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January 30, 2023

The Telegraph – The public sector must ban working from home – or face collapse

Calls remain unanswered. Emails are routinely ignored. Appointments are missed, meetings are rescheduled and the post doesn’t get sent out. 

We already knew that the UK had a dismal record on productivity, with output stubbornly refusing to rise and the economy flat-lining for year after year. And yet, far from being improved, it is getting worse. 

In the public sector, which accounts for a larger and larger share of the overall economy with every year that passes, it is now in absolute decline – and it is dragging the whole country down with it.  

There are lots of explanations for that, many of them tediously familiar. The unions are too powerful and resistant to change. Management is centralised and enterprise and initiative are stifled. Targets are top-heavy and, given that its services are typically free at the point of delivery, there is little incentive to innovate. 

But by far the most obvious is staring at us straight in the face: working from home. Until the government finds a way to get the 5.7 million people on its payroll back into the office every day, the public sector will never function properly.

We never expected the public sector to have an outstanding record on productivity. Ministers have been giving speeches for years about how systems need to be more responsive, standards have to be improved. 

Margaret Thatcher drafted in leading businessmen to try to kick some enterprise into the system, while privatising everything she could in the belief that shareholders would always do a better job than the state.

Tony Blair and Gordon Brown introduced targets, appointed “czars” and created “delivery units”, in the belief that top-down Stalinist central planning would fix the issue. 

David Cameron mainly left it to Nick Clegg to worry about – which, in practice, meant forgetting about the whole issue – while for Boris Johnson the detail was too much hassle to even attempt to grapple with. In different ways, British governments have struggled with the issue for years.

Today the challenge is not how to improve public sector productivity. It is how to stop it from completely collapsing. There has been plenty of anecdotal evidence that each person working for the Government is producing less than they used to. 

Want to book a driving test? It will take four to six months to get one, compared with, for example, a private sector eye test, which I could easily book for tomorrow from a dozen different providers. Or a new passport? You will have to wait up to 10 weeks – and that is the official figure. Or process a planning approval for some changes to your home? 

Don’t expect anyone to get back to you soon. Or your rubbish collected? Many councils have cut back to one pick-up every three weeks, and some to one in four, halving output on what was the norm a few years ago. 

Even HMRC, the body that collects the money to pay for everything, has more or less given up on answering the phone – the personal finance app Untied found a 10pc annual increase in wait times – while letters remain unopened for weeks. Even when they are not on strike, services are clearly deteriorating.

And now the official figures confirm that output is indeed in freefall. Over the latest quarter, public sector productivity fell by 1.3pc according to the Office for National Statistics. 

That compares to a 0.1pc increase in the private sector, hardly a stellar result, but at least something. Overall, government output per person is now 7.4pc below its pre-pandemic level, compared to a 1.6pc increase economy-wide. 

The Centre for Economics and Business Research estimates that the state will have to spend an extra £73 billion just to keep pace with declining output per person. Even more alarmingly, at the current rate of decline, public sector output will have dropped by 20pc over the next decade, and 34pc measured over two decades. 

Read the full article.

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