Inspectors On The Non-Job

FRIDAY, NOVEMBER 27, 2009

Inspectors On The Non-Job

Labour's huge and incompetent government inspectorates are worse than a waste of money - they are downright dangerous. Take today's scandal:

"Poor standards of care at an accident and emergency unit in one of the country's flagship hospitals may have contributed to the unnecessary deaths of over 400 patients, an official NHS investigation has concluded. Dirty equipment and an absence of leadership contributed to a death rate almost 40 per cent above the national average among emergency admissions to the 770-bed Basildon and Thurrock University Hospitals NHS Foundation Trust, inspectors said. 

The unit had blood stains on the floor, dirty curtains, stinking mattresses and soiled equipment; nurses who failed to monitor, feed and give drugs to patients correctly; and a rate of pressure sores almost twice the national average. Instead of the national four-hour maximum waiting time for A&E, the trust was operating a 10-hour waiting time."

That's scandalous enough of course (especially as the description sounds all too reminiscent of various other NHS hospitals we could mention).

But the real scandal of Basildon and Thurrock Hospital is that it's literally just been rated by government inspectors as "Good", with a 13/14 mark for "Safety and cleanliness" (see here). And those inspectors - the Care Quality Commission - arethe very same inspectors who've now discovered the hospital is in fact unsafe and filthy.

So WTF is going on? 

On BBC R4 Today this morning, Evan Davis attempted to find out from the Commission's head, serial quangocrat Baroness Young (Environment Agency, BBC, etc etc). She made virtually no sense. 

First, she said the scores on the Commission's website were out of date, even though the scores relate to 2008-09, ie the recent past. She reckoned they'd only published them because the Secretary of State had a duty to so. Then she said the Commission's inspection methods had changed and that they now involve... er... inspections. Then she said the Commission is brand new and can't be held responsible for the rubbish produced by the previous inspectorate - even though it's been published by the Commission on the Commission's website. 

Obvious questions arise. If the scores on the website are useless, why should we punters believe them? What's the point of them? What should we believe? How do we know any hospitals are safe? 

But when Davis tried to ask those follow-ups, the Baroness slipped into a kind of gibberish that Tyler cannot report because he simply couldn't follow it (like virtually all members of the modern commissariat, Young is immensely articulate without actually making any sense).

So there we have it - another large government inspectorate churning out screeds of rubbish that is much worse than useless.

And what does the Quality Care Commission cost us?

The Commission is another of Labour's superquangos, established in March 2009 as the amalgamation of three existing quangos - the Healthcare Commission, the Mental Health Act Commission, and the Commission for Social Care Inspection. Summing the 2007-08 spend of those three gives us a total annual spend for the new Commission of £214m (see latest TaxPayers' Alliance quango book). Let's call it £230m for this year.

The combined staff is 2700, which you might consider more than enough. But the Commission clearly wants more, and is currently advertising the following attractive new posts:

• Head of Learning - £75k pa
• Head of Culture and Performance - £75k pa
• Head of Change Management - £75k pa

Amazingly, they are not advertising for a Head of Tying Up Your Own Shoe Laces, but we get the general idea.

We've blogged these hopeless government inspectors many times (eg see here). They have a long and shameful history of rating killer organisations as perfectly safe and fit for purpose - Oftsed rated Haringey Social Services as good at the very moment Baby P was dying under their watch (see here). 

Things are so bad, even the chief inspectors no longer have confidence in the ratings. Baroness Young clearly thinks her organisation's ratings are useless, and earlier in the week the head of Ofsted said the same thing about their school ratings. 

In Ofsted's case, it turns out that when they rate a school as "satisfactory", what they really mean is that it is failing to provide its pupils with a proper education. Which right now means that a shocking one-in-three state schools is failing. 

Ofsted's Annual Report also illustrates another key weakness with these inspectors - they keep changing their minds. So nearly one-in-five schools judged to be good at their previous inspection are now rated as no longer good - ie merely "satisfactory" or inadequate. Who can place any faith in ratings that slide around like that?

So what to do?

First, abolish these massive inspectorates - they have expanded way beyond their original remit of making sure taxpayers' money was not being squandered, and they now do more harm than good (especially to the organisations they terrorise).

Second - yes it's that same old song - put power into the hands of the customers, and let the market decide who's doing a good job and who isn't. School vouchers and competing social health insurers are the only way we can seriously expect to achieve improvement.

THURSDAY, NOVEMBER 26, 2009

Keep Right On To The - To The - To The

A very scratched record

Regular readers may recall the paper we wrote last year for the TaxPayers' Alliance calling for the abolition of the Barnett Formula (see here and here). We argued that Scotland should be granted full fiscal autonomy, with responsibility for raising its own tax revenues. 

Since then we've had a weighty report from the Calman Commission that fell some way short of what we proposed. And yesterday we got the government's response, which fell even shorter.

The guts of the government's new proposal is that the Scots would be given wider authority to vary their local income tax rate (they already have authority to add up to 3p to the standard UK rate). In Scotland, the UK rate of income tax at both basic and higher rates would be reduced by 10p, and replaced with a Scottish income tax, decided by the Scottish Parliament. Scotland would lose an equivalent chunk of its block grant funding from London, but therefater  it would have the authority to vary its local income tax rate up or down. 

So a step along the high road of fiscal autonomy?

Well, yes, but a very very small one.

To start with, the amount of revenue involved is only about 15% of the current block grant. Overall financing arrangements will remain hugely dominated by the Barnett Formula, which will remain in place, as is.

Second, the Scots will not be permitted to change the progressive structure of income tax: their Scottish local income tax will have to be at the same rate for all taxpayers right up the income scale. Which means for example, they will not be able to counteract the economic nonsense of the new 50p top rate (which as we know, will damage the economy and may actually reduce revenue - see this blog).Real fiscal autonomy would allow the Scots to make their own decisions on tax incidence and would allow them to compete with England.

Third, the Scots will have no incentive to build their tax base. The Barnett Formula grant will be reduced by Whitehall's calculation of what a 10p rate would raise in Scotland. Which means that if the Scots manage to grow their economy and their tax base, they will lose grant funding, one-for-one. This is the classic problem with such grants - they incentivise inefficiency rather than local enterprise and effort.

The real decisions on Scotland's fiscal autonomy still lie ahead.

But don't hold your breath. No London-based government has ever shown enthusiasm for surrendering meaningful tax power to Edinburgh. And since the collapse of their overblown banking system, the Scots have also taken a mighty step backwards.

It's going to be a very long road. And an increasingly stoney one for the English taxpayers who continue to fund much higher public spending in Scotland than they receive themselves:

WEDNESDAY, NOVEMBER 25, 2009

How Many People Work For The Government?

How many people work for the government? According to the Major, the answer is none. 

Personally, I think that's a tad harsh. But prompted by a comment on a recent BOM post, we've taken another look at how many are employed by the government.

We start with the official count published by the Office for National Statistics. It says that as of Q2 2009, public sector employment totalled 6.039 million, up from the 5.182 million Labour inherited in 1997 - an increase of 17%* (and see here for some interesting longer-term material). 

However, big though it is, that total excludes a number of groups who are not counted as being employed in the public sector, but who depend on the public sector for the vast bulk of their earnings:

• Higher and further education - for arcane historical reasons, H&FE colleges are defined as being in the private sector, even though most of their funding comes from the taxpayer. When last sighted, they were employing some 530,000 staff.
• GPs - they are counted as part of the NHS by the Department of Health, but most are excluded from the ONS count because they're technically private contractors. There are currently some 40,000 of them in the UK.
• Network Rail - as we've blogged before, Network Rail is nationalised in all but name, but under an extraordinarily convoluted definitional fudge it's counted as part of the private sector. It currently employs 33,000.

Adding these groups back in takes the public sector employment total up to 6.7 million. 

And then of course, there are all the people whose jobs have been privatised over the years, but who still work pretty well exclusively for the public sector - ie hospital cleaners, dustmen, IT staff, etc etc. How many? We have no idea, but our guess is at least another quarter million, taking our public sector employment total up to around 7 million. 

So, of the 28.9 million people currently in employment (see here), around one-quarter of them are employed by the government (aka the taxpayer).

And of course, there's another huge group of people who while not employed by the government, are still dependent on taxpayers for their incomes.

To start with, there are now 5.8 million people of working age who are entirely dependent on welfare (see here), including 1.4m on Job Seeker's Allowance, 2.6m on incapacity benefits, and 0.7m on lone parent benefits. Actually those figures relate to May, and with increased unemployment, the overall total is now probably 6 million.

Adding them in as well, gives us an overall total of 13 million people dependent on taxpayers for their incomes. 

And remember, these are people of working age. If we add in the 12.5 million older people now drawing state pensions, we get to a grand total of 25.5 million - 25.5 million people who are dependent on the taxpayer for most or all of their incomes.

Which is somewhat alarming.

Because on our calculation, we've only got 22 million people who are generating income from sources other than the taxpayer (ie 28.9m in employment less the 7m employed by the public sector). So each one of them has to earn the income to support him/herself plus 1.2 other adults... kind of idea.

Does that sound like it's sustainable?

Or is it time to dust off those dog-eared copies of Bacon and Eltis? (Britain’s economic problem: too few producers by Bacon and Eltis (1976) is not online, but for quick flavour, see here - section 3.1).


*Footnote - although the ONS public sector employment numbers exclude college lecturers and GPs etc, they do now include the 235,000 staff employed by our nationalised banks - ie RBS, Lloyds, Northern Rock, and Bradford & Bingley.