Life after the budget

11 Mar 2011     Last updated: 20 Jun 2014

In an article written at the end of February, Seamus McAleavey highlighted how the McKinsey report could help to reconfigure public services as the final Budget approached.

On the Budget, the Northern Ireland Executive has been put in a place not of its own choosing; George Osborne saw to that. Literally “between a rock and a hard place”. The cumulative loss of £4
billion in real terms over the cycle is very difficult to deal with, even for Tories who want, as a matter of principle, to cut government expenditure.

Any sensible person realises that the situation cannot be saved by anonymous, free from pain, efficiency savings. There are probably three ways for the Executive to deal with this, and any number of variations of those three.

They can slash the billions off their spending, cut out what they believe are the least important services, and hope the public does not notice or feel any adverse effects.

They can talk about efficiency savings and “doing more with less”, but the outcome is likely to be similar to the first option; public service delivery will be inferior in 2014 than it is today.

The third option is reconfiguring priorities and services to be done differently in the future than in the past and maybe doing a lot better with fewer resources. This option is the most difficult as it’s about change and the change is being forced on us by circumstances outside our control; but then again, that’s when change happens.

NICVA has voiced its reservations about the quality of information available from some departments during the consultation on the draft budget. A few produced detailed plans and told it as it was; a few produced plans that were very scant indeed; and a few didn’t really produce spending plans at all.

Right at the end of the consultation period, the DHSSPS Minister Michael McGimpsey produced a document that he had commissioned called the McKinsey report (available on the DHSSPS website). It is a document worth reading because it tells the Minister what he might do to achieve the third option above.

Michael McGimpsey does not agree with all the proposals and neither would I, but it is what we need to consider and do a lot of if we want to continue to improve health and well-being for people in Northern Ireland. It does, though, require investing in order to save in the long term. The report estimates spending £300 million on transition costs over the four years, but saving up to £600 million in the year 2014.

This has real possibilities for Northern Ireland and surely there are other possibilities across other public services.

That is why it is imperative for the Northern Ireland Executive to make all main spending decisions as a collegiate body. They cannot be delivered by ministers acting on their own, in isolation
from the decisions made in other departments. This is the essential ingredient that will deliver success or failure. Failure will mean public services in retreat, economic stagnation and a bleaker, wasted future for many of our people, particularly those on low incomes.

It is unlikely that we will get a real Programme for Government before the May election, but a serious PfG needs to be hammered out quickly thereafter. The Executive needs unity of purpose if it is to deliver and it should also seek to extend agreement on the PfG and budget to the external stakeholders in the trades unions, private sector and voluntary and community sector.

We have to avoid a drift towards a dysfunctional democracy where departments are party fiefdoms and MLAs defend their own ministers and attack all the others.

Voluntary and community organisations have lots of ideas and examples to offer where “prevention is better than cure” and saves more expensive interventions in the future. The McKinsey report seems to be about that and not just about willing or unwilling cutting and reduction of
services.

Other articles:

Budget passed: protecting the vulnerable must now be a priority

NICVA response to draft Budget consultation

First independent analysis of draft Budget released

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