By Paul Carey-Kent, Policy Manager, CIPFA
CIPFA’s latest set of ‘Perspectives’ essays, The Brexit Balance Sheet: Weighing Up the Public Sector Costs, was launched on 4 April with brief talks by several of the contributors. Julia Goldsworthy (PwC, and chair of CIPFA’s Brexit Advisory Commission on Public Services) led the discussion and suggested that there were three main areas of concern for public services as a whole: policy implications, operational matters (including workforce issues) and delivery capacity, especially given the challenging agenda already facing the public sector.
Saffron Cordery (Director of Policy and Strategy, NHS Providers) gave an overview of the potential impacts on health and care, setting out five main issues:
- Money, due to the knock-on effects of economic effects.
- Reciprocal health care arrangements. We tend to take those for granted when travelling abroad, but that could change. Moreover, if there’s a shift towards collecting payments from EU users of NHS services, the bureaucratic effort involved will be considerable, and could materially shift the ‘free service’ ethos of the NHS.
- Not being part of the European Medicines Agency could reduce the UK’s status in pharmaceutical trials, leading to slower introduction of new treatments.
- Changes to competition and procurement law, which could be a positive, as EU rules are widely seen as unduly burdensome.
- Workforce, with signs already of a slowing of recruitment from the EU.
Jonathan Portes (Professor of Economics, King’s College, London) filled out the workforce concerns: some three million people, 7% of the total workforce, are from the EU, including 7% of health and care workers (though with a higher percentage overall in the private rather than public sectors). That may not sound a high proportion of the ‘stock’ of staff, but the ‘flow’ of new entries is weighted much more towards the EU, the more so since migration from other, non-EU countries has been made more difficult.
Consequently it is critical to keep the EU workers who are here, and prevent the inflow from drying up. Tony Travers (Director of the Institute of Public Affairs) pointed out that a possible regional effect should let the flow reduce: workers will be drawn from deprived regions into London to replace EU workers, so that such areas as Cornwall, Lincolnshire and Cumbria face the potential double whammy of reduced funding (as they are prime recipients of EU grant streams) and loss of workers who contribute to the local economy.
Other, more general, contributions were also potentially relevant to health and care. Joe Owen (Institute for Government) explained the logistics of the Brexit process. There are 750 workstreams split across 20 or so chapters, each to be headed by a lead negotiator backed up by a cross-departmental team. This additional workload will tax government capacity, which will have to concentrate initially on making sure things work properly from April 2019. The speed and scale involved is likely to require the agreement of frameworks on a broadly ‘as is’ approach in most areas, with details to be worked out later.
The potential advantages from rethinking whole areas of policy in a more independent way will only be available in the longer term. Making the comparison that a single EU law often takes five years to pass, he suggested that the task of taking a view on the whole of EU law in two years is immense – the more so, perhaps, as British governments are more skilled at deferring decisions than at delivering them to a set timetable. Several speakers mentioned the potential knock-on effects for devolution, though that is likely to be one of the ‘follow-on’ developments – especially if defined as deciding what to reserve to the centre, with everything else localised along with appropriate tax-raising powers.
Overall, the speakers clarified the tasks and the problems to be dealt with, but also the longer-term opportunities.