mindhenge

Home - society - economy - article

Questionable practices

2 June 2003

Good decision-making is a process of questioning, and that involves listening carefully to the answers that you least expect.

Here's a really stupid question. You want to build a new school. Do you (1) borrow the money at a low interest rate and pay a builder to do the job or (2) invite the builder to borrow the money at a higher interest rate, and then pay him back (plus a profit) over thirty years?

It's obvious, isn't it. A no-brainer, as they say. Of course you get the builder to deal with all the hassle of borrowing money and then, by the time you've finished paying him off, inflation will have made the cost seem quite reasonable.

Or.... er ... um, ...... borrow the money cheaper and save yourself a sackful by paying for the job outright?

Who's to say? In a case like this it helps to know the answer before you ask the question, because the answer is not an answer but a statement of political intent. In politics the answer you want defines the question you ask, which probably explains why, in a speech on social policy last week, former cabinet minister Stephen Byers had a go at the venerable institution of meals on wheels.

His question was about choice. Why not, he asked, offer recipients of the service a money alternative to purchase a take-away meal delivered to their door at a time of their choosing?

Why not indeed? It was a question the BBC picked up the day after, interviewing satisfied folk for whom the traditional "English" nature of the meal on wheels was half the charm. They pointed to the "social" aspect of the service, provided by a regular, volunteer staff who took more than a passing interest in the health and happiness of their clients. The pizza delivery boy, it was implied, might prove a poor substitute in this respect.

Byers was probably dead pleased. He'd asked a question about choice to which there could only be one reasonable answer (more choice, please) and been answered by a bunch of fuddy-duddy people on a fuddy-duddy radio channel saying no thank-you. It all went to show (you could imagine him saying) how wrong they all were and how right he had been to raise it in the first place.

It is the fatal attraction of party politics that the big idea sweeps all before it. A modernising government is going to modernise. A government committed to the war on terror is going to go to war with Iraq. Any question that challenges the underlying assumption is just an irritating flea bite, with the biter to be batted away. And the strange thing is that the motivation for this does not flow from intellectual dishonesty or any conscious desire to avoid the truth. The enemy is not truth at all, but complicatedness, which in politics is seen as a fungus that eats away at focus, and direction, and leadership and, determination, and all those things that we are supposed to admire in a political high command.

Why should such admirable human qualities lead to lousy decisions? Might a government, for example, bent on modernisation, introduce competition into meals on wheels? It would, after all, be consistent with a well-worn article of New Labour (and Conservative) faith, that choice creates markets and markets generate efficiency. Why should any institution wish to be insulated from the warming rays of this general good?

When applied to the transport network, or the legal profession, or even the National Health Service, the modernising-for-efficiency thesis brooks little opposition from those considered Luddite or self-serving for their resistance to the trend. What makes this possible is the prevalence of simple and unquestioned assumptions about the pre-reformed condition of the services - that British Rail was necessarily inefficient, or the legal profession necessarily grasping, or the NHS necessarily chaotic or wasteful. The reinforcement of these assumptions is essential to political endeavour since without a starting point there can be no journey, hence no determined and focused leadership on the way.

The meals on wheels service, on the other hand, is irredeemably complicated. It defies general market principles not least because the people who take the meals round (and some of the cooks) give their time for free. Applying the concept of efficiency under these circumstances is difficult. This is not because volunteer-run organisations cannot be more or less efficient. Volunteer labour is still an economic input that can be used to more or less effect depending on how well it is organised. What makes it different, however, is that it is not subject to the sort of controls that would dictate the efficiency of labour in a standard economic model.

The most basic control is pay. Organisations can, for example, reduce staff numbers if the remaining staff are willing to be flexible in relation to their hours and their range of assignments (doing what is needed when it is needed). If the cost in pay to purchase that flexibility is less than the saving achieved by reducing numbers, the result is counted as an increase in efficiency.

Volunteer labour, however, is motivated not by pay, but by the return that the volunteer personally gets from undertaking the appointed task. This, in turn, is likely to be connected to their perception of the social or "human" value of the work. The more "useful" the work, the more likely is the volunteer to wish to undertake it, and to do it well and conscientiously.

Because of this, the best results can be expected if the volunteers have as much freedom as possible to set for themselves the quality and nature of their input. It's a fair bet that spending a little more time with each client than is strictly necessary for the delivery of a plate of food, chatting with them and fussing over them and generally making sure that everything is well in the household, is part of the "added value" that the meals on wheels volunteers bring to the work and, symmetrically, part of the value of the work that makes them volunteer in the first place.

Quantifying the economic value of this added social input is therefore difficult for three reasons:

The workers are not being paid for their time
The added social input may be the reason they agree to work for nothing in the first place
The added social input is economically valuable to the Social Services department because it relieves pressure on their own paid staff.

But problems of quantification need not conceal that the arrangement is a good thing from everybody's point of view. Volunteers, Social Services Departments and the recipients of the meals are all winners, which is quite a score.

Which brings us back to our opening question. For every political "big idea" there is a mass of little but highly pertinent inconsistencies, and the right answer can only be found to a question when these inconsistencies are permitted to come to the fore. The fact that people work for something other than money is rather a big "little inconsistency" that might lead to the conclusion that even paid workers are susceptible to motivations of this sort. It's a thought that, if it figured more prominently in decisions concerning the nation's resources, might serve as a reminder that (for example) building a school is not a task best undertaken for purely economic motives and that the question asked at the top of this piece is perhaps not the one to ask at all.

The question "how to build a school" is wide and inclusive of possibilities that are outside the box of the political dogma. The question "How to pay for it" is, by contrast, narrow and exclusive - how to get the most for your money rather than how the get the most for and from everybody involved. A school, after all, is a human, social venture. Perhaps the success of it depends as much upon the human impulse of its builders as their undoubted need to earn a crust. In that case, the political task would be to make the space within the contract for the human impulse to flourish. For without it the buyer has been sold short, and everyone is the loser.