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My Lords, the right reverend Prelate the Bishop of Oxford has invited us to talk about the concept of public service. I hope that your Lordships will therefore forgive me for being conceptual. First, what makes a service public rather than private? A public service is not the same as what economists call a public good. A public good is public because you cannot slice it up into little bits for individual consumption. You can buy a meal at a restaurant or you can buy a slice of butter but you cannot buy a bit of streetlighting. Streetlights are public goods and therefore have to be paid for by public contribution.
Healthcare and education are not technically public goods. They can be consumed in individual packages exactly like meals in a restaurant and therefore you can readily charge for them. Is it just an outworn prejudice to think of them as public rather than private services? I do not think so. We think that healthcare and education should be provided for the good of society whether or not people want them or are able to pay for them. Moreover, we think that they should be distributed as equally as possible.
The reasons that people think like this are complicated and I do not have time to go into them. But we do think in that way and the fact that we do so affects the motives of those who choose to work in those services. By and large, whatever companies now say, they are full of the notion of corporate social responsibility, and so on--I believe that people go into the private sector mainly to earn money. Their satisfaction comes from the incomes they earn. I know that that is not a complete explanation but as a broad generalisation it is true.
However, it is not true for most of the people who choose to work as doctors, nurses or teachers. Much of their job satisfaction comes from doing good. They regard their calling as honourable, even as noble. That gives rise to the problem. For 20 years, the main thrust of public service reform has been to replace public service motives for action by commercial incentives. The language of markets has replaced the language of service. We have been told to think of hospitals and schools as businesses selling services to customers and clients. We look for all kinds of market mechanisms short of actual profits and losses to hold those business "accountable" to their "customers". The noble Lord, Lord Plant, was a pioneer of what is called the "quasi-market" approach to the reform of public services. I shall be fascinated to hear what he thinks in retrospect about that.
I have no doubt that a big shake-up was necessary. The typical vice of the public service ethic is self-righteousness which too easily becomes indifference to the wishes and needs of those whom the public servants are meant to serve. Furthermore, a public service ethos is no justification for a blank cheque. And just because material incentives are weaker in the public services, it is extraordinarily difficult for them to adapt to new demands made of them.
However, in trying to make public services more like markets, we run the great risk of drying up the springs of genuinely valuable motives for action. The loss of that motive will make the services more expensive in the long run. As has been pointed out in the debate, people do not go into them to make money.
I do not claim to see my way clearly through the conundrum: that one has to introduce accountability and control but at the same time take care not to destroy the valuable motives which cause people to go into those occupations. At the very least, politicians and public persons could start talking a different language which more adequately reflects the nature of public services. They must not talk so much about buying and selling but more about responsibility, obligation and the nobility of the calling. The right reverend Prelate the Bishop of Oxford has put us all in his debt by reminding us what that language is.