Judy Terry is a marketing professional who stood down as a councillor in Suffolk in May.
When George Osborne says that there is more to be saved from public spending, frankly, I cheer. Because, in my experience, there is potential for huge savings. But I would suggest that he puts aside a few million to develop a Project Management Institute. This is a skill sadly lacking across the public sector and without it disaster strikes.
We’ve all heard of IT projects which go awry, but there is one which takes the biscuit.
In 2011, the Public Accounts Committee published its report into the failed £500m plan to create nine regional fire service control centres, cancelled by the incoming government because the computer system didn’t work. Several of these luxurious complexes remain empty, at significant ongoing cost to the taxpayer because no business wants them.
Dubbed ‘Prescott’s Folly’, the Committee Chairman, Labour’s Margaret Hodge, described it as one of the most disastrous projects ever. Flawed from the outset, there was ‘an extraordinary failure of leadership, with none of the objectives achieved, yet no-one has been held to account.’
I wonder what she says about the closure of The Public, the West Bromwich arts centre, after just five and a half years, having cost more than £70m against an original £25m estimate and delivered two years late in 2008. Mrs. Hodge, Culture Minister at the time, hailed it as ‘placing West Bromwich at the forefront of the cultural scene.’ Yet all the people of West Bromwich actually wanted was a swimming pool or cinema! Neither of which they have.
Has anyone been held to account for this cavalier waste of public funds? The Arts Council reportedly said that ‘there is always a risk’ with such projects. Evidently the ‘business case’ forgot about the unaffordable £30,000 weekly running cost to the local council.
Another debacle was the £55m Earth Centre at Doncaster, opened in 1999 and closed in 2004 because the local council simply couldn’t afford the £200,000 annual operating costs. The site was sold to a private operator, although the original investment cost was never recovered.
The £780m Millennium Dome suffered a similar fate, being reinvented as the popular O2 concert venue by private business, at a vast cost to the taxpayer.
More recently, the planned King’s Lynn waste incinerator hit the headlines because its cancellation has left Norfolk County Council with an estimated £30m bill in contractor compensation and legal fees. But why was the £500m contract signed before planning consent had been obtained, especially given the visceral opposition from MPs councillors and residents, which inevitably led to its refusal?
Yet again, no-one has been held to account. Makes your blood boil, doesn’t it? And only a few days Peterborough City Council wrote off £3m when cancelling a planned solar panel/wind farm development.
I could go on, but this is just the tip of the iceberg, adding up to well over £1 billion of public money wasted whilst dozens of hospital PFIs with no break clauses are crippling the NHS.
However, waste more commonly equates to a few million or a few hundred thousand pounds here or there (easily dismissed, with overspends and write-offs coming out of reserves) because of – as Mrs. Hodge said – ‘a failure of leadership and accountability’, as well as forward planning.
Why? Because project management is a rare skill, and silo structures ensure that no-one has specific responsibility, so no individual can be held to account. Project boards for individual schemes, bringing tight external progress monitoring and financial oversight, allowing problems on delivery or budget to be quickly identified and addressed, are a rarity.
So it’s back to leadership. In the military, all ranks have responsibilities for which they are accountable – the same should be true right across the public sector, including Non-Executive directors of hospitals, housing associations, publicly funded arts, charities and school governors.
They have a duty to challenge what and why something is done, have a good grasp of the finances, as well as support the executive team, whilst holding them to account, fairly and robustly. As we all know, on the rare occasions when individual failure is acknowledged, it is too often rewarded with a big payoff, and/or another job.
Questioning isn’t popular amongst these institutions, which can resist the appointment of anyone with the confidence to upset the status quo, and to quash expectations that the taxpayer will always fund whatever an organisation wants to do, whether or not there is a proper business case.
Councillors, especially those holding Cabinet or Executive positions, who also usually represent their authorities on external boards, should think of themselves as Non-Executive directors of multi-million pound businesses, with a responsibility to challenge, and lead, taking professional advice, but questioning it. Regrettably, as at Rotherham, this doesn’t always happen, and the relationship can be too cosy for the public good with a refusal to explore good practice elsewhere.
In contrast, the Local Enterprise Partnerships are business-driven and effective; they understand finance, the importance of good business planning, welcome new ideas and deliver quickly. The public sector could learn a lot from them.