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Fairness in a recession | 4

The public sector can, immediately and effectively, support business and the economy, through sharper use of its own procurement; specifying more than a narrow set of outputs; breaking up its contracts into smaller, more competition friendly chunks.  To do this, the politicians need to get on board, understanding that the possible negative consequences (more visibility for any supplier shortcomings) will be more than outweighed by the wider benefits achieved.

Finally, the public sector can and should invest in communities – specifically, in developing an asset called “social capital”.  This point underpins all the others.  Social capital is a fancy phrase to describe the extent to which a set of people are connected with each other and with the agencies that serve them.  It is, manifestly, an asset.  Where there is high social capital, as we saw earlier, there are a wide range of positive indicators, in health, crime, education and wider well-being.  Put simply, people are at their best when they feel part of something: no man is an island.  The scale of social capital in a community is measurable, at least as measurable as is the value of a brand in the private sector.  Yet we do not put social capital on the public sector balance sheet.  We treat public sector interventions as if they were a cost on the profit and loss account, rather than a balance sheet investment.  As a result we continually give the man a fish, rather than teaching him to fish.  We spend in ways that keep the poor at the bottom of the pile, rather than spending in ways which enable them to take greater control over their lives.  As much as anything, this is about power – the officer class, well-meaning, analytical, holds on to the power that goes with budgets and resource allocation, and acts in ways that undermine the very assets that should be being built.

If we found a way of putting social capital on the balance sheet, we would at a stroke require that much public sector spend, from health promotion campaigns to social services and education, did what it did in a way which build lateral connections between members of the community.  We would reinforce what the adult care personalised budgets initiative has started; moving from centralised, prescriptive, “flat” interventions, to local, particular, personal  – and cheaper solutions.

posted by

Peter Latchford

Professor Peter Latchford is Chief Executive of Black Radley www.blackradley.com, the public sector consultancy and systems business.  He is also Chair of Urban Living, the housing market renewal pathfinder and Vice Chair of the Community Development Foundation

 

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