The deployment of staff to run public services themselves at arm's length from council control has become the latest policy to emerge from the coalition government's big society agenda.
Announced by Cabinet Office minister Francis Maude, the so-called "mutuals" will be tested in 12 pathfinder areas and if successful could become the norm across the public sector.
Each pilot will get access to a mentor who has experience of running mutuals, such as the John Lewis Partnership. Among the pilots are four involving children and young people's services (see below).
Divided opinions
Earlier this year, CYP Now reported that Hammersmith & Fulham and Westminster are looking to merge their children's services departments. As two of the 12 pathfinder areas they have announced that parts of the merged department will be run as staff-led organisations.
Westminster's strategic director for children and young people Michael O'Connor says that even before the pilot was announced both councils were discussing the mutual option. "Being part of a pathfinder really helps us develop the idea, giving us the added expertise from businesses," he says.
In announcing the pathfinders Maude said the mutual model could lead to a cut in costs and give staff genuine power in running services. But opinion is divided among professionals. British Association of Social Workers joint England manager Nushra Mansuri says a new way of working could benefit social work practice. "The current system is not working well," she says. "Our members say they are overburdened by bureaucracy. Maybe mutuals could be the answer."
But among the most scathing critics is national officer for community, youth workers and not for profit sector at Unite Doug Nicholls. "Youth workers are not motivated by profit," he says. "Staff want to be part of a professional service and a working environment that has a focus on support. All of that is being replaced with this hair-brained gimmick."
Nicholls says mutual models will also still have to work in a climate of cost cutting and are unlikely to offer staff greater job security.
But O'Connor disagrees. "Cutting costs is about cutting the overheads of being part of a council, like human resources and administration," he says. "By being separate from the council the service can focus more of the budget on frontline staff."
Hammersmith & Fulham's director of children's services Andrew Christie says a mutual model might not work in all areas. "Where there is already a market, such as education support or fostering, where councils or schools already buy that in from the commercial sector, I can see this type of model working," he says. But for Hammersmith & Fulham, youth services are unlikely to be included as the bulk of the work is already commissioned out to the third sector, an arrangement the council is keen to continue. Whereas in Kensington and Chelsea, another pilot area, much of the integrated youth support service is council-run.
Risks and rewards
Local Partnerships, the joint Local Government Association and Treasury initiative that promotes different models of running public services, is among the mentors for the pilots. It has already assisted similar schemes in health services.
Dan Gregory, investment executive at Local Partnerships, concedes results have been mixed in health and there are risks in becoming a mutual. In one case a mutual-style health organisation "went bust" but he adds that "the state picked up the pieces, and no-one lost their job".
For O'Connor, the concept of mutuals could be taken even further. He says there is a possibility that a successful, mutually-run Westminster and Hammersmith & Fulham children's services organisation could even run services elsewhere.
He says: "We are not talking Capita or Serco here, but there is a possibility that we could be called in elsewhere to run services." Breakaway services Pathfinder projects to give staff power over children and young people's services
London Boroughs of Hammersmith & Fulham and Westminster
Plans to merge children's services by these two councils effectively make this is a joint pathfinder. Subject to council approval to merge the services, the mutual model could begin to be tested in April next year. Plans to merge the two councils' education support services have already been approved.
London Borough of Kensington and Chelsea
The council is to look at a variety of models of running youth support services as mutuals.
A spokeswoman added that no timescale has been put in place as to when these proposals will begin.
THE 157 GROUP
A consortium of 28 further education colleges is looking to set up its own qualification awards body and test whether it can be run as a mutual. Lynne Sedgmore, 157 Group executive director, says: "This will allow us more flexibility and control over the way in which qualifications are developed and awarded."
