Earlier this month, Manchester Business School’s Colin Talbot dismissed the suggestion that the Big Society could take over the role of the state:
Rather like the fish swimming in the sea has no concept of water, because it is all around them all the time, anyone who says the state in Britain today is not “reverted to” by most people for most of their problems, or at any rate a large proportion of them, is living in a fantasy.
Let’s be clear to any Big Society romantics (and the so called Big Society Network is a leader in that field) money is crucial. And do not imagine if the State withdraws there is an army of people just itching to get involved and fill the gaps. Or that miraculous giving rises dramatically.
If 25 percent of the current public funding is withdrawn, a lot of services will simply disappear. The Big Society and the other initiatives that fall under the broad description of social innovation, will not replace the services currently provided by the state. The most we can expect them to do is mitigate the effects of the spending cuts to come.
When running any organisation, there is always a trade-off between increasing output and increasing efficiency. If a manager can increase output without increasing costs by the same amount, or reduce costs while maintaining output, he or she is a hero. The management nirvana would be to increase output while reducing costs at the same time. Even in commercial organisations few people manage to do that, yet that is what some of the advocates of social innovation are claiming can be done with public services.
Examples of organisations that have achieved significant cost reductions without a reduction in output are rare and are almost unknown outside the lean manufacturing organisations. Maintaining services while making major cost savings has proved beyond the capacity of most public sector organisations. The scale of the challenge has defeated some of the country’s most capable executives. That significant cuts in budgets will lead to comparable cuts in services must be beyond all reasonable doubt.
Great hope has been pinned on efficiency savings but just because something is more efficient, it doesn’t mean that it delivers more. If delivery is reduced by 25 percent and the service costs 50 percent less to run, the accountants might see that as an improvement but the end users would have a different view. They would only see the reduction in the services offered. It might be more efficient but the experience of the users would be worse.
If public sector budgets are cut by a quarter there is no way that the output of those public services affected can be increased. It may be possible to make them more efficient, so that the 25 percent budget cut only leads to, say, a 20 percent cut in services, but they will inevitably deliver less than they do now.
That’s where efficiency savings, Total Place, social enterprises and the Big Society come in. They are simply ways by which we might be able to reduce the impact of the spending cuts. If we are very clever, and a lot more of us get involved, there is a chance that we can avoid a 25 percent cut leading to a 25 percent reduction in services. There is a very slim chance that, in some areas where there is a fortunate coincidence of serendipitous circumstances and some very capable and committed people, it might be possible to deliver services that are better than they were before. However, those examples will be few and far between.
The Big Society and other social innovation initiatives are means of damage limitation – nothing more. A few bright ideas and a lot of volunteers can’t and won’t plug a 25 percent cut in spending. In four years’ time, the public sector will be delivering significantly less than it does now. Hopefully, public services can become cleverer and more efficient so that the cuts don’t hurt as much. That’s about the best we can hope for.