Government's mutualisation programme needs clear targets, says National Audit Office

Report published today says criteria for success must be set out from the start

National Audit Office
National Audit Office

The government must set clear targets for its programme for the mutualisation of public services, according to a report from the National Audit Office.

The report, published today, assesses whether the government obtained good value for money from the 'right to request', in which  social enterprises worth almost £1bn a year became detached themselves from primary care trusts.

It says there is no clear evidence that the programme has been successful because the Department of Health did not set out "separate, measurable objectives" against which success could be measured.

The right to request was instituted under the Labour government. It has since been followed by the 'right to provide', a large programme introduced by the coalition administration that will allow most public sector workers the right to spin out their services into independent social enterprises.

The NAO report says:"The department should put in place arrangements that enable it to evaluate whether the programme is value for money or not, including specifying what it expects the costs and benefits of the programme to be and what the actual cost and benefits are."

It says PCTs had not specified in their contracts with social enterprises the benefits they expected those organisations to deliver. They should. it says, have monitored the savings social enterprises achieved above other delivery models, and who benefited from those savings.

The report says future mutuals should be given clear objectives and that the means for evaluating success must be "established at the outset".

A Department of Health spokeswoman said the NAO had failed to understand the point of the programme. She said the idea was to give more freedom to organisations to make the best decisions, and that setting clear targets for them to achieve was incompatible with this process.

"The right to request has delivered clear benefits to the NHS and patients," she said. "Across the country, the very reason why it has been so successful is that it is led by users of the service, local people and staff – those who are best placed to deliver responsive services for their communities."

Peter Holbrook, chief executive of the Social Enterprise Coalition, also criticised the report's conclusions.

"The report points to a risk of not having targets set by the Department of Health," he said. "But to stipulate the benefits to be delivered by social enterprises in this way would negate the ability of these organisations to empower their staff and communities to develop quality services that meet the needs of patients.

"To do so would undermine the principles that form the basis of the right to request programme."

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