Payment by Results

FRIDAY, FEBRUARY 8, 2013 originaaly blogged by Jon Harvey  or @cllrjonsharvey on Twitter
 

On the November 15, 2012, voters across most of England & Wales elected their new and first Police & Crime Commissioners. Whilst not involved in operational policing (that will still be directed by the Chief Constable), the PCCs now have sweeping powers. This blog is here to act as source of information & ideas about how the new PCCs can build positive futures for policing and criminal justice in the UK.

I share this with you as Jon is a thought-provoking chap  and I think we might encourage more debate in this blog. Let me know if you want more like this? – Roger

The clue is in the name (PbR)

Today at midday the Guardian Public Leaders Network is hosting a live chat entitled probation service in peril? (You will be glad to know that I am not on the panel although this has not prevented me, of course, from already posting a couple of comments.)

Among the questions it poses is “Is a payment-by-results model the most effective way of delivering services?”

You will not need reminding, I am sure, this is in the week of the Francis Report into the scandalous treatment of people at Mid Staffordshire Hospital. Here is an extract from one of The Independent’s pieces (with an added highlighting from me):

Francis describes the leadership of Stafford Hospital as being characterised by a lack of experience, great self-confidence, and an obsession with meeting Government-imposed targets without worrying about the consequences. There was a pervasive culture where poor practice was tolerated as long as it remained hidden. Even when high mortality figures and patient complaints were brought to their attention senior managers denied their significance. Instead all they cared about was balancing the books so they could achieve cherished ‘foundation trust’ status. Francis said: “It is impossible to avoid the conclusion that there was an unacceptable delay in addressing the issue of shortage of skilled nursing staff. There is no evidence of any sense of urgency about this problem”.

And so we turn to Payment by Results, which is being touted by Policy Exchange and Government ministers as the next best thing since sliced bread. The notion that this policy could well to lead to creating just the same sort of conditions / culture that led to the ‘results’ at Mid Staffs, is simply not countenanced by its advocates.

But the clue is in the name: payment by results. In other words it is about creating a financially based transactional contract whereby results trigger money. It is a bonus scheme in other words. It might even be called ‘piece work’. Or even ‘performance related pay’. What all these schemes have in common is the idea that ‘more for less’ will be achieved because people’s hunger for money will drive improvements in efficiency, effectiveness and innovation.

There are some people for whom this is true and they will go to any lengths to satisfy their hunger for more money. These are the sorts of people who pushed the world banking system to the edge back in 2008 because their bonuses were rewarding them to do so. These are also the people who fixed the LIBOR rates so that (again) their bonuses were increased while borrowers has to dig deeper into their pockets. And there are people who will spend hours and hours each day, patiently devising ways to write to people with announcements about fake lottery wins, family inheritances and muggings in order to gain money. The drive is there in many people to accrue money no matter what the consequences.

And there are other people who go to work and expect to earn a fair day’s wage for a fair day’s work. These are the same people who delight in fixing a tap, helping to build a car, providing advice to customers in need and are happy with the pay that comes from that. These are the people who are not just motivated by money but actually (and strangely to some of the people in the earlier paragraph) just want to do a good job and make a customer / user / client happy.

And still more people give their time for free (or at well below the market rate) to a million voluntary and charitable institutions. And people do this because they care, because it matters to them. It matters to them that people are healthy. It matters to them that children get the best start in life. And it matters to them that offenders are helped to stop reoffending for the sake of society and for the offenders themselves.

  • Payment by results cheapens all that.
  • Payment by results starts from the ethical position thatmoney is (and should be) the principal motivator for people and organisations doing this work
  • Payment by results has no evidential base (or though if you can point me towards a controlled study, I would be happy to read it)
  • And payment by results will not work (as I have blogged before)

Some people reading this will probably say “here another crusty old hippy who cannot quite bring himself into the 21st century” and will go on to say “of course PbR will work, how could it not? Money, not love, makes the world go around! All great achievements in human endeavour have come from a desire to earn money… PbR simply taps into that fact”

OK. Then perhaps answer me these questions:

If PbR is so good, why not apply it to the judiciary. Let’s pay judges on the basis of their results. Supreme court judges will get a special bonus payment for making decisions that the Government wants…

If PbR is so good, why not apply it to midwives, those well known slackers who just don’t work quickly enough. A well designed PbR scheme will up productivity in labour wards and babies will be born more efficiently and effectively…

If PbR is so good, why not apply it to the police? Police officers (and their private sector employers naturally) will be able to earn mega bucks by arresting lots of people, redefining crimes to trigger more payments and generally being speedier, slicker and slimmer…

Where else might PbR be applied with interesting consequences? Should MPs be on PbR contracts, for example? 

Back to the serious point of this blogpost: PbR is highly likely to yield unforeseen consequences that will set back the cause of creating a just future, fair for all.

Posted by at Friday, February 08, 2013 You can email me on JonSHarvey@ymail.com
Advertisements

About Roger Nield MBE

Safety Director for the SMPL Organisation and supporting our Vulnerable Veterans Programme.
This entry was posted in Spot Light. Bookmark the permalink.

3 Responses to Payment by Results

  1. johndubyah says:

    Payment by Results is good certainly in principle. The age-old problem has always been that the devil is in the detail. How do you specify what particular aspect of the service to measure without potentially prejudicing another equally important part of the job description which perhaps has a lower profile in the eyes of management? And, Yes, it does lead to distorted reporting verging on the dishonest and fraudulent. PbR systems also tend to be bonus oriented – or at the very least a device to procure praise and favourable in-house performance assessments. In short a means of ticking boxes and laying verifiable claim to doing a ‘good job’ – in the eyes of management, rather than the customer. In my experience, achieved often at the cost of customer dissatisfaction and frustration.
    And yet – all too often even if we do not recognise our poor performance ourselves, the customer we serve (and there always IS a customer) is still not satisfied and justifiably critical of the service (or product) delivered.
    perhaps the problem is to create far too complex PbR systems and reporting. We should rather consider KISSing the problem is more appropriate ie ‘Keeping it Simple Stupid’ – though I much prefer ‘Keeping it Seriously Simple’). Possibly as simple as merely measuring Customer complaints (and compliments) – and tracking how these are responded to including improving quality, responsiveness, and continuous improvement of the system – customer satisfaction. Having measured these things then it is certainly justifiable to seek for continuous improvement in efficiency, cost reduction and where appropriate Return on Investment – even, dare I say it here, PROFIT! Sometimes progress demands that technology replaces jobs in the interests of the service, affordability – and customer satisfaction. An innovative economy should be continuously striving to train and retrain the workforce so that new fields of employment are found.
    … just a few musings!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s