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Nov 23

Government action for big productivity improvements

Words are all very well but good measures leading to worthwhile actions matter most to people and nations

And, to boost national productivity, governments must look to:

  • Boost their private sectors by helping them produce the profits which pay for everyone’s SoL (Standard of Living) and underpin their QoL (Quality of Life)

  • Ensure all public sector service units offer the tax-payers who fund them good VFM (Value for Money)

 PRIVATE SECTOR:

“There’s no magic money tree” said both Prime Minister Theresa May and Home Secretary Amber Rudd i.e. the nation has to cut its cloth to what it can afford

Nevertheless, to boost its private sector, the government must seek to offer it a mix of the following:

  • More generation of new technological ideas, patents and intellectual capital via more incentives for firms to do this aided by more investment in government-owned R&D organisations and university research – plus:

    • More links/ knowledge transfers between them all

    • More commercialisation of new ideas, especially via access to venture capital which does not seek a quick buck

  • More investment in the labour workforce to provide the skills firms need rather than leave individuals to choose what to study without any guidance

  • More encouragement for the private sector to form clusters of firms in specific fields so each firm is close by and either helps or competes with others there, so all rise with a productivity improvement tide

  • More investment in better infrastructure to reduce work delays, improve service levels and increase labour pool sizes for many needy geographical areas

  • More incentives to build more houses, not only to address current shortages but also encourage more workers to move to where they’re needed most

  • Better use of performance measures and BPDBs – Best Practice Data Bases – in all public sector units to identify current waste and inefficiency levels and establish where extra funds clamoured for are truly needed

  • More devolution of power to major cities to let them decide how best to use local tax-take to meet local economic needs

At the same time, they should fund a major HMRC drive to minimise the immoral but legal tax avoidance schemes employed by major behemoths such as Apple or Starbucks who apparently hide enormous profits offshore leaving other businesses at home and the population to fund the public services and supply the demand on which they rely for their gains

Overall, there’s no one silver bullet for government here – politics will determine priorities for each of the above – and all will take time, some maybe decades, to be fully effective

PUBLIC SECTOR ACTION:

As a nation’s private sector grows and becomes more successful, so it also provides more taxes for the government to fund better public services to meet the population’s demand for them – and once one need is satisfied, more and better is wanted across the board

Politicians then have to decide which public services to fund and how much cash to allocate to them given there is no bottomless pit of tax-payers’ money available

They also have to ensure the tax=payer gets good VFM (Value for Money) for each pound of tax he pays – ‘the most bangs for his bucks’ – to maximise the number and quality of public services that can be afforded

But government ministers and civil servants are not productivity experts so they hire others who claim to be so – outside advisers, top management consultants, academics and economists who are at the leading-edge of thinking in how organisations and national economies can become more efficient and grow

And what do ministers get, mostly?

Management-speak, buzz words and gobbledegook before any business commonsense – major projects set up but most end up making major losses and only a few clock small wins

How so?

Ministers and service unit managers nod through project proposals after diagonally reading them – and they don’t want to ask too many questions for fear of looking ignorant in front of their peers – meanwhile, the workers affected soon ‘cut through all the crap’ and become even more disengaged

Public sector productivity thus falls further, managers pleas for money to continue wasting money as before grow ever louder, opposition MPs bang on about incompetent ministers and also shout for more funds given votes for them in doing so

And despite a litany of project failures, especially when employing latest management fads – once it was TQM, now it’s LEAN – the ‘top boys and girls’ keep on peddling them as the panacea for the sectors’ ills

Someday, government ministers will recognise how much they are being conned here by admittedly bright people – indeed, one wonders how the latter don’t dig a little deeper and figure things out for themselves rather than spout their groupthink bulls..t

It’s not leading edge fads, nor rocket science, that’s needed to make a big difference to the productivity levels of each of the public sector services – it’s simply:

  • First, good productivity measures installed at all levels in each service unit which highlight the % waste of costly resources and time, and the % waste of capacity of each process or task team

  • Then process and task teams taking time to study and understand where and how they waste so much – after which, they apply business common sense, not complex mathematics or IT, say, to massively reduce this waste and make better use of existing resources – only then might fads, IT or outside advisers be considered appropriate – usually, they’re not!

Currently, billions upon billions are being wasted by the public sector – ministers are on the back foot and cave in to much of the demand for even more funds – they keep on believing what top advisers tell them to do, and thus waste more and more – they ignore other consultants who have demonstrable success employing their own versions of the above broad approach – “it can’t be as easy as that”

So tax cuts to give a boost to the overall standard of living and economic growth are off their agenda

It’s a national scandal, just waiting to be addressed by some brave public sector minister itching to make his or her mark and climb the Westminster ‘greasy pole’

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