It is now some two years since Intelligent Nation (Routledge, 2021, available at all good bookshops) was published. In that very short time the need for a radical change in how we organise our country has become even greater.
The global pandemic that featured so much during its writing has been followed by war between Russia and Ukraine with substantial consequences for energy prices in particular, the execution (if not the true completion) of the exit of the United Kingdom from the European Union, the resurgence of inflation coupled with increases in interest rates to more conventional levels and, connected with that, increases in withdrawal of labour by employees in healthcare, education, public transport and other public services. Some of the effects have been compounded by continuation of working from home which, in some instances, has challenged the productivity and efficiency of those public and private sector organisations where processes and technology are not adapted to remote working. The ONS however has shown that good management practices are the key to maintaining productivity (Ref 1).
Meanwhile, at the political level, while the incumbent party secured a substantial majority in the 2019 general election (winning at 43.6% the largest vote share since 1979), it is on its 4th leader (May, Johnson, Truss, Sunak) since Cameron resigned post the Brexit referendum. Some opposition parties have also changed leaders following that election. And yet, despite the several competitions that have been held, each party seems to continue to be riven by challenges to its established orthodoxy and an inability to develop and settle on a coherent set of principles which it seeks to pursue either in government or opposition. Overall, for those of us old enough, it feels a lot like the late 1970s – a period of economic decline and social disorder – and an absence of political leadership.
Perhaps though, the roots of some of our current challenges, rest in the changes introduced at that time, some of the consequences of which both could be and were foreseen – and recorded (Ref 2).
From the late 1970s there has been a pursuit of productivity and efficiency much of which was arguably necessary and beneficial to customers. Its execution was perhaps poorly undertaken with substantial negative consequences for significant communities. This effect was in part alleviated by the changes in public spending patterns and amounts from 1997 curtailed by the banking crisis of 2008. The processes of austerity (squeezing costs without transforming operations) that followed both imparted significant harm and hampered recovery such that there has been a loss of resilience at the individual, organisational and both local and national government levels, particularly where the effect of austerity has been to further centralise spending.
The nation is at best stalled, driven by an inadequate understanding of productivity and efficiency coupled to (and even driving) failure to invest in transformative technologies and digitally enabled ways of working. This is overseen, in the absence of clear political difference, by a political class (on all sides) arguing about which of them is the best manager (answer? none of the above) while still beset by somewhat Kafkaesque processes (I visited a public sector organisation last week where a manager had failed to fill in the paper form that would warn reception of my arrival, in a headquarters building with hundreds of visitors every day, we just have to hope the paper is recycled!). At worst we are circling round the drain.
Talking of drains, consideration of a particular case may help us.
Along with energy provision, telecoms, motor manufacturing and certain aspects of defence industries, the water companies were privatised in the late 1980s with a view to transforming at least customer service. This enabled private sector investment in the substantial infrastructure upgrades that were necessary, relieving the load on the public purse and, of course, purportedly transforming efficiency. Yet, 30 ish years later we find ourselves in a position where one water company has stated that it cannot guarantee supply and others (if not all, then many) are dumping untreated sewage at periods of high rainfall (it perhaps being cheaper to pay the fine than to make the investment?) and there is talk of banning ‘power showers’ in order to reduce consumption. Meanwhile, the water distribution system is fraught with leaks.
Something has not worked out as hoped? After demonstrating compliance with the rules of the company, the duty of a Company Director is to:
“act in the way he [sic] considers, in good faith, would be most likely to promote the success of the company for the benefit of its members”
That requirement, notwithstanding subsidiary clauses, is most usually taken to mean profit maximisation, the Members typically being shareholders seeking a return on capital invested. We cannot then accuse the Directors of dereliction if they have faithfully pursued this clause.
Equally, being a regulated industry, the Directors are constrained to act within the regulations against which they report. These regulations, primarily economic, demand that they protect consumers by promoting competition, verify that companies carry out their statutory functions, maintain their finances in such a way that they are able to fund their obligations and secure a resilient long-term supply of water and sewerage services.
It is eminently foreseeable that a tension will arise between the actions which maximise profit and the actions which secure long term supply. The first requires distribution of surpluses, the latter their long-term reinvestment. It is inevitable that trade-offs between the two will occur.
I have argued elsewhere (Ref 3) for alternative models of ownership of utilities. I now argue that if we are to stop circling round the drain of decline, stimulate the next generation of social and economic development and address the challenges arising from the last one then we need, very rapidly, to:
- adopt transformational models of organisation;
- create radical models of digital delivery of necessarily bureaucratic public services; and
- generate alternative approaches to the sustainability and resilience of all utilities.
This can only be done, in the absence of violent revolution, if our political leaders cease the pursuit of power for its own sake and collectively realise that they remain in office at our behest, that their duty is not to act in pursuit of their individual or party interest but that of the citizenry as a whole.
That will require a meaningful, clearly articulated vision of a better shared future, that truly engages the voters such that they believe their vote makes a difference, is sensitive to the sophisticated and nuanced choices that will be needed and aware of the need to build consensus and collaboration.
Whither leadership or wither leadership?
References:
2: https://www.margaretthatcher.org/document/110795
3:https://beckfordconsulting.com/misc/utility-of-utilities-towards-community-ownership-model/