There is growing interest in payment by results across the public sector as a way of improving performance in public service delivery and  attracting external investment.  A4e Insight has put together the attached introductory guide to PBR and some of the issues which it raises for those involved in its development.

Undaunted by the unprecedented torrent of words already devoted to the Spending Review, the A4e Insight Team have added our own commentary, which can be read here. 

As usual, we have tried to get behind the bare numbers and focus on the implications for the public service industry and its investors, both in general and across individual sectors.

Please contact us if you need further or more specific advice on any aspect of the review

The Spending Review is now only two weeks away and A4e Insight will be doing its level best to assess its implications for companies in public sector markets and their investors.  In the meantime, here is our take on a long, not that hot summer of partial paralysis as we all wait for the Spending Review to arrive.

Mark Lovell, Executive Chairman of A4e and also one of the A4e Insight team, comments on the emergency budget

I thought it was about time I posted a couple of comments on the Budget.

There is lots of speculation about the impact cf the Budget on public services – and that is the bit I am focused on in the context of making an impact on the public sector deficit. So, what can we do? Read the rest of this entry »

The Emergency Budget on 22 June has obviously divided political and economic opinion but there has been considerable praise for its openness, especially compared to Budgets presented by previous governments, about the challenge which the UK faces and how it will be addressed.  Read our commentary on the Budget and its implications here.

The 2010 Spending Review process started in earnest on Tuesday June 9 when the Chancellor made a speech and the Treasury released a document –“ The Spending Review framework” – setting out how the review will be conducted.

The attached commentary considers what these proposals tell us about the review and what its implications might be for the public service industry

The attached commentary takes stock of where the new government has got to so far in mapping out its plans for reducing the deficit, and looks at some key issues that will need to be addressed during the forthcoming Comprehensive Spending Review (CSR).  It was drafted before  details started to emerge on June 8 about the way the government intends to approach the CSR, which suggest that the intention will be to be truly radical.  One Treasury official has already been quoted as saying that ” Anyone who thinks the spending review is just about saving money is missing the point”

The proposals for the CSR which are still emerging raise issues for public service companies which are worthy of much more detailed comment, and will be the subject of a separate paper from us in the near future.

Despite having one of the shortest ever tenures as a Cabinet Minister, David Laws managed to make a considerable impression in successfully negotiating the package of £6bn public spending cuts (actually £6.2bn) which was announced on May 24. 

There is no formal document giving details of the cuts package, other than the transcript of the Chief Secretary’s speech, which can be found here.  This confirms that around £3.8bn will be saved by “cutting out waste” while most of the rest – save for some eye-catching but low value items such as reducing Ministerial cars and first class rail travel for civil servants -  comes from ending lower priority spending such as the Child Trust Fund.

As Ministers are now admitting openly, this is only the first and probably the easiest step on the road to fiscal rectitude.  On June 22 George Osborne will deliver an emergency budget which we expect to focus on tax measures rather than public spending changes, but which will also give much greater clarity to the coalition’s plan for reducing the deficit (a must have, since both coalition parries were suitably vague about what they would achieve and by when in their manifestos and during the election) Then the really hard decisions will follow in the Comprehensive Spending Review during the summer and autumn.

We will be following both the Budget and the CSR closely and trying to anticipate the impact on public service companies.  However some items in this initial package point the way forward and are very important for private sector suppliers to government.

Read the rest of this entry »

Welfare reform has been put at the heart of the coalition government’s first legislative programme.  Its proposals have major implications for the welfare to work industry.  Read our commentary on the proposals here

In formally launching the “Big Society” on May 18, David Cameron committed the new coalition government to a number of objectives, one of which was to provide explicit support to the creation and expansion of mutuals, co-operatives, charities and social enterprises.  He also said that the government will give public sector workers a new right to form employee-owned co-operatives and bid to take over the services they deliver.

At the same time, we know that the government faces unprecedented challenges in reducing public expenditure dramatically over the life of this parliament.  So while new co-operatives may not have to save money, they will certainly be expected to improve the effectiveness of existing service delivery.

And if they can do both – deliver services better and reduce spending, so much the better.

Read the rest of this entry »