Friday 27 February 2009
Participated in a Chatam House rules event organised by the Royal Institute of British Architects at One Great George Street in London. Basically the event was a debate about how we continue to construct public sector infrastructure in an environment where the banks are unable or unwilling to lend the money necessary to fund such vast projects.
As it was a private discussion I will have too generalise but needless to say the future of PFI looks grim as the sums involved are collosal and the banks are looking at maximum terms of seven to ten years for such high level loans. In the past of course the typical lending term for a PFI deal has been twenty five years. It looks like traditional procurement could be set for a major comeback.
One of the worrying items discussed was the fact that a large number of deals were at advanced stages and without Government guarantees would be unlikely to be concluded. If these deals for schools, hospitals, motorways and waste treatment facilities collapse then it goes without saying that the depths of the economy could plunge to a new all time low. It would of course be the final nail in the coffin for what is left of the construction industry and the knock on effects would be catastrophic.
Subsequently of course the Government have announced £13B of guarantees to make sure these deals don't collapse.
Monday 23 February 2009
Chair a debate on Housing between the four main political parties in Scotland at our Peebles conference. Livingston MSP, Angela Constance opens on behalf of the SNP Government, Derek Brownlee MSP responds on behalf of the Conservatives, Jeremy Purvis MSP on behalf of the Liberal Democrats and Cllr Jim McCabe, Labour Group Leader on CoSLA on behalf of the Scottish Labour Party.
The main focus is on the state of the economy but also on the fact that the public sector has a huge roll in helping in the recovery from recession. Having said that Derek and Jeremy provide a fairly forensic analysis of the depressing state of public finances between now and 2015.
All of the panelists and audience agree however that we need to build more council housing and a general mood exists that suggests a lack of balance between the £25m pot available for council new build in Scotland and the £100m available to Housing Associations. Especially when the Housing Associations appear slow of the mark with new build and ongoing rumours about their ability to secure additional borrowing from the banks. I think this is something that needs to be revisited quickly if the fiscal stimulus is to have any immediate impact.
A point made by Jeremy shed some new light on how public finances operate for me. Jeremy stated that he had taken a lot of flak in Parliament for speaking out against the Bill to introduce free school meals. He pointed out that the £40m per annum transferred to revenue spending to cover this could have been used to borrow up to £1B of capital infrastructure spending over the period. He made a compelling case as to how this may be a more important priority for the economy at this present moment in time!
Tuesday 17 February 2009
Think APSE has started a pretty hot debate with the publishing of our latest research project which is a guide to Insourcing local authority services previously outsourced.
We did articles for the Guardian, Public Finance, MJ and Public Servant, as well as some other sector journals and a number of journals and websites also gave the report coverage and their own particular slants on it. Of course there were the usual attacks from the vested interest brigade in both the third and private sectors but it was quite obvious that they hadn't read the report and it was therefore fairly easy to rebut their whining.
The research actually examined over 50 case studies where local authorities had Insourced services mainly because of market failure and poor performance of private contractors. It didn't call for a wholesale Insourcing of every previously outsourced contract or the cut off of funds for the Third Sector - however there is that much of an industry built up around these sectors that I suppose they have to hysterically attempt to misrepresent any challenge that comes along to the status quo or the orthodoxy that they have carefully crafted around public services being monolithic, bureaucratic and inefficient - despite the tangible evidence available painting a very different picture.
I guess they ain't going to take to kindly to anyone pointing out the failings in the market based approach and the flaws in the performance of the private and third sectors when they have spent so much on lobbying and marketing an image of a perfect alternative.
They may be in for a bigger shock as local authorities up and down the country have purchased our publication in record numbers. Maybe the aim of the research - to establish Insourcing as a credible option - has been achieved.
Wednesday 11 February 2009
Keeping the highways of the country free of snow and ice has dominated the news agenda in recent days and APSE has stepped into the breach in order to help its member authorities.
We first became aware of the fact that salt and grit supplies were starting to run out a few days before it became front page news when we attempted to set up a salt brokerage amongst our member authorities. Almost immediately we were inundated with authorities requesting supplies with no one offering any spare! We began to hear stories of authorities who were down to their last day or two of supplies and how suppliers were telling them they couldn't release any stock as it was committed to Highways Agency contracts and this was their largest customer. When we checked with the Highways Agency they were holding reserves of 6 days supply!
It was at this stage that I decided to contact Local Government Minister John Healey and explain that despite the fact that the National and Regional Resilience Committee had been activated this wasn't necessarily filtering down locally and having the impact necessary to free up resources. To John's credit he responded quickly and the Highways Agency downgraded their reserve levels from 6 days to 5 and then ultimately 4. Supply then appeared to get to the correct areas and a potential disaster was averted.
I also contacted Cleveland Potash one of the largest suppliers and through their Marketing Manager Dave McLuckie, who is also a Councillor on Redcar and Cleveland Council and Chair of the local Police authority, got a sympathetic response with regard to diverting some of their supplies to the most needy authorities.
However Local Government's reputation took a bit of a battering once again and I found myself on BBC West Midland morning radio having to defend the response of local authorities Highways teams. The West Midlands, Yorkshire, Wales and swathes of the South of England had taken a hammering and the press were not in the mood to be sympathetic. However they would be the first to criticise us as being bureaucratic and inefficient if we kept grit and salt mountains with the expensive equipment required to spread it mothballed, waiting for weather conditions that were after all a once in 20 year phenomenon.
Lessons will be learned and perhaps the biggest one is getting suppliers to build in more flexibility in the supply chain. I am sure communication channels will also be better between Government, both central and local, Highways Agency and suppliers, now they have been tested to this extent.
APSE is hosting 'The Great Salt Debate' between member authorities and supplier representatives at our annual Highways seminar in Newcastle on 12 and 13 March.
Saturday 07 February 2009
Birmingham University is the venue today for the first in a series of seminars for a research project on putting policy into practice funded by the European Social Research Council. This is a joint initiative between the Institute of Local Government Studies (INLOGOV), Edinburgh University and APSE. Its aim is to test the practicalities of implementing policy and to gain insight into how policy design can better take place in conjunction with practitioners.
Alastair Merrick from Wolverhampton Council, Graham Bayliss of Sefton Council and myself are there to bring the practitioners viewpoint, whilst Leiden University in Holland is represented along with numerous U.K. based Universities such as Birmingham, Edinburgh, Manchester and De Montefort.
Much of the day is spent with the academics presenting papers and then all of us engaging in debate to tease out current problems. One of the main issues to emerge for me was the limited 'real life' and operational experience of some of the key policy makers in this country. The obvious influence of so many being from an Oxbridge background tends to point to a similarity of thinking and a lack of diversity in life experience.
The next event in the series will be more based on the operational practitioners presenting their views with the Academics playing the role of inquisitors.