My Cap X article
The public sector proceeds by running out of cash and then demanding more
More government spending is not the same as better public services
The UK’s lost public sector productivity could fill the Chancellor’s black hole
Here’s something people of all parties and of none ought to agree about. If we could raise public sector productivity we could have better service for less money. Could we also agree that the failure of the public sector to raise its productivity so far this century is something we should be able to change? The official forecasters pencil in good progress in raising productivity in the private sector, so shouldn’t the public sector be able to help out? As the public sector spends a fortune on bigger and better computers, shouldn’t there be some savings on the wages bill? If the public sector had managed just 1% annual growth in productivity, there would have been no black hole in the Chancellor’s figures. If we could get back up to 2019 levels of public sector productivity, there would have been no need for all those Budget tax rises.
Much of what the state does can be automated – tax collection and benefit payments already largely are. These big clerical factories can plan for fewer, better-paid people to manage the systems, deal with hard cases and talk to the public while much more of the work is done by the digital giants. The NHS is moving over to more being done online and via computer booking. Policing draws more on computers, mobile phone records and camera evidence to trace, track and arrest criminals.
Quality and efficiency are two sides of the same coin. Get things right first time and you can slim down the complaints department. You have more happy service users and less correspondence and fewer calls to handle. Get things right and you waste less of your supplies. Doing things well and providing a quality service is good for staff morale, encourages a can-do attitude and gives people a wish to avoid waste.
In the private sector, when I have been leading companies I have always put customers first. Without them you do not have a business. I have always stressed the importance of managing the cash. A profit is not a proper profit unless it is reflected in a bigger cash balance. The aim is to get enough revenue from satisfied customers to pay decent wages, meet the other costs and have some left over. You need the profit to invest in the future, to replace old plant and reward the shareholders who put the money up in the first place.
Good businesses generate cash, giving them options to renew and improve. If you can get productivity rising, you can reward people better and still have more left over to fund future plans. Failure to manage the cash leads to decline and bankruptcy, which can come swiftly if things have drifted.
In the public sector, I have always found there was plenty of cash if you knew where to look and intended to manage it. Most of the public sector always claims it has insufficient cash and always wants new money for new ideas without looking to see what could be shut down or reduced to pay for them. It is reluctant to go on the journey of continuous improvement. It proceeds by deliberately running out of cash and then demanding more, against threats to close or cut the most important things it does.
The good private sector manager, by contrast, is always on the road to better performance, accepts the need to cut or close marginal or poorly-performing activities and always has money for the core purposes and the key services. Any sign of cutting corners or spending too little on quality flows quickly into fewer sales and a bigger financial black hole.
In my new monograph for the Centre for Policy Studies, I set out some of the basics of how a manager improves productivity and quality. It does not need compulsory redundancies or big new investment programmes.
The first task of a public sector productivity programme today should be to get back up to 2019 levels. The public sector knows it could achieve that. And 2019 was before AI, so you do not need a big investment in new computing to do it.
What it does require is better management of staff. People are moved around too often in the public sector, so you do not get the benefit for long after they have worked out the best way to do a job. Rewards need to be better aligned with performance. Bonuses are paid too readily without requiring good results. How did the CEOs of the Post Office get bonuses for losing the state a fortune and locking up some of their best employees? How did bosses at HS2 get bonuses for massive delays and cost overruns on their railway line?
The public sector is also overstocked, and often writes off stock which goes to waste in some half-remembered warehouse. The property estate is rambling, and has not been modernised and downsized for the era of working from home. Much capital spend is one-off, overspecified and changed too often in the process of designing and building it.
The public sector needs to improve its customer or service-user focus. Public sector managers look upwards, knowing they rely on senior officials in the Treasury and Ministers to underwrite their mistakes and provide them with more money when the cash runs out. The habits of spending badly and in a rush before the year-end, parking money in reserves or unlikely capital spending to vire (i.e. transfer) it out when needed, are bad ideas.
Answering every question about what the government is doing to improve services with statements about increases in spending shows the wrong mindset. If I go into a shop to buy a shirt, I do not care how much it costs the shop to provide me with the service. Nor would I regard it as a good reply to be told that, although they don’t have the item in stock, they plan to spend £1 million in future to fix the problem. I would expect them to tell me how quickly they can get one and how it will be delivered to me. I want them to offer high-quality, low-cost retailing to keep their prices down.
The public sector often blames the user for not conforming to its bad service, whereas successful private sector businesses thrive on meeting customer requirements. The Christmas pudding maker does not tell you he cannot supply for Christmas because that’s when everyone wants one. The public sector rations road space to create traffic jams in an effort to stop people wanting to travel so much or at the times that fit their lives. It does not see high demand for certain routes to be an opportunity to provide more and better service.
Getting productivity back up in the public sector is the nearest to finding a magic money tree in the overrun public sector jungle. The sooner we find it, the sooner we can have tax levels that help growth, and a better balance between the public and private sectors.
February 14, 2026
the NHS spends more on lawyers defending it against legal claims for negligence and poor care in maternity wards than it does on maternity services. the standard of care in maternity wards is sub 3rd world. yet we are supposed to bang our pots and pans for the NHS. nobody is accountable, nobody ever gets sacked. the system just keeps rolling along. its too hard for politicians to take on.
February 14, 2026
Indeed it is appalling
Our dire legal system also spent rather a lot prosecuting and jailing the surely innocent of all 15 offences – or at least totally unsafe convictions of poor Lucy Letby. Plus twice 3 “learned” appeal court judges have refused her even the right to appeal.
February 14, 2026
the reality of the PPE incompetence and waste during covid has avoided proper scrutiny, the public sector workers who destroyed the evidence are still in the public sector doing rather well. billions wasted, none of the self reflection and ideas on how to do better the next time. vast sums spent in china for little to show for it. yet another critical national infrastructure we are incapable of supplying ourselves.
February 14, 2026
The really expensive incompetence was the net harm unsafe and ineffective Covid “vaccines” and the net harm lockdowns costing circa £600bn while doing vast net harm.
February 14, 2026
a classic example of crap public sector service is the failure to roll out proton beam therapy widely in the NHS. it is basically only offered to small numbers of children with head cancers. mainly due to a father the British state chased around the world and had arrested, for nothing more than taking his child for better care abroad. the public sector officials who did that were never sanctioned. other countries get far better results than we do for adult head cancers, prostate cancer, and so much more, because they use proton beam while we continue to use xray radiotherapy. the NHS simply cannot get its corporate brain around a proper cost benefits analysis, it is stuck in the rationing and allocation communist mindset. if the NHS was in charge of cars we would all be driving trabants.
February 14, 2026
I am in absolute agreement with all 3 of your comments (eerily it’s as if you are writing word for word what’s in my head)
I think when it comes to public services we have a huge problem with politicised unions, and we know certain parties will never tackle that because they are their money lenders.
The public also are easily persuaded by campaigns to show our poor nurses have to visit food banks, junior doctors are tied to their posts with bread and water, etc. The NHS is used as a political tool to bring the public into line, both Cons. and Labour have used it as such, particularly during the covid era.
So anyone wanting to tackle that particular area of one of our many problems must first of all ensure the left wing media are not allowed to produce bias reporting. A big Conservative failure, in my opinion was always the timidity to fight back against blatant media preference rather than even handed reporting.
February 14, 2026
Starting with the Civil Service, why are they permitted to recruit thousands more Staff at the drop of a hat? Why, when the country is in dire straights does the Head of that poor service receive £250k pay off when he ‘retires’? Why are Hospitals being paid to cancel appointments or GP’s getting extra cash for prescribing Statins. The Banking system can transfer money from one account to another in a different bank immediately. So why aren’t deaths recorded immediately and patients names removed from GP lists, stopping Surgeries getting paid for patients they don’t have?
The NHS and Civil Service waste so much money through mismanagement, if managers thought it was their money they were squandering rather than Taxpayers, that practice would soon cease. Total overhaul of the Public Sector by a Private Sector Enterprise required immediately.
February 14, 2026
Indeed the other many magic money trees would be 1. the ditching of the May/Miliband/Tory/Labour/Libdim anti-scientific net zero lunacy. Even the dire Tony Blair seems to have finally realised this and as Starkey rightly says in his videos Blair did more harm than two World Wars.
2. “Much of what the state does can be automated” indeed but much of what the state does is entirely negative so we do not want it doing more efficiently we want it stopped.
Much of what it does is blatant Anarcho-tyranny a system where the state fails to enforce fundamental laws (anarchy) while simultaneously over-regulating, taxing, fining and oppressing essentially law-abiding citizens (tyranny). People who perhaps acidentally put a tyre in an empty bus lane, or for a seconds or two or do 23 mph in a new 20 mph zone, or pour a drop of coffee down a street drain, or spit out a fly that went into their mouths, or are late with the tax return perhaps due to illness or absurd complexity…
and 3. Deregulation (a huge benefit for both the private sector and the state sector).
and 4 Easy hire and fire also a huge benefit for both the private sector and the state sector.
and 5 Stop aumenting the healthy but feckless with over generous benefits to live off the back of others.
and 6. A vast bonfire of red tap policies and tax simplification policies that release essentially parasitic and unproductive workers in law, tax consultancy, HR, DEI, OTT health and safely both in private sector compliance and in the state sector to get productive jobs instead.
7. Get free and fair unrigged competition between state and the private sector often the more efficient private sector is being pushed out of business by unfair competition in schools, universities, transport, healthcare, BBC broadcasting, banking…
8. Stop pushing the wealthly, high tax paying and hard working people overseas, People like Sir Jim Radcliffe, and stop importing low skilled, low or not tax paying and benefit claiming people to replace them. Stop Reeve’s doom loop suicidal lunacy.
February 14, 2026
A blueprint for our new political clans which will emerge now that there is a proper job to do, thanks to Brexit, and a proper party to serve, Restore Britain.
Let’s win more than the arguments.
We owe it to our fathers and our children.
February 14, 2026
Well yet but we have first past the post voting so Restore Britain and Mr Lowe say the right things but are likely to be fairly irrelevant,
February 14, 2026
My son was off from London to Bath this weekend with his Girlfriend. The train cost was £250 each (return) for the flexible 230 mile return journey at the times they needed (plus the end connection taxis) and about another £250 each in taxpayer subsidies to the rail companies too. So they got a coach for about £35 each. Please kill off these moronic and rigged markets. If trains are so energy efficient (as is endlessly claimed) why do they cost such a fortune and yet are not even reliable or clean or have working loos?
They could probably have had a weekend in the Canaries for less than just this train fare to Bath. An average wage worker might have to work an extra 60 hours and after tax and NI he can just buy two return train tickets London-Bath and still has the hotel and meals to fund!
February 14, 2026
You could sack everyone in Network Rail head offices for little impact on the railway.
Making the failed Network Rail people the core of the new nationalised mega train operating company is a massive mistake.
Great British Railway is nothing more than the very worst railway managers in Network Rail being given control over all the trains as well as the tracks they were already managing badly.
Claiming West Mids trains is being nationalised when in fact it was already being run by the West Mids mayor is a joke, it is not being nationalised, it is being moved from one public sector owner to another public sector owners, one that is more removed from the people of the West Mids.
So many layers of crap management, political interference, and dogmatic communist claptrap from the current government.
February 14, 2026
https://dailysceptic.org/2026/02/12/excess-deaths-continue-to-climb-with-no-sign-of-slowing-down/
The government is still hiding the statistice properly broken down by Covid Vaccine status of the victims which would reveal the truth in no time at all. I assume this is because they know the truth.
The article concludes:-
As Covid is a negligible factor in overall mortality statistics now, something else has caused these excess deaths. Furthermore, whatever it is, it appears to still be working its insidious effects as we begin 2026. The only way to describe such a situation is carnage on a scale that would be considered unacceptable even in a war situation. It is quite extraordinary that this matter has not been properly investigated by the UK authorities, who seem neither to notice nor to care.
February 14, 2026
This is a crime against humanity.
February 14, 2026
I wouldn’t trust the Daily Sceptic as far as i could throw it. You might find the ONS weekly series more useful.
The main messages of this report are:
“in week 3 (week ending 18 January) of 2026, no signal of high mortality above the baseline was seen in England using all ages combined
no signal of high mortality above the baseline was seen in England in those aged under 5 years, aged 5 to 14 years, aged 15 to 64 years and aged 65 years and over, or in any region
a signal of high all-cause mortality above the baseline for all ages combined was seen in Northern Ireland but was not seen in Wales, or Scotland in the week ending 18 January 2026 (week 3) applied by week of death occurrence (Table 3)
https://www.gov.uk/government/statistics/weekly-all-cause-mortality-surveillance-2025-to-2026/weekly-all-cause-mortality-surveillance-week-7-2026-report-up-to-week-3-2026-data
February 14, 2026
it is not better management that makes the private sector more efficient than the public sector, its buying power in the individual citizens hands, which forces providers to continually innovate, optimise, and keep customers happy. inefficient business units shut and new better ones replace them. there are virtuous feedback loops from individual consumers to top management. to improve public sector services we need to hand real, continual, effective buying power over to individual citizens wherever possible. in everything schools, health care, housing, advice services, etc.
February 14, 2026
In short the government cares not what they spend not what (if any) poitive value they actually deliver to the public. It is not their money nor they who get the value. They far would prefer just to use the money for higher civil service wages, better pensions, more “working” from home and/or nicer offices.
February 14, 2026
the tax and benefits system could be administered far more cheaply if we had a radical simplification of the rules, and politicians stopped meddling.
I could sketch out a new system in half a day. tax and benefits offices could be privatised. pay benefits by manipulating the tax allowance, put everyone not already on a paye system on one which pays a nominal one pound per month, but which triggers tax refunds from allowance. scrap all the benefits systems. scrap NI and roll it into tax. so easy to do. so much admin saving we could do without a lots of barriers to payouts and still be cash positive.
February 14, 2026
My Lord, we all know what is happening in the Public Sector. The focus of activities has been switched from service provision to virtue signal point scoring and tick box trining to meet the latest DEI ESG or other dreamed up essential distraction.
We now have councils up and down the country actually bankrupt despite above inflation increases in charges for council tax etc. The money they should be devoting to services is being squandered on Net Zero alignment. Council houses must be retrofitted with solar panels and insulation plus heat pumps yet they have no money to fund these programs. The result is a very few individuals have warmer homes while the majority of rate payers have a degraded council service to help cover the costs.
Town centres that were the economic drivers locally are being shut down by excessive controls imposed by councils, no parking allowed, road closures to avoid short cut journeys that locals had the privilege of knowing are gone, fines for simply being stranded in a box junction due to traffic light controls stopping traffic flow.
In my own small town we now have pedestrian crossings sequencing to red to stop traffic without anyone pressing a button to cross. The effect is simply to stop traffic flow which it does. There is zero benefit to anybody, just more frustration.
The whole mindset of public service has to change and return to the days when those paid from the tax payers purse were true civil servants. Back to the days when value for money was a focal point of service.
We can but hope.