Public Sector Productivity

Productivity levels across public services of government are lagging behind the private sector, with many government departments and agencies struggling to connect their people with their core purpose.

Since the pandemic, the private sector has seen a 1.3% uplift in productivity, but public services are currently 5.7% less productive. There is increasing pressure to deliver immediate turnarounds in productivity – but such pressure doesn’t always lead to sustained operational improvements. Government departments will face tight funding settlements for the foreseeable future, against rising demand for public services.

There is a lot of noise about the productivity challenge, and there is a very real risk that overfocus on getting more cases out of the door doesn’t address the fundamental challenges with delivery of public services.

At Baringa, we help our clients think more broadly about how to achieve more productive public services. Our government clients have unlocked sustained productivity improvements when we have worked together on what it truly means to be efficient and effective, starting with connecting people to purpose.

Watch video: How do we address the public sector 'productivity' challenge?

Transcript

Matt Jones, Baringa
The UK economy is in a productivity crisis. According to the latest data, the output from the average hour worked is lower than peer nation such as France, Germany and the U.S. And despite many government efforts to drive reform, the issue is even more acute in the public sector, where output is 5.7% lower than it was before COVID hit.

The productivity challenge is not going away. Government departments will face tight funding settlements for the foreseeable future against rising demand for public services. Delivering efficiencies through service modernisation will continue to be a core focus for upcoming spending reviews.

Rhiannon Evans, Baringa
So, what can government do to recover the productivity gap? Where are the greatest opportunities to improve public sector efficiency? And what does best practice delivery look like for public services?

Shreeya Parulekar, Baringa
There's a lot of noise about the productivity challenge, and there's a very real risk that overfocus on getting more cases out the door doesn't address fundamental challenges with delivery of public services. There's also a risk that efficiency is seen as synonymous with headcount reduction to the detriment of true public sector reform.

Theo Whitaker, Baringa
In Baringa’s work with the public sector, we support our clients to cut through the noise and focus on tackling areas of greatest impact. Here are three things we have seen that make a material difference to public sector productivity.

Shreeya Parulekar, Baringa
Focus on outcomes. The public sector should define and measure success by the impact on citizens and society, not just by the number of outputs produced. For central government departments, this means a much stronger link between the outcome delivery plans and operational teams working across each layer of the organisation.

Rhiannon Evans, Baringa
Unlock the power of people. Recognise that public servants are the most valuable asset. Empower them to make decisions, take risks, learn from mistakes, and share ideas. This will boost morale, motivation and performance. This is particularly pressing for government departments where technology portfolios are already full. Whilst programs focusing on people capability are rare, there is massive untapped potential.

Theo Whitaker, Baringa
Bring digital, data and technology close to operations, create multi functional teams to collaborate and co-create solutions to modernise service delivery, be that streamlining processes, automating tasks or enhancing insight. In doing so, operational teams are upskilled in the use of digital tools and data effectively.

Matt Jones, Baringa
At Baringa, we recognise that productivity in the public sector is a complex and multifaceted issue that requires careful analysis and creative solutions. We see first hand every day the challenges that public services face, as well as the exciting and innovative ways in which they're becoming more efficient.

Rhiannon Evans, Baringa
Over the next six months, we'll be sharing our insights and examples of where we have helped our clients in the public sector to improve productivity.

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Solving the public sector productivity puzzle

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How far will the Chancellor’s productivity programme go towards unlocking a more effective public sector?

Details of the latest government productivity programme have been revealed – but now comes the hard work of implementation for departments and agencies. Lessons must be learnt from previous efficiency drives.