5. The cycle of dependency
Privatised utilities, outsourcing and consultancies
I. Problem
The post-war settlement relied on the idea that the state could take on more responsibility because its staff were competent, impartial public servants. But by the 1960s, there was a growing ‘scepticism and distrust of the power of government’.1
This was not simply a right-wing critique: in government, Harold Wilson and Tony Benn became deeply sceptical of the civil service, and began hiring consultants.
By the 1970s, the nationalised industries were a byword for sluggishness; council services ranged from the overpriced (grass-cutting) to the horrific (children’s homes).
The concentrated power of trade union-led employee interests was overriding those of citizens and consumers, as visible in strikes across the public sector.
From a public choice theory viewpoint, this was rent-seeking: the exploitation of a concentration of power for sectional gain. As Conservative leader, Margaret Thatcher denounced this, and cast the public sector as ‘inherently inefficient’. It was ‘a drag on the wealth-creating enterprise of the private sector’.2
II. Power shifts
In government, Thatcher invited the private sector to take on tasks previously performed by the public sector, in three ways:
- privatising state-owned industries and public utilities;
- pioneering the outsourcing of public services to private contractors; and
- hiring private consultancies.
These overlapping approaches embodied the idea that the public sector lacked an effectiveness which business thinking could readily provide instead.
Privatisation
At first, even many free-market ideologues thought privatising public utilities was impossible. Early privatisations were tentative and partial; the first full sale of a major state-owned corporation – British Telecom (BT) – came only in 1984.
The proposition was that private owners would liberate the state from a costly burden, taking power over the nationalised industries and utilities and their profit-making potential in return for shouldering their financial risks – while disempowering the old corporatist bosses and their trade union counterparts. Competition would allocate resources more efficiently and drive innovation.
With the success of the BT sale, another argument emerged. In contrast with the socialist insistence on ‘power to the State’, Thatcher offered ‘power through ownership to the man and woman in the street’.3 At first, popular ownership in newly privatised entities blossomed, and productivity rose.
Outsourcing
Similarly, from 1980, local authorities were compelled to launch tendering processes for work on building construction, maintenance and highways. As with privatisation, this broke taboos, and the concentrations of power they entrenched. Despite trade union resistance, outsourcing took hold, often generating savings.
In 1988, compulsory competitive tendering was extended to other manual municipal work, including refuse collection, and in 1992 to white-collar services like finance. By the 1990s, large generalist contracting firms were emerging, such as Serco, G4S and Capita (a former consultancy). When Labour returned to power in 1997, outsourcing continued to flourish.
Consultancy
The Thatcher government brought in consultants on an unprecedented scale, not least to help make privatisation and outsourcing work. The doctrine of ‘New Public Management’ brought business methods into the heart of government itself. Through the 1990s and into the New Labour era, consultants were invited to apply their quantification-based approach – driven by targets, benchmarks, and key performance indicators – to ever more areas of policy.
In some contexts, such as the Downing Street Delivery Unit, consultants played a constructive role. It made sense to hire in specialist advisers as required, rather than maintaining rarely required specialisms on staff. However, by 2010, the state’s reliance on consultancy had reached the point that the new Coalition government set about striving to rein it back.
III. Overextension
Privatisation
Privatisation eventually reached into the nation’s critical infrastructure. Much creativity was required to break natural monopolies up into viable businesses but even then, government recognised that they did not neatly fit the market model. As a temporary substitute until competition took off, privatised utilities would need to be overseen by powerful new state regulators to prevent price-gouging.
But regulation has not always worked. Some experts argue that regulators’ ‘lack of grip explains why privatisation has failed to achieve its primary purpose — of passing the operational and financial risks for the delivery of a public service to the private sector’.4
Instead, the most powerful new force in the system has often been investors’ expectation of returns. Regulators have frequently failed to impose the equivalent of market competition, and to compel the utilities’ new owners to invest in infrastructure. They have allowed the sweating of existing assets, in pursuit of ‘securing operating efficiencies which could be passed on to consumers in the form of lower bills’. When there has been significant investment, regulators ‘have usually allowed the UK’s infrastructure companies explicitly to charge customers’, rather than ‘paying for such investment out of profits at a cost to shareholders’5
The most controversial example of this power shift towards shareholders is the water industry. The goal of privatisation in 1989 was to bring in investment which the state had been failing to provide, by offering investors a safe asset with reasonable returns. Over the first decade, investment was much higher – as were bills. However, from around 2000, as one specialist closely involved in the sector puts it, an ‘implicit compact’ took shape between governments, the regulator Ofwat, the companies and consumer groups: ‘to keep bills low, at the expense of long term sustainability’. Vital investment in infrastructure dried up, even when interest rates were near zero.
Ofwat also let owners prioritise their own interests in other ways. It tended to overestimate companies’ likely costs when setting prices, allowing them to pass dividends to shareholders rather than reducing bills. It shied away from regulating utility companies’ balance sheets, licensing ‘an orgy of borrowing’,6 which has left some companies dangerously weak, while reducing the Treasury’s tax take.
Privatisation ended the unions’ rent-seeking concentration of power – but replaced it with another one.7
Outsourcing
Policy experts have proposed a series of tests to ascertain whether outsourcing is likely to work:
- Is there ‘a competitive market of suppliers’?
- Can success be measured?
- Is the service non-integral ‘to the purpose of government’?8
- Can the outsourced organisation carry most of the risk of its own failure?9
Public sector outsourcing has long since been extended beyond services where the model logically works, even dominating sectors such as children’s social care, where the answer to these questions is ‘no’. Unsurprisingly, the state has struggled to monitor fulfilment of such contracts.
Extending outsourcing so broadly has also further entwined public and private sectors, and has helped to concentrate power in a few huge all-purpose contractors – primarily Serco, Capita, Atos and G4S – on whom the state has become increasingly reliant through years-long contracts.
Such contracts are appealing to businesses because they offer long-term, steady returns, facilitated by Whitehall’s reluctance to sanction poor performance. These companies have grown by acquisition, by focusing on winning ever more contracts (far beyond their founding specialisms), and if necessary by bidding unsustainably low at first. Government generally accepts a change of terms later.
This approach has served to concentrate power, if not responsibility, in the hands of the big four firms. They have squeezed out more specialist providers, abetted by the costs, bureaucracy and complexity of the procurement process.10
Their power is visible in the fact that they are happy to receive public money to deliver public services, but often insist on commercial confidentiality when challenged. Moreover, their profits do not always remain in the UK: Atos is French-owned, and G4S was bought by an American company in 2021; by 2025, the UK’s last commercial waste disposal firms, Biffa and Viridor, belonged to US-based private equity companies.
The overextension of outsourcing and the power shift that followed laid the ground for a litany of high profile failures, which have both wasted public money and harmed the public more directly, from the death of a deportee to the collapse of Carillion. In 2019, for example, Serco was ‘fined £19.2m for fraud and false accounting over its electronic tagging service to the Ministry of Justice’.11
Consultancy
Similarly, the state’s increasing reliance on consultancies has been criticised for extending the principles of New Public Management to the point of self-disempowerment. Here again, a handful of huge organisations dominate the market, offering government an extremely broad range of contractable functions. Over time, hiring consultants erodes the state’s capacity because the lessons, insights, skills and adaptations that follow from executing a project accrue not to the civil service but to the consultancy.12 This process also risks disincentivising ambitious officials who see the most interesting work go to external firms.
IV. Entrenchment
Overextending the market model involved intertwining public and private sectors to create a ‘hybrid state’,13 with power and responsibility dispersed across it, framed by complex systems of regulation.
The consequent erosion of the state’s own capabilities is reminiscent of the ‘benefits culture’ critiqued by social conservatives. As Iain Duncan Smith once put it, ‘A system developed to help the most vulnerable and support people in times of need is trapping people in a cycle of dependency.’14 For benefit claimants, read Whitehall; for the benefits system, read private contractors.
This process has been entrenched by the belief that, unlike business, the state is ‘inherently inefficient’.15 While business can chase a single, measurable goal, the state cannot and should not. But to conclude that business does almost everything better is a damaging fallacy. It perpetuates the cycle of dependency.
Privatisation
Since the 1980s, there have been repeated attempts to make naturally monopolistic public utilities fit the market model. Forty years on, the ‘temporary’ regulation of privatised utilities is still in place, with true competition nowhere to be seen. This recalls the great delusion of the Soviet Union: that, as communism was established, the state would wither away. Likewise, privatisation tried to force unworkable dogma on recalcitrant reality. The resulting system lasted because over time, it became inconceivable that the state could take back control of tasks it once carried out routinely.
Outsourcing
As the state came to rely increasingly on a few big external suppliers, it lost capability which was difficult to recover.16 When this cycle of dependency went too far and created severe problems, politicians could ‘never quite take the next logical step’, and accept that certain services simply cannot be made to fit the model. This would involve tackling the state’s lost capacity, and rejecting the orthodoxy that the private sector is necessarily more efficient. Instead, politicians blamed the state for its suppliers’ failures, arguing that it ‘just needs to get better at contracting’.17
Entwined with the belief that business is more efficient is the faith in quantification. This is visible in the incentivisation of short-term savings over unmeasurable service quality18 and in the use of big, standardised systems, even if these tend to subject citizens to one-size-fits-all transactions, delivering poor service individually.
Consultancy
At its best, consultancy can circumvent procedure-constricted hierarchies, providing an independent voice to speak truth to power. But critics contend that consultancies embody the belief that the state should be run using business practices, and provide advice accordingly.
This belief dovetails with Whitehall’s increasing reliance on consultancies to create another cycle of dependency, to the point where ‘internal capability became sufficiently diminished so that it was no longer economically viable, or practically possible, to rebuild the competencies’.19 Many departments have ongoing contracts with consultancies, avoiding the need for project-specific bidding processes – further entrenching their dependency.
Writing in 2009, Jesse Norman suggested that ‘a gigantic client state of consultants’ had entrenched the overuse of market models in the public sector:
‘These have tried to apply the supposed lessons of lean manufacturing to government in a coercive and standardised way, by creating so-called “public service factories”. On this approach, services are specified from the centre; and departments split into front- and back-office functions, given targets, and made subject to inspection and compliance regimes. A focus on people is replaced by a focus on procedures. … A mania for quantification and cost control suffuses the whole.’20
V. Public discontent
The private sector models imposed on the public sector cannot compute local and individual complexity. This disempowers employees, customers and citizens alike, eroding trust and fuelling ‘social frustration’.21 The diffusion of power between state and contractor creates accountability sinks, such that when something goes wrong, it is difficult to attribute blame. This means public anger at poor treatment has no clear target, creating opportunities for scapegoating.
Privatisation
The transfer of reward to the private sector, leaving substantial risk on the state – contrary to the original idea – costs customers and taxpayers money. This is easily read as unfair, even as a scam, particularly when combined with the sense that utilities that were once ‘ours’ are being run for profit by anonymous foreigners. The cost of living crisis and the chronic financial calamity in the water industry have provocatively juxtaposed high bills, high dividends, high pay and low investment, making all too visible whose interests the model puts first.
This is corroding public trust in how the country is run. Effluent polluting our lakes and rivers is an emotive, all-too-visible symbol of impunity: of a model that prioritises shareholders and executives over long-term stewardship (even if sewage overflows are a relatively minor part of the overall problem, and currently water companies are not making large profits). As one former regulator puts it, ‘there’s no kind of public legitimacy for investing in [the water industry], because in some cases they think they’re giving money to shysters’.
Outsourcing
Outsourcing disempowers the public on three fronts:
- pressure on employees’ pay and conditions to ensure profit;
- lack of market competition can land customers with high prices and low quality; and
- when it fails, citizens’ taxes are spent to keep services going.
All this risks generating a sense of unfairness. But this tends to erode confidence less in distant, faceless supply companies, of which those affected may know little, and more in all-too-visible politicians.
Likewise, where the failings of outsourcing have serious consequences, this risks fuelling toxic populist attacks on the state alone. The majority of the country’s children’s homes are run by the private sector, often with private equity involvement. As Sam Freedman notes in Failed State, private companies have set up children’s homes ‘where property is cheap, in northern towns like Blackpool and Burnley… meaning councils in London and the south-east are having to send children hundreds of miles away from their existing homes and friendship networks.’ The consequences, he writes, have sometimes been devastating, with young people drifting into crime and being targeted by grooming gangs’.22 Yet little of the discussion about who bears responsibility for the grooming gangs scandal has focused on the private sector’s role.’
The outsourcing model has played a part in the development of another populist flashpoint: the housing of asylum seekers in hotels. Here too the public sector has found itself ‘in a weak negotiating position due to the urgent need for accommodation’.23
A decline in the speed of Home Office claims processing combined with a rise in arrivals to force the state, via outsourcing companies, to hire hotels at short notice. This is far more expensive than the normal dispersal accommodation (self-catered private housing).24 The three main outsourcing companies, benefiting from long contracts and poor monitoring, have made record profits as a result. The Home Affairs Committee reports that there are ‘incentives for providers to prioritise hotel use’ rather than seeking out cheaper dispersal accommodation.25 Using hotels has significantly increased profits; the companies are due to return a proportion of these to the Home Office but this is still in process. The select committee report paints a picture of an outsourcing model which has left the state dependent on profit-driven private companies, its position weakened by long-term contracts which it lacks the capability to robustly negotiate, enforce or adjust, despite dedicating large teams to this task.26
And perhaps the most extreme recent example of popular outrage at unfairness flowed directly from excessive faith in quantification, state over-reliance on a few ‘strategic suppliers’, and the accountability sinks generated by dissipating power between ministers, regulators, suppliers and their shareholders.27 After decades of warnings about the Horizon software supplied by Fujitsu to the Post Office, and after the wrongful prosecutions, needless misery and multiple suicides that followed, polling suggested the ITV dramatisation of the scandal had finally brought the scandal to the attention of a majority of the public in January 2024 – and that 63% of British voters ‘would support criminal prosecutions being brought against those who pursued sub-postmasters through the courts’.28
However, it emerged that government had been unable to blacklist the company because ‘government lawyers advised that it would not be legally possible to discriminate against companies based on their past performance’.29 The Sunak government was ‘reluctant to sue Fujitsu for compensation for the sub-postmasters whose lives have been wrecked by their flawed system’. As one critic put it, ‘the British state has been hollowed out to the point where it is so dependent on the corporations to which it has outsourced critical services and functions that it dare not rein them in’.30
Consultancy
In the private sector, consultants are cast as agents of unfairness through their role in advising on corporate restructuring, which can ‘lead to mass job losses, changes in the terms of employment, or wage cuts’.31 More broadly, the whole concept chimes with the public’s suspicion that those in positions of power are engaged in scams. Popular media accounts, however unfairly:
‘have frequently stressed the “swindling” nature of management consultancy, with headlines chronicling the “great management consultancy scam”, and the “plundering” nature of consultants’ work. From this vantage-point (echoed by several politicians), consultants were portrayed as “making money out of suckers”.32
Here again, the imposition of a particular ideological model has reached the point of provoking resentment and hostility.
VI. Government response
Across these three areas, the Labour government has promised a series of steps to address excessive reliance on contractors and the consequent imbalances of power which impede government delivery and stoke public disquiet.
Privatisation
In water, rail, energy and steel, the government has moved away – to varying degrees – from the dominant model of ownership, on the basis of tackling concentrations of power:
- It has legislated to set up Great British Energy as a publicly-owned renewable energy investment body;
- Its Bus Services Bill will reverse the ban imposed in 2017 on local authorities owning bus companies;
- It is creating Great British Railways and bringing the railways into public ownership ‘as contracts with existing operators expire or are broken through a failure to deliver, without costing taxpayers a penny in compensation’;33
- In April 2025, it invoked emergency powers to take control of British Steel; and
- Labour’s 2024 manifesto also undertook to ‘put failing water companies under special measures’, empowering the regulator to block bonuses and ‘bring criminal charges against persistent law breakers’.34 The Independent Water Commission, chaired by Sir Jon Cunliffe, has since recommended the abolition of Ofwat. On taking office, the government obtained verbal agreement from water companies to change their articles of association to encompass stakeholders beyond just shareholders.35
Full re-nationalisation of water is supported by 82% of the public; however, then-Environment Secretary Steve Reed ruled it outside the scope of Cunliffe’s review on the grounds that it ‘would cost £100 bin’.36
One regulatory analyst argues that the level of public disbelief in the current ownership arrangements in the water industry is such that the current case against nationalisation – ‘the government can’t afford it’ – is inadequate. If private ownership of the nation’s critical infrastructure is to continue, the case for it needs to be made afresh.
However, public anger has reached a level where, much more so than with the Bank of England’s Monetary Policy Committee, the OBR or private companies, government may need to think the unthinkable. To some extent, it is effectively already doing this, but has not clearly articulated its approach in those terms to the public. This government could justifiably pull together all the policy moves it has already taken and argue that it rejects the whole idea that the state is ‘inherently inefficient’ at running the country’s basic systems, and that the market model was never a viable replacement.
Outsourcing
In December 2024, following her declaration that ‘We want our money back!’, the Chancellor appointed a Covid corruption commissioner.37 This was cast as a direct assertion of power. A Treasury source told the BBC, ‘She won’t let fraudsters who sought to profit off the back of a national emergency line their pockets’.38 The initiative has recovered almost £400 million so far.
More broadly, the government has picked up on a move among local authorities to reverse outsourcing. This developed because outsourcing was a means to break up old concentrations of power, but eventually generated new ones. ‘Labour’s Plan to Make Work Pay’, the implementation of which was a manifesto commitment, casts this as both a pragmatic reform and a deliberate power shift, promising to ‘learn the lessons from the collapse of Carillion’ and ‘end the Tories’ ideological drive to privatise our public services’, by bringing about ‘the biggest wave of insourcing of public services in a generation’39
This was accompanied by a detailed set of measures to challenge the presumption that the private sector is necessarily better than the public sector, and where it is chosen, to provide stronger state oversight, including to ensure value for money, better ‘longer-term investment in the workforce’, and to ‘value organisations that create local jobs, skills and wealth and treat their workers well and equally’. Elements of these plans have been reiterated post-election by ministers, and are contained in the Employment Rights Act40
This might also apply to the housing of asylum seekers, given expert calls for ‘long-term strategy to replace short-term profiteering’ partly by ‘using local authority expertise to provide dispersal housing in communities’.41 As of 6 November 2025, the government has so far ‘recovered £74 million from excessive profits made by companies running asylum accommodation’ after a review of the contracts concerned – approximately the equivalent of 13 days’ spending.42
Case study: children’s social care
One sector where local authorities have been striving to return provision back to the public sector is children’s homes. In November 2024, the education secretary announced the ‘biggest overhaul in a generation’, promising to ‘crack down on care producers making excessive profit, tackle unregistered and unsafe provision’ and ‘ensure earlier intervention to keep families together’. This involves supporting more non-profit social enterprise providers to enter the sector, and more active oversight to avoid providers going bankrupt, with terrible consequences for those in their care. Requiring ‘providers to be owned and residing in the UK will also be considered to stop businesses syphoning public money off-shore’.43 Some working in private equity report that companies have grown wary of the sector and the reputational risk it carries; social enterprise practitioners, however, report the opposite.
The move towards earlier intervention and keeping families together accords with the proposals outlined in the Independent Report on Children’s Social Care (2023), led by Josh MacAlister, who was elected as a Labour MP in 2024. Interviewed before his appointment as Children’s Minister, MacAlister argued that the fact that ‘over 80 per cent of residential care is now privatised’ had left the state feeling ‘powerless’ – neither able to ban private involvement nor re-nationalise provision that was not in the right locations. His proposal ‘to get power back into the system’ is to shift ‘hundreds of millions of pounds in the care system towards supporting kinship arrangements … funding solutions where relatives in the family network can look after the kid’. This, MacAlister argues, will give the public sector the ‘power of planning ahead, investing together, recreating public provision’.44 There are signs that this is now the government’s approach. Bolstering the roles of kinship networks and fostering would reduce demand for care homes: one of the aims of the Department for Education’s Families First Partnership programme.45 The goal is to tip the balance of power away from suppliers to the state, and to the children themselves, giving them a choice of placements where necessary.
Investment announced for children’s homes in the 2025 spending review is being directed into regional care co-operatives, which bring local authorities together to commission provision jointly; the Children’s Wellbeing and Schools Bill creates powers for government to instruct councils to create these co-operatives. Along with a stronger child protection system, this might offer a more effective answer to the issue of rape gangs sexually exploiting vulnerable children, given that many of these children were placed in residential children’s homes when they were abused (and with it, a counter to toxic populist narratives that the state doesn’t care about such victims).
As a next overall step, government could acknowledge that in areas of public provision like this, the outsourcing model could never have worked. When it was first written in 2019, the civil service guidance in this area was titled the Outsourcing Playbook; it is now the Sourcing Playbook, in line with the inclusion of ‘insourcing’.46 It now warns that outsourcing may be more challenging if ‘there will be disproportionate effort and cost to bring services back in-house in future’.47
Nonetheless, orthodoxy enforcement and learned helplessness remain legible. The guidance on when insourcing is appropriate includes a section on ‘specific considerations before insourcing a service’, unlike the section on outsourcing – and one of those considerations is ‘impact on market health’. More importantly, it warns: ‘Insourcing is a substantial transformation in service delivery model, and should have additional care and consideration applied before being undertaken.’ The guidance worries that insourcing may be difficult if ‘there is currently a lack of senior management capacity or capability to transition, integrate and manage the insourced services’.48
It seems unlikely that major outsourcing firms have a playbook which cautions the need for ‘additional care’ about expanding into areas where ‘there is a lack of required specialist capability internally’. Perhaps if the state were more confident and outsourcing giants were less gung-ho, we could achieve a better balance.
Another approach to reducing the need for outsourcing might be to identify other services where MacAlister’s approach might be applicable, such as early years provision and adult social care. This is likely to become easier if indeed private equity firms are growing warier of the reputational risks of involvement in sensitive public services. Alongside this, there is much scope for promoting the role of social enterprise as a non-profit partner to the state. The government’s February 2025 National Procurement Policy Statement specifies that contracting authorities should ‘maximise procurement spend with small and medium-sized enterprises (SMEs) and voluntary, community and social enterprises (VCSEs)’.50
Commissioning authorities should use the power to require any supplier of people-focused services to demonstrate their commitment to open book principles, to ensure profit is not excessive and extractive. Ideally, services which are provided directly to people, as against those services which public authorities need to operate, should not be commissioned through the commercial, competition law-based market-purchasing procurement system at all.
Consultancy
In its manifesto, Labour promised not to tolerate the waste of public money on ‘excessive use of consultants’, including a cut of 50% in their spending plans.51This echoes the Coalition’s attempt to radically reduce reliance on consultancies, though that succeeded mainly in achieving a temporary reduction in fees.52
Mariana Mazzucato and Rosie Collington are among those advocating a concerted revival of state capability. Under the previous government, a Government Consultancy Hub was set up to develop this, and a Consultancy Playbook developed with input from consulting industry stakeholders to guide how officials should manage consultants. This had the dual aim of ‘maximising the value-adding potential of consultants’, while building ‘a better, more self-sufficient Civil Service that is less reliant on external resource’.53
Alex Chisholm, then Permanent Secretary of the Cabinet Office, declared that while the overall project had proved ‘too difficult’ to achieve, ‘we need to make sure that we only use consultants in exceptional cases with specialist skills on a temporary basis and achieve knowledge-transfer’ back to the civil service.54
Similarly, former Deputy Cabinet Secretary Helen MacNamara argues that departments should ‘find the in-house experts the taxpayer is paying for and use them’ – rather than handing public money and publicly funded learning to external organisations.
The Open Innovation Team, set up in 2016, has successfully pioneered a related approach. This is a cross-government unit that operates somewhat ‘like an in-house consultancy’, partnering with academic experts whose research can usefully inform policy, to offer departments an alternative way to deliver policy projects. Partly because it is not run for profit, it is ‘usually less expensive than external consultants’.55
Championing this kind of state entrepreneurship would rebuild confidence and morale, retain learning and save money.
Officials should be encouraged, and eventually required, to cease the routine outsourcing of core civil service tasks such as evaluation and analysis. (The necessarily subjective definition of ‘core’ should be adjudicated by ministers in order to avoid this becoming a source of delay.) To institutionalise the principle that hiring consultants should be exceptional and project-specific, no ongoing ‘call-off’ contract with any generalist consultancy should be renewed, and the government’s Consultancy Playbook guidance on this point should be tightened to reflect this.56
The money this will save should be invested in advance to ensure the re-establishment of the necessary in-house expertise before each contract ends. One justification for call-off contracts is that they enable officials to commission consultants without going through a laborious procurement process on a case-by-case basis. This points to an urgent need to address the reasons procurement has become so slow, starting with excessive risk aversion.
Other ways to reduce reliance on consultancy include revising the ministerial code to facilitate bringing in expertise through reinstituted Extended Ministerial Offices, building in ‘a dedicated surge function’ to cope with spikes in workload, and making civil service human resources (HR) procedures more flexible to facilitate poaching talent, including on pay57
Conversely, it has long been clear that pay and promotion policy should be rethought, in order to incentivise officials to commit to their roles for longer periods. This would allow departments to retain learning and expertise, further reducing the need to hire consultants.
These measures require a careful unpicking of the status quo, but the public is ahead of politicians here, particularly on privatisation. The alternative to careful unpicking may end up being a blunt instrument. Reform UK has promised renationalisation of the steel industry, and of 50% of the water industry – recently revised to ‘short-term, partial nationalisation’ of ‘certain failing industries’58 The party has called for the end of foreign ownership of utilities,59 and has plans at local authority level for ‘breaking up the outsourcing oligopolies that [Nigel] Farage and [Zia] Yusuf see as the real chance to deliver savings and modernise’60 – though to date Reform-led councils have increased spending on private providers.61
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