Inclusive Growth and the Airblade Effect

There is a traditional English blindness (there is no evidence that it extends to the other parts of the British Isles) when it comes to some simple technologies like showers or hand dryers. For decades, the English seemed satisfied with dryers that would maintain the wetness of their hands with a small breath of tepid air.

It hardly seemed worth all the heavy equipment. You might as well have waggled them in the air, and you tended to have to do that anyway.

When James Dyson invented his Airblade in 2008, it did the job – as those using similar technology now do – with a burst of effective hot air which actually worked. But it used less energy because it did the task required of it.

We may require a similar entrepreneurial insight in some of our services, which cost increasing sums simply because aspects of the system don’t actually do their job.

The crisis in social care seems hard to dismiss, not so much because of what happens to those individuals caught up in it, but because of the obvious effect it is having on the NHS. Most of us have personal experience of the pressures being brought to bear on hospitals and GP surgeries.

The BBC featured an older lady who had been six months in hospital because they could not get a care package in place.  A&E attendances are on average 1,400 higher across the UK each day compared to this time last year.

It has been something of a revelation about how different parts of the system interact – how spending cuts in local government social care get visited upon the NHS, and maybe costing anything up to 25 times the money saved according to some estimates.

Even undermining people’s confidence in their ability to cope, or making them worry about their housing – any GP will tell you how that feeds through into more demand.

This may be a demonstration of the paradox set out by system thinkers like John Seddon, that concentrating too much on saving money can make services paradoxically more expensive, while concentrating on making them more effective can paradoxically save money. If district nurses are down by 28 per cent since 2010, and 400,000 older people are not getting the social care support they need in the same period – we might assume that would cost less but, if you see the system as a whole, it costs more.

The question is how much this principle is applicable more widely, so that the wrong kind of cuts imposed by Whitehall, which take no account of their likely effects on other funding streams, are damaging the UK’s ability to target money effectively.

It is said that George Osborne backed the devo deals idea because he could see how local government cuts tended to feed through into central government cost increases. There had to be a better way.

The issue lies behind the inclusive growth agenda: if national spending programmes perversely add to costs, as spending cuts do, it has undermined the efforts cities have made to involve their whole community in the local economy – to provide them with assets to give them security, and the skills they need to earn them.

The inclusive growth prescription involves making choices between different kinds of investment and growth. It also involves intensive, flexible interventions, based on trust and face-to-face mentoring, to get people the support they need.

Whether this works – whether the social airblade is as effective as the one that just dries people’s hands – remains to be seen. But there is certainly evidence of similar ideas, mainly individual attention – GPs at the hospital door or available on the phone or a range of other ideas that add flexibility and humanity to the system, do seem to have an effect. The same is true of new more local approaches to social care, like Local Area Co-ordinators, an idea that came from Western Australia and is now in cities like Middlesborough and Derby.

Alone among the devolved cities, Greater Manchester has been given the chance to see if bringing the Whitehall silos of Health and DWP together locally can be demonstrably more cost effective, but it certainly should be.

These are all, in different ways, problems of information – and they happen because the centre either does not understand that the cities have better information about local needs and opportunities, or because they don’t believe they will use it effectively. There are also blind spots among departments and ministers who want to feel effective, or to control the minutiae of how professionals behave locally.

The problem is that, as a result, spending is not being optimised. There are opportunities for funding to achieve more, but it isn’t possible under current arrangements. 

To move towards inclusive growth, this problem must be solved. It requires considerably more innovation at local level and a national government that knows they must let that happen for either side to be effective. Local government needs to be able to join up services in a sequenced and integrated way, to support people when they need it and in the way they actually need, not the way government departments think they should. 

One fascinating confirmation of this comes in a speech this month by the National Audit Office Auditor-General Sir Amyas Morse, where he talks about the costs associated with ‘silo mentality’ in Whitehall, and asks this:

“Did the centre know, do they know now, when the boundary between mainly efficiencies, more for less, was crossed and we started into the territory of less for less? Not that I can detect…”

For examples of how city leaders are working to create inclusive growth, in the UK and internationally, see our report, ‘Inclusive Growth: Principles into Practice’. Read the Inclusive Growth Commission's final recomendations, 'Inclusive Growth Commission: Making our economy work for everyone'.