Exclusive: Clark says quality will govern public service provision, not just cost

Decentralisation minister Greg Clark has dismissed fears the Localism Bill and forthcoming public services white paper amount to a blueprint for mass privatisation of Whitehall and council services – and insisted outsourcing decisions would not be controlled by ‘bean counters'. In an interview with The MJ, Mr Clark said crucial decisions on whether local and national services should be provided by the state, private or third sector bodies would be determined as much by considerations about future service quality as by cost. ‘The [Localism] Bill provides for an assessment of social value to be taken into account. So the assessment of whether or not an organisation can contribute usefully is not made by bean counters – it's based on an assessment of the potential community value that any proposition [to take over a service] has. It's not just about money,' he said. Mr Clark indicated the imminent Open Public Services white paper – which prime minister David Cameron has said would contain a ‘presumption' that private, voluntary and charity bodies could bid for health, education, justice and council services – would be based on similar principles. Combined with the ‘community right to challenge' section of the Localism Bill, which hands local bodies and residents powers to bid for council services, the white paper has been interpreted as the most radical attempt to reconfigure public service provision since Compulsory Competitive Tendering in the 1980s. Critics, including public sector trade unions, have attacked the plan as a mere agenda for privatisation – and not a genuine ambition for mixed service provision. They fear large private sector providers – including FTSE-listed Capita and Serco – have the financial clout to out-bid other organisations interested in running services. Brendan Barber, TUC general secretary, recently warned the white paper proposals would see ‘voters and service users lose their say in what will be a "get even richer quicker" scheme for the companies that win contracts'. But Mr Clark insisted the time was right to break up ‘public monopolies'. The devolution of powers from central and local government, he said, was ‘in the DNA' of the coalition. As part of his decentralisation remit, Mr Clark will hand Mr Cameron a report in July, outlining all Whitehall departments' progress in devolving powers to localities. Amid Westminster rumours the Department for Work and Pensions, for example, has retained a heavily-centralised view of 21st Century public services, he reiterated some would fare better than others in his assessment. ‘Some are much further ahead than others, and part of the exercise is to force the pace. Those that are further behind the others know they are and equally know the consequences for not improving their pace,' he warned. Mr Clark would not be drawn on what remedial action he and Mr Cameron would take if departments fail to devolve powers and budgets swiftly. But he revealed theTreasury – traditionally viewed as a barrier to devolution – has supported decentralisation. ‘There's a recognition that we need to operate in a different way. Take the local government arena, and the removal of ring-fencing: the old system was mainly a legacy of Treasury insistence that every pot of money had to be separately accounted for and minutely controlled or supervised from the centre. ‘The fact that we were able to get rid of ring-fencing…required approval from the Treasury and in fact they did it with some enthusiasm,' he said. Mr Clark also revealed that, with arguments over local spending cuts beginning to dissipate, attention would turn to the coalition's ‘community budgets' plan – involving cash pooled from a range of local public services – over the next 12 months. He urged geographically large collectives of public and community bodies to come forward with proposals on how to prioritise local services and spend cash to meet residents' needs. ‘I would like to see…a system in which a city, for example, should be able to gather together all of the different public and community bodies and make a proposition [on how to run and prioritise local services] to the Government,' he said.

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WHITEHALL

Exclusive: Clark says quality will govern public service provision, not just cost

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