But I am frightened to be paying my respects to this much loved old man: frightened because it will be a gathering of dozens of people in their seventies and eighties, and I can’t know if they will be safe there, however many times I wash my hands. 

Coronavirus has sent a shudder of fear through our society about interacting with others. There’s that moment when you reach out automatically to shake the hand of a friend or colleague, or exchange a hug. And then you pause. You wonder if they’ll think you timid if you pull back — or will they be horrified if you press ahead? We giggle awkwardly, we touch our elbows, and then the next person we greet charges in with a kiss on the cheek and you wonder why you bothered. Everyone we meet could be the carrier, even the people we love the most.

An argument broke out on my local internet forum about how we can best look after the elderly. One kind woman wanted to launch a new initiative where we all reached out to the older people on our streets and asked if they needed any help — could we pick up groceries, or just make sure they’re not lonely if they want to stay in to keep safe. But soon others pointed out that visiting is more likely to harm than to help, by exposing them to people who may unwittingly be carrying the disease. After all, one of the key factors in keeping our schools open is the fear that, without them, grandparents would end up looking after grandchildren, and getting infected that way.

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Children's literature has lost the plot

By Polly Mackenzie

That’s why I’m so baffled by those who see this epidemic as a corrective that will restore communitarianism, as we abandon global supply chains and go back to self-reliance. I see the exact opposite happening, as we all retreat into digital fortresses. The people who are smugly content right now are not communitarians. They’re the “extremely online” millennials who are as happy in confinement as anywhere, so long as they can get to Tiktok. And the hyper libertarian preppers who’ve been stocking extra loo paper for decades, and buried their gold somewhere in the woods.

The lesson thus far is that if you rely on other people, you’re at risk. As this crisis continues, we will be pushed to do more and more online. We will distance ourselves from physical contact in favour of virtual interaction. Those who persist with the kissing and the hugging will start to be pariahs.

It’s happening not by accident but by design. Universities are cancelling classes and telling people to log in to a virtual classroom. Some schools are doing the same. The NHS is talking about a target of 50% of GP appointments being held over the phone, app or video. There’s a government initiative with supermarkets to introduce shop-by-phone for elderly people who don’t trust the internet when it comes to ordering groceries.

This is a digital inclusion programme on steroids. The reality is that the more we can enable people to stay indoors, and stop breathing on each other, the safer we will be. Digital transformation has been slow in the past decade because of the complexity, the resistance of staff, and the fears of leaving older and more vulnerable people behind. But now all those reasons — good and bad — for moving slowly will be swept away in a blizzard of emergency initiatives from video courts to robot health assessments.

Suggested reading

Coronavirus is the wake-up call we need

By Tom Chivers

And don’t tell me these are temporary measures. Putting women in the factories in the First World War was a temporary measure: it transformed women’s role in society and life was never the same again. Millions of sceptics and reluctant adopters of technology will try out the online version and — perhaps grudgingly — use it. Our high streets are struggling already with the competition from online.

Two weeks of isolation will push almost everyone into trying online shopping, which is great if you’re a neoliberal who cares only about price, competition and choice. But less good if you’re interested in the human interactions that happen on high streets, when we queue together, chat together, and simply see other people and how they live their lives. On Amazon I see only products for people like me. At the local shop (even my local Tesco) I see products for people like my neighbours too.

But these tiny treasures are easily swept away by the efficiency demands of AI-optimised services. Over the next few months, huge public funding will be thrown at keeping people fed, happy and healthy without leaving their homes. So we will have got over the big costs and upheaval of introducing digital access. Public services and businesses alike will be reluctant to go back, when they think of the savings they can make by closing down physical locations.

I’m not a technophobe. Of course, digital services can be just as good if not better in some circumstances. But if we move things online we have to notice what we lose, and find a way to get it back. We are in real danger of disregarding the social and emotional value of face to face public services and of human contact with neighbours, fellow parents, fellow patients, fellow shoppers, fellow worshippers, fellow pupils.

Suggested reading

Farewell free trade, and good riddance

By David Goodhart

With a cloud as big as coronavirus, it’s only natural to look for silver linings. So I understand why people are praying it will call a halt to the things they hate, whether that is neoliberalism, globalism or even Borisism. But we must not be naive. Social disruption of this scale will never take us back to an old way of being; it will only accelerate change. We have to be clear about the kind of society we want. We have to face the truth about the forces we are fighting against.

We all know the economy will take a knock from coronavirus. So we talk about a fiscal stimulus to get it back to health.

Let’s admit that our society will take just as big a knock. Weeks or months of staying indoors, not trusting strangers, second guessing every cough and every handshake: this is social poison. When this is over we will need a social stimulus on a massive scale: a rebuilding programme for relationships, friendships, and communities.

What do I mean? Perhaps a national C-Day celebration when we’ve beaten back this bastard disease and can move freely again: with streets closed and lunch parties and union flags and bunting. A national commitment to our relationships at the heart of all our public services: job clubs for unemployed workers; expert patient clubs for people with long-term conditions; parent clubs at every school; tax breaks for employers to fund after-work social activities; doubling the number of parks, and ensuring people don’t need a licence to do anything interesting in them; a parish council in every community with a mandate for parties and friendliness and little else. 

In the past the state didn’t need to worry about this. But as our society atomises, and diversifies it could become its most important job.

An array of functions that were once the recognised duty of elected representatives have been progressively handed over to people from business and technocrats with no democratic mandate. Is it because our politicians are so bedevilled by a lack of confidence in their own abilities? Perhaps.

But it is also undoubtedly a consequence of the theory, embedded deeply in the psyche of the political class over the last 40 years, that governments shouldn’t meddle because ultimately the market and experts know best.

Suggested reading

Politicians are in hock to big business – and consumers are paying the price

By James Kirkup

Take the running of the economy – arguably the most crucial function any government can perform and one pivotal to the prosperity of a nation and the wellbeing of its citizens. Conventional wisdom has it that the decision by the New Labour government to grant ‘independence’ to the Bank of England in 1997 was a wise and far-sighted one. Few now question the merits of relinquishing control of the money supply – a cornerstone of the management of any economy – to unelected technocrats.

Yet, given the value of monetary policy in the armoury of any government – for example, by giving it the power to influence levels of investment and stimulate demand through the control of interest rates and quantitative easing – it beggars belief that a Labour government should wish to give it away. And it was given away to career bankers who, far from being ‘independent’, have been inclined to direct policy according to the interests of fellow bankers and asset holders, rather than those whose lives are rooted in the real economy.

In his autobiography, Tony Blair admits that, when it comes to the economy, he sees the role of government as nothing greater than “to stabilise and then get out of the way”. It is a striking departure from the attitude of previous Labour governments who understood only too well the need to use every available economic lever at their disposal to create jobs, build homes and fund public services.

That Corbyn’s Labour – which rails unremittingly against austerity and the rapacious power of finance – has not committed to restoring democratic control over the Bank of England is an indication of how deeply the ‘hands off’ philosophy has infected political thought.

Suggested reading

How Corbynomics is winning over Britain

By Matthew Goodwin

As with economic policy, so it has been for the public sector, with politicians of all colours eager to divest themselves of responsibility and control. The ideological drive to roll back the frontiers of the state pervades the public sphere at all levels, with few local institutions or services having escaped the onward march of outsourcing. Even modest, yet crucial, jobs that keeps our communities ticking over – the bus driver, the hospital porter, the town hall cleaner, the dinner lady – have often been contracted out.

There was a time when a shared civic pride existed between the communities running these services and the workers who delivered them. But with a diminished public ethos has come a diminished sense of public duty. These community-facing jobs are now seen as purely transactional, a commodified source of profit for an impersonal market. Little wonder that this new, abstract relationship between communities and their public servants has served to intensify the sense of loss and deracination felt in so many of our towns and cities.

The consequence of government disengagement from public provision is most apparent in the area of housing. We don’t build council homes anymore, and the government has no serious plan for addressing the chronic housing shortage. The result has been catastrophic. Try telling a young couple attempting to get on today’s property ladder, but faced with crippling costs due to inadequate supply, that the ‘market knows best’.

And perhaps the most indefensible shirking of responsibility by politicians has been in handing over so much of our justice system, including the running of prisons, to private companies. The punishment of crime, and such matters of moral right and wrong, ought surely to be the responsibility of the State alone, not of commercial entities seeking to extract a profit. Politicians who agreed to put the delivery of justice into the hands of multinational companies should hang their heads in shame.

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The fake patriotism of the liberal Left

By Paul Embery

This ‘hands off’ approach sits neatly with the attitude of most parliamentarians to the European Union over the last 40 years. Our relationship with that institution has been one of increasing surrender of powers from Westminster to Brussels. We can see the result of that now: our MPs are petrified of control coming back. They are rabbits caught in the headlights. A parliament atrophied by decades of having its legislation dictated by someone else has given its members a mindset similar to that of the average parish councillor. No wonder MPs are reluctant to assume responsibility over laws governing every area of public life.

The ceding of control over large parts of the economy and public services to business and technocrats has profound implications for democracy. It weakens accountability and reduces the status and power of politicians. As the functions of government, national and local, have been outsourced, so has responsibility – and ultimately the blame when things go wrong.

This isn’t a crude argument about privatisation versus public ownership. Any economy, if it is to be successful, needs a flourishing private sector, and God knows politicians have often done more harm than good when it comes to establishing the conditions for one. No, this is a debate about the nature of our society and the health of our democracy, about the proper role of our elected representatives and how much we value a sense of national and civic pride.

In 2008, we saw where a ‘light touch’ government philosophy and misplaced faith in the ‘expertise’ of bankers and technocrats led us. Now, the frontiers of the state must be rolled forward just a bit, and the role of government and elected representatives as a force for good reasserted. But to achieve that, we need a new class of politician who actually believes it.

In the latter part of the 18th century, someone had a brainwave – it might just make more sense to have one department dealing with foreign policy and the other with domestic policy. So in 1782, the Northern Department became the Foreign Office and the Southern Department became the Home Office. In the course of the 19th and 20th centuries, as governments got bigger and provided more public services and a social security system, various specialist departments for heath, education, housing etc were split off from the Home Office – meaning that most Whitehall departments today are lineal descendants of the old Southern Department.

Multiple ministries with subject-specific responsibilities are the obvious way to organise a modern national government. There is a cost, however. Separate, specialised ministries beget separate, specialised bureaucracies to administer and deliver the public services for which the most senior minister in each department is ultimately responsible.

The trouble is that public services are delivered to real people in real places, whose real needs are not separate. Rather, individuals and families have problems that can only be effectively dealt with together.

Writing for the New York Times, Dhruv Khullar provides a sombre example:

“Americans with depression, bipolar disorder or other serious mental illnesses die 15 to 30 years younger than those without mental illness — a disparity larger than for race, ethnicity, geography or socioeconomic status. It’s a gap, unlike many others, that has been growing…”

The reasons for this gap aren’t necessarily what you might expect:

“We may assume that people with mental health problems die of “unnatural causes” like suicide, overdoses and accidents, but they’re much more likely to die of the same things as everyone else: cancer, heart disease, stroke, diabetes and respiratory problems. Those with serious mental illness are more likely to struggle with homelessness, poverty and social isolation. They have higher rates of obesity, physical inactivity and tobacco use. Nearly half don’t receive treatment, and for those who do, there’s often a long delay.”

Further reading

Poor mental health is bad for the economy

By Charlotte Pickles

To differing extents, we have specialised healthcare services to administer specific treatments for specific physical and mental health conditions. These are, in most cases, more effective now than at any time in human history. But when it comes to helping the person, I wonder how much progress we’ve made:

“After decades of fragmenting medicine into specialties and subspecialties, it’s perhaps not surprising that a siloed system often fails those in need of whole-person care.”

This isn’t just about medicine, of course. Other public services – from social housing providers to the police – may end up dealing with the same individuals, but each only in respect to their immediate responsibilities.

Khullar reports on some innovative projects whose purpose is to help the whole person, not just one of their problems. But why are such schemes the exception and not the norm?

Though politicians like to talk about ‘joined-up government’ and ‘integrated public services’, they forget that public services already overlap – at the level of the person and the place. Given the opportunity to do so, frontline public service professionals from different services, who have practical experience of the people they help and the places they work, have every reason to come together to exchange information and find solutions.

The trouble though is that they are subject to separate bureaucracies, with chains of command stretching away to distant centres of power, where policy decisions and resource deployments are separately and distantly made.

Even when governments make an effort to coordinate public services – as in the case of Britain’s Troubled Families Programme – it is done from the top of the bureaucratic hierarchies, not at the frontline. No wonder such programmes fail.

It is not the centres of power that need to be joined-up, but the localities of experience.

Further reading

Wanted: a government willing to perform experiments on us

By Peter Franklin

Carillion employs 20,000 in the UK and another 23,000 overseas. As recently as last July it boasted a stock market valuation of some £2 billion. Now, after the share price collapsed, and shouldering a £1.5 billion debt burden and whopping pension deficit, Carillion has gone into liquidation.

The collapse of such a large company matters – not least given the number of employees affected, and the knock-on impact on the thousands of subcontractors and other suppliers owed money by the group. The reason this Carillion collapse is really reverberating, though, is because it has reignited a political debate in the UK that, for several decades now, appeared to have been resolved.

That’s because Wolverhampton-based Carillion had emerged as the flagship among a select group of huge private sector outsourcing companies that, initially during the early 1990s under the Conservatives, but particularly since the subsequent Labour governments of Tony Blair and then Gordon Brown, have been awarded lucrative contracts to deliver all manner of public sector projects and services.

From building hospitals and schools to modernising the National Health Service, running prisons and even providing school meals, these behemoths have their fingers stuck in many government pies. Carillion, alone, when it collapsed, had 450 government contracts on its books, worth £1.7 billion.

Now the company has imploded, folding under the weight of debts so heavy and contracts so toxic that administration and a possible rescue plan was not even worth considering, the Government’s Official Receiver choosing to dismantle Carillion instead. This is a public relations disaster for British commerce – and comes only weeks after Richard Branson’s Virgin Trains and its partner Stagecoach handed back the East Coast railway service to the Government, at a potential £2 billion cost to taxpayers.

These two debacles have not only left Theresa May’s government looking incompetent, at a time when the Prime Minister and other senior players are embroiled in the UK’s Brexit negotiations. This double private-sector failure has also emboldened Labour leader Jeremy Corbyn, and others on the far left who think capitalism is inherently unjust and the only answer is a wholesale renationalisation of public services and a broader reassertion of the state.

“It is time to put an end to the rip-off privatisation policies that have done serious damage to our public services and fleeced the public of billions of pounds,” declared Corbyn, via a slick video clip that appeared very soon after news about Carillion emerged, and was widely distributed across social media, with the key message:

“The collapse of Carillion is a watershed moment.”

The fact is that Corbyn’s outrage is warranted – even if his proposed solution, the nationalisation of vast swathes of commercial activity, is dangerous, utopian nonsense. The manner in which hundreds of UK public-sector construction and outsourcing projects have been managed over recent decades has indeed been scandalous.

Under the so-called Private Finance Initiative (PFI), successive governments signed hundreds of long-term contracts to construct, service and maintain schools, hospitals, infrastructure and other public buildings. The government pays back investors over 30 years or more, after which the buildings revert to the state – but, crucially, with much of the borrowing being done by the private sector, keeping it theoretically off the state balance sheet.

Gordon Brown, Labour’s self-styled “iron chancellor” was particularly keen on such “risk transfer” during the decade leading up to the 2008 financial crisis. The PFI, in which Carillion became a major player, as it acquired established construction firms such as Wimpey, Tarmac and Mowlem, allowed Brown to be seen providing the funds for countless new schools and hospitals, but with the related financial chicanery flattering official borrowing figures. This was important, given Labour’s well-deserved reputation, established during the 1970s when the UK needed an International Monetary Fund bailout, for running up disastrous public sector debts.

Even then, it was clear to some of us that what Brown called the “the biggest public building programme since the war” was based on a gigantic – and controversial – hire-purchase scheme. PFI companies began making double- and sometimes triple-digit returns on capital, as they re-financed projects once construction had been completed, often outrageously refusing to share related gains with the Treasury.

And because the private sector pays more to borrow than the state by definition, the much-cited “rigorous and objective value for money test” that supposedly underpinned PFI was always cynical nonsense. This was a scheme that allowed and continues to allow ministers to be photographed opening shiny new buildings, while keeping much of the capital spending off the government’s books – so value for money tests were effectively rigged. That’s why from 1997 to 2003, the first six years of Blair’s Premiership, PFI was used for 90 of the 100 hospitals built or refurbished under New Labour and 500 out of 550 new or renovated schools.

These were the years during which saw the entrenchment of the lax procurement procedures and culture that produced Carillion, which was founded in 1999. As well as making huge profits from leasing new buildings and infrastructure to the government, Carillion and the other PFI giants boost their returns with lucrative service contracts – charging local authorities and NHS Trusts extortionate amounts to carry out simple maintenance, renovation and alterations, often under the cloak of “commercial confidentiality”.

Carillion’s 2016 annual report boasted that the dividend paid to shareholders “has increased in each of 16 years since formation of company”. While the company existed, it also paid many millions in executive bonuses, while running up a pension deficit of over half a billion pounds – largely off the back of taxpayer-funded contracts.

As well as building schools and hospitals, Carillion’s portfolio has expanded to work on the HS2 fast-rail link, redeveloping Battersea Power Station, building the Aberdeen by-pass (Scotland’s largest construction project) and maintaining 50,000 army base homes for the Ministry of Defence. The company also has extensive operations in Canada, the Middle East and the Caribbean.

‘Over-reach’ has clearly been part of the problem. Carillion’s incessant appetite for expansion saw it pursue too many risky contracts – some accompanied by questionable accounting practices. In the fierce scramble for business among the UK’s PFI giants, Carillion also began over-promising on the work it could do for an agreed cost. And when it failed to deliver on time and on price, as with the new 646-bed Royal Liverpool hospital, for instance, the company ramped up borrowing even more.

Carillion had been fighting for its life since last July, when it warned it was losing cash on key contracts and debt was rising, leading to the departure of CEO Richard Howson. Having received £1.5 million in pay and bonuses in 2016, Howson somehow secured an agreement for his £660,000 salary to be paid until October 2018. Last autumn, five banks agreed an additional £140 million in loans but, with the company burning cash and facing massive contractual problems, creditors last week refused to pour more good money after bad. Leading British lenders including Barclays, the Royal Bank of Scotland and Lloyds Banking Group now face the prospect of hundreds of millions of pounds in outstanding loans going unpaid.

The UK government, then, isn’t bailing out Carillion. Shareholders and most creditors will sustain large losses, while the company’s pension liabilities will fall squarely on the Pension Protection Fund, which is financed by raising a levy on the functioning pension schemes into which millions of workers contribute.

There are, though, numerous questions for the Government and Carillion’s directors to answer:

• Why did ministers and civil servants agree to hand Carillion no fewer than eight lucrative contracts AFTER last July’s profits warning?
• Why did KPMG sign off on Carillion’s 2016 report and accounts, published at the end of March last year, just months before the company issued that warning?
• Was Carillion truthful when, in December 2016, it told financial markets that the company’s performance was “meeting expectations” and that it expected “strong growth in total revenue and increased operating profits”?
• While refusing to re-finance Carillion, how much will government end up paying for the cost of receivership and the re-tendering of countless, often very complex contracts?

The really unknown, though, relates to the broader debate about the role of the state – and the private sector’s role in the provision of public infrastructure and services. While PFI was championed by both the Tories and Labour, Corbyn himself obviously comes from the branch of his party that never accepted the “Blairite” revolution and which is now, after key internal party elections, very much in the ascendency.

The truth is that state-only procurement, with work being done by massed ranks of public-sector builders and technicians, is a recipe for massive inefficiency and corruption. The state already employs over 20% of the UK workforce – which is more than enough. And long before the ghastly PFI, the use of private sector contractors to build schools, hospitals and roads was commonplace – albeit without the opaque mingling of public and private balance sheets and the related over-priced service contracts.

There was also no golden age of nationalised railways in the UK, as Corbyn would have his legions of younger voters believe. During the 1960s and 1970s, state-run British Rail was a national joke, beset by endless inefficiencies, delays, cancellations and frequent industrial action. The UK’s part-privatised railways are now far from perfect, but they carry more people than ever before and are unrecognisable better than when British Rail prevailed.

Having said that, this Carillion debacle does raise very serious questions – which the Government and the various commercial interests embroiled in this saga must now answer. And let this collapse lead to changes that bring an end to the excesses of PFI, as some of us have long demanded.

For PFI is a public-sector rip-off, a wheeze that has allowed myopic politicians and devious contractors to construct shoddy high-cost buildings, while providing grossly over-priced services – all of which is short-changing the taxpaying public. PFI is giving the private sector, and capitalism more broadly, a bad name – and that’s why it’s got to stop.

“Perhaps the most popular current success formula is the 10,000-hour rule popularized by Malcolm Gladwell. The idea is that you need 10,000 hours of deliberate practice to become a world-class performer in any field.

“Research now tells us, however, that this formula is woefully inadequate to explain success, especially in the professional realm. A 2014 review of 88 previous studies found that ‘deliberate practice explained 26% of the variance in performance for games, 21% for music, 18% for sports, 4% for education, and less than 1% for professions. We conclude that deliberate practice is important, but not as important as has been argued.’”

Practice can give you an edge in some fields, but not others:

“…deliberate practice may help you in fields that change slowly or not at all, such as music and sports. It helps you succeed when the future looks like the past, but it’s next to useless in areas that change rapidly, such as technology and business.”

Sports and music are rules-based activities, but in technology and business the game is changing all the time. Therefore what is needed is not so much “deliberate practice” as “deliberate experimentation” – continually trying out new ideas and strategies to stay ahead of the game. 

If that’s true of business, then it’s surely also true of government. Even in the most free market of developed nations, the state directly controls a massive chunk of the economy. Public sector innovation is therefore as important as private sector innovation to our prosperity and wellbeing.

The state is well-practiced at what it does, but a deliberately experimental approach is rather less in evidence. Indeed the culture of government often works against innovation.

The secrets of successful innovation need to be embraced by the state, but what are they? Michael Simmons reviews the evidence:

“…most innovative ideas are generated by a small number of superstars. In any given field, the top 10% of performers produce more than 50% of breakthroughs.”

In an over-centralised state there are no superstars because the bureaucracy is monolithic. To allow the best to emerge from the rest, the state must be decentralised – with different bodies within government (especially the locally elected ones) empowered to experiment with different policies. If that produces different (and therefore unequal) outcomes that should be seen a feature and not a bug of the system. 

The system must also become more tolerant of failure, which is the tribute that experimentation pays to success:

“…superstars produce just as many bad ideas as everyone else — they just produce more ideas overall. Having many more ideas means they have more failures but also more hits.”

Policy makers must also beware of false productivity:

“…we live in a culture that is obsessed with productivity: getting more done and less time, systematizing, automating, and even outsourcing. If one has a frame of short-term productivity, then taking time out of your day to nurture a creative process with unpredictable results that don’t pay off immediately is extremely hard. What is productive in the long-term often feels not productive in the short-term.”

This is so important. Government is full of competent, cautious and profoundly unimaginative individuals. They are not, by nature, risk takers – and yet taking risks is what innovation (and enabling innovators) is all about:

“Given a ten percent chance of a 100 times payoff, you should take that bet every time. But you’re still going to be wrong nine times out of ten.”

That said, bureaucracy does have a part to play – in setting up the information gathering systems that allow the results of innovation to be systematically assessed. As Simmons points out “today’s tools allow anyone to increase their quantity of experimentation by an order of magnitude.”

For all of the data gathering power of a Facebook or a Google, nothing compares to the direct line that a modern state has (or should have) to vitally important activities like education and healthcare. 

An entrepreneurial, innovative state shouldn’t just be striving to find new ways of improving our lives, but also using the knowledge it gains to generate revenues for the public purse. A government that isn’t experimenting on its own people is letting them down.