Taking the debate upmarket
by Duncan O'Leary
The temptation is to be either support or oppose greater freedoms for schools, but the danger is that �freedom� or �control� become ends in themselves, where more or less of either automatically becomes a good or a bad thing. As I tried to point out with my posting on HSBC banning customers from rival banks, the devil (and the politics) really is in the detail.
As Julian Le Grand points out in January�s Prospect, the way in which government structures the competition is vital to the types of outcomes that it creates. He writes:
�if cream-skimming does become a problem, there are well established ways of dealing with it. One possibility is a stop-loss insurance scheme whereby the government picks up the bill for very expensive patients or pupils. Another is not to permit providers any discretion over admissions. Yet another, and the most attractive, is to adjust the payment system so that providers have a positive incentive to take on difficult or expensive users.�
This is more than an objective discussion about whether choice is �better� than a government monopoly � it�s a refusal to be complacent enough to think that it is necessarily either. And more than that, it�s a political decision to structure incentives in such a way that the least well off in society benefit at least as much as everyone else from public services.
To return to the question then � what does this mean for the reform of public services � I would say that the White Paper represents an opportunity to move beyond market evangelism or implacable opposition, to a debate where neither side gets off so lightly. If reformers want more choice and diversity, then they need to start thinking about on exactly which the terms that takes place, and the responsibility for their current opponents is to engage them properly in that debate.