Author: johnredwood

The Chancellor gave an important lecture recently on the need to raise public sector productivity. He drew attention to the decline in public service productivity by 5.7% compared to pre pandemic, whilst private services had shown a productivity improvement of 1.7% over the same time period.

He raised the issue of the “10,000 public workers in equality, diversity and inclusion” wondering if this was too many. I would add why did the NHS recruit more than 3,500 additional managers over the last three years? How did their appointment coincide with a major decline in productivity and what are they doing about it? How many new forms and requirements have these additional managers imposed on the front line staff? Why do we have duplicate or triplicate  management, with management at NHS England levels, management at regional NHS quango level and management at hospital or GP Trust level? Why is there a cadre of senior NHS managers in the Department of Health and another corps of senior managers in  NHS England? How many requirements on NHS trusts do these bodies send out each year?

When staff morale is low as it has been in the NHS with strikes and disputes over working conditions as well as about pay it implies the senior management have  not listened and led in the way they should. It took senior management a very long time to come up with a manpower plan. Given the dominance of the NHS in the UK health area it is important the NHS does enough to stimulate sufficient education and training of our future health practitioners. That will take time and is not enough by way of response to current troubles. The senior management need to rework rotas, shifts, working practices and conditions with their medical teams to win back the loyalty and support of the staff. There is the danger of losing too many experienced and good people over  conditions and job gradings.

Knowing some  of you will want to talk about the by elections, here is your opportunity. Each of the three parties won one. They showed continuing poor support for Conservatives, no love for a Labour replacement, and anger at Mayor Kahn’s anti motorist policies. They show Lib Dem’s with very low national poll figures can pull off the odd  by election win. A highly subsidised investment in the West country did not impress voters there.

In an age of digital investment, artificial intelligence, smart phone activity and other leaps forward in productivity from technology, you would expect the UK public services to have had a good 25 years achieving more from its workforce thanks to investment and modernisation. Instead the Office of National Statistics reports that public sector productivity by the end of last year was lower than 25 years ago, at a time when the private sector had continued to show reasonable annual growth. In the whole period 1997-2019 the one fifth of the UK economy that is public services managed growth of just 3.7% in productivity. In 2020 productivity fell 13.3% thanks to lockdowns. In the following two years when the private sector made a full recovery from covid the public sector showed a rise of 7.3% in productivity in 2021 and of 1.9% in 2022, leaving it 5.2% below 2019 levels, and 1.7% below 1997.

UK public services are very labour intensive. We all want plenty of great teachers, good doctors and nurses and well trained uniformed police and defence  personnel to take care of us and protect us. Behind them lie large back offices with people giving the front line professionals support. In these areas more can be done by computer and by organising workloads and shifts well. Back up staff can keep more of the records and handle more of the administration to get the best out of the public facing staff. In too many areas management imposes a wide range of duties, checks and forms on staff which can get in the way of undertaking the day job instead of supporting its better performance.

The Chief Secretary to the Treasury has been put in charge of trying to cut through the complexities and overhead costs to deliver just that amount of administrative support and good planning that a successful service needs. He needs to do a lot to improve management performance especially in the NHS where huge sums of additional spending have been released without a proportionate increase in output. Your thoughts on how this can be achieved would be of interest.

Yesterday I met some experts on energy and supply chains. They told me that the official figures implying there would be twice as much CO 2 if we import LNG in place of domestic North Sea gas down a pipe was a big underestimate by the government. If you take into account the different levels of emissions in extracting the gas, in compressing it, in transporting it as a cold liquid and then converting it back it could as much as seven times as much CO 2 is produced by all these processes. Those who argue we must keep our own gas in the ground to speed net zero are wrong – it would delay our road as we would have to import the gas we did mot produce for the rest of this decade at least. There is no way we will have enough people with electric heating or electric cars by 2030 or nearly enough grid capacity to power them to do without much of the oil and gas we currently need to stay warm and to get about.

The investment task to replace all the current oil and gas based activities and put in enough reliable electrical power is colossal. People wanting to put in new windfarms are  being told there is a queue into the next decade to get access to grid to carry extra renewable power to users at the times when renewable would be available. The Grid is only just considering how to expand, which it would need to do by a factor of 5 or more by 2050 to take out our current dependence on gas heating, gas industrial processes, and petrol, diesel and  aviation  spirit for transport. It would also need much enhanced electrical cable capacity under every street to provide enough power to each electrically heated home with an electric car to recharge.

The UK needs to improve our energy security and self sufficiency. Being reliant on imports by pipe and wire from a continent short of energy and recovering from the need to end its dependence on Russian fossil fuels, we could run out of energy at crucial times. We always used to be self sufficient. We have a good mixture of natural resources to provide  more oil and gas, wind power, nuclear and the rest we will need. To have a successful economy with well paid ,jobs we need more reliable and affordable power. Letting the market work with less interruption would help bring this about mainly with private sector investment capital.

The Speech needs to tackle problems with restoring productivity in public services, encouraging smarter working with a happier and better rewarded workforce.

1. Repeal the independent management of NHS England, as everyone still blames Ministers for management failings.

2. Reduce layers of management in NHS and strengthen powers of Trust CEOs and Boards

3. Strengthen rights to free speech in universities and Colleges

4.Amend public procurement rules to give proper recognition to the tax and job contributions to UK made by UK based suppliers

5. Require Ministers to hold annual meetings with quangos to 1. Set objectives for the year ahead and agree budgets; 2 to review annual report and accounts; 3 to review performance.

6.Grant NHS patients the right to free treatment in the private sector if the NHS fails to deliver in a stated time

7 Block  loans to Councils wanting to make commercial investments given the big losses some of them are recording on past attempts at property and green ventures

8.  Review and consolidate government property holdings to cut costs and reduce dominance of expensive London

9.Cut energy use in public sector

10. Charge foreign visitors for using public services