Public service spending not bringing results, say firms

Four out of five firms (81%) think that much of the extra government expenditure on public services over the last decade has not resulted in service improvement, according to the CBI.

The CBI’s Public Services Survey found that nine out of 10 firms (91%) want politicians to look again at the size and cost of the public sector, 91% of firms wanted a reduction in the size of central government and 67% in local government.

The survey also reveals widespread business concern about public service modernisation, with 94% of respondents saying they believe there will be no significant reforms between now and the general election, due by early June 2010. 91% of firms believe the impact of the recession means such action is needed now more than ever.

John Cridland, CBI deputy director-general, said: ‘We need an honest discussion about what sort of public services we want and who should deliver them - and how best to maintain service quality.

’Whichever political party wins the next election needs to secure a mandate for radical action. Otherwise the country faces an uncertain and uncomfortable future.

’Business does not believe the fundamental issue of how public services are delivered has been dealt with.

’An additional £871bn has been pumped into the system since 1997. On the face of it, these extra billions have not resulted in a step change in the quality of services.

’Like it or not, we have to squeeze more out of what is already being spent and look for new and innovative ways to give people the services they want at a price UK plc can afford.’

Asked what could help improve the quality and value for money offered by the UK’s public services, 70% said more use of competition between suppliers, 57% said less public spending and 55% said fewer central targets.

The survey was sent to 1,637 CBI member companies and 248 responses were received.

neil.durham@haymarket.com

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