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Mutuals Champion Maude standing down, what next for the mutuals agenda?

by Craig Dearden-Phillips 02/02/2015

Cabinet MP Francis Maude is to stand down from Parliament at the General Election. He will be missed a great deal by many of us. An arch-moderniser in the Tory Party, he pushed hard for radical change both in the way Government operates and in the way public services are delivered.   

For this reason, he was the biggest force behind public service mutuals, of which there are now over 100 employing 35,000 people. Francis invested energy and passion into the mutuals agenda and, without fanfare, spent many Friday's out in Blackburn, Wakefield or wherever, meeting and encouraging these new enterprises. He believed they worked and presented an attractive alternative to state provision or outright privatisation. He has been a great Minister for mutuals.

And it is for this reason that I am worried that he is on his way. Public service reform, more widely, has been a rather mixed story under this Government. The ambition set out in the early white paper on public service reform, which envisioned a new level of pluralism right across public services, was an early victim of both coalition politics and a lack of determination across all government departments, to run hard with that degree of reform. The fact that mutuals remained more than a footnote is largely due to Francis Maude's efforts.    

There are other reasons I am concerned. Transforming Rehabilitation looked like a nailed-on opportunity to demonstrate the potential of Mutualisation in the probation sector with several strong candidates emerging. But the Ministry of Justice was, in reality, having none of it and the real winners were the big global outsourcers Interserve and Sodexo. Mutualisation, for many in today's Conservative Party, is seen along with huskies and hugs-for-hoodies, as part of that early 'Cameron vision' for a kinder, gentler conservatism. Those voices, I venture, are not the dominant ones in the hard world of public sector reform post 2015 when, I believe, we will see massive private sector outsourcing on a scale never seen before, at all levels of government.

As those who read my columns know I am actually in favour of the opening up of markets in public services. How else can alternative models like mutuals see light of day? But I am concerned that we may see re-treads of Transforming Rehabilitation where good mutual propositions fall due to the lack of financial might and the need to meet the Government's own requirements for parent company guarantees. This is a market failure, no less, that needs to be solved. (Social Investment funds take note!)

However there are some grounds for optimism. While Francis leaves the stage, in his place are over 100 live-and-kicking public services mutuals. This is no longer just an idea; it is a living experiment with some compelling early evidence to suggest that mutualisation boosts productivity, quality, innovation and reduces cost. These are all titanic challenges facing the public sector more widely and we now have a cadre of businesses showing how it can be done.

Wisely, Maude has understood that the best way now to boost mutualism in public services is to ask those leading this new sector to design the future delivery of mutuals policy, post 2015.  His Challenge Prize is inviting mutuals to create future ecosystems for this agenda so that 100 mutuals can become 1000, whoever is Cabinet Secretary in a few months' time.

Of course, a lot depends, we all know, not only on the result in May but on the flavour of overall policy on public sector reform. Academies and Foundation Trusts went large because they made sense to a lot of people and were used to push reform in an intended direction. Mutualisation will either get picked up or quietly dropped by the next administration. Thankfully we have supporters across all three main parties and the latter feels less likely now than perhaps a year or two ago. But it really is on a knife-edge, we have to understand that.

What can the mutual sector do to help itself? It's essential that this approach is sold properly to all parties to fit their own worldview as well as the wider needs of the country. To those on the right we represent plurality, contestability, agility and productivity. To the left, we are an alternative to privatisation, we are staff owned, we are inclusive and fair in the way we work. To the politically neutral we are the obvious middle ground between the still unproven private sector and the unaffordable public sector which, too often, will close services in preference to reforming itself.

2015 is an important election for mutuals, as well as everyone else!

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