Future of Public Services conference 2015: Matt Hancock speech

The Minister for Cabinet Office spoke about commercialisation, experimenting and digital at the Local Government Association conference.

Future of public services: more commercial, more digital, designed for citizens, with central and local government collaborating

Today is all about the future of public services.

To all those here from central government, local authorities or the NHS: for most of the public you are public services. You are the link between the citizen and the state. In moments of need, they turn to you, so when you deliver, you can make the biggest impact.

My case is that we need continuous improvement in public services. And for that we must reform the relationship between citizen and state.

The case for reform is strong. Because people have high and rising expectations about what our public services should deliver. Because budgets are tight, and we have to make significant savings for our country to live within her means.

So we must spend less and deliver more. It’s not a choice between making those savings and meeting those expectations. We must cut costs by making our services better.

In short, we must build a truly 21st century state: smarter, nimbler, more responsive and more accessible. The technology exists to do it, and the public expect it. It is our duty.

In so many other areas of life choice has exploded, costs have imploded and user feedback drives continuous improvement. It should be the same with public services. We no longer have to make do with 20th century technology and 19th century structures.

So today I want to focus on 3 areas of reform offering huge potential for our public services: commercialisation, experimentation and digital. And I want to take some time to go through some examples of the sort of transformation we’ve seen.


Let’s take commercialisation first. Public or private, in-house or outsourced: these tired old binaries fail to capture the complexity of modern life.

It’s an increasingly futile debate, because the truth is we can have the best of both: we can have public service values and financial discipline, an entrepreneurial drive that’s driven by more than money.

It’s why, at the Cabinet Office, we’re supporting organisations across government to explore new commercial models for assets and services.

Sometimes this involves bringing together public and private sector partners with complementary skills.

Take Crown Hosting, a joint-venture between HM Government and Ark Data Centres.

In the past, data-hosting services were expensive because departments built or procured their own bespoke products. By contrast, Crown Hosting provides a service that can be used by the whole of government.

Our combined market power is cutting costs, and instead of locking us into aging IT, the model lets us tap the latest industry advances. Crown Hosting is now well on its way to saving £105 million.

The public service mutual – giving staff direct ownership of the services they provide – is another, very different model with huge potential.

Look at the public service mutual EPIC. EPIC provides support services for young people with disabilities and learning difficulties.

Formerly part of the Council, the staff voted to mutualise in 2014. With employees and young people on the board, staff are now trusted to try things out. They’ve just won a contract with the local Clinical Commissioning Group: delivering healthy lifestyle programmes for hard-to-reach young people.

It’s also saving money. EPIC outperformed their first-year savings target and is expected to save £800,000 by 2020.

The mutual movement has grown from just 9 organisations in 2010 to over 100 today, and I want to see many more.

But we shouldn’t get too hung up about structures. The first question for government shouldn’t be what’s the best model for delivering public services, but rather what is the user need?

The DVLA’s need for secure data hosting is very different to a young person’s need for a youth service they can trust. Getting this right inevitably involves trial and error.


And this brings me onto my second area of reform: experimentation. Because in seeking to improve our services, we need to know what actually works.

We’ve always had policy pilots, but we’re now putting on our lab coats, testing out variations of a policy against a hypothesis. Test, try small, fail fast and learn: it’s part of the secret of continuous improvement.

Famously, the Behavioural Insights Team – itself a Cabinet Office spin-out – are doing this with behavioural science.

Among other things, they’ve discovered how to reduce human error in hospital prescriptions, how to improve take-up of business support schemes and how to increase the chances of teenagers in Somerset applying to university.

We set up the Policy Lab to help departments prototype new tools and techniques, then iteratively to improve them in an agile way.

The team are currently working with the Department for Work and Pensions and the Department of Health to trial ideas aimed at preventing people from falling out of the jobs market and going onto Employment and Support Allowance (ESA).

These include GPs prescribing a work coach, and a health and work passport to collate employment and health information. These emerged from research with people on ESA, and are now being tested with local teams of Jobcentres, GPs and employers.

Doing this in just a few places is low cost and means we can discard the policies that don’t work and improve the ones that do.

Iterate, iterate then iterate again.

Empirical rigour goes hand in hand with a radically new approach to data. Not long ago the main role of data in public life was to demonstrate to central government that you’d hit your centrally determined targets.

Now, the best organisations are adept at turning the data they generate into real-world insights, which then feed back into continuous improvement of services. Some of the most impressive examples come from local authorities.

Take Hampshire County Council, which is using data to forecast the pressure points on GPs’ surgeries over the next 5 years.

Or Windsor and Maidenhead, who cut their energy bills by 16% simply by publishing oil, gas and electricity use.

Recently, a number of local authorities teamed up with national agencies to design systems for linking their business compliance data. By linking multiple datasets like food hygiene inspections, immigration enforcement and fire rescue callouts, they were able to pinpoint and focus resources on the worst rogue businesses.

In the past local housing officers weren’t comparing notes with immigration officials, even when they’d taken enforcement action at the same premises. Data means they can.

So data holds immense potential: for experimentation and continuous improvement.


But if we’re going to unlock it, our services require digital transformation. And this is the third frontier of reform I want to talk about.

We need to be clear what we mean by digital. Because it’s not about apps, it’s not about the cloud, it’s not even about buying an iPad for Gareth in accounts.

All 3 may be great, but fundamentally digital services are about making government easier to deal with. You don’t have to know how an engine works to drive a car, so you shouldn’t have to know how our internal processes works to use our services.

Some of the biggest innovations in GovTech are happening right here, in counties and boroughs across Britain.

Westminster Council have saved £6 million in theft prevention by moving to cashless parking.

Staffordshire are trialling a tool which allows frontline staff to quickly login and see which other agencies are supporting their client.

Cornwall saved residents thousands by helping create a viral marketing campaign encouraging them to switch energy providers.

We’ve transformed 20 high volume services by redesigning them around the needs of our users.

Patents can now be renewed in minutes rather than weeks.

Prison visits can be booked online in minutes, rather than the 10 days it used to take.

When we redesigned the Carer’s Allowance application we were able to remove 170 questions, saving precious time for carers.

So across government we’re using technology to cut costs and improve our services.

But just like the use of data, we’re about to go much further. On digital, we are just in the foothills.

Centred on the world-beating GDS, we’re now developing cross-government platforms: a core digital infrastructure for common activities like making and receiving payments, or tracking the status of an application. These can be shared across government, so departments and agencies don’t have to rebuild them each time, and the public deal with us through one simple interface.

We’ve already done this for government information with GOV.UK, and we’re now working on Verify, which provides secure identity checking for government services without the need for a central database.

Built using open standards, and we will share the software freely, so local authorities, the wider public sector, and even foreign governments can use them too.

The New Zealand government website looks remarkably similar to ours. Check it out. And there’s a reason for that. They didn’t reinvent the wheel, the used our code.

Get this right, and it will mean someone could set up a business in just a few clicks, or update a welfare claim instantly online, without having to know which bit of government they’re dealing with. It’s the smartphone state: offering fully integrated public services focused on the needs of the citizen.

This is a hugely exciting time for reformers and we all have a part to play. We have powerful tools at our disposal: commercialisation, experimentation and digital transformation.

As we put them to work in the task ahead, we must be united in purpose, radical in ambition, bold in our intent, focused on the citizens’ need. Because we all share one aim: to make public services more effective, better able to meet the needs of the citizens of Britain.

That’s why we’re here, that’s we’re in it for: to build a stronger, brighter, Britain, offering hope and opportunity to all who live here; to help all of our citizens succeed.

Published 21 October 2015