(Ed Miliband on the Marr programme)
When Ed Miliband said this in January he was talking about the energy industry. One of the major planks of his policy for developing a new economy is to encourage and enable much more active consumers.
Active consumers challenge provider bad practice in two ways.
First they make a fuss about their existing supplier. Increasingly they may join a range of campaigns about how badly they are treated – and social media is making those campaigns more powerful every day. The political scientists (and Ed Miliband) call this ‘voice’. Increasingly consumers let the world know when they get bad treatment and they say it ever more loudly and in greater numbers. The reputational costs for providers of services that have campaigns run against them can be immense. So providers worry about consumer voice.
Second, where there is competition consumers have the right to take their business somewhere else. Political scientists call this ‘choice’. In the energy industry Ed Miliband makes the important point that exercising choice is difficult. He is committed to making it a lot easier for consumers to move their business. And where there are monopolies he will develop policies to break them up and provide the consumer with more choice.
Whilst voice can raise problems of reputation for businesses, it is the loss of customers through choice that is the direct driver for companies to improve service. If there is no choice the impact of putting consumers at the heart of change is diminished. Thousands of active consumers combining voice and choice will have an impact on bad providers – or they will lose a lot of business.
The important political point for Ed Miliband here is that given his committtment to stand up for consumers against monopolistic power in the private economy where does he stand on the issue for consumers of public services.?
On February 10 he made a speech addressing the problem for consumers of public services. In this speech he clearly said that he was as committed to tackling the abuses of power of public services as he was of private services. This is a new dimension to the recent post-2010 politics of the Labour Party and of course will have a big impact on the politics of the NHS.
If you are to win votes from voters outside your tribe then good politics is all about developing positions that are a bit different from those that the tribe expected. A traditional Labour position attacks the power of private companies over consumers but has not attacked the power of public organisations over citizens.
So when his Feb 10 speech talks about understanding that that there are people feeling powerless because of state institutions and not only private sector companies, he is making an important and not completely expected point.
The speech went on to talk about enhancing the power of the citizen in developing their voice in gaining more power in public services. There were important promises for parents (and in the future patients) on developing their public voice to have a greater say. In particular a part of the speech that could have a big impact on the NHS was the promise of helping individual patients organise themselves with similar patients. This blog has often spoken about the importance of patient organisations developing a more powerful collective voice for individual patients. This is potentially an important and practical policy.
He was talking about people powered public services.
But when it came to choice he said that this was different for public services because parents don’t choose a school in the same way that they choose a café. That’s true. A café choice is made every day, and a school choice once every few years. That makes them very different choices – but they are still choices.
And parent choice of schools informed by information from Ofsted has had and is having a big impact on driving up standards. Just as for a private company if you don’t listen to the voice of parents about your school then parent choice will have a direct impact on your bottom line. Head teachers who don’t care how parents use their ability to choose schools don’t last long.
To allow consumers in private industry to use the power of choice is a vital way of empowering consumers.
Not to allow citizens who use public services to use the power of choice will limit their empowerment.
If you want to improve public services people need all the power they can get, choice as well as voice.