Ted Howard from the Democracy Collaborative was in town last week
He was the star turn in a workshop exploring the art of the possible on the subject of public organisations as economic anchors, the context of inclusive growth.
He imparted a lot of wisdom in a short space of time, and left us with a lot to think about
Again, in the spirit of democratisation of knowledge here is my take on key points discussed.
1. Why now?
The economy is a determinant of health and wellbeing, we know the economy and our economic model leads to inequality.
This plays out in many policy areas, across all sectors of the economy.
Opportunity around inclusive economy. RSA report and many other pushes in this space.
SPB want to push on this area. Anchor institutions will be a part of that but we won’t know all the steps in this. Not sure yet what the end point is going to be, just that we want to go on the journey.
2. Why is this issue important?
a)Previous approaches have not been seemingly successful as we wanted
Map of deprivation from the 80s is largely akin to now – aka regeneration has failed
Funding injections didn’t address the mainstream commitment of £ base – the institutions we want to continue to support
This is a route into permanent change of the way an economy works (at least the public economy)
In times of plenty, we didn’t make the mainstream better, we funded stuff at the margins to correct the deficiencies of the mainstream.
And thus we never corrected the problems in our view of allocative value in the mainstream (in everyday language we failed to shift upstream).
b)There’s a growing narrative re. alternative models of economic growth
We know inclusive growth is important.
We know the way the economy works is one of the fundamental determinants of well being
We know there are deep inequities in income and wealth
We know that there’s a great deal that can be achieved though the economic power of anchor institutions
To address health inequalities you need to address social and economic inequalities
For those anchors here is an opportunity to directly address the economic influences on health with your existing budget
c) A strategy with political appeal on both sides, (but try to de politicise)
This is an under the radar and doable strategy that can address some of the underlying economic determinants of health that may never happen nationally.
There are moves (labour) in this direction
This has been going on for 8 years in the states – with support from both sides of the house.
Depoliticise this. Make it not a feature of left or right, or greens, or middle
Find arguments for all brands of ideology. Make it practical fiscal and economic and political sense from lots of different perspectives.
Appeal to all ideologies – This is an alternative model to free market economics. Arguably an approach that all ideologies can agree on and something in it for all sides of argument (liberal and conservative)… not another big federal investment, good for CSR, more efficient way of harnessing and utilising resources in local economy…..then the social reasons…..
Frame not as big “government programmes” but about getting more efficient use of £ already committed AND local multiplier effect AND social gains.
3. Why local matters
Large national providers or commissioners are not invested in place
Can’t respond and flex locally
Not in tune with our local ethos
National v local policy differences.
National providers less able to tie up with other orgs locally across nhs, local gov, or vcs
If there is to be national contracts, local role is to ensure standards, rules, ethos is fit for local circumstances
4. Purpose of the workshop – to explore the art of the possible
We know there’s stuff going on across the city.
Where we are on baseline doesn’t matter.
Trajectory of improvement is what matters
Is it at the right scale?
Has it been institutionalised and built into the woodwork?
Have all the different anchors connected it together and is there a mechanisms to share it, and capitalise on scale?
What does better look like?
What are we aiming for?
5. Economic anchor institutions tend to be:
Non profit or public
Sticky capital, rooted in place. Tend to not move on account of economic factors, they don’t leave when the economic going gets tough. Economic engines – large purchasers, employers and investors
Hospitals, uni sector, local govt
Often large purchasing power
“There are 3 organisations that will be here in 20y time – hospital, job centre, local govt. better structural links between the 3 critical”
Strategic question to the anchor institution is
“Dear anchor – conduct your business in a way that reflects your anchor status and builds capacity to address social determinants. Not just as a side issue but 100% of your activity…this leads to better economy – and should be done for economic reasons in addition to intrinsic health reasons”.
Can we incentivise the way in which you use your funds, systems and processes to impact on health and well being in a more positive way than if you do nothing?
For the NHS – What can NHS system DO about social and economic determinants?
6. Defining the anchor mission
Historic- the approach has been through a small office, not bending the mainstream mission
Aim should be to transform the mission of the organisation towards social benefit
ALL functions of the institutions
Part of the business propositions – triple bottom line.
Be accountable for all out impact – Social, Environmental, Economic, Health, Ecological
7. Domains of the business to look for progress and opportunity
All the assets of your institution should be “in” – e.g.
Employer, Annual spend, Annual procurement, Investment and portfolios and endowments
HR, Technology, Treasury, Research, Community benefit, Comms, Environmental, Service delivery
I.e. Not really the core mission of delivering great services, but something much wider.
Turning from slightly left field mission to one of using the core architecture to make better/develop/grow
Economic assets are felt to be key
Hiring and workforce
Procurement and purchasing
Place based investment. Investments/endowments/portfolios
An early ask was of the Cleveland Clinic ($1.8bn) = how they incentivise themselves around local supply chain
25% of supply chain has to conform to green and local metrics
Hard edged indicators that were set were met.
What is/can be the role of anchor re: Building, Housing, poverty, Employment/training
The local lettuce story – Cleveland experience
Cleveland can buy lettuces from California $0.03 cheaper
But carbon cost (the externality) not accounted for
And by growing local you get 7 extra days of freshness (thus less wastage)
And grow local creates jobs and economic stimulus, multiplier effect.
Develop the local supply chain
Full Business Model – thus important
7. Q&A points and critique
Mix of leadership and development staff and architecture to make it happen, make it institutional and not “a project”
Could be concern that this about changing the dynamic of economy towards isolationism (although things have swung very far the other way)
Is thisjust total place again (although clearly we still have much left to do)?
Issues to contend with
Rules and regulations regarding procurement
Local vs cheapest. Local =? Define. Set metrics
Short vs long term
Overcoming the inertia of large institutions
Leadership – needs visible commitment
Organise within the institution – may need resource, more likely need mindset shift.
Visible and tangible goals – specific.
In the Business Plan
Incentive structure – is it right to encourage success in this space?
Breakdown of contracts to smaller more meaningful chunks, smaller lots – maybe issue re greater administration workload on institutions?
Embed the mission into SOP and structures
Local knowledge and context are a part of the criterion of contract
Targets – set them(same as some have done for green)
DON’T displace local business and plan for success (there can be unitended consequences, e.g. gentrification
Corporate ritual/custom and practice
Benefit of Brexit? – EU Procurement – we have more latitude
2013 Legislation re Social Value Procurement – Not well known about or enacted. Using this can change the nature of process– we can do these things
Create workarounds where legislation is a barrier – e.g, disadvantaged business entities (example given when someone pointed out that positive discrimination in favour of black owned businesses was illegal in New Orleans)
Apply Principals of:
Powerful narrative/alternative vision (the boss may need to change the narrative)
Multiplier effect re keeping to local – creating local jobs, tax base
Full economic and social case, not just the money
Triple bottom line addressing the externalities in a way procurement officers don’t often account for.
Other points raised in discussion
Mobilise economic and human capital:
Student brains, 60k in the city
Potential for Two-way skill exchange across anchors
Culture change – move the conversation from ‘should’ to ‘have to. Show them how.
The futures of our instituitions are dependent on a thriving society. Our institutions doesn’t have a bright future unless we solve the image of Sheffield…
8. Business case.
What is the formal system of accountability where you combine financial accountability with social and wider economic accountability – Triple bottom line accounting
Got to make it hard edged enough that the CFO say this is the right thing, and doesn’t unravel when times get tough.
CSR – Tesco have made great strides, the NHS has barely started
NHS Sustainability Unit have made some interesting arguments with respect to the 24 month Return on Investment, expressed Financially / Health and well being of community / Carbon. There are a number of case studies. See references at bottom
Benefits may not be readily tangible
The ‘Ah but we can’t see the benefits, they are intangible or long term…., thus we shouldn’t’ line –
Compare the Risk and benefit of doing this
Compare this to the risks and benefits of not heading down this path
9. Key advice from Ted Howard
Keep creating and recreating a big picture vision of what is possible
Keep sharing examples of where things have worked despite local or national defaults
If you want to do this job – you need to be intentional and hold feet to fire
This path is NOT the path of least resistance
Make public commitments
Hold yourself to account to progress back to the community
10Wrap Up & Next steps
we need to to reflect on discussions and push forward on developing a shared vision and framework
The vision is not as crystallised as it needs to be yet. Probably can’t be controlled. Is there a need to connect the institutional approaches together and scale them? Under the framework model perhaps?
Risk appetite – what is the risk appetite ?
Where are the opportunities?
Risk of doing it vs risk of doing nothing
Move away from project approach but building maximum approach
Political conversation about whether we want to push on this model.
What are our assets and existing projects?
How well Organised are we to leverage these assets?
Not about current story, there’s good stuff going on. How do we share, How do we scale, how to we set the trajectory towards Better?
Leverage collaboration – ? at expense of competition, use the collaboration to attract external funding
10a)Should we set up an anchor network?
To help each participant accelerate their own mission and spread the model more widely
And invest wisely to achieve the broader social aim
Meet x times a year
Define the org imperative
Build the evidence base
Collaborative with wide range of stakeholder
Working groups – for significant themes
How does/could/should this fit with existing partnership structures? And local leadership programmes. Is it possible to use City Partnership Board or others to bring this together? How do we avoid duplicating effort but have maximum impact?
There are many, many opportunities (through existing networks and with new networks), the q of “what” is reasonably settled (the toolkits are available, opportunities will arise)
Multiple anchor collaborations – the opportunity to Leverage the current:
Bit by bit and building into the woodwork so as it becomes part of the mission not “a project”
Ongoing work with anchors (supported by Partnership Board) around ‘progressive procurement’ and ‘joined-up education, skills and work’ – need to push this forward and influence across the organisations, as well as looking for new opportunities to start pushing on some of the other themes.
NHS specific issues
NHS is behind here. Give tools to the NHS to catch up.
What do the regulators have to say on this matter in NHS context? This might be a driving factor.
Is STP about service sustainability or transforming the model?
The NHS matters to local economy in many ways – Estates, Social inclusion, Workforce, Local spend (do we know and understand our local supply chain and impact), Commercialisation of research
There will be no central message telling us to deliver this, or measure it
Localism is a challenge to nationally centralised system like the NHS
NHS is massively centralised
Challenge for NHS is how it responds to devolution and this agenda.
Natural path will be to centralise
In the Paris climate change talks, it was the case put by the USA Mayors that changed the game
National is to set the context, local is what matters.
The creativity is local.
And we can influence through what we do locally.
Best way of protecting from market forces, Brexit, etc is local……this cannot be done from a centrally managed system.
This agenda is part of health creation.
Help needed from national bodies
Regulatory bodies need to acknowledge the concept of social value in their inspection regime or how they regulate the orgs.
Triple bottom line accountability is well documented in the private sector…..is it not built into the mission of the NHS…. much to learn.
NHSE and NHSI – not at top of shop but some levels below.
Unleash the creative potential that already exists.
Opportunities for NHS
In ACO model what we trade is health services…
In a wider model the traded commodity is health and well being
Link it to a contemporary policy and service problem
Inclusive growth is huge opportunity and role / place of NHS debate
Skill escalators – short term apprenticeships
Sources referred to –
SDU (2012). NHS England Marginal Abatement Cost Curve.
SDU (2015). Healthy Returns from Sustainability Actions.
SDU-Smart Healthcare – Low-Carbon and Resilience Strategies for the Health Sector, see p25-16.