Money and (Better) Public Services?

I was on the Nolan Show this morning, performing my usual role as defender of the idea of small state/low tax economy. The discussion was to have focused on whether it might be a good idea for us to collectively pay more tax to fund ‘better public services’.

You can listen to the debate by playing the Audioboom recording above.

However, I wanted to pick up on one strand of the discussion. It was an emerging ‘theme’ of the programme – following an extensive discussion regarding Northern Ireland’s relatively high rates of suicide – that additional funding for the NHS might be a solution to this problem. I like to refer to this as the public-pocket-fix that tends to be the default argument of most lefty commentators and politicians and callers to the Nolan Show.

Now, this morning, I committed the cardinal sin of suggesting that perhaps the NHS wasn’t all it’s cracked-up to be. Yes it’s great etc. And it employs veritable selfless saints. But it’s still not that good, relatively speaking. Other nations spend less (or more) on healthcare but have much better healthcare systems and outcomes.

The spending isn’t the point. Everyone wants better healthcare but the current system isn’t providing it. The NHS is stuck. Funding is vast and is politically contrived. In other nations, with much better outcomes (like the Netherlands or Switzerland) there’s more localised control, more competition and less politicised funding arrangements.

In certain areas the NHS is over-funded. There has been a vast increase in managers given the complexity of the organisation. Social care has vast staffing, comparatively speaking, to front-line acute staffing.  The entire organisation is bloated, procurement practices are bizarre and the rock-stars of the NHS – the consultants – derive considerable incomes from private work while being in the employ of the tax-payer.

To say these things doesn’t make one bad or NHS-hating. Stephen Nolan’s reaction, when I suggested these inefficiencies might exist, suggested that the (hard-working) porters at the local hospitals might be perplexed by my assertions (I paraphrase).

But as Dr Kristian Niemietz of the Institute of Economic Affairs has put it, “If one views the NHS primarily as a team-building exercise, it would be seen as a phenomenal success, but as a health system its outcomes are sobering. It lags behind most comparable countries in terms of health outcomes, quality and efficiency measures, and is financially unsustainable in the face of an ageing population. Patient choice is underdeveloped, incentives to innovate are low, and political short-termism continues to trump best practice. It’s time for these significant shortcomings to come under the microscope, otherwise the health of the nation will suffer.”

Jeffrey Peel is @jeffreypeel on Twitter and, among other things, is a Fellow of the Institute of Economic Affairs.

 

 

  • Ernekid

    I heard you this morning Jeff. All you proved is that you know sweet FA about the NIHSC and health care funding.

  • Disdain

    “Social care has vast staffing, comparatively speaking, to front-line acute staffing.”

    In what sense is social care not a front-line service?

    On a related point, would you not accept that an effective (ergo well staffed) social care system has a preventative effect on NHS usage, and therefore a multiplier effect on public savings?

  • Kevin Breslin

    “In certain areas the NHS is over-funded. There has been a vast increase in managers given the complexity of the organisation”

    Hang on I would’ve thought that more complexity means more management?
    The NHS is a very complex organisation, the service provision it provides and the number of customers is huge.

    If you had said “In certain areas the NHS is over-funded. There has been a vast increase in managers given the simplicity of the organisation”

    But you didn’t.

    People have seen the problems caused by a mismanaged NHS where staff have absolutely no direction and where there is no executive control over finances, the fiscal conservatism of resources is compromised. I imagine what management can be safely delegated to the medical staff has and can be.

    The complexity of the organisation, justifies the need for management.

    You say it is “bloated”, but then infer that “being bloated means less managers can manage it better”. That doesn’t seem to make sense with human capacity, difficult tasks generally require more work and potentially more workers, certainly more manhours overall.

    In my view that really leads to something of a Hobson’s Choice.

    1. Simply the organisation that it requires less management, and cut provision of health services.

    2. Cut the management and increase the complexity of the organisation.

    You can’t juxtapose your experience with a small lobbying company to an organisation of a much larger magnitude.

  • Kevin Breslin

    If the man was really serious about what needs to be cut from the NHS he would read an audit report.

    He would also clearly define clearly which general services should no longer be free at the point of delivery and only available by another route. e.g. He wants to cut consultancy, what alternatives does he propose.

    Telling people who could be helped by consultants that “We no longer have the expertise to provide these services anymore, could you go away and die or suffer in silence?”

  • chrisjones2

    You set up a bogus semantic aunt sally and then demolish it. How interesting.

    Still saves having to address the real issues

  • chrisjones2

    Doh …yet again do read the sentence especially phrases like ‘front line acute’

  • Kevin Breslin

    The semantic aunt sally was Jeff’s invention, read the article.

    I’ve expressed my opinion on the real issues and the critical weakness in Jeff’s argument, like it or not semantics pay a key role in communication.

  • I’d rather have the NHS in its current state, warts and all, than let any more small-government ideaology loose on it – I think we all know who would lose out and who would benefit.

    If anyone is going to reform the NHS I’d prefer that they are doing so for the right reasons.

  • Graham Parsons

    Where to start. I know lets look at the facts.

    http://www.independent.co.uk/news/uk/uks-healthcare-ranked-the-best-out-of-11-western-countries-with-us-coming-last-9542833.html

    Your condescension towards some of the most caring people in our society is pathetic. Your lack of self awareness, as someone who works in a right wing think tank, is startling.

    If slugger must give a voice to the right can it not do better than this?

  • chrisjones2

    Again an aunt sally …..

    And auditors audit … they dont set policy or promote innovation …just complian that they dont see it

  • Kev Hughes

    Yeah, I agree with you on this one KB.

    Can efficiencies be made in any organisation? Of course. But simply put, the NHS is like any large organisation; it’s complex and needs a layer of expertise to navigate and run it.

    I just feel the above post is kind of a glorified ad hominem attack on an organisation that the writer is opposed to as it’s a state organ, something he is clearly against in nearly every shape or form.

    The line of thinking is: ‘It’s a states organisation, private sector is better, therefore, let’s eventually privatise it’. Simplified? Perhaps, but as someone who is all for the ‘common weal’ I am well aware that the private sector doesn’t have all the solutions, that it may actually create problems and that there should be some form of democratic oversight on things which the populace consider to be common goods, health care provision being one.

  • Kevin Breslin

    Health resource inflation does pressurize the capacity of the NHS to even maintain its current state. You only have to look at proton beam radiotherapy a new costly health service (available in the Czech Republic) and see how much money will be needed if and when that gets introduced over in the UK and Ireland with the potential removal of other radiotherapy treatments.

  • Kevin Breslin

    Actually, I’d imagine in order to fix something you want an idea of what the real problems are.

    Audits aren’t just book work, they help focus the minds of policy makers and innovators.

    I would think people might prefer evidence of a problem to word of mouth.

  • Belfast Barman(ager)

    I’m afraid you might have missed Jeffrey’s point.

    He’s saying nothing discrediting about the NHS staff (except perhaps that consultants moonlight, which is indisputable).

    If, in every discussion about improving the NHS, its supporters have the blinkers on and see, “we need to improve X,” as, “these people aren’t doing their job,” we’ll never see the NHS improve, it will just stagnate until either it breaks completely or we all die from preventable causes- whichever happens first.

    When my boss comes to me says, “Kris, I’d like you to change from using X to using Y,” it isn’t necessarily a criticism of me, perhaps I am doing great at my job but the results would better if I followed route Y than route X.

    There isn’t a single part of our society that doesn’t need improving, this is self evident as we don’t live in a utopia. If we want to improve ANY of these areas, we need out-of-the-box thinking where people shouldn’t be afraid of suggesting controversial topics… that’s where ideas are born.

    Facebook used to have a motto of ‘Move Fast and Break Things’, not because Zuckerberg et al want things to be broken, but because by pushing what you currently do, in whatever field, through the barriers (man-made or natural) into a better version of itself is going to be messy – you just have to be open to the possibility that after messy, comes utopia.

  • Belfast Barman(ager)

    And policy makers are at the whim of the political wind… “Change this,”…….6 months pass….. “We need to change this back, it wasn’t popular,” – doesn’t mean it wasn’t the right thing to do to benefit all

  • Reader

    Jeff could have said it better; you could have read it better.

  • Kevin Breslin

    An average reader should not have to infer the subtext of the author’s intent.

  • Graham Parsons

    I’m all for criticism where it is necessary. It also important to understand where the criticism comes from. In this case an ill informed right wing think tank who clearly have an agenda.

    A quick search quickly tells you that his statement “In other nations, with much better outcomes (like the Netherlands or Switzerland)” is false.

  • Thingy

    Perhaps the much better outcomes in Switzerland and the Netherlands (though you dont state what are referring to, and comparing such outcomes across countries is diffocult) are because both countries spend more (per capita and per capita by GDP) than the UK?

  • murdockp

    Nothing generates votes than an MP/MLA with a placard protesting about the closure of a hospital or department that society no longer needs and there is no medical case for it to exist.
    You wouldn’t have a tennis coach managing a premier league team yet armchair amateur MLAs and MPS think they know better than hospital consultants and senior managers, the facts are they don’t.
    Most of the outcries are generally from people scared of loosing their jobs, not the actual patients.
    We live in a full employment society straight of east Germany, we don’t even have ticket machines for our trains as that would mean the ticket seller loosing their job.
    A backward, overtaxed socialist state is what we have become.

  • Jeffrey Peel

    Graham, first of all I’m not an employee of the IEA – merely a local observer and spokesperson. As for the better outcomes in other nations the UK does less well than most other OECD nations in breast cancer survival, cervical cancer survival, colorectal cancer survival, stroke mortality, acute myocardial infarction…it also has a higher number of unnecessary deaths per 100,000 population than France, Italy, Iceland, Japan, Sweden, Netherlands, Australia, Austria, Norway, Spain, Canada and Luxembourg (according to an OECD report published last year). As for the IEA being uninformed, I think you’ll find it’s one of the most respected policy think-tanks in the UK. Free market, yes. But very well researched.

  • Jeffrey Peel
  • Jeffrey Peel
  • murdockp

    I have met very few people in the public sector other than Nurses and Doctors and care worker who actually care about people and their wellbeing. Most civil servants I know and have met in my dealings with their departments detest dealing with the general public but like the salary and working hours. But I have to say they hide behind this most caring people in society statement to belittle or negate any critical commentary about their working practices and performance.
    Would you see a building control officer stop to help and homeless person find somewhere to sleep for the night when they are walking from their office to their car? No as their job has finished for the evening yet doctors and nurses would help a person how has fallen ill.
    There are two types of civil servant, those who care and these who don’t and I am pretty sure they are more of the latter.

  • notimetoshine

    You’ll find most people in customer service/client facing roles private and public lol

    The general public are in general vile to deal with.

  • notimetoshine

    Two points that I have to take issue with.

    Mental health services are the poor cousin of medical services in the NHS. Few beds, even fewer specialists, lengthy waiting times. Money is exactly what is needed. May not be for every case but for mental health its exactly what is needed.

    “Social care has vast staffing, comparatively speaking, to front-line acute staffing.”

    Of course social care is going to have bigger numbers its far more intensive in terms of manpower compared to say what doctors do. Apples and oranges.

    Social care isn’t bloated, in fact it needs to be bigger and better staffed. It’s poor social care provision that causes so many problems in terms of acute services and bed numbers.

  • Kev Hughes

    ‘for the IEA being uninformed, I think you’ll find it’s one of the most respecked policy think tanks in the U.K.’

    Come now Jeff, that’s the grown up version of Milhaus in the Simpsons saying ‘but my mom thinks I’m cool’.

    Respected, by whom? You’re not an employee, cool, but you’re a bed fellow. Have at it, but expect to be questioned as you’re also an ideologue.

  • Jeffrey Peel

    Think I typed ‘respected’.

    I don’t know if you have any background in Economics but this extract from the IEA’s Wikipedia article might help you understand a little better.

    “The Institute’s research activities are aided by an international Academic Advisory Council and a panel of Honorary Fellows. All IEA papers are subjected to the same rigorous independent blind-refereeing process that is used by leading academic journals. The views expressed in IEA papers are those of the authors and not of the Institute (which has no corporate view), its trustees, directors or advisers.”

    “IEA publications are sold throughout the world – reprinted and translated into over twenty-five languages. In the UK, many IEA titles have become mandatory in university and classroom reading lists.”

    Hope this helps.

  • Kev Hughes

    Jeff, I work in PE/RE and private client before for 8 years in total and am a CFA candidate, so yeah, familiar with economics.

    Still, a wiki entry? My point is it is pretty subjective and you should stay away from the ‘my mom thinks I’m cool’ argument which you’re re-enforcing above.

  • Jeffrey Peel

    Goodness ‘Kev’ – that’s a lot of acronyms. CFA candidate? What’s that? Perhaps it gives you the necessary authority to give me advice? Is that it? We can all, these days, pick and choose the evidence we need to enforce our arguments. I choose well researched free market arguments. Perhaps that makes me an ideologue. But I’m very comfortable with that. Cheerio.

  • Kev Hughes

    ‘Kev’, – that’s weird, why are you quoting my name like that ‘Jeff’?

    PE = private equity
    RE = real estate
    CFA = chartered financial analyst, you should check it out.

    I’m surprised you’re not au fait with these acronyms.

    I try to be prudent in advice and modest in my goals, especially after what has happened over the past 8 years and starting my career in 2007 when reading clients’ portfolio reports coming in and talking of a ‘soft landing for sub-prime real estate that should only affect a few entities’ and then the mess that followed afterwards, I have become largely shaped not only my career but my entire cynical outlook on things.

    My problem with dealing with ideologues is that they rely on faith as opposed to evidence.

    ‘I choose well researched free market arguments. ‘

    You see, I feel you work from the conclusion and then back. How do you ‘know’ they are well researched and not merely operating in an echo chamber, for instance? Have you tried to challenge your own beliefs? Have you waivered from any of your core doctrines? I get the impression there is no compromise with you which I am sure you see as strength when I would say it’s probably a weakness.

  • Jeffrey Peel

    I think the key word is ‘free’. Free markets. Free thinking. No god or gods.

    It’s laudable that you are working towards a CFA exam. I note that UBS, JP Morgan and Morgan Stanley are avid employers of CFAs. Perhaps, prior to the crash, the analysis went wrong somehow. And all those CFAs working for the credit rating agencies just made some mistakes when computing the AAA+ rating of those collateralized debt obligations? Should I give you and your colleagues the benefit of the doubt or were they all blinded by faith?

  • Kev Hughes

    Let’s de-construct what you’ve posted, shall we:

    ‘It’s laudable that you are working towards a CFA exam.’ Thanks, it’s a nice challenge.

    ‘I note that UBS, JP Morgan and Morgan Stanley are avid employers of CFAs.’ They are indeed, though I don’t work for any of them.

    ‘Perhaps, prior to the crash, the analysis went wrong somehow.’ An understatement to say the least. They went very wrong.

    ‘And all those CFAs working for the credit rating agencies just made some mistakes when computing the AAA+ rating of those collateralized debt obligations?’ Indeed, not to mention all of the economists who also fed this too, including I’d say some of the folks who’ve had dealings with the think tank and the points you raise too, no? Though it would appear that you’re working on the supposition that if someone has a qualification then they must only think in one particular manner. Poor form.

    ‘Should I give you and your colleagues the benefit of the doubt or were they all blinded by faith?” I doubt that ‘my colleagues’ had much to do with this. But then, you’re jumping to a very large conclusion that those who sit the CFA must be blinded by faith. A faith in what, precisely? Why instead, I merely see the programme as one that can provide me with further skills and knowledge to challenge presumptions of value in the market.

    Your argument also follows a line of ‘well, if some guys who have a qualification got this wrong (the financial crisis) then here go that qualification must be tainted’. It’s the same argument raised by some (I know a candidate in Belfast for the Greens who used a line of argument)for economics in general, supposing that there is only one way someone can of course think and use a qualification or discipline when in fact there are many discussions, debates and arguments over what is a social science. Though, as an unashamed ideologue I would imagine that thinking in black and white like this would come naturally to you.

    I’m curious Jeff, what do you do then?

  • Jeffrey Peel

    I work in evidence-based consulting. I try to construct arguments (for and against different policies/strategies) based on evidence and perspectives. I never predict or forecast – because that’s quackery. I never describe myself as an Economist because it’s such a discredited profession (too many future-predicting quacks). I rarely suggest that it’s possible to determine causality when complex systems are involved. And I make a good living.

  • Kev Hughes

    Yes, but you’re also a professed ideologue, which makes me wonder if you just find the evidence you want for your stated position. I look at what you’ve said before and would you not say that this is a fair point or am I being too harsh on you?

    I’ve never described you as an economist, but as for it being a discredited profession, only parts of it are and tbf, more of it should be.

    As for predicting or forecasting, it largely depends. I’m minded of Taleb’s point regarding projections of more than 2 years and how they are largely useless and agree wholeheartedly with that. To make the point more personal, every time I have went for an interview I have been asked ‘where do you see yourself in 5 years time?’. I think back 5 years and ask myself, did I think it would be here? Answer = no.

  • Jeffrey Peel

    Indeed. I’m a Taleb fan. In my view libertarian/free market thinking is not ideology. Rather it’s a platform/perspective. Many free market thinkers vehemently disagree with each other. Mises and Hayek had frequent disagreement. Ayn Rand agreed with no-one it seemed. But I am of the view that the more we dis-aggregate, the more we behave as individuals, the better our society performs. I dislike corporatism as much as statism. That doesn’t make me an ideologue – rather it’s simply a view that I can make my own decisions without the interference from others. It’s not just about economics, it’s also about life. I don’t want anyone to make decisions for me. And, it seems, the default answer to everything these days is that we should defer to ‘the government’. In the case of Northern Ireland the government is clearly incompetent so I think we should collectively do everything we can to limit the extent to which it can meddle. Needless to say, the bigger the government the more incompetent it becomes. That’s why I have issues with the EU. Feel free to disagree with me but to suggest that I’m blinded by faith is just plain silly. We all reach decisions based on evidence. I do my best to be rational. I’m comfortable with the positions I take. I’m sorry you don’t like them.

  • Kev Hughes

    ‘I work in evidence-based consulting. I try to construct arguments (for and against different policies/strategies) based on evidence and perspectives. ‘

    That’s interesting, but what does that actually mean?

  • Kev Hughes

    ‘Feel free to disagree with me but to suggest that I’m blinded by faith is just plain silly’

    Then this?

    ‘Perhaps that makes me an ideologue. But I’m very comfortable with that.’

    You can say that I am being petty and should not read so much into that statement, but then you’re asking me to discount what you say without walking back.

    ‘And, it seems, the default answer to everything these days is that we should defer to ‘the government’.’

    Not really or at all. I would say it is that the overarching answer or narrative for the past number of years is that the state is corrupt and that the only answer is for the private sector to solve it. I disagree with this as I want a blend between both. So, privatisation being an example, i’m Ok with BT’s sell off but I think rail privatisation has been a disaster in its current form.

    ‘I do my best to be rational.’ Everyone does.

    ‘I’m comfortable with the positions I take. I’m sorry you don’t like them.’ You’re not really, and my worry is you don’t challenge yourself. I just don’t see any real curiosity above and you frame it with ‘I work in evidence-based consulting’. I don’t think one should ever be comfortable in their positions, I certainly am not. That’s why, you’re a bit of an ideologue.

  • Jeffrey Peel

    Why is that a worry Kev? Why are you worried about me? I have no idea who you are. But before this morning I had no idea you existed. I’ll leave you to be uncomfortable.

  • Kev Hughes

    Oh dear, someone doesn’t like being challenged on their held beliefs and is taking a comment far too literally rather than go over the main substance of what was said. Churlish…

    I was hoping to have a discussion with an adult but I can see that won’t be happening today.

    Feel free to go over the other points raised, if you’d like, or shall I file you as one of those bloggers who prefers not to answer points raised on what they had wrote and misdirect instead?

  • Jeffrey Peel

    Kevin unlike many bloggers I try to reply to points made. But I have a day job and limited time. I rarely blog on Slugger because invariably I’m caught up in circular, point-scoring pedantry. You have come to a conclusion about your opinions of me. Let’s leave it at that. Seriously I don’t have time for further dialogue. Bye.

  • Kev Hughes

    Let’s be honest here.

    You came onto slugger and posted something. We challenged you and an organisation you’re associated with. You came back with a wiki link saying how good you guys allegedly are and I challenged that as it’s backslapping nonsense.

    You’ve asked if I was familiar with economics (not that it should have any bearing on what we discuss here or points raised), and when I confirmed that not only a, I but have worked in private sector finance for 8 years you then decide to have a go at the qualification I am studying for (like that has anything to do with the points raised).

    When I quote you (literally, a copy and paste job) you decide to ignore it and become churlish.

    I have come to a conclusion about you, as I am sure many others will who read this and, tbf, it’s not a great one. It’s of a churlish man who could’ve saved himself a lot of time if he could actually reflect on what he writes, engages honestly and had a little humility as opposed to acting like a teen.

    [I RETRACT THIS PART IN LINE WITH PLAYING THE BALL AND NOT THE MAN]

    Good luck.

  • Old Mortality

    ‘Your condescension towards some of the most caring people in our society is pathetic.’
    ‘Caring’ might well come more easily when you’re paid for it. The really caring people are those who look after others on an entirely voluntary basis.

  • Old Mortality

    murdockp
    I’m a little disappointed to see you falling into the facile popular view that doctors and nurses are always ‘marvellous’ or ‘wonderful’ and ‘worked off their feet’ while the ills of the NHS are entirely due to bungling managers.
    Fortunately, I don’t find myself in a hospital very often, but when I have been I’ve never noticed nurses being particularly busy and doctors are rarely visible (except in A&E).

  • Old Mortality

    Like clamping down on doctors who insist prescribing expensive proprietary drugs rather than cheaper generics?

  • Jeffrey Peel

    I hope you and your conclusions are happy together. Good luck with the ‘finance’ exams. Maybe you’ll be a finance expert one day. Then you can provide investment advice.

  • Kev Hughes

    Just, wow. Churlish, beyond belief. Maybe this blogging thing isn’t for you?

  • Jeffrey Peel

    Maybe not.