Reforming reform with payment by results

June 26, 2013

When Chris Huhne was released from prison earlier this year, he was handed £46 to help him on his journey home and a plastic bag filled with his belongings. If he was lucky, he might have received a few words of encouragement, rather than the more common “see you soon” reserved for regular customers.

But as Huhne was sentenced to less than a year, he won’t have seen a probation officer and is unlikely to be in touch with a mentor, mental health worker or drug treatment specialist. He will receive zero support to prevent him from reoffending; in fact, he’s much more likely to have picked up a few tricks of the trade from his cellmates.

Now, this might be fine if you’re a well-educated former banker, journalist and politician, but what about the tens of thousands of drug-addicted, alcoholic, chaotic, workless and mentally ill men and women who constitute most of our prison population? Can it be right that the state offers no support whatsoever to short-sentence prisoners upon release, or that the ‘support’ it offers to those serving longer sentences is often limited to a weekly cup of tea in a busy office with a stressed-out, overburdened probation officer?

There are many prisoners who genuinely want to turn their lives around but simply don’t know where to start. And there are many people working in the criminal justice system who want to help them, but don’t have the resources. The government’s ambitious probation reforms are designed to cut through that and generate, for the first time, an acute focus on preventing people from returning to the prison system.
Incentives to innovate

The mechanism by which justice secretary Chris Grayling has chosen to achieve this is payment by results (PbR), a principle that the conservative think tank Policy Exchange has long advocated to tackle stubbornly high reoffending rates. The state will tell providers: “Cut reoffending and we’ll pay you in full – but if you don’t, we won’t.”

This is potentially revolutionary. There will be a powerful commercial incentive for providers to innovate and effect some badly needed cultural changes within probation. More than a decade of Whitehall micromanaging the system has meant the professionals are completely overrun with process, reports and backside-covering paperwork. It’s got to the point where probation officers literally spend more time on their computers than with offenders. This is a system crying out for change.

As the public sector cannot be allowed to fail financially, PbR inevitably means opening the probation system to new providers who have the capacity to take on significant financial risk and invest in new services. Inevitably, critics argue that this is just privatisation and the ideological introduction of a nefarious profit motive for the providers who will be charged with cutting reoffending.

It’s funny that, in this country, people object so vociferously to the idea of a company making money by helping people, yet have absolutely no problem with companies that make money but don’t help anyone. Many would actually prefer to keep a service that doesn’t cut crime or change lives, so long as no-one is making any money out of it. Could this be one reason why bright, talented UK entrepreneurs choose to found tech start-ups rather than help tackle our deep social problems?

But leaving aside the quality of the debate about public service reform, what people are missing is the huge opportunity these reforms represent for the professionals within the system. These reforms could set them free from the bureaucracy, inertia and risk-aversion that currently hold them back, and will give them the freedom to try new things, to be rewarded for success and to enhance their professional training.
An army of ex-offender mentors

There are many details that the government must get right about payment by results. It should adopt Policy Exchange’s idea of the most hardened criminals attracting higher tariffs, so that the hardest-to-help get proper support. It must devise a new measure of reoffending that ensures providers don’t just ‘cream off’ the easiest cases, or ‘park’ the hardest ones. Government should wrap the prison system into these reforms too, by setting each prison a reoffending reduction target, to ensure that offenders are properly prepared for release and don’t fall through the cracks. They could also start training a nationwide army of ex-offender peer mentors now, so that they can be ready to help when the new system is up and running in the next 18 months.

We can also expect to see significant innovation in service delivery. Providers have already been experimenting with new technological solutions to monitoring low-risk offenders, halfway houses to help offenders transition from prison to the community and GPS tags worn voluntarily by offenders to help keep them on the straight and narrow, and away from criminal peers.

The shape of the sector will change dramatically from the monopoly enjoyed today. Providers are likely to include the larger, more established justice service providers, but we will also see probation trusts spinning out of the public sector to form mutuals and cooperatives. Backed up with capital from the social investment market, mutuals could emerge either as prime providers in their own right or as part of joint ventures with the big primes.

So there are lots of important decisions to be made about exactly how the new system should work. But one thing is for sure: if the government isn’t blown off course by the howls of protest from the vested interests in the criminal justice system, prison guards might find themselves saying “see you soon” a little less often.

This article originally appeared on the Ethos Journal website.

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