Audit commission tells councils to get competitive The Audit Commission is urging councils to be more creative in using the market to drive down costs and improve services. Local authorities need to be more open minded and creative if they are to realise the £4.9bn efficiency savings required following this year's Comprehensive Spending Review, says a new report by the local …
Competition is all very well, but it leads to lowest-cost bids providing substandard services with inequitable contractual terms (10 year cleaning contracts in hospitals with no measurable standards of cleanliness attached f'rex). And if the Councils don't have the skills for working in such ways, then similar screwups will inevitably occur.
Gawdelpus.
What you describe is not competition nor contestability but poor outsourcing. Poor outsourcing retains the risk (of bad outcomes) with the outsourcing authority.
Using your example, if health were truly contestable, with the money following the patient, then poor hospitals would go out of business, with or without cleaning services.
We don't need state control of food supply (which is still subject to state regulation) why is state control of health provision (as opposed to regulation) such a good idea?
The Public Sector's private agenda makes them inherently wasteful. Squeezing suppliers or always going for the cheapest option won't change that.
Council services are supply driven, not demand led. A shiny new community centre will get the Councillor's face in the paper whether it is used or not.
Reducing waste will not get them in the paper.
Central Government needs to decide which of the many quite pointless and/or expensive taks they mandate Local Government to do can be scrapped.
Its kinda like the Forces problem, only thankfully not life threatening for the staff. More and more action required for less and less money.
The Local authority I work for recently had their new management hire a bunch of expensive consultants to advise them on saving money. The consultation went something like this:-
"That's expensive, can cut expenditure on it?"
"No, its a legal requirement"
"OK that's expensive, can you cut that?"
"No, it would be electoral suicide for the councillors"
"Oh, well what can you cut?"
"Well nothing, anything cuttable has all been cut years ago"
so they then went back to the old favourite of cutting ten percent from all the budgets and hoping nothing went too badly wrong. If they hadn't hired the bloody consultants it could have been 9%...
The Audit Commission is quite good at spotting rubbish councils, but I suspect they are whistling in the wind with this one. Tendering for contracts is riven with corruption up and down the country, with contractors even paying each other bungs to queue in an orderly manner for their turn at the trough of council tax expenditure, and there seems little the councils can do about it.
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