Made to measure

Made to measure

Top councils will next week be officially rated as matching the best public companies and government departments for efficiency. But some critics of the new town hall inspections claim that the regime is too 'half-baked' to be taken seriously

Peter Hetherington
Wednesday December 4, 2002
The Guardian

When the team of inspectors finally called, Irene Lucas was five weeks into her new job as chief executive, relishing the challenge of improving the lot of a borough with high unemployment, poor health and low attainment in secondary schools. Armed with a "brutally honest" self-assessment of South Tyneside's strengths and weaknesses, which the five-strong inspection team had pored over, she managed to suppress emotions more associated with entering hospital for a major operation.

"It was a bit like being told you were going to have open-heart surgery," Lucas recalls, two months on. "You do all the preparatory work, prepare your reports and make sure you are giving the surgical team as much information as you possibly can."

Lucas is reflecting on "comprehensive performance assessment", already better known as CPA, which amounts to the most rigorous inspection process in the history of the public sector. The 150 big councils (unitary, metropolitan and county) have been through the mill over the past few months and the process is about to be extended to second-tier, district authorities.

Like many senior officials who have been on the receiving end, Lucas has mixed emotions about the experience. "We were all passionately wanting to get better, so we knew there were some remnants of a malaise and were quite happy for people to operate on us," she says. Then she pauses, carefully measures every word, and adds with a faint smile: "But it would have been nice if the training and the process methodology had been completed. It was almost like having surgeons operate on you who haven't quite completed their training - holding the instruction manual, which hadn't quite been finished."

Lucas stresses that her criticisms are not aimed at individuals, but of the "half-baked" process. "When you put a bit of pressure on [the inspectors], they were wriggling," she says. "I don't mind a process provided it is tried and tested and well thought through. This wasn't finished - and I was in the last tranche."

Detractors of the CPA initially feared a hidden political agenda to expose the perceived failings of authorities in a national league table, with the dead hand of Whitehall bearing down on "failing" town and county halls to impose the political will of a Downing Street machine deeply sceptical of their ability to deliver good services.

But it has not quite turned out that way. Today, the audit commission, which is behind the process, publishes "early lessons" from the exercise - full results of which are due next week - and it insists the outcome puts the best of local government into a whole new league.

"The top performing councils match the best public companies and government departments," says the commission's controller, Sir Andrew Foster. "These results will show that some places with tough social and economic problems - inner-city areas - demonstrate that they can still do very well. This is really a very challenging thing. It isn't just leafy suburbs, south-east and shire counties that do well. We want to focus on the excellent messages around."

Step forward Blackburn with Darwen in Lancashire ("significant level of deprivation... with a 20-year vision... to be innovative and take bold steps to realise ambitions"); Gateshead, Tyne and Wear ("used landmark regeneration projects to build confidence in itself... highly ambitious... modern and well-run"); Camden, in north London ("ambitious targets to reduce inequalities... as most polarised borough in London"); and Hertfordshire ("maintains a consistent focus on its customers, which drives all it does"). As Foster says: "We want to celebrate the excellence and show that other places can get there."

The CPA has its roots in a 2001 local government white paper, which promised councils freedoms and flexibilities in return for getting good marks in a new inspection regime. The regime has proved immensely time-consuming, nerve-racking and, in some cases, plainly disorganised, with the inspectors (fellow chief executives, senior officials, councillors, accountants and "performance specialists") seemingly more ill-prepared than anyone could have imagined.

"You got the impression," says Lucas, "that these people were operating on you when they didn't know the details of the operation."

Some councils had already been under the cosh, with a "best value" regime geared to continuous improvement assessing service provision on a range of pre-determined performance indicators. Best value was widely criticised for giving only an inaccurate snapshot, with little indication of a town hall's overall efficiency, and the former local government and regions secretary, Stephen Byers, backed the audit commission's plan for CPA to examine efficiency "in the round".

The process is fed first by two key elements: existing inspection reports from six service areas, including education, social services and housing, and a self-assessment, or "capacity to improve", produced by the council itself. These elements, in turn, feed into an overall framework. During a two-week inspection, services are scored for performance on a scale of one to four. These are then combined into an overall score and the council placed into one of five categories: "excellent", "good", "fair", "weak" or "poor".

The Local Government Association (LGA), fearing that the process was so arbitrary that only a handfull of councils would get top ratings, successfully lobbied for changes. But critics say the science is still so inexact that too many will be damned, giving an awful impression of local government and prompting a string of lurid headlines around a common theme: "Sink councils exposed." And there will certainly be some casualties. "We now know more about local government through CPA than we've ever known," insists Foster. "We've got a better diagnosis. There will be very few places left for anyone to hide - and, frankly, when you do look at the performance of some of the worst places, it absolutely must be challenged in the public interest. Why should the citizens of 'X-shire' be paying their council taxes and getting a poor service?"

However, Foster concedes: "While a lot of the focus is what's gone wrong in, say, Hackney, Walsall and Hull [slammed in earlier, special inspections] we have always thought that the biggest room for improvement is probably in the middle. They don't feel very challenged. The money isn't too bad. The social agenda they've got is probably not as tough as other places."

Of the councils inspected so far, it is likely that next week something more than 10% will be classed "excellent", around 35% "good", up to 25% "fair", 20% "weak" and 10% "poor". One commission official at the heart of the process insists: "This will not be about naming and shaming. The idea is not to weigh pigs, but to fatten them: help the poor performers to improve. How do we balance national and local priorities with the priorities of a council?"

And this balance strikes at the heart of the process, leading some to question whether central objectives can override priorities decided by a local electorate. A problem? "Oh yes, absolutely," says Lucas. "That's an important point. They come with a national perspective and we found it really important to ensure that the inspectors understood what was important to local people."

During lengthy interviews, for instance, Lucas was asked why transport - a national priority - was not a higher priority for South Tyneside. Yet the borough is served by one of the best public transport systems in the country (the Tyne and Wear Metro). The council was criticised also, she says, for "not being as successful as they thought we should be in reducing crime", when the council (which is not a police authority) had provided CCTV, and youth offending and drug action teams. Rather than spread spending thinly, it had focused on education and social services, after failing sectoral inspections almost two years ago. Now these two areas have been given good star ratings, which could help South Tyneside to be judged at least in the middle or "fair" category next week.

For his part, Foster says that while he is not unsympathetic to the charge of local democracy being challenged, this is sometimes used by critics to deflect the valid arguments for CPA. But he adds: "I would say this to people: 'You develop, with your councillors, a strong agenda locally that meets the needs of your area, projected strongly in your CPA self-assessment, and you see whether we mark you down for being engaged with local people and developing priorities from what they say.' The message I will give our organisation is that we should be very sensitive to local engagement with people and local priorities."

With inspection overall in local government services - from education to social care and beyond - estimated at £600m a year, has the whole exercise been worth it? Irene Lucas, for one, believes that the motive to drive forward improvement is honourable. But she cautions: "I just think it used up an enormous amount of energy. I really do hope they achieve what they set out to do, which is to improve services overall."

Of course, there is another side to the inspection coin which has not yet been challenged - the performance of Whitehall itself. "The first CPA results will confirm that many councils are offering some of the best public services around," insists Sir Jeremy Beecham, chair of the LGA. "It would be interesting if government departments and their agencies faced the challenge of this level of scrutiny and public reporting of their performances."

Interesting, but unlikely.

The price of power

Under the CPA system, top-performing councils will win a range of new freedoms, including a three-year "inspection holiday" and exemption from most Whitehall-imposed plans governing all aspects of municipal life. But the poorest 10% face the deployment of special management teams drawn from other authorities. As a last resort, outside contractors could be drafted in to run specific services.

A new local government bill promises that authorities judged "fair" or "good", as well as "excellent", will have powers to raise extra cash through selling services - such as CCTV, security patrols, and other council enterprises - to business and other councils, plus power to borrow without Whitehall approval.

However, the new powers, which the government promised in return for the CPA inspections, mean that England (but not Scotland and Wales) could soon have a much wider variation of service standards among authorities. Sir Andrew Foster, controller of the audit commission, speculates that top-performing councils could form themselves into a club to campaign for more freedom - and local government minister Nick Raynsford does not deny that an "innovation forum", which they will join, could yield additional flexibilities.

"Nothing is off the table," says Raynsford. "But we expect freedom and flexibility to go hand in hand, and certainly want to give extra freedom to those authorities who have demonstrated they are truly excellent in serving their communities and delivering high-quality services."

Foster believes a "tremendous bridgehead" of deregulation has been created. Although he acknowledges that, on "social equity grounds", some object to particular authorities gaining extra freedoms over others, he says: "This is genuinely the best opportunity I have seen for local government to start to turn the tide of central control."