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An in-depth assessment for the government

Former regulator and civil servant Matthew Bailes assesses the government’s performance and awards it governance and financial viability ratings

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Picture: Getty
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In a tongue-in-cheek piece, former regulator Matthew Bailes scores the government on governance and financial viability, in-depth-assessment style #ukhousing @MB4Paradigm

If the government could be given an in-depth assessment, how would it do? Former regulator @MB4Paradigm has a bit of fun with his latest IH50 column #ukhousing

In IH50 today, @MB4Paradigm criticises politicians’ short-term thinking #ukhousing

Paradigm has just undergone its first in-depth assessment. It was a slightly odd experience for those of us with ties to the regulator, but overall a very positive one.

The process reminded me of the judgement that lies at the heart of our regulation. Since no organisation is perfect, the question for the regulator is whether imperfections are relatively minor and a one-off or a sign of fundamental problems.

This question might equally be posed in other contexts. For example, those of us working in housing have day-to-day experiences of a system that is fundamentally flawed.

These problems could have been prevented. They are not the result of unforeseeable events, but rather the accumulated effect of what Lord Kerslake described as “the biggest public policy failure of the past 50 years”.

So are the failures in housing policy a one-off, or a sign that there are systemic weaknesses in the way we are governed?

One of the defining features of housing is that it is a long-term issue.

It takes time for policy changes to take effect, often well beyond the political cycle.

Sometimes the right long-term policies would create short-term pain for some voters. Politicians can also reap short-term benefits while creating longer-term risks.

“One of the defining features of housing it is, by its very nature, a long-term issue.”

For example, recent governments have done very little to stem house price inflation which in the short-term conveniently boosts consumer confidence. The long-term result is that much of the younger generation is priced out of decent, secure and affordable housing.

In the circumstances, it would be reasonable to ask whether government has struggled with other issues that require longer-term thinking.

Sadly, it is not terribly hard to see signs of a wider problem. Take the challenges posed by an ageing population. Again, these were (and are) entirely foreseeable.

In 1980 there were about 3.5 people of working age for every pensioner. That figure will be nearer two by 2030, and by 2040 one in seven people will be over 75, but the government has failed to plan for these changes.


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For example, David Cameron’s government decided to slash provision for social care and commit future generations to fund a triple-lock mechanism, which means state pensions will go up even if earnings go down. This is the exact opposite of a sensible long-term approach and has contributed to the current crisis in the NHS.

The related issue of public health provides another example. We have moral and economic imperatives to encourage people to remain healthier for longer, especially if we want to retain a free-at-the-point-of-use health care system. But we have an obesity crisis and as a result some 10% of the NHS budget is spent dealing with diabetes.

Forecasts suggest that by 2030 around one-third of adults will be obese, yet it took campaigning by celebrity chefs to nudge government towards modest changes.

There are similar problems in other policy areas requiring long-term planning. Few commentators think that the UK has a coherent long-term energy strategy and our transport system faces a myriad of challenges.

Getting decisions on big issues – like airport capacity – has proved long and tortuous. Our response to climate change is tepid at best.

There are good arguments that say this is just the price of democracy, and that politicians are constrained by public opinion.

Good long-term policy can be bad short-term politics, and for politicians there is not much point in having great policy ideas if you are not in power. As a result, in democracies there is a tendency to confront difficult issues only when they become crises.

“The chances of ministers effectively dealing with complex long-term issues aren’t great if they are mostly focused on their next tweet.”

However, the demands of the 24-hour news cycle and latterly social media have made things worse. They have created a generation of career politicians whose formative experiences involve doing battle for positive media coverage, rather than running businesses or public services, and relentlessly demands to feed the media machine.

The chances of ministers effectively dealing with complex long-term issues aren’t great if they are mostly focused on their next tweet.

This suggests that if ‘UK plc’ was exposed to an in-depth assessment, it would struggle to achieve a G2 rating. A viability assessment wouldn’t look any better given the record deficit, off-balance sheet liabilities like private finance initiative and grave risks to our key trading relationships.

As those of you familiar with regulation will know, G2 and V2 is not alright. It would often trigger an independent governance review. That might not be such a bad idea for the UK as a whole.

Absent is a change in the way we governed, so it is hard to be optimistic about any government’s approach to long-term challenges like housing.

Matthew Bailes, chief executive, Paradigm Housing

 

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