On Tuesday this week the prisons and probation minister Crispin Blunt made a major speech to a conference organised by the Social Market Foundation on the coalition governments plans for the so-called rehabilitation revolution. The centrepiece of this vision is the desire to see voluntary, private and social sector players enter the field and bid for work. I have this vision of a room full of company fatcats, sorry putative bidders absolutely hanging on his every word and salivating at the mere thought of lucrative government contracts in the offing. Interestingly Mr Blunt said that 'several Probation Trusts were amongst potential bidders' so the coming weeks will indeed be interesting as players begin to show their hands in this high stakes game of poker. At the nub of the plan is the great new idea 'Payment by Results' :
"There has also been far too much prescription from the centre with providers not being held to account for their outcomes. It could be characterised as a ‘command and control’ approach to running public services. The results of this are predictable: large sums spent; constrained professionals; insufficient return; a lot of time spent on processes; little time spent on outcomes.
Payment by results by contrast does exactly the opposite. The commissioner specifies a goal and increasingly pays for what gets delivered against this benchmark. Because we will allow providers discretion in how they manage individual offenders – that’s up to them – they are free to innovate. But they know they will be held to account for their performance against the outcomes that they achieve. So they have strong incentives to do what works. It’s a much more decentralised and flexible approach. Ultimately too, it is a potentially market-based one as different kinds of organisation start offering services – be it public, independent or third sector. We are excited about payment by results because we believe that it represents an excellent way of helping to drive up standards, reduce reoffending and improve value for money for the taxpayer.
Of course we are aware of the technical and organisational challenges in developing payment by results. We need to find the best way to measure reductions in reoffending levels. It is essential that providers are only paid for results directly attributable to their work. Hence in Peterborough we will rigorously analyse their performance using independently assessed control groups and reoffending of other similar offenders, being careful to ensure that we can identify the effects of the interventions on the offenders with which they work."
Mr Blunt puts his finger very neatly on what the last government did to the probation service - removed all innovation and variety and substituted uniformity and a command and control structure. So far so good as he thinks that's now a bad idea. Step forward new idea, Payment by Results. Now I am already on record as saying we have to give the idea a go for the simple reason it can be funded primarily from sources other than the public purse and the government says there is no other game in town. Whether it will work or not is another matter.
Of course probation officers are well placed to say that in all probability it won't, but it will be made to work for political and economic reasons. The figures will have to be 'fiddled' because we know there are no magic bullets or quick fixes in tackling re-offending - it might take several or many attempts before change in a persons behaviour occurs and even then it might just be because of the natural maturing process, or something outwith any agencies control like getting a girlfriend.
All this will be of more than just academic interest under a Payment by Results system because the credit for the outcome will have to be claimed by one agency or other in order to receive payment. As the minister says, 'It is essential that providers are only paid for results directly attributable to their work.' Heaven forfend if an agency gets paid wrongly. Yes of course it's barmy, but there we have just one of the irritating little problems associated with this great new idea. Maybe there will have to be an evaluation and appeal process to determine who gets the credit for Darren or Craig stopping their crime wave?
The other problem with this idea is that the government will want to prove it works. This will be relatively easy with the Peterborough experiment because no work was being done with prisoners serving 12 months or less any way. But it will get a bit more difficult with other core probation work and the figures may will need some careful management shall we say. After the passage of a suitable period of time, no doubt some providers will be deemed to be failing and so get removed. The problem will be, were they failing or were they just not very good with figures?
Sadly I feel this idea is going to have to run its course before we can return to a more sensible approach of having a state funded public service, not paid on the basis of spurious results, but rather paid to provide a flexible, innovative and client-centred professional service. Now there's a really novel idea.