Trust in public services is in decline, when we might expect it to be on the increase. Consider the NHS. Spending is at its highest ever level. Waiting lists have fallen by about two thirds overall since 2001. The King's Fund, often a critic of government, concludes a recent review: "Increased funding has bought more staff and equipment and… helped reduce waiting times to an historic low." The number of procedures carried out has roughly doubled. Information on the treasury performance website provides more evidence on what is happening than ever before.
Yet while the NHS scores high on competence and transparency, trust levels are low and declining. Responses to a recent British Social Attitudes survey showed that only 12 per cent of those interviewed had a great deal of trust that NHS hospitals would "spend their money wisely for the benefit of their patients" as against 16 per cent for private hospitals. Why is the public withdrawing trust just when the service is getting better? Recent social science research provides some clues.
Work in psychology and sociology indicates that trust in this context has two main components—a cognitive judgement that an agency is competent and efficient, but also an emotional belief that it operates in one's interest—there is little point in putting one's trust in a health service which has the highest standards of expertise, but which can't be relied on to use it when you need it. Recent approaches to public sector reform are based on a logic derived from economic theory that appeals primarily to reason. The affective aspect has been relatively downplayed, and this has harmed trust.
The key principles of public service reform are the decentralisation of authority and a structure of incentives designed to make sure that the various agencies direct their energies towards the goals set by government. These principles can be seen in the breakup of the old NHS and the creation of an internal market, in which budgets are decentralised and resources flow to hospitals in relation to their success in attracting referrals from GPs. In education, schools are constituted as "budget-holders," with income determined by student numbers. In both areas, information on service quality is publicised in league tables and star gradings, backed by publication of progress towards targets set in the treasury's public service agreements, so that consumers can make informed choices. Government also tries to maintain standards though inspection by semi-independent agencies—such as the Healthcare Commission and Ofsted.
These procedures follow an economic logic, based on "principal-agent" theory: the aim is to ensure that the interests of the agent running the GP practice, hospital or school correspond to those of the principal, in this case the government. The means to achieve this are, above all, budgetary incentives; if you can't get patients or school students, you lose money and fail. This is reinforced by provisions for replacing management if the service fails to meet standards. The whole structure lives in the house of reason. Managers are faced with a clear structure of rewards and penalties.
This approach has had considerable success in relation to performance, as noted above. But trust is a different story, since trust depends on evidence that the providers have the users' interests at heart. Here the rational incentive-based system fails to engage.
The main motivation of service providers is no longer focused downwards, on service users, but is redirected upwards, at the budget-holder. So although the new system is designed to improve service to the end-user, and has done so in the NHS, it does not feel like that in terms of daily interactions. In the past, when there was more professional autonomy, the system was less efficient, but it felt as if the GP or nurse was primarily focused on the individual patient, as opposed to a distant budget holder.
The reform programme stresses rational incentives and pays little attention to the ethos of public service or client interest. While it may continue to improve performance (if resources continue to grow) it is unlikely to nourish trust. But this may be a paradox we have to accept as the price of greater efficiency in a new managerialist welfare state.
