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 that money 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)
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.