Monday, June 04, 2007

Roadblock To Reform

Servants of the people

Here on BOM we take it as self-evident that politicians cannot be trusted to run our public services. The continuing fall-out from the grammar school row shows exactly why.

Writing over the weekend, David Cameron was quite unabashed about it:

"The changes I am leading in the Conservative party today have two vital characteristics: modernity and long-term thinking.

Modernity matters because if we allow ourselves to be marooned on the wrong side of social and cultural change, the result is simply irrelevance and opposition. For too long, Tony Blair and new Labour laid claim to the future while the Conservative party seemed stuck in the past."

To state the bleedin' obvious (again), "laying claim to the future" is not about improving our public services: it's about a marketing strategy to get elected.

And of course, as we're all tediously aware, if you don't get elected, you don't get any chance to... er... serve.

So what about the other bit, the "long-term thinking"?

"Before the 1997 election, new Labour failed to put in the serious policy work demanded by many of the big challenges of the day, notably public service reform. As a result, Labour wasted time, goodwill - and billions of pounds - going round in circles on issues such as education, the National Health Service and policing.

We will be different."



IIRC, the problem with Labour in 1997 was not that they arrived with no serious policy ideas. The problem was they had too many ideas that turned out to be plumb wrong (eg abolition of GP fund-holding, abolition of school's right to exclude disruptive kids, lumbering public services with wildly expensive PFI debt, etc etc etc).

And here we go again:

"We will apply our traditional Conservative belief in sound money to the benefit of all, by putting economic stability before short-term tax cuts."

We've blogged this many times. We all know why Dave says this from an electoral marketing perspective. Yes, that's obvious. But in terms of the real world, tax-cuts vs economic stability is a classic false dichotomy straight out of the junior debating society.

To understand that, you've only got to look at the serious work being done around the world on fiscal rules. For example, the OECD has just published its own research showing how clear observable rules help governments actually deliver on all those vague undertakings to downsize themselves at some stage when the time is right.

Any chance of Dave and George taking any of that on board? Forget it. They are entirely boxed in by the fear of appearing slash and burn "Thatcherites".

"We will replace Labour’s mismanagement of the health service with an approach rooted in Conservatism: trusting people and decentralising power. Reducing top-down direction of professionals and giving people more control over the health services they use are the priorities: improving the NHS for everyone rather than offering opt-outs for a few."

Easy to say mate. But having junked the patient passport idea- before any proper policy debate- how are you actually going to do it? I can't for the life of me see how what you're saying differs from current government policy rhetoric (delivery being an entirely separate matter of course). Again, we're in the land of electoral marketing strategy, not real world choices.

"Similarly, at a time of declining social mobility and chronic educational underperformance, we will best achieve our vision of opportunity for all by applying traditional Conservative belief in high standards and firm discipline throughout the state education system, rather than going back to the 11-plus and some mythical policy of “a grammar school in every town”.

"When the dust has settled on the grammar school debate it will be clear that our distinctive approach - more setting in schools, head teachers’ control over discipline and a big expansion in opportunities for new schools to open - is robust."

But as we've also blogged before, why should anyone think Dave and Dave, or any of our politicos, know better than parents what's best for their children? Or know better than headteachers how to teach reading or organise the classroom? Surely the last 50 years must have taught us they don't.

No, Dave's education policy, like all his other headline policies, is driven not by what's most likely to work, but what's most likely to get him elected. He knows his mythical policy groups are not going to come up with some hitherto undiscovered magic bullets that somehow achieve both, and it's brutally clear which of the two has priority.

Now, you may say, get real, grow up. Without power, you can do nothing. And starting from here, we have to agree. On a choice between Gordo and Dave, of course we go with Dave. So from where we are now, he has to do what he has to do.

But for future reference, as he twists and turns on that overcrowded patch of policy-free centre ground, let's just make another Big Mental Note of how the electoral imperative gets in the way of the real policy changes we need.

The fundamental roadblock to reform of our public services is not Gordon Brown, or Spanish practices among consultant surgeons, or even those Red Robbo style unions. It's the simple fact that we're still trying to run everything through our dysfunctional Westminster political system.

PS For future technical reference, the OECD recommends "fiscal rules with embedded expenditure targets". An explicit spending target- along the lines of Reform's Growth Rule- is something we've always wanted on BOM (eg see here). As the OECD observes: "Historical observation is consistent with the regression results in suggesting that in general budget-balance rules that are not combined with expenditure rules are less effective. A striking example of this is the United States experience: neither the Gramm-Rudman-Hollings (GRH) Act of 1985 nor its revised version in 1987 succeeded in significantly reducing the fiscal deficit. A further example is the Stability and Growth Pact (SGP), which has not so far led to sustainable positions being attained, notably in large EU countries. On the other hand, when the United States turned to an expenditure-based rule, the Budget Enforcement Act (1990-2002), a surplus was achieved and maintained for a time. Some EU countries (e.g. Netherlands, Spain, Sweden, Finland and Czech Republic) supplemented the SGP by national rules (in most cases including some expenditure ceilings) and also enjoyed success." (p 43).

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