Now admit, are you one of those people who will drive well out of your way just to find fuel suppliers that offer a slightly lower price? A friend of mine will spend ages looking up who has the best price and then taking great pride in telling everyone how he had saved two pence a litre by using a service station five miles or so out of town. I did once try to point out to him that he had almost certainly spent more driving there and back than he had saved, but it seemed that the principle of the thing was more important than the actual facts of the matter. “I don’t let those big businesses make me spend more than I have to” is his position.
Now, in the grand scheme of things I guess a few pence here and there if it makes him feel he is ‘beating the system’ is not a big deal, but just imagine if this sort of attitude were applied to multi-million-pound funding systems. What would be happening is that some pretty significant sums of money, which should be providing much needed services, would get squandered because the managing agency for those funds would be more interested in making sure they were not being misused in some way than in ensuring best value and outcomes from what they had. Now that would be daft wouldn’t it?
Increasingly over the last couple of decades there has been a trend for defensive welfarism, that is to say that resources designated for public good are managed by agencies who see their principal role as hunting down and preventing fraud, rather than finding the best way to utilise those resources. To achieve this, they use a percentage of the resource to ‘police’ those who receive it and place onerous reporting and auditing requirements on those tasked with providing the end services. There have been many attempts to quantify this, with estimates across much of the third sector of close to a third of the value of the actual finance received having to go in compliance monitoring, financial checking and audit. Indeed, in one of our most important contracts at Apex by December 2020 we were into our 17th contract variation within an 18-month contract, each of which requires expenditure, time and energy to apply. That sort of behaviour would be laughed at in the private sector as totally inefficient and impractical but somehow, in the crazy world of the relationship between public money and the third sector, it is considered perfectly acceptable to make sure that we are not all deviously squirrelling away vast sums for some nefarious purpose.
Overzealous regulation has its roots in all sorts of things including, it must be said, occasional examples where systems have been abused by providers. Fundamentally though, it seems more linked to a lack of trust and a distance between funding bodies and the purpose which the funding is designated for, than any real evidence that the huge sums being wasted on the off-chance of saving smaller sums is actually sensible. Principles are great things but when they become more important than the primary intention then they are, at best, an expensive distraction and, at worse, create a breakdown in trust and ultimately the overall effectiveness of the whole system. I understand that the sums saved in most anti-fraud systems are much less than the cost of enforcing it, a bit like driving miles out of town to save a few pence despite the fuel cost of doing so being greater. My late and sorely missed mother was fond of the phrase ‘cutting off your nose to spite your face’ and I wonder if the huge industry of contract monitoring and procurement often demonstrates this to the detriment of all?