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Theresa May Gives the Stamp of Approval to Public Service Mutuals

13/07/2016 10:47 | Updated 13 July 2016

After a year in which the election and then the subsequent spending review process has slowed the pace of public service reform, the government has clicked into gear and is putting the foot on the accelerator in support of public service mutuals. For those not familiar, this is where front line staff take ownership of their service. Usually this means spinning out of public sector employment into a new social enterprise, which continues to deliver the service with more flexibility and innovation.

I have previously voiced my concern that Brexit could stall public service reform - but speaking in Birmingham earlier this week, Prime Minister designate Theresa May gave her support to this exciting agenda. In a section of her speech focused on "putting people back in control", Mrs. May followed comments on accountability in big business by suggesting that "there are other ways, too, in which we need to put people back in control. As the Government reforms public services, we should encourage public sector workers to set up mutuals."

This is significant as it was quite a short speech and Prime Ministers in waiting have a huge list of policy areas they could choose to focus on. I understand Mrs. May's enthusiasm for encouraging staff to take ownership of the service they deliver is absolutely genuine and it fits nicely into one of her key themes of giving people control of their lives and work.

This comes hot on the heels of a couple of significant and positive interventions from Cabinet Office Minister Matt Hancock who last week hosted a round table at Cabinet Office to discuss mutuals and also made a speech at a conference organised by the Employee Ownership Association.

Hancock hailed the success of mutuals to date and reminded the audience (although few will have needed reminding) that the Conservative Manifesto included a 'right to mutualise' and that he was committed to delivering that. He also put his money where his mouth is by committing £4m to support groups looking to mutualise. There is an enhanced team in Cabinet Office now working on this agenda and they intend to publish a new strategy in the autumn. This will set out how the £4m is to be put to use and will also consider any wider policy levers Cabinet Office are able to utilise. Perhaps this work will look at some of the wicked issues preventing more mutuals from emerging such as VAT treatment (which can make exempt service like children's social care prohibitively expensive to deliver outside the public sector) and the wonder of procurement law (which is mostly EU driven so perhaps up for review in the near future anyway!).

I was at the EoA event where the Minister made his speech and it was fantastic to see so many old friends and clients who are making a real success of being independent and innovative. There was a fantastic buzz as people shared their success stories and discussed how they had overcome challenges. What is now clear is that mutuals and social enterprises are not just delivering locally and on a small scale - a number are taking the lead on major policy reforms. Care Plus Group and Navigo in Grimsby are taking the lead working with the CCG and Council in establishing their local Accountable Care Organisation (with the purpose of integrating health and social care services). In Nottingham, the Chief Executive of Nottingham City Care, Lyn Bacon, is leading the development the area's Sustainability and Transformation Plan (which again looks at the future shape of health and social care services).

So public service mutuals are already serious players in the public service market place - but with the momentum now building (not to mention support from the incoming PM), mutuals could be set to play an even bigger role. Exciting times ahead.

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