Key to economic recovery lies in unlocking workers' creativity

5 May 2009

The future of our public services will be as central to the next election as the future of the economy. The experience of Newcastle City Council shows that most political party leaders are wrong when they believe the solution lies in further competition and outsourcing.

The future of our public services will be as central to the next election as the future of the economy. Indeed they are increasingly bound together. On this as on many other issues, party leaders are speaking the same language: the language of competition and outsourcing to private companies.
We have to look beneath the political radar to find an alternative.
The workers and managers at Newcastle City Council for example have demonstrated the practicality of an alternative based on releasing the creativity of public sector staff. A genuine partnership between an innovative management and a strategically-minded trade union is reaping benefits for all.
Public Sector Reform... But not as we know it! is the story of how staff, trade unions and managers at the council joined forces to defeat the privatisation of the authority's IT department and went on to transform the department, simultaneously producing £28.5m in savings and making dramatic improvements to services – all without a single compulsory redundancy.
Key principles guided their achievements:

  • Treating workers as assets, not problems, and creating a genuine culture of collaborative problem solving.
  • Putting a genuine public service ethos at the heart of the transformation.
  • Recognising the critical role of trade unions in providing a strong voice for staff and in providing an infrastructure for workplace democracy.

The resulting reforms provide strong proof that the public sector has its own criteria and mechanisms for efficiency, quite distinct from goals of profit. They show that, with a clear shared vision, an egalitarian management, a strong union and workplace democracy, the public sector can make itself a highly effective steward of public money. In particular it can realise its special asset of skilled staff committed to serve their fellow citizens – the very asset that Lord Mandelson's policies will squander.
But this story of democracy-driven change is also fundamental to an alternative economic strategy to counter our fast-moving descent into a depression. Publicly-led public service reform driven by the principles exemplified in Newcastle lays the basis for creating new and useful jobs in the public sector throughout the UK – in building council housing, caring services, youth services, environmental services, ICT, strengthening the social economy and so on. It is not as though there is a lack of things that need doing!

Taken from a report, Public Sector Reform... But not as we know it!, by Hilary Wainwright, the Research Director of the New Politics Programme at the Transnational Institute, published today by Compass

About the authors

Hilary Wainwright

Hilary Wainwright is a leading researcher and writer on the emergence of new forms of democratic accountability within parties, movements and the state. She is the driving force and editor behind Red Pepper, a popular British new left magazine, and has documented countless examples of resurgent democratic movements from Brazil to Britain and the lessons they provide for progressive politics.

As well as TNI fellow, she is also Senior Research Associate at the International Centre for Participation Studies at the Department for Peace Studies, University of Bradford, UK and Senior Research Associate at International Centre for Participation Studies', Bradford University. She has also been a visiting Professor and Scholar at the University of California, Los Angeles; Havens Center, University of Wisconsin, Madison and Todai University, Tokyo. Her books include Reclaim the State: Experiments in Popular Democracy (Verso/TNI, 2003) and Arguments for a New Left: Answering the Free Market Right (Blackwell, 1993).

Wainwright founded the Popular Planning Unit of the Greater London Council during the Thatcher years, and was convenor of the new economics working group of the Helsinki Citizens’ Assembly from 1989 to 1994.\

Follow Hilary on twitter: @HilaryPepper


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