting delivery targets set in Whitehall. This is to some degree understandable given the need to ensure that public sector organisations are accountable to the taxpayer. But the resulting red tape undermines the autonomy and trust needed for high performance. And it also de-motivates staff, to the detriment of service improvements.

CIPD research shows that poor people management is a key cause of stress in the public sector with Central Government officials complaining about this aspect of their work in particular.

Philpott continues, It seems to be no accident that central government has one the highest rates of absenteeism across the range of public, voluntary and private sector organisations, nor that many public bodies face serious staff recruitment and retention difficulties despite the relatively strong growth in public sector pay rates in recent years.

Without an immediate change of tack such problems look set to get worse rather than better as the private sector recovers and competes more actively for labour. In addition, poor people management is hardly likely to be conducive to a smooth process of downsizing in Whitehall departments as the government tries to realise potential savings highlighted by the Gershon review.

The CIPD believes that the Government should thus remould its existing approach to reform into one that:

*Further, and significantly, reduces the number of centralised targets

*Greatly increases consultation on targets that are set

*Allow managers much more discretion at local level over pay-setting

*Puts people management at the heart of the reform process by shifting from a command and control style of management to a high performance model based on autonomy and trust.

CIPD research shows that local leadership that is capable of energising and enabling people is the key to transformational change and performance improvements in the public sector, especially when accompanied by good people management practices which include frequent job appraisals, performance-related pay and effective team working. The Chancellor must use this spending review - the last before the General Election - to show that the UK public services can be led and managed in just this way.