My mission statement

The times we are working in now need a great deal of accelerated change and there must be no negotiating that down. So my mission statement for this part of my consultancy career is to be clear that there needs to be and will be a lot of change from the work that I do with individuals and organisations and if organisations don’t want that, then it is probably best to go somewhere else.

Read my statement in full »

The Big Society and the Political Left.

Filed Under (Big Society, Culture of the NHS, Trades Unions) by Paul on 08-11-2010

The coalition government want to paint their picture of the Big Society as an idea which is an attack upon the left wing of politics. They would like to pretend that ‘civil society’ is their idea and ‘the state’ is the left’s and that that is the way in which they define political difference between the left and the right. In the current social and political context if the left were to fall for that political bifurcation they would be out of electoral power for several generations.

I want to use this blog to demonstrate that there has been, and will always be, a strong strain of left wing politics that is favour of civil society as one of its main organising principles and works practically to make civil society – and not the state – stronger.

The nature of the state in British society has long been a significant issue for the left in the UK. A strong debate has taken place for the last 120 years and will continue to have an impact on the Labour Party into the future

Interestingly in the last 10 years this political debate has had an impact on Labour’s policy towards the NHS and will I am sure continue do so.

One of the little known but obvious factors that played a role in politics throughout the 20th century was the rather obvious point that the Labour Movement, including  the Labour Party, trades unions and the Co-operative movement were all, and continue to be, voluntary organisations. Keeping the trades union movement as a set of voluntary organisations was a consistent argument from the trades unions. The separation of the trade union movement from the state was one of the main battles that the trades unions fought in the late 1960s and early 1970s when first Barbara Castle and then Edward  Heath tried to make them state organisations.

Members of trades unions and the left fought very hard for the independence of trades unions and for the fact that they should be financially based upon the resources that they get coming from their members’ subscriptions  – and not from the state.

The importance of this independence goes back a very long way. In the 19th century and earlier, working people wanted to create and develop their own institutions. For as long as they were a part of organisations that had been created for them by others they felt they would not learn the skills of self organisation. Generations of working people learnt to organise and develop themselves by taking roles in these organisations. Many learnt literacy and numeracy by running a trade union branch and not in the formality of the classroom. When they became shop stewards or chairs of branches they were ‘lay members’ running the organisations and were responsible for staff, money and making sure good records were kept of their organisation. For generations, up until the 1960s, working people learnt to run organisations not by taking MBAs but by running parts of these civil society organisations.

Within the Labour Movement there had been a very strong self organisation policy which did not only organise itself at work but also organised its own retail trade. The creation of the Co-op movement developed a part of the retail industry that working people could trust – because they ran it themselves. This went beyond shopping – to other services, including finance. In South Wales Nye Bevan worked with the miners’ unions to develop their own health services to help the sick and injured at work. This was mirrored in other parts of the country.

The Second World War gave impetus to a powerful counter argument in favour of the state as the organisation that would improve the lives of ordinary people.  As much as we might want to romanticise the impact of the home guard on the organisation of the war, the war had been won by a compact between a powerful state and the people. Fascism was defeated by an army which was organised through the state. Civilian life was maintained by the state.  Food was distributed through rationing by the state. The state organised the people and we won the war.

The post war Labour Government based its policies on the powerful and successful state. If you wanted to tackle Beveridge’s 5 big giants that were stalking the country (Idleness, Ignorance, Want, Squalor and Disease) you needed big powerful forces to defeat them. The state having won the war was the obvious organising force for welfare and for the economy.

It was in this political period that the NHS was created as a state funded and organised institution. The state nationalised the patchwork of voluntary municipal and voluntary hospitals. It is worth recognising that no one at that time felt that the “big society” would be big enough to organise health care. The state was agreed to be the vehicle for its payment and organisation.

At the time there was however some debate within the Cabinet and the country not only about the nature of the state in health services but also with regard to wider economic and social policy. The Atlee Cabinet had a debate not only about the accountability of the NHS to the central state, but also the state’s role in nationalisation. One part of the Labour Movement felt that central ownership and control was integral to public ownership, but another argued for a much stronger mutual ownership with direct workers’ control over industries.

In the early 1950s Nye Bevan felt that he had underplayed the role of local government in his plans for the NHS.

Mutual ownership had a strong history in the Labour movement and would have maintained local control of organisations but without the financial pressure on institutions to maximise the interests of shareholders. However those arguing for a model of mutual ownership lost the argument and the model of ownership that evolved based power in Whitehall

For the NHS this meant that the nation’s new NHS hospitals were owned by the Secretary of State for Health in Whitehall. For much of the next 50 years – despite Nye Bevans personal rethink in the 1950s – it was the state owned model of health care that dominated the way in which all political parties thought about the NHS.

This changed when the debate about Foundation Trusts started in 2002 and has continued ever since.

Those who argued for Foundation Trusts believed that you could have a form of public ownership that did not involve Whitehall ownership. But for others this was impossible. Public ownership had come to mean state ownership. Therefore those who believed in a different form of public ownership believed in something that was not possible.  For those people any non state ownership had to, by definition, be private ownership. This simple bifurcation State = public ownership and anything  else is private, fails to give any credibility to the possibility that there could be different forms of public ownership just as there could be different forms of private ownership.

During the passage of the Bill creating Foundation Trusts this very powerful argument took place. The argument that had been a major part of the political argument within the left for over 100 years had come to the NHS. Those who believed in a new form of publicly owned hospital had to argue strongly that such an organisation could be created. The assets had to be guaranteed to be maintained within the public sector. Therefore the Board of the FT would not be able to sell them into the private sector.

For those arguing for FTs the role of membership was an important part of the governance of the new publicly owned form of hospital. For others this was irrelevant since the state had to be the owner.

Sections of the left still see Foundation Trusts as a form of private and not public ownership. But others have come to recognise how new forms of public ownership can be separated from the state but still be securely publicly owned.

Both the Conservative Party and the Liberal Democrat party opposed the creation of Foundation Trusts in Parliament, but are now searching for other forms of public ownership as a part of their view of the Big Society.

But let’s not forget that it was the politics of self organisation as a form of public ownership within the Labour Party that created Foundation Trusts and did so as part of a long term belief within the left that self organisation creates a better culture than that which results from being run by the state.


2 Responses to “The Big Society and the Political Left.”

  1. Hi Paul,

    Long time no speak! Hope you are well…

    I liked this article – it brought back a few memories. Take a look at our latest effort on the Post Office, on our website. Same issues!



  2. An enjoyable historical summary, Paul, but let’s get down to the political reality of FTs and the Big Society.

    FTs are a fundamental part of the healthcare marketplace that you helped to design. You and Bill Moyes described the main way FTs could benefit the NHS in your paper “Future Foundations” for the Right Wing thinktank, Policy Exchange.
    In this paper you describe 5 main ways to change NHS culture:

    1. Developing real competition between FTs and any other willing providers.
    2. Developing a pricing framework that drives change
    3. FTs using their autonomy e.g mergers and managing other weaker trusts
    4. Making the NHS an Industy rather than an organisation or system
    5. Power to the payors i.e commissioners

    It is interesting that the 5 main drivers you point to above are all part of current Tory policy. Your point about Foundations Trusts remaining public entities rings hollow in the context of them becoming Social Enterprises, which takes them off the public sector borrowing sheet.
    In addition, competition between providers will lead to Schumpeter’s “creative destruction” of the NHS. Many FTs will be driven out of business. In fact quite a few NHS Trusts will not even make FTs let alone Social Enterprises. The private sector will take on some of this work. It will also take on much of the management of “failing” hospitals since we have already witnessed a lack of desire for FTs to take over other Trusts (e.g Hitchingbrook).
    The “best practice” tariff system and price competition will accelerate FT closures and mergers. In addition, FTs will need to increase their income by taking advantage of the abolition of the private practice cap. This will be aided by the increased public uptake of health insurance caused by the funding gap and rationing of care by GP Consortia under financial pressure from the NHS Commissioning board and Monitor. The abolition of waiting list targets could fuel this process. GP Consortia will also be placed under severe financial pressure by “national health tourism” as patients cross practice boundaries to get access to commissioning funds. Finally public money will be handed to FESC companies and their shareholders. The White Paper is a roadmap to privatisation of our health service. A lot of your own ideology is in this proposed legislation. How do you plead?

    As for the “The Big Society”, it is consistent with the neoliberal agenda because it is about the utilisation of Social Capital. The use of voluntary workers reduces the need for paid workers and their associated pension demands. This reduces public expenditure, allowing lower taxation and is also anti-inflationary as wages are not paid. It’s about keeping the international bond markets happy in our globalised economy. Unfortunately, it will lead to deskilling of the younger generation who can’t live doing voluntary work or on charity work wages, whilst many fit retired people will do the jobs instead. This is no way to run a fair society.

    The same neoliberal ideology and principles also underpin the idea of Social Enterprises. This is also about reducing the taxation and pension burdens, with wage control to help keep inflation down.
    This is how it works: SEs will come off the public sector borrowing sheets. New staff will not be protected by TUPE legislation and lose national T+Cs including NHS pensions. The best practice tariff will lead to FTs/SEs racing to the bottom on cost. Service Line Managers will use the cheapest possible staff to deliver the service. Failing SEs will need to merge creating further job losses. NHS workers who lose their jobs may well end up in the private sector instead.

    So much for your idea that FTs are still public institutions. The NHS will be gradually privatised over the next several years. This is a scandal and the public have no idea about it. In fact my own profession have little idea.

    Finally Paul, a couple of economics questions:
    1. Where is the sense in transferring UK taxpayers money to US and other foreign healthcare corporations, when our own economy is in dire straits?
    2. What is the evidence to support commissioning between primary and secondary care? In my opinion it is doomed to fail because GPs are specialists in primary care, not secondary care. There is too much information asymmetry and results in a complex contractual mess. It will never work.

    Best wishes,

Leave a Reply