Foreword

Deal or no deal?

We do not need to see October’s spending review to know that there are anxious times ahead for those working in the public services. Even the ‘ring-fenced’ NHS is facing job losses and 25 per cent cuts in other budgets will mean hundreds of thousands of posts lost.

Politicians and commentators are beginning to talk of a ‘new deal’ for public servants, in which their job security, pensions  and organisational structures become much more like those in the private sector. There is no suggestion that there will be pay rises to match – a two-year freeze for all but the lowest-paid has already been announced – but the old certainties that compensated for comparatively modest salaries are looking shakier by the day.

So what will this brave new world be like? Will public servants be prepared to make the sacrifices in pay and conditions that saved many jobs in the private sector during the recession? And will their managers be given the scope to innovate and have the skills needed to transform public services?

The July edition of Policy Review looks at the prospects for pay and job security, pensions and the new community organisations on which so many of the coalition’s hopes are pinned. And we ask what will be needed to mitigate the effect of the harshest cuts in living memory.

Peter Latchford, chief executive of Black Radley and visiting professor of enterprise at the University of Birmingham, says that a failure to innovate will mean poverty, ill-health and social tension. Simply trying harder to deliver acceptable public services with dramatically reduced funding will not be enough. But he sees a rare opportunity to ‘unfreeze’ the system if power is devolved to front-line managers.

David Walker thinks community enterprises will help, as long as ministers recognise that they too need state support. But John Philpott, chief economic adviser to the Chartered Institute of Personnel and Development, is less optimistic about the prospects for industrial relations. He believes that highly-unionised public servants are less likely than workers in the private sector to accept a ‘take it or leave it’ deal. Battle lines are already being drawn over pensions.

The second section of Policy Review addresses health, education and social policy. Nigel Hawkes has his doubts about Andrew Lansley’s surprise proposals to transfer commissioning powers to GPs, while David Lee tries to get to grips with Scotland’s curriculum reforms and Ted Cantle warns that public concerns over immigration must be addressed if the Far Right is not to disrupt social cohesion in mixed communities.