Welcome to the Public Works blog.

Public Works is UNISON Scotland's campaign for jobs, services, fair taxation and the Living Wage. This blog will provide news and analysis on the delivery of public services in Scotland. We welcome comments and if you would like to contribute to this blog, please contact Dave Watson d.watson@unison.co.uk. For other information on what's happening in UNISON Scotland please visit our website.

Monday, 16 October 2017

Welcome energy decisions, but we must be bolder

There is no shortage of activity on energy policy and we haven’t even heard the outcome of the Scottish Government’s energy strategy consultation.

Let’s start with fracking. The Scottish Government has announced that the existing moratorium would continue ‘indefinitely’, which is an effective ban given their planning powers. This follows a similar ban on underground coal gasification. It will be the subject of a vote in the Scottish Parliament, but that should be a formality, as only the Tories support fracking. 

Claudia Beamish MSP still has her members bill which would put in place a stronger legislative ban. The problem with using planning powers is that the moratorium could be overturned very easily, unlike legislation. I suspect the government has decided to go down the moratorium route to avoid compensation claims from INEOS, who now have drilling licences that they can’t use. However, as the minister said, fracking, “cannot and will not take place in Scotland” - and that is the practical effect.

The overwhelming majority of people in Scotland will welcome this decision. A staggering 99% of the 60,000 respondents to the consultation supported a ban. Apart from INEOS, we had a grand rant from Jim Sillars, who claimed that people didn’t know about the consultation. Well, 60,000 respondents would indicate that claim is mince, not to mention the noise campaign groups having been making on the issue. Jim also expects trade unions to put pressure on the government to rethink the ban at the STUC. I wouldn’t hold your breath on that Jim, most unions are opposed to fracking. 


And you won’t win us over with nonsense claims about how fracking will end fuel poverty. Scotland’s geology means so little fracked gas could be extracted that its use would be for industrial, not domestic heating. Even if it could be extracted in any quantity, the cost would be prohibitive. That is why the investment is drying up for drilling in England and the companies are going to the UK Government with their begging bowl.

The next big announcement by the FM was the establishment of a state owned national energy company. Details on this are a bit scarce, but the announcement points, at least initially, to a retail operation. This is not exactly an original idea, with operations like Robin Hood Energy in Nottingham, Our Power Energy run by housing associations and the People’s Energy Company based in Musselburgh. 

A national energy company is something UNISON supported in its response to the energy strategy consultation. However, we envisaged a more radical option that involves generation and transmission as well as retail. We also support a big role for municipal energy - generating electricity, managing distribution grids, running energy efficiency schemes as well as retail sales. This is very common across Europe and seriously challenges the ownership model in Scotland, something the Scottish Government has been unwilling to do. The big energy companies’ reaction to the announcement last week, indicates that some modest retail competition doesn’t worry them very much. 

The UK Government’s stop-start efforts to introduce a price cap on energy bills, has once more run into trouble. The minister claimed the cap would be in place this winter, a suggestion that was promptly contradicted by Ofgem. The legislation could take a year and then many months more for Ofgem to implement it. Shambles doesn’t even begin to describe this. 

All the usual suspects have been dragged out to tell us how wonderful the market is - all we need to do is get into switching supplier. Meanwhile, in the real-world consumers are increasingly supporting real public ownership options as set out the Labour manifesto. The TUC joined that call at its recent Congress, unanimously backing a motion that supports returning the energy sector to public ownership and democratic control. The motion also called for a mass programme of energy conservation and efficiency, a just transition strategy and investigating the long-term risks to pension funds from investment in fossil fuels.

The last few weeks have seen some important energy policy decisions that could help reshape our energy strategy. However, that will only happen if we are bolder and resist tinkering around the edges.

Monday, 9 October 2017

Improving the governance of public bodies

Scotland's public services are administered by some 200 public bodies. Most of these are run by boards that make the key decisions on the majority of public spending in our country. This means we should pay close attention to the governance of public boards.

In 2010 Audit Scotland published a report on the role of boards that made a number of recommendations. Holyrood's Public Audit Committee has recently conducted an inquiry into the same issue and have published their findings in a letter to the Cabinet Secretary.

Some of the key points they make include:
  • Encouraging board members to provide an effective challenge to board chairs and chief executives, preventing ‘group think’ on our boards. As the recent SPA issue has highlighted, corporate responsibility should not be a means of silencing difficult’ voices;
  • The committee questions whether the involvement of a senior independent director on a board, as is the case in some parts of the private sector, could be a useful, additional check and balance on the performance of the board chair/ chief executive. Board's also need to establish a fully effective and transparent means of assessing the performance of all board members;
  • It is essential that the public appointments process attracts the best possible candidates, who should not be discouraged by the complex processThe current system may reward those who are most adept at repeating public sector jargon;
  • New legislation should give greater consideration to governance arrangements. Some of the problems have stemmed from poor initial decisions on governance arrangements;
  • There is considerable variance in the governance arrangements across boards and not always a clear rationale for such differences; 
  • Boards also take differing approaches to transparency such as holding meetings in public or private. The committee's view is that boards should be as transparent as possible and should meet in public unless there are justifiable reasons for meeting in private.



I contributed to an informal evidence session during the inquiry and the recommendations are very welcome. The membership of boards has become very 'samey', with the usual suspects dominating appointments. I have heard more than one board Chair use the phrase 'a safe pair of hands'. This isn't likely to to provide the sort of challenge the Committee is referring to. 

Workforce representation can provide a real challenge. The Fair Work Convention report recommended there should be a worker representative on every Scottish public body. Some have non-executive directors with a workforce interest. While these appointments offer an expertise that might otherwise be ignored, they are not a substitute for an employee director. However, such directors need to be supported and accountable, otherwise they can become isolated and less effective.

There is a tendency to use the shambles that is the SPA to highlight all that is wrong with public boards. The treatment of Moi Ali was both shocking and a 'good' example of the issues highlighted by the committee. However, we should remember that the structure of governance between Police Scotland and the SPA underpins many of the problems. There was a clear failure to recognise the governance problems this would cause when the legislation was going through parliament.

While the SPA is the most well known example, it isn't the only one. I can think of a number of NDPB boards that provide very weak governance. FE colleges are one as the severance packages row has illustrated. Food Standards Scotland is another, with the food industry having too great an influence. Most boards could do better on transparency.

In fairness it has to be said many of these governance failures are not unique to public boards. There has been a failure of governance in private and voluntary sector boards on pay and workforce issues. In addition, you can only appoint from applicants and many people of working age simply do not have the time to participate. On my way to giving evidence to the committee I bumped into an ex-steward who is now a senior manager in a private company that makes a big play of corporate governance. He told me that serving on public and voluntary sector boards used to be encouraged - now it is barely tolerated.


The Audit Committee recognises that some progress has been made in recent years, particularly over gender balance. Government now needs to focus on strengthening other aspects of governance. This report is a good starting point.

Monday, 2 October 2017

Funding, not more quangos will improve care integration

The implementation of health and care integration won’t be achieved on the cheap. While there should be long-term savings and better care from a shift to community services, it will take time to realise that ambition.

The Scottish Parliament’s Health and Sport Committee has been holding an inquiry into the budget for next year. We don’t have much idea how big the pot will be until the UK Autumn Budget and the Scottish Government decides on its own tax policies. However, that still allows some scope for an examination of the principles that underpin the budget.

The Integrated Joint Boards (IJB) are now responsible for some £8.3bn of expenditure – a substantial part of the Scottish budget and supplemented by local taxation. In evidence to the committee the IJB finance officers highlighted that resources are not keeping up with demands. They said:

There is emerging evidence which indicates that the current level of resources is less than that required to meet current cost and demand pressures. In practical terms this means that the required shift in the balance of care will take longer to achieve. A number of Integration Authorities have modelled the level of additional resources required to meet cost and demand pressures, with estimates between 3% (for 2018/19) and 14% (over two years) of existing budget.”


The clear message to the committee was that increased demand, largely due to demographic change, means that they don’t even receive a standstill budget. Transformational change comes with a much bigger price tag.

Measures to reduce unplanned admissions to hospitals and cut delayed discharges can be successful. A number of IJB performance reports demonstrate progress. Not least in Glasgow, which claims continuing decreases in delayed discharges with acute bed days lost falling from 38,152 (13/14) to 15,557 (16/17). However, the picture continues to vary across the country. As I said while giving oral evidence to the committee; unplanned admissions will continue until a full social care service is in place – hospitals don’t turn patients away.

I did notice a definite pitch from IJB directors and finance leads for direct funding and greater control. We should remember that IJBs don’t employ staff and get their budgets from health boards and councils. Their complaint is that funding ‘doesn’t lose its identity’ in this system and they have matrix performance monitoring. Concerns over double counting of health and care funding are valid, as are the constraints of ring-fencing.

It was entirely predictable when you create a system that co-ordinates services that sooner or later the leaders want to create an empire that they have more control over. This leads to a demand for stand-alone bodies – in effect a whole new set of local quangos. 

This demand should be resisted. The change that is required in care cannot be achieved by IJBs in isolation. One of the points I picked up from trade union colleagues in Norway was that separating the management of acute and community services made it that much more difficult to achieve resource transfers. The same applies to councils, who run range of other services that impact on health; like housing, planning, libraries and leisure services. You don’t join up services by fragmenting them even more.

From a staff perspective, such direct control would involve a massive transfer of health and care workers to new organisations. A move that will be resisted by all the trade unions for good reason. Such a transfer would take many years and the harmonisation negotiations would be a complete nightmare. It would require a massive funding pot and divert staff and management effort for years.


It is clear that transformational change in the health and care system requires a significant increase in funding. While there are still some organisational and cultural barriers to integration, more local quangos are not the solution.

Tuesday, 26 September 2017

Why John McDonnell's PFI pledge is welcome and affordable

John McDonnell caused a stir yesterday with his pledge to bring Private Finance Initiative (PFI) contracts back in house. Commentators who bandy about huge sums of money to pay for this commitment are missing the point.

The shadow chancellor said in his conference speech that Labour had already pledged not to sign any new PFI deals. He then added: “We will go further. I can tell you today, it’s what you’ve been calling for. We’ll bring existing PFI contracts back in-house.




Unsurprisingly, this was immediately welcomed by UNISON, who campaigned against PFI from the outset, whichever government (Tory, Labour and SNP) used the scheme. Dave Prentis tweeted, “At long last! Our party sees sense on PFI”.

Let’s start by understanding what a PFI scheme is. Instead of borrowing in the normal way, public bodies contract with a consortium of private companies known as a Special Purpose Vehicle, to design, build and operate a public asset - typically schools, hospitals, roads and waste treatment works. The Tories invented the idea, Labour developed it and the SNP use it in Scotland to this day – albeit renamed as NPD or Hubcos. Instead of meeting the borrowing and running costs directly, public bodies pay an annual fee to the contractors.

The scheme has been criticised on many grounds and in the early years the main driver was keeping capital projects off the public sector off the balance sheet. Particularly important in Scotland because of the block grant and led to the saying ‘it’s the only game in town’. 

The main problem with PFI is that the private sector can’t borrow as cheaply as the public sector, and of course take a profit. Government can now borrow very cheaply indeed and this had led to calls to refinance such projects. PFI schemes are notoriously secretive, but we know that they are paying interest rates of 7%+, at a time when public bodies could issue bonds at a little over 1%.


UNISON Scotland set out in our ‘Combating Austerity’ plan how this can be done and save millions of pounds of austerity cuts in the process. The Public Accounts Committee at Westminster, hardly a bastion of socialist economics, also highlighted how such refinancing had been achieved in England. Sadly, while some projects have been brought back in-house in Scotland, progress has been glacial, as our progress report this summer shows.

An important forerunner to any contract renegotiations should be stricter monitoring of contracts and restructuring the existing provisions. A number of public bodies in Scotland are beginning to take this seriously, but again more could be done. At UK level John McDonnell could help by committing to changing some of the Treasury rules that make refinancing more difficult than it might be.

That’s why the commitment from Scottish Labour leadership candidate Richard Leonard is so welcome. He said: “Scotland has a huge liability to PFI and the Scottish Government’s Non-Profit Distributing scheme. The Scottish Government could and should set up a debt disposal department dedicated to raising funds to buy out the total outstanding £28.8bn PFI and NPD debt on operational contracts. Doing this could save the public purse hundreds of millions of pounds. If I’m Labour leader I’ll be pressing them on this issue and as a Labour First Minister it will be a priority.”


McDonnell’s actual commitment is fairly modest and doesn’t commit Labour to a massive increase in public spending. That’s because the public sector is already paying over the top for these schemes, so bringing them in-house would actually be a saving to the public purse. As well as giving public bodies control over vital public assets.

Thursday, 14 September 2017

Health & safety and the ageing workforce

With twice as many people working past the State Pension Age, we need to give proper attention to the health and safety implications of the changing workforce.

I have highlighted before our research into the ageing public sector workforce in Scotland. With the 50-60 age group expanding the fastest, around 40% of the workforce is likely to retire within ten years. This is reflected in the wider workforce, with one in three workers over the age of 50 by 2020.


Yesterday, I was speaking at the RoSPA conference in Glasgow on this issue.

I argued that we need to recognise that despite equality legislation, older workers face at best unconscious bias in the workplace, and at worst overt discrimination. This shows itself in attitudes towards training, development and promotion opportunities. The UK will have 7.5m job vacancies to be filled by 2022, and that's before the impact of Brexit. With one million 50-64 year olds unemployed, but wanting to work, we simply cannot allow their skills to be wasted.

As I said in a recent column in The Scotsman, we need to talk less about the demographic time bomb and more about the demographic dividend. We need to find ways of keeping older experienced staff and helping them to pass on their knowledge and skills.

That's not to say that we should ignore the health implications. Older workers are at risk of burnout, due to the physical and emotional demands of their jobs over a long period. We need to look at later life career changes, flexible working and develop a funded sabbatical policy.

Older workers have a lower incidence of short-term absence, but a higher risk of long-term illness. This needs to be reflected in sickness absence policies that have become increasing rigid in recent years. For example, workplace dementia will be a new condition for many employers to address. Some 3,200 workers under 65 have been diagnosed and this means that employers need a strategy that includes diagnosis, support and adaption. The Alzheimer's Society has a useful guide on this issue.

While there is no evidence that older workers are at greater risk in the workplace, there are some age related factors. Older workers are at marginally higher risk from slips and falls; physical strength and stamina declines with age; as does sight and hearing. However, I could produce a different list of risks with younger workers.

We therefore need to respond to the challenges and opportunities of an ageing workforce as we would for any other safety risk. By risk assessment and if necessary by redesigning jobs to reflect age factors. All the time remembering that older people are not a homogenous group, to be lumped together in a one size fits all response.

Overall, we need to change workplace culture to regard older workers as a positive gain to the workforce. This starts by raising awareness and developing a strategy. Such strategies need to recognise the health and safety implications - always remembering that work needs treatment too, not just the worker.

Friday, 25 August 2017

Barclay review - mostly sensible reforms to business rates

The long awaited Barclay review of business rates hasn't exactly set the heather alight, but its recommendations are, in the main, pretty sensible.

The reviews main recommendations are set out in this helpful infographic.


The remit for the review was that the recommendations had to be revenue neutral. This means there are gainers and losers from the changes in both the structure and the reliefs.

The business lobby has long argued that business rates are too high in Scotland. However, they conveniently ignore the wider picture of business taxation. As this chart shows, businesses generally pay less taxation than their OECD counterparts.


The report recommends a number of administrative improvements such as three yearly revaluations. This is something UNISON has long argued for and the same should apply to the council tax on domestic properties. Better information, transparency and speeding up appeals and repayments are all reasonable. Plugging the many tax loopholes and a general anti-avoidance rule is a long overdue reform.

Big companies have obviously lobbied for consistency, but while the report supports standardisation, it doesn't recommend centralisation through another quango. This should remain a local system, reflecting local knowledge and that fact that most businesses in Scotland are local. The disappointment is that the review should have gone one stage further and returned the decision making on the level of business rates to councils.

The review also questions the effectiveness of the Small Business Bonus Scheme. The government has thrown huge sums of money at this scheme that could have gone into councils. A review in Northern Ireland has found that this relief could be better directed. Reform would also pay for the generous recommended changes in business support costing £45m.

There are winners and losers of reliefs. Town centres and day nurseries get new relief from business rates. It is perfectly reasonable to use tax reliefs to encourage particular policies and early years provision is a key element of tackling inequality. However, such support should come with at least some strings. The Scottish Living Wage would be a good start for the notoriously poor employment practices in many day nurseries.

The losers come in recommendations to restrict charitable relief. Private schools have come out with a predictable defence of their status. However, it’s not the purpose of charitable status to perpetuate the inequalities in our society that private schools sustain.

 

The other is sport and leisure facilities including council leisure trusts. Despite the claimed benefits of these organisations, the primary driver was tax dodging. If this loophole is plugged, as we warned it might, then councils should be taking these services back under direct control. However, this was one of the ways that councils coped with cuts to their budgets, therefore there would need to be compensatory budget uplift from the Scottish Government.

Supporters of Land Value Tax won't be pleased with the review, even if the door is partly ajar. They came to “An over-arching conclusion that we reached is that some form of property tax is still an appropriate way to fund the local services provided by councils”. While there may be a role for Land Value Tax as part of a basket of taxation, this is the right call.

Finally, the impact of the council tax freeze is highlighted in the revenue data. This chart shows how the council tax and business rates used to raise similar levels of revenue. Hopefully, ending the freeze will start to redress this imbalance once again.


While I might have wished for something a bit more radical, the review overall recommends some pretty sensible reforms. Not without some political challenges for the finance minister!


Getting it Right for Every Child

Before the recess the Education Committee at the Scottish parliament published a report into how well additional support for learning is working in practice. The report supports the feedback UNISON had been getting from our members in schools. Scotland is not getting it right for children with additional support needs.

We have some great strategies and policy commitments to supporting children with additional needs but these have not been matched with adequate funding to enable their implementation. Schools do not have enough money for recruitment, training and support for the staff needed to meet those needs.

There is also still widespread misunderstanding about who is actually working with these children and young people on a day-to-day basis. Again and again in policy papers and inquiries the focus in on teachers, teacher training and improving their skills and knowledge. These are not the workers supporting children. It is is support workers, pupil support assistants and classroom assistants. There needs to be training and professional development for all the staff working with those children.

When the education committee held an evidence session at the parliament it was interesting to see that politicians, and policy people talked about teachers all the time but the parents talked about classroom assistants and support workers. They know who is working with their children.

No policy will work without appropriate funding. This means the day-to-day delivery of that service and for adaptions, special equipment and extra space in mainstream schools and nurseries and as the new proposals for strategic delivery acknowledge very specialist provision out with the mainstream for some.

Parents often have to fight to get the additional support their child needs. When parents (who are able to fight) “win” that fight is no additional funding attached to implement the decisions. This therefore has an impact of provision of services for other children relying on that budget. The Scottish government needs to develop a much more detail on the demand for both the strategic services proposed in the strategy and those services that will remain in local authority control. There then needs to be funding to meet those costs. It is also clear that there is a risk that those from better-off backgrounds have higher chances of winning those battles and so further increasing the attainment gap.

UNISON conducted a survey of school staff earlier in the year and while the survey was about the impact of cuts on schools, members working with children with ASN consistently responded saying that they were not getting adequate training and support to deal with the complex needs of the children they were supposed to be supporting.

Scottish government is now consulting on improved guidance for schools on “supporting children’s learning” and the "healthcare needs of children in our schools". Good guidance on these issues is very welcome but delivery of the services depends on adequate funding otherwise it will just be another set of folders on an office shelf.