Weekly policy update
3 February 2010
HEFCE funding decisions
Personal Care at Home Bill – costs disputed
Change imminent in community services
Foundation trusts urged to re-think workforce
Public sector union threatens rolling strikes over redundancies
Interview with political architect of “easyCouncil” model
Green paper on military reform prepares ground for defence review
HEFCE funding decisions
On Monday, HEFCE announced its board’s provisional funding decisions, taken after
considering the information in the Secretary of State’s grant letter. More information
on the grant letter is available here.
HEFCE’s total grant for 2010-11 is £518 million less than 2009-10, although the
comparison is complicated by the fact that £250 million of capital funding was
brought forward from 2010-11 into the previous two financial years. Compared with
the funding forecast for 2010-11 in the 2008-9 grant letter (i.e. the funding
universities were expecting) the total reduction in funding is £449 million.
Key decisions on how to allocate the funding include:
 £4,727 million recurrent funding for teaching - a 1.6 % real- terms decrease on
2009-10
 £1,603 million recurrent funding for research - a 2 % increase in cash-terms
(maintained in real terms) on the previous year
 £562 million in capital funding - a 14.9% reduction in cash terms on 2009-10
In addition, HEFCE estimates that the amount to be paid by universities who exceeded
the caps on student number in 2009-10 will be £10 million in total.
Institutions will be told their individual grant allocations on 12 March.
Read HEFCE’s circular letter announcing the decisions here.
Personal Care at Home Bill – costs disputed
The Association of Directors of Adult Social Services has cast doubt on the feasibility
of the Personal Care at Home Bill, which had its second reading in the House of Lords
on Monday.
www.odgersberndtson.co.uk
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According to a survey of 61 local councils carried out by the organisation, the cost to
local authorities of providing free care at home to approximately 280,000 people with
the highest care needs will be twice the £250 million estimated by the government.
ADASS claim that the average weekly cost of providing care to those with high needs
is £200 per week, as opposed to the £103 per week which the government figures
supporting the bill allow for.
The Department of Health is currently consulting on the regulations and guidance
that should accompany the bill, and the consultation runs until 23 February.
Summary and progress of the bill
Department of Health Consultation
Change imminent in community services
The Health Service Journal reports that guidance which the Department of Health is
due to publish shortly on the future shape of community services will encourage
providers of those services (which include things like health visiting, community
matrons, occupational therapy, palliative care, etc) to undertake so-called “vertical
integration”. This is a form of merger, whereby providers of community services,
rather than operating as discrete entities, are integrated into a larger provider of
hospital care.
The aim is to simplify care pathways, such that a patient’s care is more closely
arranged around their needs, simplifying their journey through the healthcare
system, and ultimately saving money by reducing costly, unnecessary hospital
admissions.
There has been considerable policy confusion recently around the provision of
community services (which account for around two-fifths of the total NHS workforce)
which are facing growing demand, downward pressure on budgets, and the
introduction of pricing for their services (likely to lead to more aggressive
commissioning and competition from the third and private sector). But the
expectation is now that, by March 2011, providers of community services will have
definitively separated from their former PCT parent organisations, and established
themselves as social enterprises, vertically integrated providers, acquired Community
Foundation Trust status, or else merged with Local Authority social care providers.
You can read a policy briefing on trends in community services here.
Foundation trusts urged to re-think workforce
A copy of an internal report produced by the umbrella organisation the Foundation
Trust Network (essentially a lobby/advocacy organisation for the NHS’ quasiautonomous Foundation Trusts) was leaked to the public sector union Unison. The
report suggests that Foundation Trusts should fundamentally re-examine their
workforces, in the short time remaining before budget freezes kick in from 2011,
since an approach to headcount reductions which relied on “natural wastage” of posts
would not save sufficient money, and would not produce the type of skills and
workforce that the NHS will require in future.
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The report was based on a survey of Foundation Trusts; it calls for a halt to pay
progression for a couple of years, a cap on the top pensions, a reduction in the
number of pay points in the Bands set by “Agenda for Change” (the national pay
structure) and action to reduce absence through sick leave. Its leak comes as unions
and NHS employers are due to begin discussing whether or not NHS staff should be
encouraged to agree greater flexibility in their working conditions, in return for
guarantees of job security.
HSJ report available here.
Policy briefings on NHS leadership and workforce available here.
Public sector union threatens rolling strikes over redundancies
The Public and Commercial Services (PCS) union, which thanks to its 270,000-strong
membership, has a significant presence in Whitehall Departments and has a record of
industrial action taken to fight controversial, large-scale workforce change at the
heart of Government, has balloted its members on strike action in the spring, to
embarrass the Government, in response to the Government’s decision to legislate to
scale back civil servants’ severance payments.
The Cabinet Office (with overarching responsibility for civil service reform) argues
redundancy packages are overly generous, and should be brought into line with
private sector levels. It hopes to save £500m over three years through the deal, which
will be included in an order to be laid before Parliament at the end of the week. It has
reportedly signed an agreement with five other, major public sector unions, who will
not oppose the moves through strike action.
Guardian Society report available here.
Interview with political architect of “easyCouncil” model
Mike Freer, the Conservative Councillor who was Leader of Barnet Council, when
controversial plans were drawn up to drastically overhaul the way the local authority
delivers services, along the lines of the easyJet business model, has given a detailed
interview to the Guardian, justifying the “Future Shape of the Council” project. He is
now the Conservative Parliamentary candidate for Finchley and Golders Green – a
totemic seat for the Conservatives, since it was the stomping ground of Margaret
Thatcher.
The interview is significant, since it represents a full-length rationalisation of the
efficiency model set out in the Future Shape project, which is widely seen as a
blueprint for the types of reforms a probable future Conservative Government will
push town halls to undertake; Barnet is a flagship Conservative Borough.
In the interview, Freer glosses the Barnet model; it’s three-pronged. The first element
is the “easyCouncil” one – concentrating on improving the quality of core services and
extending charging for non-core ones. The second is improving efficiency through the
merger of back-office functions with other public bodies in the area, dramatically
reducing spending on administration and improving information-sharing for joint
interventions. The final prong is a concerted attempt to intervene early and
strategically to address those families with complex service needs, who place a
disproportionate burden on Council and NHS resources.
Guardian interview available here.
www.odgersberndtson.co.uk
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Green paper on military reform prepares ground for defence review
Both the major parties are committed to conducting a strategic defence review – the
process by which the long-term policy on the shape of the armed forces is determined
– after the General Election. The current Government has published a Green Paper on
its view on the reform of the services, in advance. The Green Paper recognises the
need for closer and more effective cooperation with key NATO partners but there are
no commitments on spending patterns in the future. The demands on the armed
forces, and the prospect of spending cuts (in the absence of any guarantees on
Departmental budgets for the MoD from either major party) is causing much political
jostling for influence and position from the three branches of the services, and from
major defence contractors eager to defend lucrative, long-term defence supply
contracts and relationships.
Meanwhile, a think-tank, the Centre for Policy Studies, has published More Bang for
the Buck (available here), arguing that defence procurement has been deeply flawed
and is urgent need of reform, to squeeze better value from suppliers.
www.odgersberndtson.co.uk