A New Year’s resolution for partnerships between the public and private sectors

December 18, 2018 By Sarah Lawson, Policy Researcher, NLGN

This article first appeared on Room 151.

As 2018 draws to a close, it has ended in much the same way as it started for partnerships between the public and private sectors. The year began with Carillion’s collapse and twelve months later Interserve finds itself in rescue talks. As we approach 2019, the debate surrounding such partnerships retains a very January feel – slow-moving and at times difficult to see the end in sight.

It’s perhaps no surprise therefore that our recent report, ‘From Transactions to Changemaking: Rethinking partnership between the public and private sectors’, found 39 per cent of council chief executives and leaders anticipated a decline in levels of outsourcing in their council over the next two years. For partnerships to keep pace with the challenges the public sector faces– delivering high quality outcomes in a context of increasing complexity and rising demand – a new approach is needed. Yet the current debate around these partnerships resembles more of a Christmas feud than a set of New Year’s resolutions, divided along party lines on an ‘in-house versus outsourcing’ debate.

For 2019 to be different, our report calls for a new ‘changemaking approach’ with sectors working towards a shared endeavour, driving social impact and creating value over the long-term. But as we all know, a New Year’s resolution takes more than commitment to the cause; the right foundations must also be in place:

1. Be realistic
Most New Year’s resolutions don’t make it beyond the first weeks of January. While ambition isn’t to be snubbed, realism is also important. The public sector has been accused of an unrealistic attitude to offloading risk, neglecting that reputational risks will inevitably lie in the hands of the public sector when things go wrong. Meanwhile, the private sector’s unrealistic acquisition of contracts beyond their means has been a recurring theme in the fate of contractors such as Carillion and Interserve. Realism doesn’t mean abandoning ambition for systems change but, as a starting point, it does mean understanding where responsibilities and risks lie in a collaborative partnership.

2. Choose a role model or two
To really hit the ground running with a 2019 resolution, a good role model is helpful. Our report highlights several examples that champion the changemaking approach. For example, an area of weakness that has clouded many partnerships has been the prevalence of a closed-door culture, which excludes the public from scrutinising decisions. Copenhagen’s approach to public participation in urban regeneration exemplifies how citizens can be involved from a project’s start to finish through three deep phases of engagement. Other examples of changemaking practice include Braintree’s delivery of a leisure service, which can serve as inspiration for introducing greater flexibility into contracts. While Preston’s creative approach to procurement has increased procurement spend in wider Lancashire by £200 million over a four-year period.

3. Have the right support systems in place
Finally, an effective support system is a defining ingredient for New Year’s resolution success. In the reform of partnerships between the public and private sectors, these helping hands must come from all sectors and all levels of government in order to create the right system for changemaking partnerships to operate. Our recommendations include:

The public sector should replace social value with a much stronger measure of social impact.
The private sector should accept accountability to the public through an accountability code of conduct, which includes full data disclosure and open booking accounting on large public sector contracts of £1 million and over.
The Government needs to immediately undertake a substantive review to identify the steps needed to provide greater transparency of private contracts.

So, as we enter 2019, let’s hope successful partnerships between the public and private sector exemplify another feature of the cold winter months – the common cold. A contagion of changemaking practice among these partnerships really would result in a much happier new year.

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