Tendance Coatesy

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Public Services, Localism and the New Enclosures.

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Public Services, Localism and the New Enclosures.

“We want to give local people power over what happens in their communities.” Decentralisation and the Localism Bill. An Essential Guide. 2011.

“When these noble-minded altruists offered their services to the town they asked the people to believe that they were actuated by a desire to give their time and abilities for the purpose of furthering the interests of Others….” Mugsborough Community Forum. The Ragged Trousered Philanthropists.Robert Tressell. 1914.

The White Paper, Open Public Services (July 2011) follows the Decentralisation and Localism Bill – now coming into effect. They are at the heart of the Coalition Government’s policies. Public attention at present is absorbed by the impact the latter will have on loosening planning regulations. But perhaps more significant is the way that both pieces of legislation could potentially force the transfer all but a minimum of national and municipal services to a variety of non-state, private, organisations. A “diversity of providers” in the whole public sector signals the intention to alter the whole nature of the public sector. In the official Essential Guide to localism we learn that the underlying aim is “to give local people power over what happens in their communities.”

This was initially part of David Cameron’s ‘narrative’ about the Big Society. To Ian Birrel, its political agenda was about “passing power to the lowest level possible”, “Not just charities, but neighbourhood groups, workers’ co-operatives, social enterprises and, yes, businesses.” (Guardian 9.1.10) Others added that ‘faith communities’ would play a prominent role (Greg Clark, Catholic Herald. 30.7. 2010). The prospect appeared to open up of giving authority to the “little platoons” of voluntary associations, community stalwarts, and social entrepreneurs.

The Big Society faced ridicule. What state functions would be handed over to the ‘community’? Cuts in public spending implied that volunteers would replace paid workers. After the August riots the term has been largely replaced by sterner moral lectures on the importance of families, discipline and hard-work.

But Birrell’s political objectives have been far from dropped. The Minister for Decentralisation, Greg Clark, has not ceased to repeat this message – as can be seen in the above Bill. Duncan Bowie has observed that the key measure in the Bill is the creation of neighbourhood forums, to determine issues such as planning (Chartist July/August 2011). There are few rules on how “communities” at the “lowest level” create these bodies, are, how they operate (by election or self-selection), and what exact powers they have. There is talk of “community budgets”. “Bureaucracy Busters”, who will make sure this revolution takes place. Government documents are conspicuously unclear about their relations with authorities whose legitimacy relies on the ballot box. Bowie suggests that the “real issue of localism is the bypassing of democratically elected local government structures to empower neighbourhoods.” Even with the reduced resources available under fiscal austerity, these ‘communities’ will play a privileged role in governance.

Neighbourhood devolution is one aspect of the Coalition’s plans. The government is implementing other changes to some of the most fundamental aspects of public provision. These have a direct effect on the lives of civil servants, local government workers, and, above all, will “individualise” and “diversify” the services we all rely on. Despite floating the idea that Councils may be given the right to retain more of their revenues (which would favour the better-off) increased responsibility for some services, they are fragmenting others. Free Schools – taking over a name used in the 1960s by the ‘underground’ experimental education – and Academies signal he intention to remove much schooling from democratic local control. What of other areas? Will we be able to directly control how our Council Tax is spent – paying for what we want, and being allowed to refuse to contribute to services we don’t? Will we be able, as Barnet Council proposed at one point, (‘One Barnet’), to buy top-grade services at a premium price and queue-jump? Will a new range of local political actors come to determine policies and manage public provision through control of “community budgets”?

Far from being wild suggestions these are some of the potential implications of the Liberal-Conservative Coalition’s proposals. Undefined ‘communities’ will be handed power, individuals and groups will have the right to provide public services and replace existing set-ups Despite Birrell’s claim that this is not a programme for a ‘small state” it certainly leans that way. Government legislation reads less like an appeal to the conservative liberalism of Edmund Burke, Moot Halls, Shires and sturdy yeomen, than Robert Nozick’s market-libertarianism. That is a utopia of a minimum state, where everything is reduced to a contract between property-owning “inviolate individuals”. Or, as the Bill puts it, we will be “individual budgets”. In this moral vacuum is it surprising that some politicians appeal religious authority that we should trust to what Burke called the “one great Master, Author, and Founder of society”.

How This Will Operate.

It is not to be up to ‘communities’ to decide the framework that localism and the diversified state will operate within. The government has set this out.

The UNITE union observes,

“A central part of this is that rather than a public body, like a Council, hospital, school or the Government itself, directly providing a service to the public they look at all of their services and as much as possible they separate them up into individual pieces of particular services (or whole services) and contract (or commission’) others to provide those pieces instead. When a public body puts all these pieces out to contract it is then up to different organisations – staff organisations, voluntary and community organisations and private companies to compete against each other to win these contracts.”

A Guide to Social Enterprises, Mutuals, Co-Ops and Privatisationhere.

It is important to look at how this might operate. A prominent example based on a similar model (though without ‘staff’ bidders) has already operated for around a decade for the Labour Government’s schemes for the Unemployed. The original New Deal Programme, and the Flexible New Deal, were both contracted out to a mixture of private companies and charitable trusts. The ‘contract culture’ meant that there was a frequent turn-over of providers, with considerable energy expended on preparing the next bid – indeed there has been the development of specialists in the domain, with their own conferences, web-sites and publications.

The Government is concerned to make people fit the economy. It discovered – though it would have taken a second’s look at the evidence – that existing schemes for the out-of-work were notoriously poor at getting people jobs, and providing anything but basic training. They were however extremely profitable for the tax-funded companies and the ‘voluntary sector’ involved in the two New Deals.

In the existing economic climate there is a shrinking labour market. There remains, nonetheless, a large low-paid sector, with a high staff turnover. Many companies prefer to employ migrant labour – which can be cheaper and more ‘flexible’. People must compete for all these jobs – though there are not enough to absorb 2,5 million of them. And redundancies are now spreading across the board.

Originally some not-for-profit education and training organizations were involved in the schemes, in Ipswich this was the YMCA (who made a point of their Christian values to participants). They, and other smaller voluntary groups in other regions, were generally accepted as better (in relative terms) than commercial enterprises, such as, in Suffolk, SEETEC and Reed – who have a very poor reputation. The new government leant towards commerce. The new Work Programme, introduced this summer, is more slanted to private companies, as the UNITE pamphlet notes, 1 contract went to the Public Sector, 2 to the Voluntary and 15 to the Private.

The Work Programme is designed to reform the unemployed. People are pressured to do everything possible to find work (send endless spec. letters and phone calls, spend hours ‘job searching’), and are given the same ‘courses’ on CVs, Interviews and so on, that the New deal so generously offered.

For those unwilling to become a modern Samuel Smiles and help themselves, sanctions loom. Individual Work Programme Advisers have the power to remove all benefits, or put people on unpaid workfare full-time – from the uncooperative. The pressure on providers is great. Their own profitability depends on finding people work: it is a condition for their full payment. The ‘sales drive syndrome’ that puts maximum pressure on participants, regardless of the availability of work, will come into play. The potential for abuse – bullying springs to mind – is obvious. Yet there are fewer and fewer rights for the unemployed.

The outsourcers dealing with the workless now represent a powerful lobby. They have begun to shape the policies of the system. The now wealthy Emma Harrison, of A4E, one of the most prominent companies in the unemployment business, is now the government’s Family Champion. She is tasked with sending a voluntary army of middle-class mentors to run the lives of problem families.

Handing power to private bodies tends, then, has been a one-way process. It sets in motion the creation of new institutional powers. Under New Labour, and now the Liberal-Conservative Coalition, an unaccountable tangle of outsourcers is replacing the democratic public sphere. It is hard to find out how they operate. The principle of commercial secrecy has meant that critics of these companies, face great obstacles. ATOS, the body charged with testing those on the various Invalidity benefits, has felt free to menace its critics with libel and close down a web site for the disabled that carried hostile comments.

As can be seen this example has a wider relevance. The Work Programme does not create work. It is an attempt to discipline the reserve army of labour. It is a desperate measure in, a time of austerity that gives private companies the power to punish people and force them to do what is effectively community service (often the same tasks carried out by those convicted by the courts). Do we want our public sphere to be run in this way? Do we want private companies to have a major direct influence on public policy? In this multi-million pound state-funded business what exactly is there in having a “variety of providers” that gives decision –making power to the people?

Co-ops Etc.

UNITE writes,

“At the moment one of the main methods the Government is currently using to push this agenda is to promote employee owned mutuals, co-operatives and social enterprise businesses in the future delivery of public services using the language of staff empowerment.” 

Co-ops and mutuals have a long history. Many are part of the labour movement, others an expression of ‘social’ religious action, or for secular social benefit. They have been supported by advanced liberals, and have been regarded as hard-headed examples of self-help. Karl Marx considered them to be part of the “transforming forces of the present society based on class antagonism”. In this he supported worker-initiated co-ops, not top-down experiments. Mill, who defended private property and the role of capital, nevertheless saw a place for experiments, of a socialist tinge (as opposed to State Communism), in a co-operative direction. Pope Leo Xll in 1891 gave his blessing to mutual societies, which was later extended by Catholics, of the right and left, to other forms of co-operative association. Some Conservatives have welcomed co-ops, they are said to encourage thrift and responsibility amongst the less well-off.

Co-ops in all their various forms (of producers, of consumers) and mutuals operate in the interests of their members. This can easily mean that they engage in full-bloodied competition on the market – against others. They may also be purely self-interested. There is spectrum from, say, a Manhattan ‘condominium’, an anarchist Housing Co-op, to co-operatively owned social housing.

Beatrice Webb, of the Fabian Society, while she endorsed consumer co-operatives, saw a danger in producer associations. Her judgement was, and remains, relevant.

“…it is a strangely distorted view of democracy to break a community into tiny self-governing circles of producers, which by the very nature of their activities must fight each other to the death or combine to impose price and quality on the public.” (1)

During the 1970s there was a revival in efforts to create worker co-ops – to prevent company closures Beatrice Webb’s argument was much discussed. The mainstream labour movement and the left backed these efforts. They met Marx’s criterion that is they were in the first instance “independent creations of the workers” and only secondarily state aided – with Minister Tony Benn’s support. Critics, usually from those unwilling to admire anything but their own small political sects, went unheard. But none of the worker run experiments of the time, Triumph Meriden, and the Scottish Daily News, turned out to be commercially viable. Later attempts to set up producer co-ops, sometimes GLC (in the early 80s) and the union backed News on Sunday were not successes either. Perhaps the critics had a point.

There are, naturally, thriving worker co-ops. There was every reason to support the idea. But the major reasons for these failures was that some were built from failing companies, in hard economic times, others simply went under in the market’s inevitable “fight to the death”. More recent proposals, often highly abstract, to create a ‘market socialism’ around such co-operatives, face these inevitable problems.

Co-operatives may be a desirable form of enterprise. But they have to compete on markets. They do not always do this successfully. There are many other difficulties – as anyone familiar with the structure of the Consumer Co-ops in the UK, like the Co-operative Group, will recognise – from employee relations onwards. One might say that the dominant pattern of managerial structures tends to be reproduced in any form of company. The point would therefore be to change that paradigm.

Public Service Co-Ops etc.

What then of running public services through co-ops, mutuals and other not-for-profit bodies? An initial point is that an enormous part of the public domain is going to be affected. This would imply that very different organisations would have to be formed to meet the demand. Just how enormous the range is can be seen here (from UNITE),

“Firstly, individual services, such as education, skills training, social care and housing support which individual people could be given budgets for. Individual people will then choose what provider they buy their services from. Secondly,neighbourhood services, such as local environment maintenance, leisure facilities and other (traditionally council provided) local collective services which would be contracted out (presumably by the Council). This has been a feature, to varying degrees, of local government for the past few decades but what is perhaps new is the sheer scale and scope of what is now considered to be up for grabs. Thirdly, there are commissioned services, which are national services that cannot be devolved locally, such as prisons, tax collection, and Welfare-to-work which the Government nationally would contract out.”

Co-ops, not-for-profit associations, mutuals, ‘social enterprises’ (defined by their ‘aims’ not by the way they operate) and private companies, will compete for contracts to run these services. EU rules (and British legislation) mean that no group can be selected without considering commercial grounds. Their capacity to deal with these ‘opportunities’ has been called into question by the (pompously named)  Association for Public Service Excellence (ASPE) research (Here). Another factor weighs heavily. The economic climate is dire. The Cabinet has announced cuts in public spending – to massive protests. Any organisation bidding for work will have to be highly competitive. Or, to put it another way, must be cost-cutting.

Immediately we can see the difficulties. A staff and user co-op, set up to run municipal services, would get not preference over a private firm. To win it would need, like a producer co-op, to offer savings, no doubt including staff reductions, and a ‘flexible’ workforce. It would therefore probably be responsible for sacking its own staff. Despite TUPE – in theory designed to keep the same conditions and pay for employees in the new enterprise – the scope for these emasures will increase as new staff are hired. One wonders if pensions would be maintained once they are now the responsibility of the co-op, mutual, and other organisations. At some point no doubt, the power of financial institutions – needed for capital, why should Council taxpayers fork out for a service now in the hands of a minority or a business? – will find its way into affairs.

If a private company takes control of public assets the position will no doubt be much worse. One could envisage, say, libraries being turned into entertainment centres (with some suitably flashy name – Media-Audio Centre). Employees may be casualised, and workers’ rights ignored. But if a co-op wins a bid it will be primarily responsible to its members – not the general public who use the service. It will be at a further remove from direct democratic control than any state or municipal bureaucracy. It will be ‘local’ only for some locals.

The New Enclosures.

UNITE notes that under these conditions there will be a race to the bottom – for staff conditions and for service provision. There will be more costly red tape, as all provision has to go through multiple layers. There will be a drive to turn public services into commercial enterprises – even by co-ops and mutuals – because they will need to generate additional revenue. There will be pressure to reproduce the pay scales and hierarchies of the private sector. Many services will become the fiefs of local cliques, or ‘communities’, those with time and motivation, who will be in charge of decentralised budgets. Oligarchies and business will replace elected democracy.

The economist and geographer David Harvey calls this process the ‘new enclosures’. “This is, in effect, a particular form of enclosure of the commons, in many instances orchestrated by the state…The result has been a taking away of assets and rights from the common people. And at the same time as there is a taking away, there are these immense concentrations of wealth occurring at the other end of the scale” (2) Harvey suggests that it is the failure of capitalism to create uniformly profitable enterprises that leads to pressure for the transfer of public revenue to private companies. Guaranteed profits in this area are easier than innovation and entrepreneurship. The political impact is the most significant. Common, public, property, under at least a minimum of democratic control (councilors, Parliament), is being transferred to uncountable private bodies and mysterious ‘communities’. The Market State that meets the needs of commerce and business, equipping people to compete on the global bazaar, will be founded on these new stakeholders.

In Big Bang Localism (2004) Simon Jenkins imagined an alternative to Britain’s alleged centralism. He put the emphasis on elected institutions, “in the form of elected country, city, town and parish bodies.” The present government intends to by-pass elections and give power straight to ‘communities’. It will hand over provision to non-elected and only indirectly accountable private ‘providers’. Like the not-so-mythical Free-Market City Hall that meets only to distribute contracts to companies that carry out most of the Municipality’s work, this will give power to the market at democracy’s expense. Oh, and those “local people” who benefit from the New Enclosures.

Perhaps the last word should go to John Clare, writing of how the last enclosures took away the people’s freedom,

”   “I Dreaded Walking Where There Was No Path”

I dreaded walking where there was no path

And pressed with cautious tread the meadows swath

And always turned to look with wary eye

And always feared the owner coming by:

Yet everything about where I had gone

Appeared so beautiful I ventured on

And when I gained the road where all are free

I fancied every stranger frowned at me

And every kinder look appeared to say

You’ve been on trespass in your walk today.

I’ve often thought the day appeared so fine,

How beautiful if such a place were mine;

But having nought I never feel alone

And cannot use another’s as my own.


  1. Page 158 Workers Control. Anther World is Possible. Ken Coates. Institute for Workers’ Control. 2003.

  2. Page 309. A Companion to Marx’s Capital. David Harvey Verso 2010. Also: A Brief History of Neo Liberalism. David Harvey. Oxford. 2003.

2 Responses

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  1. and then read this….

    The state and local government
    Towards a new basis for ‘local democracy’ and the defeat of big business control
    by Peter Latham

    £14.95 (£4.50 p&p) 500pp illustrated
    ISBN 978-1-907464-05-8

    Forward by Kelvin Hopkins MP

    The striking continuity between Cameron’s ‘big society’ and New Labour’s ‘neo-liberal’ project for governance gives a special relevance to Peter Latham’s study The state and local government. Beneath the rhetoric of devolution and empowerment real power is evacuated to the central state and displaced to corporate capital. Proceeding from the famous dictum of Marx; ‘All science would be superfluous if the outward appearance and the essence of things directly coincided’ Latham demonstrates the foundation – in the particular neo-liberal forms assumed by ‘state monopoly capitalism’ – of the local governance in Britain and other countries. Theoretically, the study is located firmly in a rigorous address of Marxist theories of the state and argues that “superstructural” readings, which exclude political economy, misrepresent Antonio Gramsci.

    The author’s conclusions are rooted in a long intellectual and political engagement with the theory and practice of local governance and assert the continuing relevance of Gramsci’s theory of the historic bloc in devising strategies to contest the convergence of Britain’s three main parties around the surrender of local democracy to big business control. Grounded in up-to-the minute election results and policy initiatives the book includes a comparative analysis of the local governance in Britain and South Africa, a survey of ‘socialist decentralization’ models in China, Kerala, Cuba, Venezuela and Porto Alegre and a detailed analysis of local election results. It concludes with policy proposals for a new basis for ‘local democracy’ and the defeat of big business control embodied in the measures proposed by the Conservative-led coalition government.

    Dr Peter Latham is a sociologist whose thesis on Theories of the Labour Movement in the 1970s used Antonio Gramsci’s concept of the “organic” working class intellectual to explain twentieth century rank and file movements in the British building industry. A former researcher on direct labour at the London School of Economics he then taught housing policy to students working in the public sector – when he was Secretary of Lewisham Trades Council and a lay activist in the National Association of Teachers in Further and Higher Education – before becoming a full-time official in the University and College Union. From 1999 to 2006 he was Treasurer and then Secretary of the Labour Campaign for Open Local Government. His previous publications include The Captive Local State: Local Democracy under Siege (2001) and New Labour’s US-Style Executive Mayors: the Private Contractors’ Panacea (2003). He is also a member of the Communist Party’s Economic Committee, the Labour Land Campaign and Croydon Trades Union Council’s Executive Committee.

    Published by Manifesto Press supported by Croydon Trades Union Council, SERTUC, Croydon NUT, Unite 1/1148, Croydon and South London CWU, PCS, Labour Land Campaign and Brendan Bird


    Nick Wright

    September 10, 2011 at 12:25 pm

  2. ‘Philosophers have only interpreted the world; the point is to change it. So, howd does the working class fight these land grabs and profit snatches?

    Sue R

    September 12, 2011 at 9:51 am

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