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.

Friday, 18 September 2015

Dragging university bosses out of the Middle Ages

The university principals’ campaign against the very modest proposals to modernise university governance in Scotland is now bordering on the hysterical.

 

The Scottish Government’s Higher Education Governance (S) Bill proposes an elected chair of the governing body and two places for trade union representatives. Yes, that’s just about it. These are the devastating plans that will bring our cherished institutions crumbling down – if you believe the hype from Universities Scotland, the HE bosses mouthpiece.

 

Universities rightfully value their academic freedom and that is not challenged in any way by this bill. In fact, the new definition, if anything, strengthens it. However, this freedom does not exempt them from being governed properly and to be run efficiently and effectively. Better governance of banks could have prevented the collapse of those banks and the ensuing financial crisis and the same is true for charities. There must be independent oversight of how senior management operates in any organisation.

 

Scottish universities receive a substantial amount of public investment, with budgeted spend of over £4 billion since 2012/13. The public rightly expects the highest standards of governance and accountability to be followed by institutions in Scotland.

 

The response to these proposals claims that these are radical changes, that the Scottish Government is ending universities independence, that trade union members on boards would not act in the best interests of the institutions and that there is a risk to their charitable status risking millions in philanthropic giving.

 

These are all nothing short of absurd. A huge range of organisations, including trades unions, are subject to a range of legislation and government oversight. No one believes that the finance industry has been taken over by government because there are rules governing how it operates. There are volumes of company law on how businesses must be run. We have trading standards, environmental health, charity laws, rules surrounding the delivery of energy and telecoms, a charity regulator, utilities and telecoms regulators. Setting out rules for effective governance is not taking over. No one from the Scottish Government will have a role on university governing bodies.

 

Reclassification by Office of National Statistics (ONS) as a public body is the latest scare story by Universities Scotland. The ONS paper regarding reclassification of further education colleges as public bodies uses universities as a contrast to demonstrate why colleges had been wrongly categorised in the past. It makes it clear why the position of universities is different from colleges and there is nothing in the Bill that relates to those issues. For example, universities have far less government money as a proportion of income and don’t require permission to borrow.

 

The Scottish Charities Regulator is equally clear about what constitutes a charity and again nothing in this Bill leaves a universities open to a challenge by the regulator. The governing document of the university would have to give ministers the power to “control direct or stop it from carrying out its activities”. It doesn’t.

 

Universities Scotland had to dig very deep in its objections to trade union representatives – in fact as far back as the 1970’s. It is astonishing that academic leaders can be so unaware of developments in employee engagement. Modern employers understand that employee engagement in running organisations is a very effective way to improve efficiency and effectiveness. Research into partnership working in the NHS indicates just how successful employee involvement is in running large complex organisations.

 

As Professor Ferdinand von Prondzynski, the head of Robert Gordon University, who led the governance review put it; Scottish universities are inherently conservative institutions which have "survived intact" since the Middle Ages. University bosses have treated their institutions as their personal fiefdoms since medieval times and what they really fear is transparency and accountability.

 

MSPs should ignored this hysterical misinformation campaign and bring universities, if only just a wee bit, into the real world.

Tuesday, 15 September 2015

Power to the People

Local energy production offers some real opportunities for local authorities to raise much needed finance, to improve the lives of citizens through lower energy costs and to meet climate change targets. Lots of municipal authorities round the world are moving back into energy supply. The IPPR’s new report City Energy lays out recommendations to encourage and support UK authorities down this road. The report focuses on engaging in the energy supply market and raising finance for investment in low carbon infrastructure particular for generation.

Britain’s energy crisis
• Low income consumers are being overcharged
• Crisis of trust in energy companies
• Green finance gap
• UK economy is not benefiting from low-carbon subsidies
• Local energy generation is being held back
Cities account for two thirds of the world’s energy consumption and 70% of global CO2 emissions. Local authorities are well placed to make a substantial impact on the above challenges through producing and selling electricity to their citizens. Munich has a target to supply the whole municipality of one million people with renewable electricity by 2025 and have invested €900m in renewable projects. Energy production offers a much needed source of finance for local authorities in the long term.
Some of Britain’s cities are already have an innovative role in our energy market and local authority pension funds are investing in low carbon projects: Lancashire’s County Pension Fund has committed £200m to low carbon projects. Aberdeen is planning to use hydrogen as a vehicle fuel source which is produced by excess power from offshore wind farms. Bristol has a city solar project where local communities groups can invest in solar installations on council premises.
Business model options for cities
Fully licensed supplier: city authority sets up and delivers electricity Nottingham is pursuing this option
Joint venture: city authority works with third parties to set up and run an independent supplier
Licence lite: city authority becomes junior supplier taking responsibility for some aspects of supply and licensing while senior supplier deals with the rest GLA going down this road
Partnership: city authority works with existing supplier
White label: city authority licences use of its brand to existing suppler who markets to customers in that area.
Potential impact
Done properly local authorities could keep its and citizen’s energy bills low, reduce carbon emissions and ensure energy security. Beyond that there is huge potential for creating and maintaining highly skilled jobs with the many benefits they bring to local economies.
Engaging in the energy supply and targeting low income households with improved tariffs local authorities could make a huge leap in reducing fuel poverty. The report offers three ways that local authorities could invest in carbon reduction: municipal bonds, pension funds and the Green Investment Bank
Key Recommendations:
• Cities should consider engaging in the energy supply market where this promotes local generation and tackling energy affordability
• Cities should explore opportunities for investing in low carbon energy developments through municipal bonds, local authority pension funds and the Green Investment Bank
The report also calls for central government to
• Set up a local authority energy unit
• Encourage all pension funds to adopt the Principles for Responsible Investment
• Design fiscal rules to ensure capital debt from local authority bonds or green municipal bonds do not count against targets for cutting debt
• Give immediate borrowing powers to Green Investment Bank
The report also givens and up to date overview of what local authorities current role and the plans they are developing. Local energy production via city authorities has a substantial potential to improve lives and reduce carbon production. Hopefully we can see a rapid expansion of projects soon.

Can more legislation raise care standards?

Effectively tackling harm, abuse and neglect in health and care settings is vitally important, but is more legislation the best way to address this issue?

I was giving evidence to the Scottish Parliament Health Committee today on the Health (Tobacco, Nicotine etc. and Care) (Scotland) Bill. The Bill covers three distinct policy areas: controlling non-medicinal nicotine vapour products (NVPs); tobacco control and smoking on NHS hospital grounds; ill-treatment and wilful neglect; and duty of candour.

UNISON supports the regulation of NVPs on the precautionary principle as we can see the potential risks of these products becoming a gateway to tobacco smoking that has done so much damage to public health. We also support a ban on smoking in hospital grounds.The more controversial proposals relate to legislating for a duty of candour and new criminal offences for ill treatment and wilful neglect.

Care professions generally operate within culture of openness that supports an open discussion of potential harm and the management of risk. It is not clear that a new duty of candour on health and social care services is the best or only way of securing a culture of openness and transparency. It can be argued that consideration should be given to all other avenues for achieving this policy goal. The desired culture change could be secured through guidance, training and improvement support, rather than legislation.

The Bill will certainly create additional costs in excess of the optimistic assumptions in the Bill's financial memorandum. It will increase workload and probably add some bureaucracy that front line staff can do without. IT systems are generally not adequate or joined up to be of much assistance. There will need to be significant training and support.

This legislation could also have unintended consequences. Criminal offences can lead to defensive practice and even a culture of hiding bad practice, rather than the intended transparency. The development of a culture where open and transparent reporting is the norm requires employers to establish clear, no-blame incident reporting systems from which to learn and improve. It is also the case that some definitions in the Bill are less than clear and there is a risk for double or even triple jeopardy, with employment and regulatory procedures.

On the other hand we have to accept that there is inconsistently of approach. Observations made by Healthcare Improvement Scotland has shown that ethical and policy guidance has largely failed on its own to improve rates of disclosure. Research by the Professional Standards Authority outline the impact on health and social care professionals to exposure to stressful situations and heavy workloads, often linked with a requirement to process complicated information and focus on specific goals and targets. This 'stimulus overload‘ is cited as a potential contributor to unreliable implementation of best practice regarding a duty of candour. Normalisation of abnormal events becomes a way of coping with high risk situations.

Legislation can help to change culture although it rarely does so on its own. It will also need leadership, better staffing ratios and proper training and support for staff. All of these are likely to be in short supply with budgets stretched because of austerity. However, the Scottish Government's approach is inconsistent. When we made a similar case for new legislation to protect workers from violence at work, they produced similar arguments against legislation as those who are critical of this Bill. We are at least consistent in recognising the role of legislation!

While the evidence to support legislation in NHS Scotland is thin, it is somewhat stronger in the social care sector. The introduction of commercial contracts has put enormous pressure on staff and managers to cut corners in care. UNISON Scotland's 'It's Time to Care' report highlighted these pressures and they have if anything increased with the introduction of self-directed care. Staff reported that they were not encouraged to report safety or even carer abuse issues, because managers were concerned that they would lose the care package. A recent Employment Tribunal case involving a care manager showed that she was instructed to accept packages even when there were no staff to deliver them.

One reason to welcome the legislation is the emphasis on organisations and not individual practitioners. In remains to be seen how this will work in practice, but it should mean that organisations and their managers recognise their responsibility to provide the necessary support to staff. We have to improve organisational cultures rather than just create a monitoring tool. The remedial and publicity orders in the Bill are useful tools, although we should recognise the internal pressures within commercial organisations to suppress adverse reports.

On balance we believe that legislating for a duty of candour and the new offences could assist in achieving the stated aims. The Bill places important duties on organisations and managers, not just front line staff. However, care services have to be properly funded, otherwise there is a real risk that this Bill will simply result in staff being scapegoated for the system's failings.

 

Thursday, 10 September 2015

Chancellor’s choices

The IPPR has laid out some options to “make the spending review are progressive as possible while still delivering a surplus”. The government is committed to reaching “a target for a surplus on public sector net borrowing by the end of 2019-20 and a target for public sector debt as a percentage of GDP to be falling each year". Like UNISON, the IPPR do not agree that the current pace of public spending cuts is the right response to current economic, fiscal or demographic challenges Britain faces. The report attempts to move beyond only saying that austerity is wrong and lays out a progressive (or perhaps less regressive) route to meeting those targets.
Key Principles
Support employment and productivity: spending of services that support employment outcomes particularly of parents and young people
Prioritise preventative spending: there is still to much focus on having ambulances at the bottom of a cliff and not enough of building a strong fence at the edge to stop people falling in the first place.
Integrate services: ensuring that health and social care are better integrated does offer the opportunity for substantial savings but this will only work if it is user centred and that needs local flexibility and control. Top down integration will not work.
Devolve powers and budgets
Policy proposals
• Childcare: On top of the increase to 30 free hours of childcare for 38 weeks an additional 15 hours of holiday childcare for 10 weeks of the year targeted at 2-4 year olds whose families are in the poorest 40%
• Youth guarantee: the government should guarantee a 6 month long job to all under 25s the at minimum wage for those claiming JSA for longer than 9 month
• Troubled lives programme: a programme to join-up services for people who face multiple challenges building on th troubled families programme through a £100million fund to give bonuses to local authorities who achieve targets set for supporting excluded adults
• Invest in social house building: triple the budget of Homes and Communities Agency to to be used to build 50,000 social rented homes per year
• Transport investment: finance the One North package of integrated road and rail capacity
• Invest in energy efficiency: a further £31billion for energy efficiency measures in low income households.

Priorities for protected spending: 16-19 education, Local government social care and science

Under the current plans there will be an average cut of 39.8% in unprotected non-devolved government departments. Given the implications of cuts at this level the report proposes instead raising more money by:
• Reducing the planned surplus to £7billion from £10billion
• Aligning the higher rate of capital gains tax with the new planned higher rate of dividend tax: generating £500million
• Increasing tax on insurance premiums: increase to 13% (well below VAT) generating £1.5billion
• Pension’s reform: a cash cap on tax free pension lump sums and reducing the earnings threshold beyond which the pensions contribution annual allowance is tapered away: generating £3billion

While UNISON and others continue to campaign against the need for austerity we also need to find ways to mitigate the impact of the cuts on public services and the people who use them. This report offers an interesting starting point.

Monday, 7 September 2015

Working poor lose out from tax and benefit changes.

It's the working poor that will take the biggest hit in government changes to tax and benefits despite increases in minimum wage.

New research published by the TUC shows that the poorest working households will lose on average £460 a year by 2020 due to government changes to tax and benefits, despite the Chancellor’s minimum wage increase. However, the richest working households will be made £670 a year better off.

The research analyses the combined impact on annual incomes in 2020 of changes due to be made to universal credit, benefits, the minimum wage and tax allowances. It also includes gains from the Chancellor’s planned increases to the minimum wage. This type of distributional analysis was included in every Budget across the last parliament, but it was excluded from the Chancellor’s July Budget. Now we understand why!

The difference between the top and the middle shows up even more starkly in the decile analysis for all households, which shows that the average annual gain for the top decile in 2020 (£780) is twenty times the average gain for the fifth decile (£40).

The TUC says that the research shows that the government’s tax and benefit policies will redistribute from the poorest to the richest. This will worsen inequality and poverty – especially in-work poverty. TUC General Secretary Frances O’Grady said:

"Even after the extra help from a larger tax allowance and a higher minimum wage, low paid families will still be made more than £8 a week worse off on average by 2020. David Cameron needs to explain to low paid families why he is cutting their income by the same amount as a whole year of school dinners, but he’s giving the richest a cash boost worth a bottle of champagne every week. Not only is this unfair, but it’s bad economics. We need more money in the pockets of low paid families so that they can get out and spend it in their local businesses."

And it's not just pay and benefits - it's prices as well. People living in poverty pay around 10% more than average for essential goods and services. Citizens Advice Scotland’s Poverty Premium report found that people with low incomes end up spending more on services such as metered utilities because they are unable to take advantage of cheaper pay in advance deals or direct debit discounts across a range of services and utilities.

The lack of internet access or a landline telephone creates extra costs. Around a fifth of all households in Scotland lack an internet connection, with the lowest income groups least likely to have one. This means low income households are paying up to £112 a year more for their energy due to a lack of ability to take advantage of switching or finding cheaper tariffs.

The report said: "When the poverty premium impacts people on very marginal incomes it can leave them destitute and in need of emergency assistance such as help from food banks. The poverty premium does not just make life more expensive for the financially less well off, it often pushes them over the edge and into crisis."

This often leads low income households to use pre-payment meters (PPM) for their energy supply. Action by energy regulator Ofgem to address price discrimination against PPM users has done little to tackle this. Also, a lot of cheaper tariffs require a bank account for direct debits and paperless billing, again needing the Internet.

These two reports show that the UK government is redistributing wealth from the working poor to the rich. More unequal countries do less well on almost every measure, so Britain is going in the wrong direction.

 

 

Wednesday, 2 September 2015

Inequality: What Can Be Done?

Anthony Atkinson’s book on inequality was high up on this year’s summer reading list for policy geeks with very good reason. It shows us what can be done. Often books by academics are great on detail and analysis with lots of graphs and tables. This is too technical to gain widespread readership and often leaves the reader in despair feeling that nothing can change. This book is very different: understandable for the non-economist but still full of detail and information and with a clear programme for change
The book is full of references to the importance of trade unions and highlights our crucial historical role in redressing the imbalance of power. Atkinson’s programme calls for changes to trade union laws to ensure unions can continue to do this. Maybe that’s why the government is so keen to reduce our effectiveness with the opposite: even more restrictive anti-trade union laws. The book also looks at the wider role of trade unions in bringing expertise to the development and implementation of public policy in particular through a role on his proposed Social and Economic Council. Among his ideas for reducing inequality through the tax system is a progressive property tax: something that UNISON has been campaigning for to replace the council tax for some time.

The book is in three sections:
Diagnosis
Proposals for action
Can it be done?

The 15 Proposals– What can be done?

Proposal 1: The direction of technological change should be an explicit concern of policy-makers, encouraging innovation in a form that increases the employability of workers and emphasises the human dimension of service provision.
Proposal 2: Public policy should aim at a proper balance of power among stakeholders, and to this end should
(a) introduce an explicitly distributional dimension into competition policy;
(b) ensure a legal framework that allows trade unions to represent workers on level terms; and
(c) establish, where it does not already exist, a Social and Economic Council involving the social partners and other nongovernmental bodies.
Proposal 3: The government should adopt an explicit target for preventing and reducing unemployment and underpin this ambition by offering guaranteed public employment at the minimum wage to those who seek it.
Proposal 4: There should be a national pay policy, consisting of two elements: a statutory minimum wage set at a living wage, and a code of practice for pay above the minimum, agreed as part of a “national conversation” involving the Social and Economic Council.
Proposal 5: The government should offer via national savings bonds a guaranteed positive real rate of interest on savings, with a maximum holding per person.
Proposal 6: There should be a capital endowment (minimum inheritance) paid to all at adulthood.
Proposal 7: A public Investment Authority should be created, operating a sovereign wealth fund with the aim of building up the net worth of the state by holding investments in companies and in property.
Proposal 8: We should return to a more progressive rate structure for the personal income tax, with marginal rates of tax increasing by ranges of taxable income, up to a top rate of 65 per cent, accompanied by a broadening of the tax base.
Proposal 9: The government should introduce into the personal income tax an Earned Income Discount, limited to the first band of earnings.
Proposal 10: Receipts of inheritance and gifts inter vivos should be taxed under a progressive lifetime capital receipts tax.
Proposal 11: There should be a proportional, or progressive, property tax based on up-to-date property assessments.
Proposal 12: Child Benefit should be paid for all children at a substantial rate and should be taxed as income.
Proposal 13: A participation income should be introduced at a national level, complementing existing social protection, with the prospect of an EU-wide child basic income.
Proposal 14 (alternative to 13): There should be a renewal of social insurance, raising the level of benefits and extending their coverage.
Proposal 15: Rich countries should raise their target for Official Development Assistance to 1 per cent of Gross National Income.

It really great to see a detailed programme to reduce inequality particularly one that recognises the both the previous successes of unions and that we are central to delivering more change. All we need to now is ORGANISE....