Government’s lack of data and performance monitoring leads to “crisis-cash-repeat” cycle for funding public services

Profile picture for user ddpreez By Derek du Preez November 11, 2019
Summary:
Think tank Institute for Government has released its 2019 performance tracker for nine public services and assesses the impact of future government spending.

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A lack of data and poor performance monitoring are making it difficult for the government to invest wisely in public services, according to think tank Institute for Government’s latest Performance Tracker report. It notes that these gaps in data mean that political spending decisions result in a ‘crisis-cash-repeat’ cycle. 

The analysis comes less than a week after official campaigning kicked off ahead of a December 12th election. The two leading political parties - Conservatives and Labour - have both promised a big boost in public spending if they win power. 

Following years of austerity and a focus on improving efficiency in public service delivery, whoever enters the top office in December will be spending enough money to maintain standards in most public services. 

However, the IfG report notes that more money will be needed to raise standards over the next five years. The 2019 Performance Tracker projects the demand and spending on nine public services up until 2023/24 - looking at GPs, hospitals, adult social care, children’s social care, neighbourhood services, police, prisons, courts and schools. 

IfG anticipates that the government will spend £191.1 billion on these services over the five year period. However, while this may be enough to meet demand, it will not be enough for the government to make improvements. 

And in fact, in adult social care, any government would have to spend nearly £1 billion more just to keep pace with demand, the report notes. 

Equally, IfG found that all public services - whilst making efficiencies over the past 9 years - have seen some decline in performance. This decline can either be found in quality (the standard of public service and how satisfied users are) or scope (the range of services provided and the number of people able to access them). 

No data, more problems

The IfG notes that Prime Minister Boris Johnson has a fiscal rule that annual borrowing will be below 2% of GDP in 2020/21. If it does not want to break this rule - which it is already on course to do this year - then it faces tough political trade off decisions when it comes to spending. These include: 

  • Reduce the scope or quality of services

  • Increase how much people pay directly for services

  • Cut spending elsewhere

  • Raise taxes

It also notes that most public services have become more efficient because of the public sector pay cap and because staff are working harder. For example, secondary school teachers now teach more pupils and hygiene staff undertake more inspections and audits per person. 

However, IfG adds that public services will struggle to keep providing services as efficiently as they do now. This is coupled with the fact that recruitment and retention problems are widespread, public services are using one-off sources of money and are overspending, and public services are shifting costs onto individuals. 

The report adds, however, that making better use of data could help make more informed decisions about where spending is needed and help guide long-term investment decision making. 

IfG states:

Not all aspects of performance can be measured, but there are large gaps in the government’s current understanding. Throughout this report, we note the questions we cannot answer because of lack of official data or analysis – above all, the lack of consistent nationwide data.

It highlights a number of gaps in knowledge that should be priorities for the government to fill: 

  • Activity in neighbourhood services, in a consistent form, nationwide 

  • The extent of private funding of social care; staff-resident ratios and staff qualification levels for social care; waiting times for adult social care assessments 

  • What happens to adults who request but do not receive publicly funded adult social care (revealing whether they find help elsewhere)

  • Comparable data for police forces on the demand for their services (e.g. expected numbers of vulnerable people, and people with mental ill-health)

  • Workforce data in private prisons, to assess whether they have safe staffing levels - and generally, data to compare efficiency of public and private prisons

  • The are of part-time doctors in GPs to assess whether the rise in part-time doctors reflects changing attitudes to work

  • Data on vacancies, and agency and pool staff, in general practice and hospitals

The report states that “no government can make good spending decisions without understanding how its choices affect the performance of services and the impact on people’s lives”. 

Better performance tracking

In addition to better data on the delivery of public services, the government could improve the way it makes spending decisions by keeping track of the results. IfG argues that without tracking performance, the government cannot know how efficiently public services are performing, whether there is room for improvement, or whether services can sustain their current performance. 

The report states:

Lacking these insights, governments for years – but particularly since 2015 – have fallen into a ‘crisis–cash–repeat cycle’, where they react to the political fallout from predictable problems with short-term emergency cash. This is an inefficient way to spend money. 

Public services will struggle to use this emergency cash to tackle longer-term, underlying problems – such as staff retention – when it is often only enough to address immediate problems and does not provide them with certainty on how much money they will have to spend in the coming years.