Ambulances are seen at the A&E department of St. Thomas' Hospital in London. Photograph: Getty Images.
Show Hide image

Labour will empower consumers in public as well as private sectors

The state can be made more responsive by giving citizens access to data, impartial advice and control over the services on which they depend.

The old model of politics where progress depended upon centralising the capacity to act - whether in the market or by top down state intervention - no longer works.


 The task of Labour’s Policy Review is help to change politics by devolving more power to people, giving them more control over their lives. That includes reforming how public services work. The traditional silo mentality, where different departments or services jealously guard resources, won’t work. Likewise, concerns about who provides a service - public, voluntary or private - don’t answer the questions around the role of the public themselves in the outcomes achieved.

Little has really changed in our ability to shape services directly around our own circumstances, despite the impact they have on our lives. As Ed Miliband has said, "I get as many people coming to me frustrated by the unresponsive state as the untamed market". Too often, p

atient choice is confined to options made by professionals. Limited access to personal care budgets and a lack of shared decision-making more generally means only a few get the flexibility and freedom to shape their own care.

One of the central themes of Labour’s Policy Review is how best to invest to prevent social problems in order to avoid the costs of failure. We know that reforming public services, and so improving interactions between service users and providers, is crucial to this ambition. 

As 

Ali McGovern, Liz Kendall, Steve Reed and Dan Jarvis have all argued, empowering citizens isn’t about disempowering public sector providers. Good decision-making thrives on early and continual feedback. Yet Which? report that many people don’t complain about poor public services because of fear of reprisal by providers. We can’t allow a situation where vulnerable social care users suffer in silence. Many providers already address this; from Unison’s work with personal care users and their members, or Worcester University, where patients interview applicants to be student nurses or healthcare assistants, and help deliver the training course itself.


Recently the government quietly included the public sector in its Consumer Rights Bill. This gives individuals the right to services performed with reasonable care and skill, at a reasonable price and within a reasonable time. So far the government admit this covers tuition fees, and use of childcare vouchers and personal care budgets. If a service doesn’t meet the required standard, students, parents and patients will be able to request a repeat performance, a price reduction or even a refund.
Those with the loudest voices or largest wallets will make good use of these powers; those without will be further excluded and their voices diminished.Without an alternative inclusive approach, sharp elbows will increasingly be the decisive factor at the sharp end of decisions about provision – with increasing inequality as a result.

Yet that doesn’t mean we should discount individual viewpoints. Instead we need to find ways to expand participation so both personal and collective interests can be heard together. Labour’s focus is on being on the side of every service user, seeking ways to empower all with the resources and confidence they need to act both independently and together if they so choose. To that end, we recognise that knowledge is power. Whether it is patient records, university syllabuses or school performance, we understand the benefits of unlocking access to data. More open flows of information to the public have the capacity to help create better-informed consumers who can then themselves make better-informed choices first time.



But access to data alone is not enough. Too often, those with complex needs or a lack of confidence struggle to sift through the information and make effective decisions. Users who ask for help need someone to answer the call - advocates who aren’t beholden to service providers. These advocates could assist in exercising rights and options for redress when things go wrong. 

In a study in Nottingham, 40 per cent of cases dealt with by advice agencies involved "preventable" failure caused by poor decision making in the public sector. Using advocates to provide advice and so improve how residents accessed services cut the average time taken to resolve cases from 100 days to 23 and then finally to just five. This saved time, money and tempers for all concerned.


This shows how the response users get is as important as their rights to information. We need to work with service providers to welcome user participation, and help create a culture where their expertise doesn't rest on making decisions for people, but working alongside them.
 This government will leave citizens to navigate services alone, leaving those without resources - either money or other skills - to struggle alone.

Labour’s Policy Review is looking at how we reform the public sector by devolving power to people, investing in prevention and incorporating cooperation and collaboration in the co-commissioning and design of services. Our mission is to stand shoulder to shoulder with every consumer - not blunting the efforts of those who already fight for the best services, but instead putting more power at the elbows of the rest for the collective benefit of all.

Stella Creasy is shadow minister for competition and consumer affairs, and MP for Walthamstow

Jon Cruddas is Labour policy review co-ordinator, and MP for Dagenham and Rainham

Getty
Show Hide image

BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.