Nationalise or privatise? That has been a classic dividing line for politicians ever since Margaret Thatcher made the latter a core part of her platform in the 1980s. And even though the big privatisations of state-owned assets are long past, it is a choice that lives on every day when public sector managers regularly consider so-called ‘make or buy’ decisions about individual public services.
However, there is a new kid on the block: ‘communitisation’. As Jessica Studdert and I outlined in our recently published paper, The Community Paradigm, this approach is emerging on the frontline of service delivery largely unnoticed by national politicians.
And a kid it certainly is. Unlike the much more mature approaches of nationalisation and privatisation, communitisation is just getting going. So I thought an FAQ might be helpful for those who may have got a bit fed up with simplistic, binary choices over the last two and a half years.
What is communitisation?
What is the purpose of communitisation?
Is communitisation happening?
How is a public service communitised?
Does communitisation address economic inequality?
Can communitisation generate efficiencies and cost-savings?
Does communitisation allow a role for the state and private sector?
What needs to change to make communitisation more widespread?
Communitisation is the process of transferring power and resource into the hands of communities. By contrast, nationalisation is the process of transferring power and resource into the hands of the state; and privatisation is the process of transferring power and resource into the hands of the private sector.
There are four main reasons to communitise.
- It offers a more effective route to address rising demand for public services than nationalisation or privatisation. Preventing demand requires a very different relationship between service and service user. The hierarchical attitude to service users promoted by a state-centred approach to delivery, and the transactional mindset to users promoted by a market-centred approach, don’t work. Prevention requires a collaborative approach in which service and user work together as equals. However, if the public sector hoards power and resource it is impossible to build that collaborative approach.
- Mobilising communities is a very powerful way of reducing demand. There is lots of research evidence which shows that people are far more successful at looking after their own health and well-being when they are part of supportive networks. Equally, there is a great deal of research (indeed a whole tradition of economic and political analysis) which shows that when relatively small groups of people get together to solve a shared problem or run things for themselves, it can be enormously impactful and successful. Communitisation is the process of using state power and resource to support the creation of these self-governing networks.
- Communitisation is a far more relevant response to the political demands of today than nationalisation or privatisation. Much of the rise in political extremism, as well as the frustration and anger behind it, is driven by a widespread sense of exclusion from the decisions that affect people’s lives. Lodging power and resource in the hands of politicians or state bureaucrats will likely only exacerbate that sense of exclusion. Equally lodging it in the hands of private sector organisations has clearly done nothing to ameliorate it. By contrast, communitisation hands power directly to networks of citizens. It is far more likely to play a significant part in any agenda designed to give people a sense of control over the issues that affect their lives.
- Communitisation is both more humane and more humanist than nationalisation and privatisation. More humane because an approach that prioritises preventing personal and social crises over responding to those crises once they arise clearly reduces incidence of suffering and is more likely to contribute to overall happiness and well-being. And more humanist because communitisation trusts that individual people and their self-governing networks have the intelligence, agency and desire to look after themselves and their own communities rather than relying on impersonal structures both public and private.
Definitely. As we explore in The Community Paradigm, there are many nascent examples of communitisation underway. To name just a few:
- the rapid rise of community businesses, many of which have been launched through the transfer of a public sector asset to a community;
- early initiatives by councils like Wigan, Cambridgeshire, Gateshead and Barking and Dagenham to encourage self-governing networks in core areas such as social care and environmental management by transferring power and resource (see The Community Paradigm);
- NHS pilot schemes such as that in Morecambe Bay that has handed responsibility for things such as diabetic support and communications over to a community group established specifically for those purposes (see The Community Paradigm);
- Big Picture schools which have built a whole model of learning around supporting student-led networks with links into the local community around the school;
- the Big Local initiative that has given 150 of the most deprived neighbourhoods £1.1 million each of Big Lottery money to spend as they see fit with no strings attached.
Of course, none of these initiatives would currently describe themselves as examples of communitisation but that is only because the word is being used for the first (and maybe the only time) in this blog post. However, all would acknowledge that the core idea at the heart of communitisation – handing power and resource over to communities – is their key goal.
There is no single model for communitisation just as there is no single model for privatisation or nationalisation. But like those older approaches, there does need to be the establishment of a new decision-making process and/or of a new institution that formally transfers power and resource into the hands of the community. This might be, for example, the establishment of citizens assemblies based in neighbourhoods that have a legally enforceable power to direct the design of services. Alternatively, it could (again purely for example) be the creation of a new, legally incorporated body entirely or largely run by a geographical community or a network of users to design and deliver a service.
Importantly, however, communitisation can only really happen when such a formal transfer of power and resource occurs. Efforts by public servants to work in a more collaborative style with communities, while welcome, do not shift power and resource in a significant enough way to challenge the underlying hierarchical and transactional modes currently hardwired into public services.
In this context, it is important to stay alert to the risk of capture. The apparent benefits of nationalisation were seriously undermined when state institutions were increasingly run in the interests of public sector workers or public managers rather than service users. Equally privatisation has fallen foul of private companies putting the interests of their management teams or investors ahead of social benefit. The great risk for communitised services is that new processes or bodies are captured by self-interested or self-appointed groups. This is why more work needs to be done to understand how communitised institutions can be genuinely inclusive, transparent and accountable.
NLGN shall be exploring how communitisation can work in practice in a report due out in May 2019.
The appeal of nationalisation and in-house services for the left resides in its supposed capacity to reduce economic inequality. There seems to be an underlying assumption that nationalised companies will pay their employees better, charge customers more fairly and invest profits back into the company. On this basis, it is fair to say that proponents of nationalisation trust governments to use the power and resource transferred to them on behalf of the less well-off members of society.
Communitisation, I would argue, is altogether less trusting of the state to act so beneficently. The history of public ownership is far from being one of high wages, well-treated consumers and socially responsible investment. More importantly though there is the fact that inequality of power and influence is hard-wired into public ownership. Nationalisation shifts power and resource from the hands of a private sector elite into the hands of a public sector elite. There is no clear reason why the latter should be any more sensitive to the needs of the less well-off than the former.
As such, communitisation starts from a very different point than nationalisation. It seeks to place power and resource directly into the hands of those people whose political and economic exclusion leads to their deprivation. Communitisation see the creation of permanent voice and influence for the economically excluded as the best route to addressing their exclusion rather than relying on the benevolence of a powerful mediating force in the form of the state.
The appeal of privatisation and out-sourcing for the right has been their supposed capacity to deliver services more efficiently thus saving taxpayers money and providing a better service for consumers. The empirical evidence for this claim is not particularly strong. But more significantly it is based on a misconception about what makes for efficiency in public services today.
The underlying principle behind privatisation that better run, commercially minded organisations will deliver a higher level of service more cheaply is less relevant in the era of austerity and rising demand. The available resource for some services now is so low that even the most efficient organisation would only survive by rationing the service it offers which is precisely what has happened in social care. We have passed the point at which efficiency gains can be made in a number of services.
More importantly, under conditions of rapidly rising demand, saving money and improving service outcomes can only result from a systemic shift to a preventative model. More conventional routes to efficiency such as restructuring, tweaking job roles, changing management style and introducing new technology are simply not up to the job unless they are part of that wider systemic change. And as has been explained above and in much more detail in The Community Paradigm, that shift to prevention requires handing power and resource over to communities not to supposedly more efficient private organisations.
Yes. There are some specialised services which clearly require highly trained professionals for their delivery such as acute healthcare (you don’t hand neurosurgery over to a community). Equally, areas such as highways construction or town centre regeneration require levels of capacity and capability which will not be found in a community. Such functions are provided best within the context of specialised private organisations or public bodies.
However, this does not mean that communities should not play a central role in the commissioning and governance of such specialist services. They also have an important role to play in the design and delivery of services associated with specialist provision such as maintenance of infrastructure or post-operative recovery.
In addition, the state has a vital role in co-ordinating the activities of self-governing networks. As Elinor Ostrom noted, such networks can often find it hard to join together in effective ways to address problems that reach beyond their particular locale or remit. On these occasions the state can intervene positively. But Ostrom is clear that does not mean the state taking over but rather creating the conditions and context within which networks can co-ordinate with one another more effectively.
And last, but definitely not least, there is the ongoing role of elected representatives. Their role in directing a communitised service is, of necessity, not as great as in a nationalised service or even one commissioned from a private firm but they must still play a fundamental part in enabling co-ordination of communitised services. They will always also set the wider policy and regulatory context within which self-governing networks operate.
Elected representatives will also continue to play a crucial role in how public resources are allocated across the country to ensure that communitisation can most effectively address regional inequality.
Communitisation will not happen overnight by any means. There are at least three major elements standing in its way.
- Awareness: Politicians and public sector managers still think very much in binary terms about the delivery of services, i.e. state vs. private. This is a state of affairs exacerbated by Labour’s renewed attachment to nationalisation as a panacea and the Conservative Party having become an almost complete intellectual vacuum on public service reform. Hopefully, the work of NLGN and others can start to break the duopoly.
- Centralisation: Meaningful communitisation happens at a local level. The preventative and other benefits which can flow from communitisation require small, self-governing networks taking ownership of shared problems and resolving them in ways that suit the specific needs of their members and locales. Services that are delivered and/or controlled at a national or large regional level cannot achieve these benefits. This means that decentralisation of the control of crucial services such as welfare, education, skills, healthcare is a prerequisite for communitisation to grow and succeed.
- Culture of public services and communities: Communitisation will require public servants, service users and communities to lose the hierarchical and transactional mindsets that have been inculcated into them by a long historical focus on state and private provision. If the public sector is to willingly transfer power and resource and if communities are to willingly accept and utilise it, the culture of both needs to become one of collaboration around shared social goals.
These are just a few of the questions which might arise from a more thoroughgoing pursuit of communitisation. At NLGN we shall be working hard to answer these and other questions in much greater detail over the coming months and years.