There’s a lot of talk in the UK voluntary sector about Payment by Results funding and what it means for our work. While there is a certain amount of criticism of this approach to allocating government money, there seems to be a strong view that we should still ‘make the most of it.’ But doing so would be a failure to our organisations, staff and critically, those we support. This is why I’m saying “No” to PbR.
Payment by Results is not just an imperfect system, with flaws like any other. As a way of distributing public money, it really falls afoul of every indicator of accountable spending and quality public service:
- It emphasises action over impact
Even Health Secretary Jeremy Hunt recently admitted this, after a GP told him, “Payment by results doesn’t separate results from activity,” highlighting a fundamental flaw of a system that pretends it can measure impact, by measuring ‘the actions that we think lead to the impact.’ The result, as with target-based funding before it, is that in order to maintain funding, funded organisations have to make sure that ‘they do enough stuff,’ rather than making sure they do it well.
- It encourages manipulation and ‘gaming’ of its own criteria
When salaries and costs become directly linked to being able to demonstrate particular numeric achievements, it shouldn’t be surprising that people start finding ways – with varying degrees of honesty – to demonstrate those numbers. This is an example of the kind of system that breeds the very behaviours that it claims to avoid, bringing out dishonest and manipulative tendencies in those who didn’t previously show them.
- It undermines frontline workers’ ability to respond flexibly to complex situations
The same doctor who called out Jeremy Hunt over PbR’s emphasis on producing activity rather than results, also said “We don’t have the flexibility to bring about the change we need.” This highlights that if, receiving money you have already done the work for (and effectively spent), is contingent upon certain pre-defined criteria, you simply don’t have the choice to put your efforts into something else, no matter how critical it may be. PbR takes away workers’ and organisations’ ability to make judgements about particular cases or situations that may require putting effort into something that they aren’t being measured against. It creates machines that treat every situation with the same ‘objectivism’ that ignores the differences between any two people or situations.
- It crowds out smaller organisations, leaving only large scale providers
By making an organisation wait until it has finished (and ‘proven’ that it has finished) its work in order to receive compensation, most organisations will be unable to compete with the large reserves of large-scale private providers. This means that contracts will continue to go to a few large-scale, for-profit, scandal-plagued businesses (SERCO, A4E, etc) and smaller community organisations will have no way of bringing their local knowledge and experience of local issues to play for the people in their area.
In brief, it makes it harder to know if good services are being delivered and if money is being spent effectively, while encouraging worse results on both fronts. This is why PbR needs to be scrapped, not ‘made the most of.’ We owe that to everyone who relies on public and voluntary sector services, and who will see those services turn into box-ticking exercises if we keep our collective mouth shut on this one.
If you agree, please add your name to the “Say No To PbR” declaration and encourage others you know to do the same!
PS – If you’re thinking, “yeah, sure, but what do you replace it with?” I’ve written a bit about an alternative approach here.