Is the partnership model right for public services?

Is the partnership model right for public services? That might be a question posed by many public managers, in the face of the present government's drive to encourage more public sector staff to spin out into employee-owned or mutual organisations. In fact, this was one of the many challenging questions posed at last week's Guardian public services summit and the questioner was Peter Marks, chief executive of the Co-operative , the largest consumer mutual organisation in the world. Marks might be expected to be an unhesitant supporter of mutual organisations – but he sounded a warning note, saying that while the Co-op is now a successful mutual in one of the most competitive market sectors – retail – it has taken the organisation 150 years to get to this point. "I do worry about people who talk about the mutual model as a panacea," he said. Patrick Lewis, partners' counsellor at John Lewis, and great-nephew of the original John Lewis who founded the chain, which has been promoted heavily by the government as a model and a mentor for fledgling public services mutuals, has also expressed caution about the government programme. "The big thing we have learned is that this type of organisation requires time and care," he said last week . "This requires very long-term commitment to setting an organisation up in the right way and then to support it, support it, support it." The remarks by Lewis and Marks have been further underlined by a report this week from the third sector research centre at the University of Birmingham on how NHS staff have fared in their bids to set up social enterprises to deliver health services. The report concludes that NHS staff need more support to become social entrepreneurs. There has been a lot of interest in NHS services becoming social enterprises since the Labour government first launched the "right to request" scheme in 2008. The report says that if all the current applications under that scheme come to fruition (and not all have yet overcome the "considerable hurdle" of getting their business case approved by their PCT boards) then about 25,000 staff would be employed in a social enterprise – 10% of staff previously employed in PCTs. But uptake has been patchy. While about half the existing Strategic Health Authority regions in England have seen considerable uptake of the scheme, other regions have seen much lower uptake and the report highlights "significant barriers" for NHS staff wanting to set up a social enterprise, including a lack of support from senior managers and commissioners, many of whom thought delivering services in this way would be too risky. Senior managers leading right to request projects are, not surprisingly, more familiar with business planning processes and financial considerations, whereas clinicians and frontline managers have less experience in such areas. The report finds that staff leading right to request projects felt isolated and that they were trying to take forward an initiative without local or peer support, which made things harder for them. Some felt their managers were being negative about social enterprises in general and could make it difficult for them to proceed. Getting help from external bodies can help potential entrepreneurs – the report found that consultancy firms had been positive and that there had been helpful advice from national bodies, such as the Social Enterprise Unit and Local Partnerships. But it points out that despite considerable marketing about these organisations, many staff leading smaller projects were unaware of them.