Issue 2: March 2012

THE EVOLVING PUBLIC SECTOR RESPONSE TO BUDGET CHALLENGES

By Duncan Osler, Partner, MacRoberts LLP

In providing health and social care we're going to need to 'do more for less'. Though the demand for healthcare and social support is on the rise, the overall budgets for the Scottish public sector will reduce in real terms for some years to come. The Christie Commission Report noted the Scottish Government's estimate that if current models of care continue, the £4.5bn care budget needs to rise by another £1.1bn by 2016 and by £3.5bn by 2031. Readers will be well aware of this aspect of the challenge.

The legal duties of public bodies have not been scaled back to 'take the heat off', one potential response if areas of sacrifice could be found. The new powers in the Public Services Reform (Scotland) Act 2010 are to simplify the landscape of Scottish public bodies and make for more effective, co-ordinated government, but they complement existing powers.

In abolishing some bodies and consolidating others, by and large statutory duties to care (and related calls on the public purse) are transferred rather than reduced. The 2010 Act provides for Ministerial Orders to remove or reduce statutory burdens on the public or private sectors. As of December 2011 no orders have been made, according to the Scottish Government Regulatory Review Group.

The 2010 Act provides for Ministerial Orders to remove or reduce statutory burdens on the public or private sectors. As of December 2011 no orders have been made

Within public sector budgets, robbing Peter to pay a Pauline health and social care bill is not going to work (even if the option were there). Demands are made on public services across the board, no less deserving than those in health and social care. The Campaign to end Child Poverty produced data in January 2012 to support its contention that 20% of Scottish children are now living in poverty. More fundamentally, urgent calls are made every day on public services. Christie indicated that the level of ‘failure demand’ (interventions that could have been avoided by a preventative approach) was 40%.

The solution? Partly the hope is that prevention will deliver longer term benefits. Following a Christie Commission recommendation, one of the four pillars of reform in the Scottish Government's Programme for Government 2011-2012 Budget Review is a 'decisive shift towards prevention'.

Meanwhile in the short to medium term, some initiatives are already underway, as public service providers work more in partnership and seek to integrate services.

In October 2010, West Dunbartonshire Council entered into a Community Health and Care partnership with NHS Greater Glasgow and Clyde, which brings together both NHS and Local Authority responsibilities for community-based health and social care services within a single, integrated structure. Following on from that approach, the Cabinet Secretary for Health, Wellbeing and Cities Strategy announced in December 2011 that CHPs will be replaced by Health and Social Care Partnerships. HSCPs will be accountable to Ministers, local government and the public for delivering national outcomes.

Taking a different tack, NHS Highland and The Highland Council plan a partnership to integrate teams to work with children and families, and with people who use community care services, from April 2012. The Highland Council is lead agency in developing the integrated children’s service and with NHS Highland leading development of the integrated adult service, using the Community Care and Health (Scotland) Act 2002 as legal basis.

Christie indicated that the level of 'failure demand' (interventions that could have been avoided by a preventative approach) was 40%.

These are just examples of a range of initiatives and proposals at various stages across the land. Matters to be addressed once an agreement in principle has been shaped, are the sharing or pooling of budgets, assets and liabilities and the implications for staff, including any differences in terms and conditions. In some cases, those discussions are taking years.

The shaping of these initiatives, along with commissioning, is not just a matter for public sector bodies. Since the third sector delivers much of our public services as service providers under procurements and by grant funding, closer involvement of the third sector aids community focus and improves the design of health and social care strategies.

One of the aims of the Scottish Government's Developing Markets for Third Sector Providers programme (being delivered through to 2014 by the Ready for Business third sector consortium) is to support the public sector in using Social Value throughout public sector commissioning and procurement. Measuring the social impact of public sector strategies in health and social care will be essential if we are to maximise what is achieved.

So, all speed to the planning that is being done towards sustainable health and social care, not least since there is so much at stake.

 

 

 

Duncan Osler is a Partner with MacRoberts LLP who specialises in Public Sector and Procurement. He is also a Co-opted Director of Social Enterprise Scotland. Ready for Business is a third sector led consortium composed of Ready for Business LLP, KPMG, Social Value Lab and MacRoberts LLP

By Duncan Osler, Partner, MacRoberts LLP

Issue 2: March 2012

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