Mutuals: A blueprint for the future?

According to a recent article in the Guardian the Government are very much in favour of 'mutuals' this is the process where public servants can club together and effectively opt-out of the public sector.

As a former public servant I must say I always felt that myself and my colleagues could do a better job than our senior managers who seemed to be handpicked for their ability to lurch from crisis to crisis whilst maintaining a veneer of optimism.

The idea of mutuals trouble me though. Much of my interest at university (in fact I'm currently in negotiations about a potential Phd on this very topic) is around how organisational characteristics impact on the public service ethos; in other words is the profit motive found in the private sector inconsistent with public service ethos of the voluntary and public sectors? The answer you may be surprised to hear is that it is not necessarily the case, in fact the opposite may be true; that is in some circumstances for-profit organisations may contribute the public good more effectively that the private or public sectors.

This view is against conventional wisdom, but a great example is provided by the Body Shop. Seen as left-field and pioneering when they were first set up the virtues they champion have been absorbed into the mainstream. All that within a for-profit model which would have been inconceivable in the voluntary or public sector. I am aware that I have defended the public service ethos of the public sector in the past and my views have not necessarily changes, I still beleive that the public sector possesses a particular strength in this aspect, but rather I am more pragmatic about which sectors should deliver services. the way I see it is very much a case of 'horses for courses'; in some instance the public sector is best, in others the qualities of the private or voluntary sectors can be better.

The problems however, centre around the pressures such 'mutuals' may find themselves under. It appears they will be a hybrid of all three sectors and will need to balance public service with profit making. The example given in the article of Cleveland Fire Brigade presents one example; on one hand the organisation has a public service committment committed to providing services to the public, but this will need to be balanced against profit making activities. This means decisions will need to be made in the future as to how best to allocate resources, should a fireman be on standby in case of a fire, or would it be better if he/she was off conducting a paid consultancy to bring in extra cash. This is not far fetched speculation, but a real issue as in the voluntary sector the issue of 'mission drift'; that is abandoning an organisations core mission to chase the funding on offer has become a real and recognised issue in the voluntary sector, first through a glut of funding opportunities and latterly through a scarcity of funding.

The answer to these dilemmas is that there should be a level of accountability, but accountability to who? Local councillors perhaps, but what if an organisations area of operation overlaps several authorities boundaries then who takes the lead and is local government really an effective tool for this? In addition the more mutuals there are, the harder it is to trace accountability. In the NHS and public services as they stand there is a clear chain of command. Numerous mutuals operating in different areas may well be hard to keep track of and their opaqueness could prevent accountability from the public and local media.

I do beleive that there is a case for challenging the monopoly of the public sector, but any moves need to be done with extreme caution and lessons learnt from the experience of transferring services from the public to voluntary sector.