Is the Government 'playing at it' with public service mutuals?

This week the Labour MP for Rochdale, Simon Danczuk, launched a full-frontal on Cabinet Secretary Francis Maude, telling him that the Government is ‘just playing at it’ when it comes to Mutuals in public services.

Maude’s reply, interestingly, was not a counter-blast but rather a concession that we are still in the ‘foothills’ of this initiative.

Is Maude, in effect, agreeing with Danczuk – or rather simply conceding that this agenda is inherently a longer-burn than first anticipated.

Speaking as someone working quite closely with the Cabinet Office on this, I think it is a bit strong to say the Government is playing at this agenda.  Over the last year a strong civil service team has been pulled together under credible leadership.  This has been supported by an excellent Taskforce and soon, I hear, a team of well-placed ‘Mutuals Ambassadors’.  Funding too is now coming on stream and something that looks like a Programme around this agenda is now in place.  This is a far cry from a year ago when, arguably, the Government had a less coherent approach.  If they were ‘playing at it’ then, it certainly doesn’t feel that way now.

But there is a larger question behind Simon Danczuk’s remarks that does merit some attention.  Where he is perhaps more on the money is around the politics of public service reform.  When it got in, the Government appeared wedded to an idea of public service reform that saw alternative forms of delivery as front-and-central.  Mutuals appeared, alongside localism and Big Society, as a vital part of the grand-narrative of public service reform.

Two years in, the Government’s overall approach on public service reform has not turned out to be quite so coherent.  Having rowed back on certain earlier ideas and, in particular on the Big Society concept, the overall story being told on public services is one which, while lionising the voluntary and social enterprises sectors, also appears, to many, to be pushing far harder than previously to a bigger role for large private firms.   While it is by no means impossible to push for more diversity of provision in all it’s forms, the tone, tenor and now track record of the Government appears to be one that de-emphasises Mutuals and other ‘alternative’ vehicles and puts more weight on the role of big business.

The net effect of this, when you are stood in front of a bunch of staff in Norwich or Salford trying to sell the idea of a public service mutual is that people wonder, understandably, whether there is any real political backing for this from Whitehall or whether this is just ‘window dressing’ or ‘privatisation by the back door’ -  a few years of a mutual followed by the capture of its contract by powerful firms that are better at bids and can afford to offer early savings to cash-strapped public bodies.

A firmer line on Mutuals: ‘This is an approach we stand behind as government’, would give assurance to people who might be putting their jobs and services on the line and show that the Right Honourable Mr Danczuk that this Government is certainly not ‘playing at it’ when it comes to public sector mutuals.

Where is the mutuals agenda NOW?

So where is the mutuals agenda today?   Last week I heard a trio of speakers, each offering a perspective, among them historian Charlie Cattell, Ian Hasdell of the Employee Ownership Association and Lance Gardner of Care Plus.

The over-riding sentiment was that while the world was waking up to the potential of public sector mutuals, this was still a minority sport, practiced by early adopters.  While the benefits were manifest and proven, the feeling among practitioners is that of Humphrey Bogarde that we are at least 'three drinks ahead' of the rest of the public sector.

The barriers are not so much technical and legal but cultural.   There is a problem of 'Blockers' in the public sector - middle-ranking gatekeepers who sit in front of bottom up initiatives.  There is also the mindset of many senior teams in local government who, faced by a financial meltdown, do not think beyond slash and burn or simple outsourcing.  Finally, there is a confidence problem, trying to get organisations steeped in conservatism to try an approach that isn't yet the norm, even though the evidence is getting stronger every month.

The invitation to our local government audience was threefold.  The first was to divest themselves of ideology when looking at public service models.  Mutuals need to be judged on their merits, not through a political lens of state versus private.   The second was to 'Beat the Blockers' - show zero-tolerance to those who suffocate initiative and appeal to staff over the heads of such people, as has worked so effectively in particular councils like Suffolk.  The third was to move mutuals to the centre of strategy, not keep it for one or two person schemes at the edges of discretionary services.   The change augered by public sector mutuals merits being put front-and-centre of local government strategy.

Will mutuals enjoy continued support from the centre or go the same way as the Green agenda, hug-a-hoodie and Big Society?   With Maude staying, we appear to be still on the map.  This may change as time goes on but we still have funding at support from the top levels in the form of a strengthened Mutuals Support Unit.   Where mutuals will fit into the Government's public services narrative here on in is anybody's guess, but one thing is for sure that this agenda will, due the the structural challenges in public services ahead, not simply go away.

Why Anna Soubry is Right about assisted suicide

Today, Tory health Minister Anna Soubry is all over the papers for coming out in favour of assisted suicide.

At last, I found myself shouting as I unfolded the Times from my mailbox.   Soubry, though a Tory, is refreshingly candid and extremely realistic about this matter.

Indeed I am totally confident that by the time I am in my 80s (should I get there) it will be totally normal to end one's own life early in the event of terminal illness.

Personally, I know I will do this, without any doubt at all.   Three reasons. Firstly, I am very bad indeed at being ill.  I get very depressed, very difficult to deal with and have a very low pain threshold.  Secondly, I don't want to cost my family and the state ridiculous amounts of money keeping me alive for an extra year or two during my inevitable decline.  Thirdly, I want to 'check out' in my own way and my own time.

Of course I do see why people hang on to the bitter end.  They want just one more day, week, month with loved-ones - or they hold on to some hope that the end may not be nigh.  Others think of dying in a similar way to child-birth, a natural experience which is, in some way, essential if one is to be in touch with one's humanity.

My own experience is different.  My own grandmother died 8 years after a terrible stroke that left her like a baby, unable to communicate or help herself.    She would have wanted to go had she any notion at all of her condition, which she hadn't.   It broke my heart to see her having to live a life she wouldn't have wished on her worst enemy.

Some people - religious people invariably - will argue that following her stroke, my grandmother became, in a sense, a different person and that we perhaps shouldn't judge her final years by the critera that she would have done as a fit woman.   Again, sorry I don't buy that.  Just because she couldn't make a decision post-stroke wouldn't make it wrong to see her will made while compus-mentis realised by assisted suicide.

I say this with a lot of pain, but I would have administered that ending for her, had this been legal and she had signed to say that was her will.   I would have felt no guilt, just relief that I had been able to do one last thing that she would have wanted.

Has the Big Issue had its day?

Before I say a single word more I want to put on record my praise for all of those involved in founding and growing the Big Issue:  John Bird, Gordon Roddick, Nigel Kershaw - legends all.  Without these people, the cause of social enterprise would be five, maybe ten years behind where it is today.

But, cutting to my chase, who actually buys the Big Issue any more?  I know that I have moved from avid buyer to occasional one over the years.   When I read it, the magazine's editorial content is often well below what you would expect.   The sellers somehow give off a feel that the day's up and I just don't think the public now buy into the idea that the Big Issue is getting people off the streets.

I know very little about how the Big Issue is now run, how many it sells or what plans its producers have for the magazine in the future.   All that I sense looking at it, seeing the people selling it and observing the occasional people buying it is that it is a shadow of what it once was.

I feel like I am stepping on a holy shround even by saying this, but not even the Big Issue - that fine foundation-stone of social enterprise should be beyond the obvious question:  Do you still matter?

Is it better not to go to University?

Like a lot of people in my generation, I went to university at a time when it was seen as being, without any doubt, the right path for any bright young person.  For me personally, I was the classic first in my family to go into Higher Education, and university was, quite literally, a passport to a new world of people, ideas and experiences which I would not possibly have encountered had I stayed in my town in the North-West and joined a firm after leaving school.

So when people champion not going to university, I am usually the first to suggest they think again.  But, as time has passed, I have reconsidered the value of university, at least to all people.  I am not alone!  American billionaire Peter Thiel has set aside $100k for 20 students under 20 years of age who promise NOT to go to university but instead set up businesses.   He believes that university is of no real value to many young people and think that their education and development would be better served by capitalising them early  in life as entrepreneurs.

When I think about my own kids, I am definitely not going to foist university upon them.   Indeed I am going to tell them, at 18, that they have a choice: I pay their fees or I invest in their new business.   I would love my kids to be entrepreneurs as I too have found that this teaches you both practical skills, resilience and allows you to learn about other people and your own character.     I think entrepreneurship is incredibly under-valued in our country in favour of professions most people in them privately crave to escape from and stick with purely for the money.  

When I think about myself, I actually think university was the right track.  I needed the adrenaline-rush of ideas, bright people and new environment that swept me out of a very monochrome world.  But I see Thiel's point and sympathise with his programme.  Enterprise is perhaps the best form of Higher Education yet invented.

Why we need a National Talent Programme

The other week I watched a depressing programme about the riots of 2011.  Told from the 'rioters' perspective, it opened up the 'mental map' of the inner city poor very effectively.   In a diamond-shaped society, these people sit in the point at the bottom.    And if you happen to be born into this part of the diamond, you will probably have experienced shit parenting, a shit school and, if you ever get one, a shit job.  If you have kids, their lives will probably wind up the same.

So far so well-known already.  What we don't know is how we deal with this as a society.   Secretly, most politicians see this problem as un-solvable - the by-product of wider forces beyond anyone's control.  All the focus goes on how this underclass group is prevented from impinging too much on the lives of everyone else.

I too have no answers to the immediate problem.  We have a big, long term challenge here that won't go away easily.   What I do believe, however, is that we have to create escape-routes for people.   Fifty years ago, when British society resembled not a diamond but a pyramid, the escape route from a pre-determined life at the bottom was Grammer school.  Or it's religious equivalent.   Millions of bright kids from very working class backgrounds found a way to something else this way.  We all know someone whose life-path was altered this way   Of course, the system for those left behind wasn't good enough, but what we did achieve, in a way we haven't managed since, is an effective way to help people move to other places in our society.

So do we open lots of new Grammers?   No, we shouldn't.  The shape of British society today means that the life-chances of everyone bar those at the bottom of the diamond are reasonably well-served.  Social mobility is possible, as long as you're not at the very bottom.   Therefore what we need instead is a system of selecting people with talent - academic, creative, technical, entrepreneurial - from the rougher end of our society.

As we know, one size will not fit all.   Some kids should simply get free passes to public schools - like they used to before that scheme was abolished.   Others should be placed in elite state schools near where they live and given 1-1 coaching based on getting them to university.    Creative types should be fast-tracked to St Martin's or whichever is the top place for their particular talent.   Our top firms should be be on board, offering elite apprenticeships for the very best.  We don't need lots of new institutions, just a good system for identifying and tracking talented youngsters who start on the wrong side of the tracks.

A key part of this is mentoring.   A friend of mine has mentored a young boy from a rough part of London for several years and he is now about to go to study medicine.  This is a boy from a single parent family who lives in an area riven by gang culture.   This relationship with a high-performing mentor who has put in the time, over many years, has been key to this lad's eventual flowering. A national programme that couples this with easy-access to the elite institutions and firms in this country will, I believe be an important step forward.   Just the fact that it is there, that people know about it and know that, if they are any good and work hard, they can find a way out, will be a huge fillip to people who currently know, deep-down, there isn't really a way out.

Is this a real solution, given the numbers involved?   A 'National Talent Programme' could seek to target tens of thousands of our most talented kids from disadvantaged backgrounds.   Look what happens on programmes like X-factor when you put an opportunity there, however fragile.   People flock to it.   It fuels hope and allows the most capable to be seen.   I am not saying you need Simon Cowell or a studio full of neon lights, but we do need something for those who, otherwise, will not be seen and their talents never contribute to our society.

Why we need a Business Plan for Britain

When there is a war, the parties in this country quickly find it in themselves to unite, quite rightly, behind our national interest.   But the long-term success of 'UKplc' is still, sadly, a game of political football. 

Of course, this is bound to be the case.  The economics of a country is bound up with political questions of public vs private, tax vs spend and the distribution of income across classes and regions.  But other countries manage to have long-term economic strategies - so why, in reality, shouldn't we? 

So what's in a Business Plan for Britain?   As the Olympics showed, this is still a great nation.  We use the global language.  We sit bang in the middle of world-time zones.   Culturally we are incredibly influential - our 'soft-power' is still high.   We are a creative nation with great innovators and excellent 'batch' specialist manufacturing.   We are outward-looking and, in London, have what is still one of  the world's top three cities.  Finally, we have world-class universities, research and, despite recent problems, a world-leading financial services sector.   Overall, the quality of life here is good and there are fewer safer, freer or more civilised places to invest, live or set up in business.

Of course, we have massive problems too:  Large parts of our country are in permanent recession.   Millions of our people are under-educated and economically behind their peers in Europe and beyond.  There seems to be a structural problem in getting our young people into high quality jobs.  Our economy and political system have been shown wanting in recent years.   Our ability to create a proper environment for genuine wealth-creation has been exposed by the recent recession which, now, looks to be in for the long-term.    Compared to our better neighbours, the Germans, we look like a nation of accountants and lawyers more than a nation of entrepreneurs and 'makers'.  Finally, our public sector remains unreformed.   It continues much as ever in a twilight world of low-productivity, monopoly and incremental change, often entirely unconnected with the digital age and the needs of its citizens.

So, what do we do?   Essentially, it needs to be a combine the supply-side measures being proposed by the Tories with some of the more interventionist ideas of the centre and left.   At the moment, the debate polarises into one of 'small state/deregulated market versus big state, / heavy state intervention'.   Few people seem to consider that we need elements from both approaches.  Here are just five from both sides which I think are vital: 

From the right we need to adopt the following:

1.  Employment law reform.  This is an unaffordable sham and there needs to be reform of employment law that makes it easier to remove unsuitable people from their jobs.   It should also take 2 years to acquire ANY employment rights.

2.  Planning law reform.   While it is important that we protect green-space we have to accept and plan for development and growth.   New towns, such as Cambourne in Cambridgeshire, represent the way forward.  This allows historic towns, such as Cambridge, to remain within their current footprint and for them to be sustainable from a transport and quality of life perspective.

3.  Lower taxes for SMEs.   Small and medium sized businesses are the engine of the UK economy and should be taxed less than they are now.   Firms operating in deprived areas should pay very little tax at all in order to incentivise them to invest there.  

4. .    No NI for SMEs on any new hire for the first two years of employment.   This will incentivise job-creation in smaller firms.

5.  Market-reform of the public sector.   This means the end of national pay settlements, the dissolution of union-power in the public sector as was done in private sector and the creation of a plurality of providers in most public service markets - including health-care, education and most public services outside the armed forces - all under close regulatory supervision to protect the public interest.

From the 'left' we need to do the following:

1.  Set up a bank specifically aimed at 'real economy business'.   We all know of decent businesses that are going to the wall because of cashflow difficulties and disinterested banks.   We need a German-style banking system and a big new bank that operates in the way the German banks do to support the 'Mittelstrand'.

2.  Pick winners.   This doesn't mean the state owning car-firms or coal mines - it means that we acknowledge our broad strengths internationally - creative industries, specialist engineering, aerospace, higher education, research - and we make massive amounts of capital available to these sectors through state-backed angel and early investment funds.

3.  Big infrastructure spending.  This will add to deficit and debt but the country's infrastructure is in dire need and so is the short-term economy.   Reviving Building Schools for the Future, New Towns widening the A14 & A11, improving the rail network, sorting out Heathrow (not necessarily a new runway, just a better airport) - all these are strategically vital projects.

4.   Anti-trust legislation, US style.   There is now popular recognition of 'bad capitalism' and 'good capitalism' and those elements that have created a financially-oriented economy - rather than a balanced economy - need to be brought to order.     We must also unearned wealth.   Most people accept the logic of this.  This is widely defined and differentiates genuine wealth-creators & entrepreneurs from the rest.  

5.  Regional policy.  London and the South-East are outpacing the rest of the UK.   We need to decentralise powers to the cities and counties outside of the South East so that they can make their own way in the world.   It should be essentially free for foreign companies to invest in the North and Midlands.    Companies relocating to the regions should be rewarded by paying little tax or NI for the first ten years of their operations.  

Of course, these are only headlines.  But, at the moment, one set of approaches is put forward in opposition to the other.  The truth is we need both.   To get out of the position we are in, we all must pay the price - including the poor and including the wealthy.   The public sector has to work within lower limits of national wealth and there has to be a sense of national unity about what we're doing.   

Any politician who can pull this together deserves to win, whichever his or her party. 

Why I may not stand again for election

It was just after midday on a sunny Friday in May, 2009.  To my slight surprise, I had been elected as Lib Dem Councillor for Hardwick Division, the well-to-do southern part of Bury St Edmunds near to where I now live.   I had won about 36% of the vote.   Normally Hardwick was, like the town, solid Tory territory but a hard work on the doorsteps, a Tory opponent who never turned up and a renegade ex-Tory independent all translated into a narrow win on the day.

At the time, I was thinking quite seriously, I realise now, about politics as a career.  All of my life people had asked me if I was going to run for Parliament, that I would be good at it.   My experience on the doorsteps seemed to confirm this.   People responded to me, I enjoyed the feeling of it all.   The timing was also good: I had finished off as CEO of Speaking Up (now VoiceAbility) and a new chapter lay ahead, unwritten.  I was about to turn 40, it was all wide-open.

Then a few things happened.   Firstly, I got a taste of real-life politics in Suffolk County Council.   To my disappointment, the Council, or rather the elected part of it, wasn't an easy place for me to fit into.   It felt deeply 'male, pale and stale' and I just couldn't warm to many of the people I came to meet.  This changed, as time went on, but the overall dynamic of the place I found very unproductive, jeering and unnecessarily un-cordial.   

I also realised, very quickly, that in Councils only a few people actually matter.  These are the senior officers - the CEO and her immediate team, and the top three or four politicians in the ruling group.   This is simply how it is in politics.  I now realised why most MPs, and if Chris Mullin is to be believed, most Ministers, feel fairly insignificant.   The thought of Westminster, even if offered on a plate - which it never would be, especially as a Liberal - suddenly seemed less appealing.   When a scintilla of a chance did arise - to compete for what is now  30 year old academic Julian Huppert's Cambridge seat - I passed. 

A final aspect of real-life politics that hit me hard was just how utterly boring and irrelevent most of what is discussed is to the lives of most people, businesses or communities.   Councils do not, sadly, spend a great deal of time on the big questions, even where Suffolk is concerned.  Debate is limited, normally, to platitudinous sloganeering about the place, not its genuine challenges and choices.  This has improved a bit under a new leader, who has raised the intellectual ante a bit, but on the whole, the Council is not on the page when it comes to leading the county to a successful long-term future.

The second thing that happened was that, as a Councillor, I tried very hard indeed to get a few things done.   Now, anyone who knows me is aware that, as these things go, I have a decent track-record for getting stuff done.   I can normally move the dial.   Not here I couldn't.   My first challenge was getting a white line put outside a woman's house - she had a disability and didn't want folks parking there.  Eight months.   My second was getting some road-humps put in on a road where speeding was a big problem.  36 months.  A decision to designate a piece of spare land as a village-green, to discourage developers.  12 months.  Putting parking restrictions outside a busy hospital that is charging people £15 to park while visiting relatives.  36 months.   And so on.   Everything I did seemed to have to involve too many people, all working too slowly and, in the end, the decision seeming to rest in the hands of one o....f the four people who matter.   Time - the one thing that, for all humans is the same, seems to be the one thing, as a Councillor, you need not to care about.   And, of course, being one of the least patient people ever, I care more-than-a-lot about time.

The third thing that has happened - and this is perhaps the biggest contributor to my present thinking, is that I started a business that has quickly grown.   Growing a business is perhaps as far as it gets from the work of a Councillor.  It's very fast-paced, you see results quickly and you're not buggering about trying to get people to do things at your speed.   There's a sense of movement and, if you need to feel you matter, you get that too.   Growing a business again felt like a sort of homecoming.   I have seen more of my kids than I had before.  It has also had a very positive effect on my finances too, better, it has to be said, than the tight-ship that being an MP is these days once the rail fares and raffle-tickets have been paid for.    I also realised that starting a business at 40, and just out of a full-time CEO role in social enterprise would be a lot easier than doing it at 45 having lost a seat at Westminster.  

Now that my business is two years old I am, frankly, struggling to balance it with the demands of being a local Councillor.  During my first two years, I was probably one of the better Councillors.  I was visible, active and engaged.   During the last year my contribution has weakened.   Not for a key role I play on one of the council's owned-companies, I would not be comfortable with the value-for-money I am providing.  So it's time now to make a decision.

I am sure you can see where all this is going:  I no longer wish to be an MP,  I can see no way of leading a council and, anyway, I am better at many other things than politics.    Although this hasn't been a failure for me, neither has it been a a success.    What is has taught me is that you learn a lot, probably more, about yourself when something doesn't go as you might imagine.   

So what's my advice for anyone thinking of becoming a Councillor?    My simple advice is to do it.  Whether you like it or not, you will get a lot out of it.    Be prepared: it will suck up unlimited amounts of your time and you will be shocked at how little you achieve, however highly you rate your personal effectiveness.  But you will see how things work, you'll get a chance to make relationships across a wide field and, whether you stand again or not, you'll come, like me, to have no regrets.

Learning from the Sharks

The other night I went to a business school event aimed at entrepreneurs from SME (small and medium-sized enterprises) seeking to grow their businesses.  It was, if I am honest, a bit of a wake-up.  These boys (and they were nearly all boys) were hungry hunters.   Their focus both impressed me and left me feeling a bit wet in comparison.  Had I had the balls to mention 'blended return' or, worse, giving away part of my company to my staff, a hundred dead eyes would have turned on me in contemptuous disdain.   'No distractions' was the mantra coming from the front.   Don't waste time on multiple goals or equity carving - it will just distract you from the big prize.

The message was clear:  if you don't have one big goal and focus exclusively on it, you are fucked as a business.  Period.  Social enterprise would, had I mentioned it, be viewed as water-muddying.   Focus on profit, they would say, and give some away after if you feel guilty about it.

Interestingly, I was contacted this week by the group of Social Enterprise Ambassadors (remember them) of which I was one.   A reunion is being mooted.   The contrast between this group of likeable, driven and diverse people and the straight-faced biz-types could not be greater.   And I could not be in any doubt about where I would fit in with most or have the better evening with.   However, from a pure learning perspective, I suspect the biz people would at least match or even best my pals from social enterprise.  

I guess you learn most from people who are different from you.  When in the wacky world of social enterprise I see myself at the 'business' end of the equation.  I make money, I try to do good as I am doing it.  I don't like hippy-shit (to borrow Tim Smit's phrase) and I don't see Social Enterprise as Socialism-By-Other-Means.   I sit at the other end of the scale from the very good people running Community Shops, micro-enterprise units for recovering crack addicts or any of the stuff that has business as part of it - but isn't really business.  

However, put in a room where the testosterone is peeling off the wallpaper and competition oozes from a million pores, I feel very much at the softer end of business.  Here people tell me to take my 'dogs out and shoot them' if they (referring to my employees) are not delivering value to the business.  And never, ever, give the company away - just pay people bonuses - ownership is everything etc.   OK, that's as extreme as it got, and people mean well and, to be honest, not all of them were as bright as they thought they were, but, heck, my evening with the biz-guys contained as much learning as half a year of soc ent events put together.

Beecroft was Right

I say this both as an entrepreneur and a Liberal Democrat.  Vince Cable has been right about many things, not least Murdoch and the banks.  But on Beecroft he is wrong.  

To recap, Beecroft wanted to make it easier to release people who aren't working out as good employees. At the moment, it very hard for businesses to move people on who aren't quite up the job.  The law is OK - just - for moving on people who are absolutely terrible, but it isn't a lot of good in situations where things just aren't going as well as they need to - for example, where people are just about getting by - but things are not working out as you hoped.  

Tough on you, I hear some readers say. How about helping that person reach the mark?  Training?  Patience etc?  Believe me, most people in business will do all of the above before taking away someone's livelihood.  Particularly in small business where everything is face-to-face.    

What we need - which we don't have now is the right to make a unilateral decision - without fear of legal challenge - that this person isn't delivering value to our business and they need to go.  With requisite compensation, of course.   What happens instead is that you can say you're not happy but, in order to avoid a legal challenge, you have to give people all sorts of targets and supports to hit those, even when you're sure, in your heart, this isn't going to work out.    

I have been here lots of times in my previous role in a larger organisation.  With 250 employees, about ten percent are normally underpeforming.  To have that many people in 'special measures' is expensive and takes up all of managers' and HR departments' time.   It would be far better, with nearly all those people, to be able to have a grown up conversation that enables a quick, mutually dignified departure.

Will this, as Cable fears, create mass insecurity in an already anxious workforce?  I am sure that 90% of people realise that they have nothing to fear from such changes in rules.  Those that will be most scared will be the 10% who need to be.  Indeed it may, in some cases, be the prompt they need to address some of their issue.  

I realise this a very different view to that of most people who don't see themselves as on the Tory Right.  But talk to anyone who manages people or runs an organisation and you'll hear a lot of agreement.   

One's own view comes down in part to whether you believe that people in the UK, and Europe more widely, are over-protected and insufficiently flexible at work than they need to be in the current world economic situation.   

Personally, when I look at how people and companies in other continents work, I see us as asleep at the wheel, living on borrowed time before we get 'found out' and thrown in far greater hardship than we would if acted now and took the wise advise of Adrian Beecroft onto the statute book.

Guest Blog from Rob Fountain - 'My Dad is Worried About Me...."

My dad is worried about me. 

He’s a pro-State socialist.  A labour man; ex-trade union rep and proud believer in welfare, in the responsibility of government to provide a safety net – to look after the many, not the few.

He’s listened to me talk about Stepping Out, about what we’re trying to support in terms of a shift in public service delivery and he’s worried.  Worried that I’ve been turned, that I’m in league with those looking to commercialise social and health services, that I’m helping to dismantle the welfare state.

I hear – and feel – similar suspicions when I’ve spoken with union representatives in areas exploring the options of social enterprise spin-outs for health or social care services. 

The anxiety is understandable.  I had it too when I first heard about the spin out agenda.  The vocabulary of externalisation, business plans, company structures and financial modelling… it felt a long way from a commitment to core values, care free at the point of use, empowerment.

The unions lose my sympathy, however, when they make comments such as ‘I don’t really understand this social enterprise thing, but I can tell you we are opposed to it’ or ‘I’d rather people were made redundant from the Council and get a good payout, than have their jobs transfer into this social enterprise’. 

Conviction is one thing; I more naturally lean towards a belief that the State should be responsible for meeting the needs of those in our society who are vulnerable or in crisis.  I also think there are decisions emanating from the current government that should be resisted.

However, stubbornly sticking to a mindset despite the evidence that the world is shifting on quicksand is pointless.  The financial pressures on local authorities are mind-boggling and will not be resisted by a 

defiant, arms-crossed ‘I’m protecting public sector jobs and services’ stance. 

If local authorities don’t deliver services directly – and that is becoming impossible on the budgets available - the immediate alternative is tendering services out to the private sector.   A sector queuing up to deliver services and to cream 10, 20% off the budget for investors.  This isn’t the future, this is now.  The market already exists in health and social care. 

By looking at the options for social enterprise to come forward as a route to deliver public services, I’m not giving in – I’m looking for a (forgive me) third way. 

What Stepping Out is trying to support is an alternative to outsourcing, an option that removes the profit motive and gives more power to frontline staff and service users. 

My dad at least has the wisdom to listen to what spinning out is about before he disowns me. 

And I think he hears me.  He hears me when I say that we’re trying to help some extraordinary public servants who when faced with blood-curdling cuts are prepared to take a personal risk in pursuit of a better future for their services. 

He is reassured when I explain that the potential winners when this comes off are not shareholders, but frontline staff, service users & patients, the Councils and Trusts who get to deliver savings and commission quality services. 

And he remembers how when he was a foster carer the system around the children was bureaucratic and broken; how when I was a local authority social worker he worried about the impact of the demoralising culture – he remembers ultimately that no-one who has seen inside public sector delivery is able to claim ‘if it ain’t broke, don’t fix it’.

So, don’t worry dad.  We’re not trying to auction public services to private providers or dismantle the welfare state.  We’re just trying to reposition it for the current challenges and trying in particular to re-arm motivated public servants so they can flourish in the battles ahead.   

Spinning out is a pro-public service model, it’s about supporting public sector workers – giving them control of their futures, not voluntary redundancy – and striving for quality and innovation in the face of reduced central government funding. 

Why do so few social enterprises hit the commercial big time?

A year and a half into Stepping Out I now feel able to compare this with running a large charity.    One of the interesting things is that it is, on many levels, very similar to the early days in the charity.  It is about passion, finding clients, building a brand, delivering really great stuff.    There's really not that much different on one level.  Value is value, whether it's in the life of a disabled person or a council team seeking to spin out.

Psychologically, though I have had to go through a shift, one that has actually made me think quite a lot about the idea of social enterprise.   When with a pure for-good organisation, everything went through the prism of mission.  In short, we sometimes did things because they were right, regardless of whether they were good for the business.

These days, I can't function like this.   While social value - and the well-being of clients - is never far from the front of my mind I have to always always be doing the math.  Riding two horses is never easy,  I find. In a straight choice, I still tend to help, even if it doesn't make long-term business sense, but I know, that in doing so, there is a commercial cost.   

Of course, I know that the magic of social business is about precisely this - balancing commercial and social considerations in a new way.   I think what I am saying is that it is far more natural for most people to operate in one mode or the other.   Instead of holding the two in balance, I tend to oscillate between the two considerations.  On my 'social' days I have to constantly check myself for not watching the bottom line enough.  On my 'commercial' days, I ask myself if I am giving enough to warrant our claim to be a socially-oriented business.

Which brings me to my point here: social business, while appealing to our natural desire to be both commercial and social doesn't always go with the grain of how we operate day to day.   Most of us are essentially commercial or social in our approach.   Or, at best, we mould ourselves into one or the other type and operate consistently in that way.   Holding both in mind requires a kind of double-think (holding two simultaneous beliefs 'I am social' & 'I am commercial') which doesn't always come easy.   

Of course, this isn't always a zero-sum game.  You can use a commercial logic to build fanastic social outcomes.   And this is perhaps the larger point here.  I am perhaps coming from it from the position of a convert from the charity world.  But I think I might be onto one of the reasons why so few social enterprises really hit the big time commercially.

Why Consulting isn't for Faint-Hearts

Last year about 70,000 people in the third sector lost their jobs – pushing on enough to fill Wembley Stadium.  While some are happily now in new jobs, many will be making a go of it as independent consultants.   Some of these folks will, no doubt, be loving it – and telling anyone who will listen that losing their job was the best thing that ever happened to them.   Other newly self-employed, however,  will be sat, quietly desperate, in the spare bedroom opening another pack of Custard Creams  and waiting in vain for the phone to ring.

So how do you make that transition to running a successful independent consultancy? Having attempted the journey myself, I would offer three main pointers.   The first is to understand that as an independent you will need to specialize.  Whether you realise it or not, there will be something -  a single stand-out skill or attribute – for which you're best known.  It's this ‘something’ we need to understand - because this is the one thing that people will pick up the phone specifically to ask us to do.   Our specialism is the essence of our usefulness to others.  Therefore it’s vital we figure out quickly what that is.

The second is to realise that in consultancy everything matters. To win work from clients,  it is not just your encylopaedic knowledge or contacts that will bring in the business.  You need to look and sound the part.  Your website should be fresh-looking.   Your answer-phone needs to sound like you are pleased to hear from people.  Hair, teeth and clothes all matter too.  Nobody hires a consultant who looks like s--t.   If you're a voluntary sector scarecrow, get down the hairdresser before you step out into the real world.  While you’re out, buy some good shoes.

Thirdly, and perhaps, more importantly, you need to deliver. This sounds rather obvious, but it's the main fear in the mind of every client - 'What if this hired-gun lets me down?'    You deliver by listening very carefully to what the client needs.  You deliver by carefully agreeing the scope of the project,  charging a fair price and only taking on work you can deliver to a truly exceptional standard. 

Note my use of the word ‘exceptional’.  As a consultant, it's rarely enough just to put in a ‘decent’ performance, like you might do week-in-week out at work.  This seldom leads to a long relationship with a client.    While you'll always get paid for a decent job, the client will move on if you don’t totally wow them.   Should you manage to do this, however, your client will get you back time and again.   The best business is repeat-business.  Remember - consultancy is, above all else, a relationships business.   Love your clients.  

Of course, your decision to step into the world of consulting depends, in large part, on whether you’re personally suited to do it.  I'm not just talking about how clever or knowledgeable you are here, but also your character.   Resilience is key -  particularly in year one when you're still finding your feet.  You can feel very unloved on a bleak Tuesday afternoon when even the dog declines a walk with you.   Self-doubt, if it lives within your heart, will tap you on the shoulder and suggest you apply for that supervisor job you’ve seen down at Tesco (regular hours, paid holidays, people to talk to).

So should you be one of this year’s Wembley-sized crowd of third-sector leavers this year, think carefully before you make your move into consulting.   It’s not for faint-hearts.

Why Middle Age is Good and Bad for You

I have spent the last couple of days reading 'A Shed Of One's Own' by Marcus Berkmann, a personal meditation on mid-life which, even at 43, I found worryingly resonant.   Chapters such as 'Crumbling', 'Scythe', 'Pedant' and 'Money', in which looming decline is wittily detailed brought to the fore my suppressed awareness that the Only Way is Down.

But is middle-age all bad?   Yes, it is the End of Ambition, in the sense of that rather narcissistic youthful will-to-power which, if you're a normal person, kind of melts away around this time.   You do become a bit more able to deal with curve-balls, set-backs and bollocks from other people.  This is because you know, in your heart, that most of what you do, what anybody does really, doesn't matter all that much.

Well not everybody.  Yesterday I went, with my pal J to Addenbrookes hospital in Cambridge to see a friend of ours , D, who got hit by a car last week.  He smacked his head and spent three days in an induced coma and has been smashed up a bit.  For a few days things looked very dark for D.   Then  he woke up and was OK.   Just after our visit, the consultant who was going to pin his arm back together popped in to give us a two minute warning.   I guess he matters.  I went off to finish my report, following a nice cappucino in the new Costa they have put in down there.

Big hospitals are amazing.  Addenbrookes, my companion J pointed out, is now like a city.  It has shopping malls, car parks, uniformed people regulating the place.  He's right, it's impressive and one bit of the NHS that challenges my belief that nationalised health care should follow cars, steel, gas and telephones into the open market.  There's a feeling of competence, seriousness and, yes, helpfulness.  we was smilingly helped three times to find my way out by medical staff with far better things to do than tell two besuited charity consultants how to get out of a building..

Myself and J have known each other since late 20s and, having left D to his op, we have a good old chat about our early-middle-aged lives, which mirror each other's in so many ways - bar his relative financial success to mine.  I reflect that I am no longer remain the ambition-driven twit as I was,  disguised in my likeable carapace.  You kind of realise, by now that nobody really cares if you're a success of not.   It won't be what people remember you for -  if they do at all.

However the bit of middle-age I cannot yet accept is physical decline. In the way that certain senior leaders we all hear a lot about strut the public stage like alpha-peacocks, I am still hanging on for dear life to my 25 year old physical self:  thin, fast, quite sporty, not bad to look at.   I see the potential middle-age me, bursting to get out, but use prodigious amounts of gym, swim and run to keep him in his box.   Botox awaits come 45.  Perhaps some work on my chicken-neck before 50.

If, of course, I get there.   As the late Philip Gould said, 'assume nothing' about the future.  It could all end tomorrow.

Why Nations Fail...and organisations fail too

If you read one book this year, make it 'Why Nations Fai'l by Daron Acemoglu and James Robinson. Well, that is if you can resist 'The Art of Fielding' by Chad Harbach. And if you can, read both.

Tellingly, both books are written by Americans. Unlike most British and European writers, Americans have no appetite for obscurantism or snobbishness in the way they write. The authors of 'Why Nations Fail' are two of the world's foremost academics on economic history. Put this subject matter in the hands of their Oxbridge equivalents and you'd struggle to get past the introduction. In the hands of these guys, you simply can't put it down.

So what's so special? I guess, it's quite rare, at 43, to be reading stuff about an old question - why do some parts of the world, 'succeed' - politically, economically, socially - when others fail, without quickly running up against the same worn out ideas: imperialism, geography/climate, the Protestant work ethic etc.

This book debunks all of that - very quickly. Very simply, 'Why Nations Fail' says that nations succeed because, over time, they develop inclusive - meaning pluralistic political and economic institutions. They develop these, of course, party by accident and partly by design.

Factors like colonialism, great individuals and major world events (disease, war, famine) have a huge role in shaping whether inclusive or 'extractive' institutions develop, but, when it comes down to it, it is only when a territory can support the rule of law, secure property rights, reasonable public services and open political system that long-term progress can be made. Without all of the above - and the book uses many examples - you end up with a political elite which has an interest in holding back the many.

The opener of the book contrasts two halves of a city, Noglales which straddles the Mexico-US border. One sits in the region on Sonala, Mexico, the other in Arizona, US. Here the people, culture, climate and operating conditions are the same. On one side of the border, incomes are many times higher, there are good public services and crime is uncommon. On the other, people are mostly poor, there are few public services and crime is rampant because the state isn't in real control on the ground.

The history of both countries explains why such a situation has evolved. From colonial times, there has been little development in Mexico of inclusive political and economic institutions. It is hard to stay safe, start a business or progress economically. The Mexican Bill Gates or Steve Jobs does not have a chance to freely develop his ideas without overcoming unreasonably hurdles right from birth. He won't be educated, unless from an elite family. He can't set up a business without paying a lot of bribes. He can't find good people because nobody is educated to the right level. Investment is not there because nobody is sure what's going to happen next in a country like that.

And so on. It's a wonderful book. Perhaps what has capitivated me most, though, is the read-across to why certain types of public services fail, despite wonderful resources and high levels of native talent. Analogous to the extractive and exclusive institutions described at state level in this book could be placed the large public sector monopolies which still dominate much of public service in Europe and certainly in the UK.

Here, power is often monopolised and change, even 'good change' does run against the interests of many of those involved. Initiative is often powerfully suppressed. It is hard, frequently impossible, to set up in business against these monopolies and there are often few political processes which can be used to break these systems down.

What am I thinking of here? Well, if you haven't guessed, I am alluding to many of the organisations from which spin-outs do or don't emerge.

The truth of the matter, and I see this every day, is that setting up a new business to deliver public services feels like it probably does to set up any ordinary business in parts of the developing world. You need the buy-in of a variety of power-brokers, all of whom need to see their interests satisfied. You need to go through all sorts of bureaucratic processes to show you're not a risk and are 'worthy' of delivering services.

From there, you need to make all sorts of promises to the system that its interests will not be threatened and create opportunities for the system to have it's say even when the business is up and running.

All of this, of course, creates a massive disincentive for any sane person in public services who wants to change things. The risks are massive - to career, to sanity, to reputation - that most people, quite understandably either stay put or move out. Those that try to start a public service business have to run a gamut that looks far more like something you'd see in Mexico than in Midshire, UK.

Of course, this is far worse in the non-democratic part of our polity - the NHS, than in local councils where there is always a final court of appeal But you see it all over. The real disease, and it is a disease, is that organisations fail for the same reasons nations fail: if you create what are, in effect, dictatorships, if you sit hard on people, if you keep the power to take away what people have created and if you eliminate any means of influence then you end up with the organisational equivalent of Mexico.

Why the third sector lies about outcomes

I'm slowly taking my leave of the third sector village. Not on a jet plane, but more slowly - by hot air balloon.

As it gains height, I can see our little village in better context. What I notice is just how small it is next to the towns and cities of the public and private sectors.

Also visible from a height are its twisting, chaotic streets and its many, varied neighbourhoods. Compared with the Milton Keynes of the public and private sectors, our village looks, from the balloon, a far more interesting kind of place.

But is our sector any more than a small splash of colour on the landscape? Well, we surely now do better than merely talk a good game. Our finest organisations are taken far more seriously than they were 20 years ago. Furthermore, many of us now deliver public services that merit the term. Time and again, our top performers comfortably outdo the private and public sectors.

However, this is mainly the new part of the village - the extension built after the 1990s. The old parts look mostly the same. There, the conversations haven't changed much down the years. The People's Front of Judea still doesn't speak to the Judean People's Front. That nice old dance about whether we can change our grant-funded schemes into commercial services. The last-minute funding reprieves.

Then there's the much darker side of village life: the massaging of activity to make everything look better. The downright pretence, at times, that something is happening when it isn't.

OK, it's not all our fault. Without the dance of deceit on outcomes, the village starves. On one side, the public sector terrorises with piles of paper. On the other, the private sector demands mighty-sounding results for its droplets of CSR money. Everyone wants more than we can deliver. So people make stuff up.

Do people notice this darker side? Mostly not. But sometimes, they glimpse our other side. Last week, I got an agitated call from a colleague from the public sector in another part of the country who had been out to see a charity in his area that had received public money. He was horrified by the casual attitude to reporting, the lack of preparation, the scruffiness of the director and the sheer nothingness behind what was purportedly going on. He thought he was being lied to. He told me that this would never be allowed in the public sector.


Maybe, maybe not. I don't think our sector is unique in having a dark side. The fact that we can still evoke these reactions in people from other sectors worries me a lot. You imagine, on your brighter days, that the worst of all that is over.

But it isn't, of course. Today's third sector village might be charming and characterful and attractively extended but, from my balloon, its dark alleyways and murky ponds are still visible and obvious. We need to address this, big time, if we're going to make things work in an era when results will be scrutinised far more closely than ever before.

Why you can be for-profit - and for good

One of the things that people in social enterprise go on about most is about reinvesting the profit in the mission- and this being the differentiator between social and ordinary business.

What they seldom tell you is that there aren't that many social enterprises out there that actually make any profit. Some, of course, blunt their profitability by 'doing business differently' - which, of course, is fine, if it the social benefits can be demonstrated. But many more simply are not profitable full-stop, and don't have a particularly strong story on outcomes either.

When I set up my first organisation, I didn't really think about the reinvestment argument. Nor did I think particularly about how we were set up. Having a social mission was sufficient, I thought, to ensure we would go some way to achieving something more than keeping ourselves in jobs.

About a decade in, I wasn't so sure. In practice, all sorts of things ended up coming between the aims of the organisation and its mission. The biggest was the needs, and interests, of the organisation itself. Feeding, tending and nurturing the machine somehow put the mission into the background. Sure, a healthy organisation meant a bigger likelihood of being on-mission, but, somehow, the organisation felt, to many of us leading it, and end in itself.

Is this unique? I don't think so. When I founded my latest venture, Stepping Out, I decided to approach the question of mission differently - through a profit-making company. We do have a mission - rather grandiosely - to change the way public services are delivered in the UK. We are here, primarily for that reason, more than to provide ourselves with a fine living.

But we also seek, quite unashamedly, to make a profit and we focus hard on this too. Partly because this allowa us to be successful, live reasonably well and grow our founding mission. And partly because this does create a meaningful surplus which we can share with others through the Stepping Out Foundation.

I suppose what I am getting to here is that our being a for-profit organisation doesn't in any way detract from our primary mission - to change public services. Nor does it pull us away from or our secondary mission - to use a decent slice of our profit to support early-stage social entrepreneurs.

In fact, I would go as far as saying we are probably a bit more effective on both counts than had we not set out with profit at least partly on our minds.

Which brings me to my main point here: contrary to the sensibilities of most UK people who operate in the 'for good' sectors, I do not believe there is a simple and linear relationship between profit-seeking and doing good, with the one only rising when the other falls.

It just isn't that simple. You can be non-profit seeking and do very little good. Equally, you can be profit maximising and still, even accidentally, do a lot more good than your typical 'for good' venture. Does being consciously socially-minded matter? Yes I think it normally does - but it doesn't guarantee any social good ever will come of the business. .

The bottom-line here is that a social mission doesn't necessarily produce social outcomes any more than a pure-profit mission always produces profit. You can miss. You can get sucked into your own myth that your very existence constitutes a social benefit (seldom true). A social mission can actually give you an excuse not to do the really demanding things necessary to make a profit.

None of the above is to say that there are not many for-profit organisations that maximise their profits at the expense of social good. One doesn't need to look far for examples.

But there are many organisations in the public, voluntary and SE sector that also subtract from their potential social impact in order to serve other goals, often for the sake of an easier life.

These, in my view, deserve just as much shit from the media as the for-profit ones that don't deliver socially. They are ripping people off just as badly as any poor-performing Work Programme prime. In essence, you can be not-for-profit and, in reality, be not particularly 'for good' either.

We spend all our money on people - so let's engage them

When I meet with chief executives or finance directors to discuss spin-outs in the NHS or local authorities, their first question tends to be: "Why do this?". Indeed, why not just privatise – or leave things as they are? If the "fat" has already been squeezed (a claim we hear constantly), where's the gain in spinning something out?

My answer in one word, is this: engagement. The people factor. According to a recent study by Prof Raj Sisodia (and corroborated by a Global Workforce survey of 90,000 workers in 18 countries by Towers Perrin), companies that score highly on employee engagement also perform better financially. Higher margins and more rapid growth are both proven dividends of an engaged workforce.

But aren't public sector workforces already highly motivated? Well, often they are not. Many love their jobs and are deeply committed to their clients. Yet, in the management culture prevalent in many large public sector organisations – top-down, remote and controlling – they give far less of themselves than, ideally, they should.

Even the language captures this. In the NHS, the terms "staff side" and "management side" are used to describe different elements in the organisation – like two armies lined up for battle. This isn't so bad in councils, but the "done unto" mentality tends to pervade. Relatively few people appear to feel permitted to make things happen; at least not without cover from above. The net effect of this is that you have organisations which, on quite a deep level, underperform. People simply zone-out, keep their heads down and survive.

According to the management writer Gary Hamel, disengagement is allowed to happen for one of three reasons. The first is ignorance. Management just doesn't get the fact that people often withhold the best of themselves at work – and do only what is required. Their innate enthusiasm, initiative, creativity and passion is seriously stifled, with a deleterious effect on the good the organisation is able to deliver.

I find this to be extremely common in the public sector. Only last week, I was was debating with an NHS organisation that wanted, very late in the day, to cancel a good-to-go staff-led spin-out because it was, in the funny-money world of the NHS, now "unaffordable". This was despite the catastrophic effect it would have on the engagement of the staff who, for 18 months, had been taking this forward as a practitioner-based venture. I saw not a flicker of awareness of this in the calculus of management's proposal to not go ahead.

The second reason we see mass-disengagement is indifference on the part of the leadership. Managers know, in their hearts, that people are flatlining but just don't care enough to do anything, perhaps because a callous corporate culture has robbed them of empathy. Again, I see this a lot, not least in the example just referred to.

The third factor at play is impotence. Managers often care a lot – but don't feel they can do much about what they see around them. Understandably, they see a system they can't change. They do what they can, but, perhaps sensibly, they don't burn themselves trying to buck the system and its norms. One otherwise extremely helpful and supportive manager in the example above fitted clearly into this category, in my view.

What organisations fail to grasp, says Hamel, is that we need forms of human organisation which maximise this potential for engagement. Only this, he argues, will bring productivity, innovation and quality to the levels we all want.

So are spin-outs the answer in the public sector? My belief is that they point in the right direction. They are normally smaller than the vast public sector empires from whence they came. They have freedom of movement and a clearer rationale and identity. Constitutionally, they are often staff-owned, even if this ownership stake translates only into a say in how the company is run, rather than cashable shares. Most importantly, they capture people's imagination. They re-animate the people setting them up. I have seen it time and again. People tend to buy in – and stay bought in.

Of course, they are not a magic bullet. I have seen several spin-outs that look, feel and operate like the organisations from whence they came. Nothing – not even the logos or company colours – change. People often don't even appreciate that they have moved from the public sector into a social business. Things don't move on. But, more frequently, I have seen big changes that manifest themselves in large steps forward in the way a company operates, its efficiency, effectiveness and competitiveness – and, interestingly, its level of measured staff happiness and absence.

You would think that armed with some good data, this would impress anyone I meet in the public sector. That this alone would be grounds for, just maybe, giving serious thought to spin-outs as a way forward. On occasion, it does. Really good people get it.

But, quite often, I see people glazing over. They either just don't believe it or can't quite see what greater engagement, delivered through a spin-out, could mean in terms of the vaunted goal of delivering more for less. Too many people think that better productivity is primarily about simply sacking people – and ordering the remaining people to work harder. The gains of a more engaged, productive workforce are not viewed as sufficiently cashable to be of any meaning.

Yet this is, perhaps, the biggest possible win of any of the spin-outs that I have seen.

Why Employment Law is an Ass

A few months ago a little-known venture capitalist called Adrian Beecroft wrote a report for the Prime Minister, setting out a new proposal that would allow any employer to fire anyone, with compensation, if in their view things weren't working out. No hearing, no capability assessment - just a P45.

This didn't go down too well. Many, rightly, saw it as tipping the scales too far in favour of management, creating a nervy workforce terrified of getting the wrong side of their boss.

But ask any charity chief executive over a glass of wine what they think about employment law as it stands and you'll get the same answer: the system is a joke. Employment law costs charities millions, causes massive stress and, saddest of all, rights few wrongs.

After a few glasses more, you'll also get plenty of sarcasm about the system. It has become a lawyer-fest - 218,000 claims in 2010/11 in total, which is 44 per cent up on two years before.

As an employer, I have been on the wrong side of several employment tribunals. Being cross-examined at one makes you feel as if you are some kind of criminal. It seems surreal and not a little twisted. You have a trio of judges (yes, three for each tribunal) who are paid God-knows-what by the taxpayer for dissecting what is often low-grade, he-said, she-said 'evidence'. It feels like a farce. That's because it is.

So what needs to be done? Three things. First, there needs to be a place for 'safe conversations', which would allow employers to say "this isn't working out" without it leading straight to a solicitor's letter claiming bullying or constructive dismissal.

Second, every tribunal application should be put through the conciliation service Acas before it is allowed near a tribunal. This allows a mediated settlement rather than the well-paid confrontations so beloved of the legal profession and the judges.

Finally, everyone who wants to initiate a tribunal should put up a returnable deposit that is lost if they lose, say, £500. This will get rid of the most vexatious claims in one go.


Sounds familiar? By and large, this seems to be what's coming out of the coalition after the shock and awe caused by Beecroft earlier in the year.

It's easy to forget, but small employers, including charities, are terrified of existing employment law. One nasty incident can ruin a charity, and the third sector tops the league table for employment tribunals. Some cases merit the time and money that goes on them: rank injustice deserves its day in court. But most of what gets into the system shouldn't really be there at all.

This should soon change. Up and down the land, people will cheer discreetly - chief executives, colleagues of underperforming staff and HR managers. Everyone, in fact, but the opportunists and obsessives who, in my view, bring a large proportion of claims. And, of course, their lawyers.

Vain is Not the Same as Bad: Why we should think again about Emma Harrison

I could not help but notice the almost universal schaudenfraude that greeted the demise this week of Emma Harrison. On one level I enjoyed it too. Her particular brand of icky self-promotion isn't pleasant. She is clearly self-obsessed. As one of her colleagues commented, she sought publicity 'like a burning aircraft seeks the ground'.

But I regret her demise. Why? Three reasons. Firstly, while I don't care much for her style, she spent 20 years of her life building a successful company from nothing. Anyone who's set up a company knows how bloody difficult it is to get things right. And growing companies is, well, massively complex. Show me someone who has done it without some massive f--k-ups on the way and I'll give you a free holiday. Yes, she's made money, but she's taken some risks, employed a lot of people and found a lot of people jobs. All on a scale few of us will ever achieve. If you'd done all of that, you'd feel like you deserved a lot of money.

Secondly, I don't think, in light of what actually appears to have happened, she needed to go. Harrison's company, which employs thousands, had, it is being alleged, a few people on the thieve. They no longer work there. The police are looking into it. It looks fairly clear, unless I am missing something, that this was limited to a few hands. Similar things to those being investigated at A4E actually happened a few years ago in a charity I worked for. A couple of people took the charity for tens of thousands. They were arrested, banged-up, end-of. Checks were lax, management took a bollocking, life went on. It happens every day. Quite why Harrison felt the need to resign I don't know, unless there's something deeper we're all about to find out about. My sense is that she panicked. Now it looks a lot worse than it probably is: A4E is now ' troubled' and EH has left because of 'fraud'. Whoever is advising her is not doing very well.

Thirdly, and finally, there seems to be a whiff of misogyny in all of this. I saw it in the case of Andrea Hill, the former CEO of Suffolk County Council. She seemed fair-game, partly because she was a woman. It is hard to imagine there being such a furore over A4E if some greying old bloke had set it up. Indeed, plenty of such people have set up public service firms, such Rod Aldridge of Capita, and are now lionised by the establishment, rightly in some cases. We seem to have it in for women of a certain type, particular ones who get above themselves a bit, like Harrison, and Hill did, at times. We're very unforgiving.

Of course, were A4E beyond reproach as a company, I am sure things would have been easier this week. Were it not the case that one hears quite a few not-so-nice things about the way they do things, there may well have been more people rushing to her defence. But what bothers me more is that, without a lot of reflection, a lot of intelligent people have defaulted into a blind condemnation of Harrison, her company and the role of other sectors in public service provision.

This is wrong. Being vain and irritating is not the same thing as being bad. Harrison should have stayed put at A4E and Cameron should have encouraged her to keep her post in Government. Her going does not make Britain a better place.

Caught in the Middle

Last week, the courts prevented a long-planned social enterprise from being created in Gloucestershire. The protaganist here wasn't Unison or the BMA but a 68 year old bloke who believed that such services ought to be kept in the NHS - and open to NHS providers to compete for.

Ahead of a verdict, the social enterprise has been pulled. Game over.

The net result of this will, of course, be a procurement exercise, the outcome of which might be well be not an NHS provider but a private sector one. This gentleman may rue the day he successfully stopped a social enterprise in its tracks.

So what does this mean for social enterprise and mutuals in public services?

It definitely brings EU competition law clearly into the frame when NHS bodies and Councils are looking at spin-outs. Competition law states fairly clearly that where there is a market for services - even when these are social or healthcare services - there should be open competition. Exception can be granted - but only where there is a clearly evidenced, higher reason for this.

However, there are ways to address this which also give nascent social enterprises a chance before facing the competitive market. Firstly, they can operate as independent business units in 'shadow' ahead of formal procurement - so that a trading record can be established.

Secondly, there is often not a straightforward procurement solution to the complex problems that a potential social enterprise is being set up to address. Councils in particular do often want to see a key local player in place which addresses a host of challenges, some of which do not easily lend themselves to procurement..

Thirdly, an NHS body or Council can set up a joint venture with the competition law satisfied by the process involved in selecting a JV partner. We haven't seen much of this so far, but I suspect it will become more common as procurement becomes more of a roadblock.

Why the Tories are half-right about making it easier to sack mediocre people

A few months ago a little known venture-capitalist called Adrian Beecroft wrote a report for the Prime Minister, setting out a new proposal which would make it far, far easier for firms to fire people. It would allow any firm to release any person it chose, with compensation if, in the firm's view, things weren't working out. No hearing, disciplinaries, five-point plans - just a end to employment.

Of course, this didn't go down well with anyone, including the Lib Dems who, rightly, saw it as tipping the scales too far the othr way, creating a nervy workforce terrified of getting the wrong side of the person above them at work. Put into practice, Beecroft would, almost certainly, have led to abuses that would exceed those currently imposed by the army of people who use the current law to persecute their employer.

What we need, therefore, is something that runs down the middle. Here is where personal experience comes in. As an employer, I have been on the wrong side of more than one Employment Tribunal. Several in fact. Most are 'settled' meaning, that you do what is necessary to make the drain on your time presented by such matters disappear.

I have always been amazed at how many people can sign away the right to have their grievance properly looked at in a quasi-judicial setting when a fairly small cheque is waved under their nose. Friends I know who have not done this and gone all the way nearly always win - but feel like they have lost, such is the cost in time and lawyer bills.

In short, the system is indeed broken and needs to be reformed, urgently. Ask any charity CEO (not normally the most right-wing of people) what they think over a glass of wine and, to a person you'll get the same answer: the system is a joke, it deters employment, it causes massive stress and cost and it rights few wrongs.

After another few glasses, you'll also get plenty of sarcasm about the self-infated judges (there are three for each of these hearings) who are paid God-knows-what by the taxpayer for poring over what are mostly 'he said, she said' issues, that, by a freak of legal nature, have ended up in a courtroom.

So what needs to be done? Three things. Firstly, there needs to be a place for 'safe conversations' which allow the employers to say 'This ain't working and we would like to discuss a possible exit for you' without this leading straight to a solicitor's letter.
At the moment, it is very hard to have a normal conversation without your words being thrown back at you as evidence of 'constructive dismissal'.

Secondly, every application for a Tribunal should first be put through ACAS before it is allowed to go to a Tribunal. This allows a mediated settlement rather than the well-remunerated confrontations so beloved of the legal profession. Finally, every person who wants to initiate a Tribunal should personally put up a returnable deposit which is lost if they lose. This will, I can guarantee, get rid of most vexacatous claims in one go, including many of those I have had the displeasure of dealing with.

Sound familiar? Well, that, by and large, seems to be the shape of what's coming out of the Coalition following the shock and awe caused by Beecroft earlier in the year. I can't say enough about what a good idea this is. It will be good for jobs. Small employer are terrified of Employment Law as it stands. One nasty incident can ruin a business. You really think carefully about taking people on as a small firm. This can't be right.

Plus the spike in claims in recent years is fuelled by a 'No Win No Fee' industry which is based on exploitation of bad law by bad law firms. As anyone who knows me well is aware, I am not the biggest fan of the legal establishment. With notable exceptions (and there are MANY, including good friends of mine), they are, I find, non-value-adding and venal.

Because they are a 'profession', many lawyers seem to believe they have a right to charge five to ten times what everyone else does for what is, a lot of the time, an administrative job. The reputation of law has, like that of politics, taken a dive precisely because of how they have responded to opportunities like Employment Law.

This will soon change. Up and down the land people will cheer. Charity CEOs, small business people, colleagues of underperforming staff, HR managers, operations manager. Everyone, in fact, except the drongos who bring the majority of claims and their lawyers.

How localism can solve the health and social care crisis in the UK

If you're reading the newspapers, you'll be hearing both about the planned Lansley reforms and a parallel discussion about the need to integrate health and social care funding in response to what Government Minister Paul Burstow admits is a 'timebomb'.

But the two are seldom discussed together, for some reason, probably because most journalists struggle to get a full handle. Health and social care are currently separately provided for in law. You get health care for free while you normally pay for social care. Councils determine who gets what in social care and carries statutory responsibility.

In some areas, for example, Bath, NE Lincs, Torbay, Swindon and a few others, health and social care commissioning has, for some time, been placed under one body, normally the Council with a Joint Director of Social Care / CEO of the PCT. Where Council and PCT areas are contiguous this makes a lot of sense because it means that those spending the health and social care pound can see the whole picture and are not slavishly wedded to one or other worldview, health or social care.

Integration at this level also means that local democracy gets a look in. For however flawed and unrepresentative most councils are (hardly anyone young or black, essentially) they are voted in, unlike most health bodies which, while governed by a board, a not particularly accountable to the community, in reality

So why not make this the national policy? Rather than trying to delegate budgets to GP groups, which are, by now evolving into mini PCTs, and also having rump-PCT clusters running alongside (and I won't get into Commissioning Support Groups) - why don't we take localism to its logical conclusion and do the following:

1. Give Councils statutory responsibility for health and social care in their jurisdiction.
2. Make the Health and Well-Being Board being set up anyway by Councils the delegated bodies which oversee the commissioning and procurement of local health and social care. Pool the budget so that there is no distinction between health and social care spend.
3. Set up all staturory health and social care providers as either independent local healthcare trusts or social enterprises which have contractual relationships with the council.
4. Let each local council and its Health and Well-Being board shape local priorities and allow the council to be accountable for health and social care outcomes in its area.
5. Allow the centre to retain powers of intervention if a council is failing it its statutory duties.

The net effect of all of this will be to force local Councils to grab the nettle of the democraphic pressure and problems caused by the imbalance of acute and primary investment in their areas. Decisions will need to be made around what the local health service will and won't fund and where self-payment has to play a role.

At the moment, we're in the ridiculous situation whereby a person with quite profound social care needs who has some means to pay has to practically bankrupt themselves to get the support they need while another person who wants a sex change can get one done on the NHS. Merging of budgets allows some balance to be put into the question of where funding of different needs is placed.

Of course this wouldn't be a perfect system. The funding would still need to come mainly from central government and even in the event of a more localised system of taxation there would be a need for transfers from Surrey to Sunderland. That's what central government, really, should be mainly about doing. Plus the same political nonsense would happen at local level as you see nationally.

But this system, where health and social care is integrated at commissioning level and placed under LA control is, compared to what we have now, quite a sensible approach and places central government in the role of overseer, rather than controller. Would this still be a national health service. Yes, but also a local health and social care service too, with stronger local accountability and scope for appropriate local variation.

How To Murder a Mutual

A real, living example of staff seeking to form up into a mutual met an early death this week as a group of librarians in a London borough failed to get through a PQQ stage on a tender process. This was not, they were told, because they were crap or didn’t know anything about running libraries, nor that they didn’t have any business sense. No, it was because they didn’t have a balance sheet – or cash-in-bank or bricks-and-mortar – to use everyday language.

They are appealing – and good luck to them. I have also directed to them to Cabinet Office who are investigating what the barriers are to staff groups seeking to ‘step out’ into a mutual or social enterprise.

The problems faced by these librarians isn’t particular to that borough which, I am sure, is an otherwise shining example of good practice and innovative partnership working. It’s everywhere. If it hadn’t been the PQQ that trip-wired them it would have been the local unions or politicians or finance people who tend to prefer things to be either in-house or contracted out – nothing more complicated please.

Well, not everywhere – or we wouldn’t have a business! I am on the train home from one council which will, we expect, shortly see two new staff led businesses in the conservation and work-prep sectors. Yesterday I was with a council where £4m of social care services are soon to ‘step out’ into a new CIC.

Everywhere I go, there are people wanting to do this. People who recognize that the old public sector model is bust and something else that isn’t public or private sector but social-sector is the right way to go. Saving money, improving services, raising motivation and productivity.

That’s why we are doing this. It’s early in the day, but the public sector up and down the land – faced with 30% cuts over 2-3 years has to find new delivery models. They exist – and the independent social business spin out is one of them.

If only the library-commissioners in that particular borough knew it!

What can we learn from the spin-out leaders?

One of the privileges of my work with Stepping Out is the exposure it gives me to a wide variety of leaders. This has been instructive. Spin-outs almost always rely on charismatic leaders to get them off the ground. These people are invariably viewed as 'mavericks' and are seldom popular figures in their organisations. And few of them, at least early on, have the technical skills to organise a spin-out nor the political skills to play the committee game in their organisation.

But what they lack in business or political finesse, they tend to make up for in drive, tenacity and inspiration to others. Which is fortunate because this is probably what matters a lot more, certainly early on. Where we often come in is adding the skill-sets and finding the operators who can champion the mavericks' cause with politicians and committees.

What can be learned about these types of leader? I think they underline to me the vital need for all leaders to be durable, passionate and communicative. The very best ones can also do the technical and political stuff too, but I would say that these skills become more important at later stage in the life of an organisation.

The others - the softer skills - have, I think, taken on a bigger order of importance in the 20 years I have been in the workforce, as society has become more communication-focussed. The 'feminisation' of management culture also has had a welcome role to play. A top leader used to be what Michael Lewis in 'The Big Short' memorably called a 'Big Swinging Dick' - an alpha male who could bully and beat his way to success.

Now such people are viewed as throwbacks and any aspiring leader is evaluated far more in terms of how they involve and include others, how well they create a productive and positive culture and how they conduct themselves in the day to day relationships.

It is a trend I think I welcome.

Should the Health and Social Care Bill be Scrapped?

The papers are full of speculation about the future of Lansley's bill. Many Tory MPs are now privately concerned, Lib Dem peers and now working with Labour Lords to amend the bill to destruction and Lansley himself is looking increasingly isolated as the professions rally against him.

In more normal political times this would all be insignificant. But we're not. No single party has a majority and Parliament, since 2010, has enjoyed something of a revival as the 'cockpit of the nation'. You just can't ram things through anymore. Listen - or face rebellion is is the message from a Commons packed with the assertive new 2010 intake..

In some ways, the Bill is alreadyhalfway to oblivion. So far 136 amendments have been accepted from hundreds table. The net effect of this has been to reshape the Bill substantially from Lansley's original intentions. Many more amendments and the whole thing will be sunk by its own complexity and contradictions.

Although there is a lot of angles to this debate, it seems to boil down, in our current discourse, to one big issue - do private operators have a major role to play in the future NHS - or does this remain a principally state-funded, state-directed service? Where you stand on this question is a pretty good predictor of whether you basically support or oppose this Bill.

And that is where Lansley finds himself at the wrong end of the political argument. Most Britons instinctively oppose the idea of profit-making companies running the NHS. They fear its implications for access to free healthcare. For most people, it just seems instinctively 'wrong' that private companies take over the NHS.

Where Lansley has failed, I think, is to side-step the professions by successfully casting his reforms in terms of the real challenges facing healthcare in this country. In short, we need more primary and community healthcare - and fewer, better major hospitals. Anything worth of the name NHS needs to see this movement over time.

We also need to have an honest conversation about what the NHS is for, today and tomorrow, and what we should ask people to fund themselves. There is mounting evidence that the NHS will have to narrow its offer to a deliverable 'core' with more being paid for by ourselves with a logical consequence that more non-core treatments will have to be provided by other means, including the private market.

There is an urgent need for a long-term cross-party consensus about the future of both health and social care in this country if we are to avoid a major crisis within 20 years. The debate at the moment is infantile. 'Three months to save the NHS' is another facile piece of nonsense from Miliband, E.. The NHS today is a cruise-liner headed for the rocks within 5 years. The question really is how to change it over the next decade, reduce its costs and improve its offer. The left (including many Lib Dems) think this is all about planning and co-ordination. The right think it is all about ultra-devolution and introducing markets and private providers with the state well out of the way.

The sensible centre (and most of the non-political community) recognise that you need bits of both. High level planning is needed over the long term around the broad allocation of the health pound in our taxes. As a country, we need to agree what our response to our well-understood demographic and health challenges should be. This is the 'national conversation' we should be having, led by our political class. Then it is Government's job to set the framework. This is not the same thing as the 'co-ordination' offered during the Labour years - which led to the NHS being micro-managed like a nationalised industry.

Likewise we need to sensibly open up the non-core sectors of our healthcare needs to other sector. This has, of course, already happened in social care, where a diversity of providers has moved quality up and price down over the years - with notable exceptions of course. But this has to be done with care. The 'cherry picking' argument is a real one and cannot be ignored. We need to use the private sector where it can drive up standards - but keep an overview and retain powers at local level to hold the private sector in check where this isn't working for the common good..

Where do social enterprise providers fit into all of this? My fear is that they get lumped into the 'private sector' bucket and, if the Lansley Bill dies - which I see a 25% chance of happening - they get frozen out of the new NHS. There is, of course, a chance that they will be viewed as an alternative to privatisation, but the health social enterprises do not yet have the political clout to get this point heard in the current decibels.

If the Lansley Bill goes through, in a heavily amended form, it's also hard to see how things will work from here. The emerging picture is of a more complex commissioning environment than now and a very messy period of overall transition. A lot of the new structure has kicked off already. Clinical Commissioning Groups are already operating and the PCTs and SHA's all but gone - or altered to account for the bill. Very tough now to turn back the clock.

My feeling is that if politicians were up to a decent quality of debate on healthcare, I would want to see the Lansley Bill scrapped and we go back to the drawing board. But so poor and ill-informed is most of it that I fear this would throw us backwards into Frank Dobson/Andy Burnham era nationalisation with consequences I dare not contemplate. So overall, I would rather us make do with an amended bill.

However, Cameron should sack Lansley in the reshuffle and bring in a pragmatist with the operational head to see this through. So no, keep the bill - but sack this dreadful Minister.