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I have previously looked at the changes in structure of the public sector in Wales and how the performance of local authorities varies with size. Now I am addressing how I believe we can take the public sector in Wales forward.

I believe that all change should be based on the answers to these questions:

  • Is the current structure providing effective services?
  • Is the structure responsible, in part or whole, for the weakness of the organisation or its failure?
  • Is it close enough to the people so that they feel ownership of it?
  • Will the new structure improve service delivery?

 

Regional Footprint

We need the same regional footprint for all public services provided by the Welsh Government. To give an example of current inconsistency: those of us who live in Swansea have a different regional footprint for almost every service. For health, Swansea, Neath Port Talbot and Bridgend are combined; the Fire and Rescue Authority covers Swansea, Neath Port Talbot, Carmarthenshire, Ceredigion, Powys and Pembrokeshire; the educational improvement boundary is the same but policing, which is currently non-devolved, includes all the former county of Glamorgan except for Caerphilly; and finally, the Welsh Ambulance Service covers the whole of Wales.

The aim should be to have all services within the three or four footprints of Wales: the Cardiff City region; the Swansea City region; and mid and/or north Wales. Whilst services could, and in many cases will, be on a smaller footprint than the regions, no service should cut across the regional boundaries unless it is an all-Wales service which would be very rare and include things such as forestry, where regionalisation would not be of benefit. This will allow regional working across services to be undertaken far more easily.

There is nothing intrinsically good about the current structure of local government in Wales. Why were the councils of Rhondda, Cynon Valley and Taff Ely merged into one but Blaenau Gwent and Merthyr district Councils turned into unitary authorities? Change should only be considered where there is a very strong chance of improving services and/or reducing cost over the medium term because of the initial cost of change.

Having spent several years discussing local government reorganisation as if it were some silver bullet to solve the lack of funding for councils, the threat of reorganisation initially receded and has now been brought back for consideration. It was as if the economic theory that predicts that an organization may become less efficient if it becomes too large or diseconomies of scale were unknown.

 

Joint working models

Different services need different methods of joint working, but most work best at the current local authority level. Examples of services that would benefit from a joint working model based upon the regional footprint are transport, economic development and regional planning.

Specialised social service provision and educational improvement could be dealt with by two or more councils working together within the regional footprint. Within Wales, it is the councils that will know best what works for them and consequently they should be allowed to decide locally what works best for an area.

Turning to health, where hospitals provide complimentary services, such as Morriston, Singleton and Neath Port Talbot, then a health board covering that area makes administrative and medical sense. In areas such as north and west Wales, individual hospital trusts having control over their services and recruitment would make more sense.

Primary health care should be split from secondary health care and run within each region. Each region should have operational control of the ambulance service but need to work closely with the hospitals in their area.

 

Private Finance initiative (PFI)

PFI deals need to be examined and a cost-benefit analysis of buying out each scheme undertaken. The revenue cost of PFI schemes is having a detrimental effect on the money available for public service provision. We owe a debt of gratitude to Rhodri Morgan for not getting seduced by the PFI schemes that have unfortunately proven so expensive for public service provision in England. Nevertheless, Wales’s PFI bill costs the Welsh public services £100m a year that could otherwise be spent on supporting local services.

Finance Minister Mark Drakeford has stated: “There have been only 23 schemes in Wales and very, very little new PFI in the devolution era, and of those 23, 21 of them are not the direct responsibility of the Welsh Government, belonging to local authorities and to the health service.

“But we are absolutely open to keeping under continual review whether or not those arrangements could be improved and a better deal secured for the taxpayer, and when we have the next Labour government, then our ability to do that will be much enhanced.”

Local authorities could also be encouraged to consider the use of prudential borrowing to remove PFI revenue costs.

 

Conclusion

How we organise and run our public services in Wales is important to everyone. 

Decisions on changing the structure of public services should be made based upon whether the current structure is failing and if the new structure will improve the service delivery.

We need to ensure all service delivery takes place within the Welsh regions, if the regions are to be meaningful entities.

 

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