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Restructuring in the UK: Contraction and the development of a diverse

public service marketplace

Leroi Henry Working Lives Research Institute

 26 September 2013

Dublin

Restructuring in public services in UKOverview

Contraction (of staff and costs) Fragmentation (Outsourcing, contracting) Reorganisation Demonization

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Employment levels

The composition and size of the UK public sector has changed considerably over the last decade.

1999 to 2005 the steady growth of 100,000 employees per year

2005-2008 stagnant with slow decline 2008-2009 rapid increase largely due to

rescue of financial organisations (200,000) 3

The UK public sector post crisis

2010 over 6 million people employed in the public sector compared to 5.2 million ten years previously

March 2013 there were 5.6 million Public Sector employment fell 112,000 in

2012 whilst the private sector increased by 544,000.

Public Sector consitutes19% the lowest percentage since 1990s

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Uneven contraction of public sector

Most job losses focused on local government and to a lesser extent central government

Education and health funding ‘ringfenced’– job losses in NHS

Demographics- women, homosexuals and ethnic minorities over-represented in public sector and according to the TUC disproportionately affected by job losses

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Avoiding compulsory redundancies has meant the acceptance of other cost cutting practices

Very strong emphasis from social partners in avoiding compulsory job losses with most losses being natural wastage and voluntary redundancies.

Significant re-grading (usually down grading) of white collar public sector posts especially in local government.– Anecdotal evidence from our projects suggests that

social protection e.g. ring-fencing salaries are sacrificed with employees and unions making these accommodations to prevent job losses.

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Other restructuring

Reorganisation especially of health and local government.

Pensions reduced significantly Changing management practices e.g. lean

and Bradford factor. More aggressive management and less scope for social dialogue.

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Narratives and popular discourse

Public sector is a bloated drain on the economy

The wellbeing at work agenda has largely disappeared

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Fragmentation of the workforce

Outsourcing, privatisation, temporary and contract workers.

Increased from 2004 onwards with huge increase since 2010.

Limited reliable statistics.

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Significant public disquiet over outsourcing

G4S fiasco at Olympics Collapse of Southern Cross the largest

provider of social care Malpractice at A4E employment

services.

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The development of diverse public service marketplace (Open public services white paper 2011)

Massive increase in scale, scope and most importantly complexity of outsourcing projects

In conservative council most of local government is being outsourced

Most secondary schools are now outside local government control

Employment services Probation Services Marketization of the NHS.

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New relationships in outsourcing

‘The more complex it is, the more you have to build your relationship and alignment with your potential supplier so you’re thinking as one,’ Martyn Hart, chair of the National Outsourcing Association

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What does building relationships mean in practice?

Developing relationships with all social partners, commissioners (the state), unions, service users and contractors

My presentation to the Brussels conference tracked the development of dialogue between social partners and contractors over ten years and suggested that these relationships are highly problematic for workers.

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Social dialogue in outsourcing

Outsourcing involves significant changes to social dialogue, a process which can be managed by close relationships and trust between unions, contractors and commissioners.

Whilst personal relationships are critical they are not sufficient on their own.

Social dialogue used in the process of restructuring must be embedded in the post restructuring environment and written into contracts rather than being based on informal agreements. to insulate them from changes in the political environment and personnel changes

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