The public sector has a lot to learn

Getting the hell on with it.

Last week the chancellor, George Osborne, trumpeted agreements with seven government departments on their budgets for the next comprehensive spending review (CSR), which is due to be announced next month.

The CSR will lay out spending for the five years after 2015. In keeping with his commitment to “Plan A”, Osborne is looking for a further £11bn of cuts in government budgets. With health, education and overseas development protected, there will be tough decisions to be made elsewhere. Reaching an agreement with seven departments is a promising start, but these were all relatively low-spending departments with smaller budgets. The agreed savings were reported at £2.5bn. So the really tough decisions still lie ahead.

How these discussion are progressing was signalled by an interview given by defence secretary Philip Hammond on the Today programme. He explained that frank discussions (which can be read to mean arguments) between the Treasury and the MoD have had to be mediated by the Cabinet Office, which has launched an independent review of the department’s spending plans.

The MoD is an interesting case in point. It was severely affected by the last round of cuts with all three armed forces still reeling from the strategic defence review that was as much about cutting costs as it was about better military decision-making. What makes the MoD especially interesting is that it is one of the better organised ministries. Hammond has deployed former experience in business to set the department up in a businesslike fashion.

It is one of the few departments with a board that functions in the way a FTSE 100 board might. Indeed, a scan of the departmental pages of the gov.uk website reveals that of the 24 cabinet departments, only a handful have this kind of properly functioning board. Perhaps strangely, the department for Business Innovation and Skills isn’t one.

A good look at the structure of government in this country, especially compared to other countries, suggests we have too many departments and way too many ministers. The 24 ministries compares to an international average of 15 or 16. The UK’s 120 ministers compares very badly with 78 in India, 66 in Canada and 68 in South Africa.

Even more unusual is the fact that devolution of power to Scotland, Wales and Northern Ireland hasn’t seen a decrease in UK ministers, but rather an increase, so that the actual UK total (including ministers in the devolved regions is closer to 200).

With all these jobs to protect, it’s no surprise that getting all these departments to agree they can afford substantial cuts is a tough job for the Treasury.  

One way to bring all this under control and make the process much simpler is highlighted in a new report published this week by ICAEW. In A CFO at the Cabinet Table? Strengthening UK government finances for the future, Sumita Shah highlights the potential advantages of having someone in the position to take on a “group finance” role across government. While each individual financial team is making a case for their department, the political tug of war between the Treasury and all the other members of cabinet will continue.

As to the tougher question of what long-term impact the focus on public sector cuts is having on the private, new research (also produced by ICAEW) found that 31 per cent of businesses reported their turnover has been negatively affected by UK public sector cuts, this is up from 21 per cent two years ago when the same question was last asked.

Not surprisingly the vast majority of those affected by these cuts have looked elsewhere for business, with 72 per cent of those negatively affected by the public sector cuts looking for new customers outside the public sector. However almost half (49 per cent) have had to cut permanent staff and 41 per cent have reduced their contract or temporary staff.

So the message seems to be clear. The private sector, while fearing the worst, is doing its best to get on with life in the age of austerity. It would help enormously if it was obvious that the public sector (and in particular central government) was doing the same thing by simplifying and rationalising government systems and structures.

Some of the money freed up might be wisely invested by putting in place a strong central government finance function, starting with the appointment of a cabinet CFO.

Treasury. Photograph: Getty Images

Richard Cree is the Editor of Economia.

Photo: Getty Images
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British mental health is in crisis

The headlines about "parity of esteem" between mental and physical health remain just that, warns Benedict Cooper. 

I don’t need to look very far to find the little black marks on this government’s mental health record. Just down the road, in fact. A short bus journey away from my flat in Nottingham is the Queens Medical Centre, once the largest hospital in Europe, now an embattled giant.

Not only has the QMC’s formerly world-renowned dermatology service been reduced to a nub since private provider Circle took over – but that’s for another day – it has lost two whole mental health wards in the past year. Add this to the closure of two more wards on the other side of town at the City Hospital, the closure of the Enright Close rehabilitation centre in Newark, plus two more centres proposed for closure in the imminent future, and you’re left with a city already with half as many inpatient mental health beds as it had a year ago and some very concerned citizens.

Not that Nottingham is alone - anything but. Over 2,100 mental health beds had been closed in England between April 2011 and last summer. Everywhere you go there are wards being shuttered; patients are being forced to travel hundreds of miles to get treatment in wards often well over-capacity, incidents of violence against mental health workers is increasing, police officers are becoming de facto frontline mental health crisis teams, and cuts to community services’ budgets are piling the pressure on sufferers and staff alike.

It’s particularly twisted when you think back to solemn promises from on high to work towards “parity of esteem” for mental health – i.e. that it should be held in equal regard as, say, cancer in terms of seriousness and resources. But that’s becoming one of those useful hollow axioms somehow totally disconnected from reality.

NHS England boss Simon Stevens hails the plan of “injecting purchasing power into mental health services to support the move to parity of esteem”; Jeremy Hunt believes “nothing less than true parity of esteem must be our goal”; and in the House of Commons nearly 18 months ago David Cameron went as far as to say “In terms of whether mental health should have parity of esteem with other forms of health care, yes it should, and we have legislated to make that the case”. 

Odd then, that the president of the British Association of Counselling & Psychotherapy (BACP), Dr Michael Shooter, unveiling a major report, “Psychological therapies and parity of esteem: from commitment to reality” nine months later, should say that the gulf between mental and physical health treatment “must be urgently addressed”.  Could there be some disparity at work, between medical reality and government healthtalk?

One of the rhetorical justifications for closures is the fact that surveys show patients preferring to be treated at home, and that with proper early intervention pressure can be reduced on hospital beds. But with overall bed occupancy rates at their highest ever level and the average occupancy in acute admissions wards at 104 per cent - the RCP’s recommended rate is 85 per cent - somehow these ideas don’t seem as important as straight funding and capacity arguments.

Not to say the home-treatment, early-intervention arguments aren’t valid. Integrated community and hospital care has long been the goal, not least in mental health with its multifarious fragments. Indeed, former senior policy advisor at the Department of Health and founder of the Centre for Applied Research and Evaluation International Foundation (Careif) Dr Albert Persaud tells me as early as 2000 there were policies in place for bringing together the various crisis, home, hospital and community services, but much of that work is now unravelling.

“We were on the right path,” he says. “These are people with complex problems who need complex treatment and there were policies for what this should look like. We were creating a movement in mental health which was going to become as powerful as in cancer. We should be building on that now, not looking at what’s been cut”.

But looking at cuts is an unavoidable fact of life in 2015. After a peak of funding for Child and Adolescent Mental Health Service (CAMHS) in 2010, spending fell in real terms by £50 million in the first three years of the Coalition. And in July this year ITV News and children’s mental health charity YoungMinds revealed a total funding cut of £85 million from trusts’ and local authorities’ mental health budgets for children and teenagers since 2010 - a drop of £35 million last year alone. Is it just me, or given all this, and with 75 per cent of the trusts surveyed revealing they had frozen or cut their mental health budgets between 2013-14 and 2014-15, does Stevens’ talk of purchasing “power” sound like a bit of a sick joke?

Not least when you look at figures uncovered by Labour over the weekend, which show the trend is continuing in all areas of mental health. Responses from 130 CCGs revealed a fall in the average proportion of total budgets allocated to mental health, from 11 per cent last year to 10 per cent in 2015/16. Which might not sound a lot in austerity era Britain, but Dr Persaud says this is a major blow after five years of squeezed budgets. “A change of 1 per cent in mental health is big money,” he says. “We’re into the realms of having less staff and having whole services removed. The more you cut and the longer you cut for, the impact is that it will cost more to reinstate these services”.

Mohsin Khan, trainee psychiatrist and founding member of pressure group NHS Survival, says the disparity in funding is now of critical importance. He says: “As a psychiatrist, I've seen the pressures we face, for instance bed pressures or longer waits for children to be seen in clinic. 92 per cent of people with physical health problems receive the care they need - compared to only 36 per cent of those with mental health problems. Yet there are more people with mental health problems than with heart problems”.

The funding picture in NHS trusts is alarming enough. But it sits in yet a wider context: the drastic belt-tightening local authorities and by extension, community mental health services have endured and will continue to endure. And this certainly cannot be ignored: in its interim report this July, the Commission on acute adult psychiatric care in England cited cuts to community services and discharge delays as the number one debilitating factor in finding beds for mental health patients.

And last but not least, there’s the role of the DWP. First there’s what the Wellcome Trust describes as “humiliating and pointless” - and I’ll add, draconian - psychological conditioning on jobseekers, championed by Iain Duncan Smith, which Wellcome Trusts says far from helping people back to work in fact perpetuate “notions of psychological failure”. Not only have vulnerable people been humiliated into proving their mental health conditions in order to draw benefits, figures released earlier in the year, featured in a Radio 4 File on Four special, show that in the first quarter of 2014 out of 15,955 people sanctioned by the DWP, 9,851 had mental health problems – more than 100 a day. And the mental distress attached to the latest proposals - for a woman who has been raped to then potentially have to prove it at a Jobcentre - is almost too sinister to contemplate.

Precarious times to be mentally ill. I found a post on care feedback site Patient Opinion when I was researching this article, by the daughter of a man being moved on from a Mental Health Services for Older People (MHSOP) centre set for closure, who had no idea what was happening next. Under the ‘Initial feelings’ section she had clicked ‘angry, anxious, disappointed, isolated, let down and worried’. The usual reasons were given for the confusion. “Patients and carers tell us that they would prefer to stay at home rather than come into hospital”, the responder said at one point. After four months of this it fizzled out and the daughter, presumably, gave up. But her final post said it all.

“There is no future for my dad just a slow decline before our eyes. We are without doubt powerless – there is no closure just grief”.

Benedict Cooper is a freelance journalist who covers medical politics and the NHS. He tweets @Ben_JS_Cooper.