Steve Richards: In his reforms of public services, Cameron is like Blair on cocaine

It is a myth that Blair's reforms failed because Gordon Brown blocked them. Some of them failed because they were not clearly thought through
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The Independent Online

Anyone who still believes that David Cameron is a One-Nation, pragmatic Tory centrist in the tradition of Harold Macmillan should take note of his revolutionary plans for public services. Tony Blair used to write with evangelical zeal on this theme, but Cameron manages to outdo his hero in crusading intent.

In an article for yesterday's Daily Telegraph he promised "complete change" in which the "grip of state control will be released and power will be placed in people's hands". State monopolies will be broken up. Charities will be able to bid for new contracts to run services. As if complete change is not enough, Cameron promises a "transformation" too. Choice will be a key mechanism. Patients will choose hospitals. Parents will choose schools, although in a fleeting moment of reality Cameron adds an important qualification, "wherever possible". People will also have the right to take control of budgets as power is devolved to the lowest possible level. In its repetitive proclamation of change, this is like Blairism on cocaine.

Cameron is right to claim that he is heir to Blair, but misreads what happened during the latter's leadership. Blair did open up public services to competitors, but with mixed results. It is a myth that Blair's reforms failed because Gordon Brown blocked them. Some of them failed because they were not clearly thought through. Brown placed some obstacles in the way up until 2003, but after Iraq Blair became as assertive in relation to domestic policies as he had been in foreign affairs.

Curiously, events in Iraq gave Blair more confidence in his leadership skills across the board. By then, Brown was too scared to stand in Blair's way for fear of appearing a milimetre to the left of him. This was the period described by Blair's biographer, Anthony Seldon, as Blair Unbound. The private sector was brought in to run parts of the NHS. Payments for results were introduced. Faith schools were established. There were some successes but considerable chaos.

When Patricia Hewitt took over from John Reid as Health Secretary, she discovered that no one knew quite what was going on or what was supposed to be going on – and she was a supporter of the "reforms". Lines of accountability were blurred. Targets were being dropped and yet payment by results established new centrally determined objectives. The private sector thrived because there was no level playing field. The NHS was responsible for responding to all needs, whereas companies could pick and choose.

Politically, Blair was most unpopular during this period. There was no polling evidence that "choice" was sought after, not least because voters could see it was an illusion. Parents "chose" the most popular school in an area only to find that there was room for only a limited number of pupils. A choice of hospital or GP can be an effective weapon only where there is a surplus of both. No government, certainly not this one, will provide cash so there are more hospitals and doctors than are necessary at any given time.

This does not mean that Cameron is wrong to worry about the state of public services. Ed Miliband and his party would be making a fatal mistake to defend the status quo. Irrespective of the financial crisis, Labour would have lost the last election because of a perception, partly justified, that services were inefficient in spite of the higher levels of investment.

But Blairism on cocaine is not the shake-up that is required. The changes will be costly and leave users of public services less empowered than they are at the moment. If the state is responsible for a public service, there is at least a clear line of accountability. Voters can get rid of a government. One of the reasons why the Conservatives were removed so decisively in 1997 was that voters despaired of squalid public services. When the private sector steps in, accountability becomes much more complicated.

To take one example of thousands, I was struck during a visit to a part of Spain how clean the streets were, and asked a Spanish friend how they managed to pull it off. She told me that if the streets were filthy the council would be kicked out at the local elections, where there was quite a high turnout. In local elections here, such punitive action is impossible. Street-cleaning deals with private companies extend over many years and take no account of mere elections. A shrinking state can disempower voters in some cases.

Now Cameron hopes charities will make bids, as well as companies used to outwitting government in securing lucrative contracts, with virtually no risk attached. This is a fantasy. Most charities will not have the resources to even contemplate making bids. If they do, they will need to hire the best accountants and lawyers in the business, which will be expensive. Cameron's vision will delight accountants, lawyers and the many companies set up to advise other companies how to negotiate contracts with the Government.

At the end of his article, Cameron wakes up from his night of partying and adds calmly that the state will have a crucial role to ensure fair funding, competition and fair access. That means the state will continue to have a bigger role than he realises or chooses to suggest. The provision of fair funding will mean the Government that raises the money must retain an interest in how it is spent.

On the morning after the night before, Cameron will discover that some payments for results are easier to make than others, and are a form of target-making from the centre. He will also find out that some services respond to competition better than others. The slight hint of this recognition at the end suggests that, like Blair's, Cameron's revolution will be half-baked, cause chaos, cost quite a lot and achieve a few improvements on the way.

As he manages the changes, perhaps in spite of himself he will have to be more like Macmillan than Thatcher in ensuring there are limits to his revolution. Last week, I argued that Cameron's advocacy of a "Big Society" was risk-free because success or failure was impossible to measure. Precise promises about the quality of public services are different. Cameron promises a transformation. If it is not a transformation for the better, he is in trouble.