Work out the options
There is a careful balancing act between approaches to control and cut public sector spending, and the consequent impact on the wider Welsh society as a whole, its citizens, those who are deprived and in need and also key environmental issues. Poorly planned cuts are likely to have far reaching and long lasting consequences that traverse beyond service users, but also deep into the fabric of Welsh communities. That is why it is important to consider the wider impact on the society, economy and environment (see the exhibit below). Efficiency actions should however reduce costs without consequences to services or citizens. And, as Mark Friedman - who developed the Results Based Accountability approach - has said, the goal when making priority based cuts should be to do the 'least harm to outcomes'.
The model below demonstrates the possible positioning of different measures to achieve savings, or cutting costs. Our observations over recent years indicate that the public sector has focused on 'low hanging fruit', typically procurement savings which represent easy savings with often minimal impact on the citizen. However, once the low hanging fruit has been exploited, the options become progressively harder or more severe. It is very easy to be protective and think about the consequences to staffing, but we believe it is important to take it a step further and think about the consequences to the citizen and service user, consequences against your outcomes, and impact to other sectors. Obvious links are between Health Care and Social Care, Social Care and Housing, availability of skills and private sector growth. It is also important to consider the sustainability of your options; this is important to ensure that economy, societal and environmental aspects are considered together. PricewaterhouseCoopers discuss this in their paper, Lean and Green.
There is going to be no right answer, but there could be numerous wrong ones. The challenge is not insignificant which is why we think good analysis of consequences is important.