Why does centralisation save money?
A common theme in Scottish public sector thinking right now is the cost saving benefits of centralisation. If rumours are true then the Scottish Police forces, and the Fire and Rescue services are to be merged and centralised. Why? Because, it seems that there is a common unspoken understanding that centralisation, whether we like it or not, will save money.
You might imagine that reading recent government reports on these initiatives would explain some of the reasons why centralisation might bring savings. But you would be sadly mistaken. From the document "Sustainable Policing Project - Phase Two Report: Options for Reform" the nearest thing to an explanation of the benefits of centralisation is the sentence on page 5:
"The single force model represents the most significant change; however it provides the greatest opportunity to manage change, drive efficiency and in delivering operations when the change is complete. The eight force model represents the opposite."
In other words, there is no explanation of the benefits of centralisation. As readers, we are expected to accept - without question - that the author of this report is right in saying that single force is best.
This assumption is then reflected in the traffic light style summary of the report on page 62 (reproduced below). If you have a spare moment you might like to try (as I did) to go back through the document and uncover the justification for the colour coding of this:
Scottish Fire and Rescue
The Scottish Government consultation "A Consultation on the Future of the Fire and Rescue Service in Scotland" takes a similar approach to explaining the need for change when it introduces the subject on page 2:
"Many people, both in the SFRS and beyond, now accept that the current structure of eight Services supported by some national support services is unsustainable over the medium-term."
As readers we are clearly expected to agree with this statement because the people are unnamed and the argument is completely unsubstantiated.
Oddly, on page 5 of this report there is a nod towards decentralisation that is repeatedly scattered through the report from then on:
"To ensure that we can deliver the best possible outcomes for the people of Scotland, we want to see a context in which: the full benefits of the SFRS are de-centralised as far as possible…"
But the application of this principal within a single force is finally explained on page 21:
"A single service offers the best opportunity for de-centralising as many elements of the business as possible across Scotland. Under current structures resource cannot be transferred between services. A single service would give us the flexibility to de-centralise and move resource to meet specific, identified needs wherever they occur in Scotland."
In other words, the word "de-centralised" is included in the paragraph to make it appear that de-centralisation is happening when it's actually centralisation. Interestingly the paragraph also claims that current structure prevents the sharing of services when clearly this is not the case and the recent English riots is one well known example of this.
But back to the benefits of centralisation. On the same page this report says:
"A single service approach offers significant scope for bringing together funding streams and reducing the complexity of governance and the duplication of effort and control. It also allows for the rationalisation of back office and specialist services, but with the opportunity to spread back-office and specialist functions more widely across the country. Through simplifying the delivery landscape in this way, the costs associated with the existing multiple governance and co-ordinating mechanisms would disappear."
To be fair this looks like a reasonable attempt at a genuine explanation of the apparent potential benefits of centralisation. But the unfortunate truth is that the last 30 years worth of research in this area provides conflicting evidence of benefits of centralisation or decentralisation within the public sector. See for example: "Centralization, organizational strategy, and public service performance".
The idea that a single service will reduce the complexity of governance may be true, but it will not reduce the overall complexity of the problem. Centralised control allows for rapid decision making at the expense of a lack of detailed and localised knowledge. In effect it could be argued that any efficiencies of centralisation are in the way that it allows rapid and consistent decisions to be implemented nationwide regardless of whether or not they make sense at the local level. In practice centralisation is very likely to result in a nation of demoralised staff who feel the stresses and frustrations of having to work within a bureaucracy that neither understands, listens to, or has the time for local concerns.
The reports pretend that this is not the case by arguing that a single force will, through efficiencies of processes and interfaces, be able to address local needs better than a decentralised organisation could. But this is smoke and mirrors as addressing local needs would decentralise control and increase the interfaces involved in decision making processes. The force as a whole cannot be both centralised and decentralised at once.
Different operating structures favour different ways of working. Centralisation makes for efficient delivery of very simple standardised unchanging services but adds complexity and bureaucracy to the delivery of complex and highly variable services such as are required to address the diverse needs of a nation like Scotland.
Decentralisation is a potentially inefficient way of delivering simple standardised services but excels at motivating staff who are faced with dealing with ever changing diverse and complex issues at the local level.
The recent Christie Report on the delivery of public services in Scotland makes it clear that we can only operate efficiently if we accept that there are different needs and priorities across the country and that we need to address those differences. In other words, we will deliver cost savings, not by delivering the same service throughout the country but by prioritising the delivery of the services that matter in the areas that they are delivered. The simple truth is that delivering the same service everywhere is a waste of money.
Cost of change
Incredibly, the suggestion of moving to a single force for the police, fire and rescue brings one certainty: the cost of change. Whilst there will be arguments about the predicted cost, there is no-one questioning the fact that changing to a single force will be a big and costly change.
If there was a strong argument why, in the long run, a single force would bring savings and improvements in service then you could understand that this cost of change would be something worth investing in.
But the majority of the published cost savings are not dependant upon a single force. They relate to reducing capacity and lowering salaries.
In simple terms the government is proposing to reduce the workforce, cut salaries and simultaneously ask them to completely change the organisational structures they work within. If that is not a recipe for disaster, what is?
What is driving the push towards centralised control?
The only answer that seems to make any sense is centralised control itself. It seems that we have a government that does not believe in giving out control to other people. It seems to believe that our country is safer in the hands of a few hand-picked individuals in arms reach of government: but out of touch with you and me.