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Kids Company, Pot Noodles, and the madness of Systems World economics

Posted August 19th, 2015 in Blog by admin

Ian Burrell’s article on Kids Company (Camila Batmanghelidjh is shooting the messengers who helped her raise millions, The Independent Media Column, 10th August 2015) offers a number of claims that adds to the many from other commentators that Kids Company is guilty of ‘financial laxity’ and ‘imprudence’. Frankly, I can’t comment on this, but, having visited Kids Company a few times, and experience of the wider children and young people’s sector, there are a few things I’d like to say.

Ten years ago, at the invitation of Camila Batmanghelidjh, I was asked to advise on and write their youth work plan. Also, I have vivid memories of their “No Bullsh*t: What matters to every child” conference in 2007 at which we discussed ‘Fresh approaches and winning solutions to working with vulnerable young people’. The title seems particularly apt now in light of recent developments, given the claims and counter-claims made about what has been going on.

During one visit I saw a room quite literally full of Pot Noodles. Camilla had received a phone call asking if she wanted them. As with the speakers she was able to assemble at that conference, I got the sense that she was, through a good deal of effort, very well connected. This might be one of the few things that is not disputed, this and the rationale that all organisations must invest in promotion if they are to survive in a world where the pressure to identify funding is on-going, and the environment in which they are trying to do this ‘resource poor’.

It’s this ‘world’ that particularly concerns me, and to which I want to address my wider comments. A number of commentators have rightly identified that Kids Company’s ethos centred on a relationship-based model of practice. They might easily have aligned this to the ‘Lifeworld’ ideas of the philosopher Jürgen Habermas. And, indeed, counterposed them with that other world that Habermas describes, the Systems World, in which everything exists in an economic paradigm, all actions mediated by bureaucratic and institutionalised processes. ‘Administration’ revolves around regulatory regimes, standards, targets, and the assumption that outcomes can (and need to be) known in advance and ‘delivered’ within prescribed timescales. Not that there aren’t critics of these ‘systems’. As the Observer editorial: Vulnerable children deserve better support’ (9th August 2015) stated: “most charities in receipt of government funding have to fill in reams of paperwork on financial and performance indicators: the problem is they are often asked to report on the wrong things”.

I’m not sure how much I knew of Habermas’s work at the time I produced my ‘Kids Company: A Vision for Youth Work’ document, but it seems I felt it necessary to write this:

Kids Company’s vision for youth work needs to be informed by the organisation’s central ethos. Children and young people are considered its primary clients; all other interventions, typically familial and with other agencies are considered secondary. Kids Company’s ethos has, therefore, an essential focus on supporting young people in understanding the factors that have a negative effect on their quality of life and working with them to remove and resolve these factors. Kids Company believes that its work can repair trauma inflicted by negative relationships thereby enhancing children’s and young people’s ability to form positive relationships in the future. By working in this way Kids Company believes children and young people become increasingly independent and autonomous persons. Kids Company views independence and autonomy as having both individual and community components – individuals prosper when they are in a dynamic relationship with a supportive community. Potential partners in Higher Education must, therefore, have a strong commitment to education for autonomy and be sympathetic to Kids Company’s ethos.

Consider then the definition of the “lifeworld” suggested by Habermas in his Theory of Communicative Action (vol. 2, 1984) as “consisting of individual skills, the intuitive knowledge of how one deals with a situation; and from socially acquired practices, the intuitive knowledge of what one can rely on in a situation, not less than, in a trivial sense, the underlying convictions.” His argument is that communication between human beings is only possible in the trusted surroundings of the lifeworld. And yet he observes this lifeworld is subject to increasing rationalization.

This might offer us a prism for understanding what has happened to Kids Company and what will surely happen to other organisations that also commit to lifeworld approaches at a time when this systems world dominates. In the case of Kids Company, a good example of this tension is the effect of new and presumed understandings of accountability. Applied to my Pot Noodle story, a systems approach to ‘accountability’ implies counting each and every one of them, logging to whom they were distributed and maybe even being expected to demonstrate the contribution their consumption made to the consumer’s ‘economic well-being’. Flippant perhaps but not without some truth.

But Kids Company didn’t work like that. In prioritising relationships and common sense it got on with meeting need in as simple a way as possible. It believed whole-heartedly that need could be determined through conversation, which has an obvious resonance with Habermas’s lifeworld. And if someone was hungry, give them a Pot Noodle, and bollocks to the bureaucracy. Like anyone with their head screwed on, they knew that bureaucracy and accountability are not one and the same.

Personally, I’m not anti-bureaucracy; what I’m anti is bad bureaucracy, and the notion that accountability can be reduced to bureaucracy. Those that believe in the latter seem to favour the view that accountability always comes down to money, especially public money. This is not without justification, but it’s a position adopted by people looking from a particular perspective, and I’m not talking about that of the thousands of young people who daily headed to Kids Company centres seeking, amongst other things, to sate the hunger they were experiencing.

A lifeworld approach deliberately locates itself in this context; focussing on the needs of service users rather than the needs of the system: being accountable, first and foremost, to those they aim to serve.

It can help to think more of accountability in terms of credibility, which can only ever be in the eyes of the people you are trying to help. And there can be no doubt that Kids Company scored highly here. The fact that many, many, of the young people supported had referred themselves to Kids Company rather than been referred by ‘the system’ is evidence of this.

Now, in the desperate attempts being made to ‘place’ these young people, we’ll see this credibility shattered. Lest we forget it is borne of empathy and trust, both lifeworld-oriented relational concepts. It’s likely the autonomy they exhibited through their self-referral will count for nothing; they’ll be assessed by the very systems-based approaches they resisted, avoided or were even turned away from. Their taste of having that autonomy valued will lead them to fear not being treated as individuals, with individual needs, rather than bodies categorised through ‘risk-based analysis’ as having varying levels of need (and none) and therefore worthy of varying levels of intervention (or none). Systems world thinking assumes positive engagement, rather than appreciating that it has to be worked for.

A further and ironic twist is that local social services had for a while being referring young people to Kids Company as cutbacks had diminished their capacity to meet need: funding for work with vulnerable children and young people has fallen by 20% in the last two years. And Osborne is now asking government departments to produce models of 25 and 40% further reductions in budgets. In this context, it is unthinkable that they will be able to offer as much support as Kids Company.

Leaving this aside for a moment, it’s important to recognise public money is involved, and a lot of it. But its worth noting that few charities were as effective at raising money from non-state sources (philanthropy and the like) as Kids Company. In fact, despite claims that it “relies heavily on public funding” Kids Company’s Camila Batmanghelidjh to step down (BBC News, 3rd July 2015) upwards of 80% of Kids Company’s funds came from charitable sources. If this is what it’s costing to meet the needs of the vulnerable, there isn’t a cat in hell’s chance that the efforts in train to cobble together an amalgam of statutory and voluntary services to replace Kids Company will produce anything substantive.

All this reminds me of the economic madness I uncovered whilst researching youth crime prevention in a Midlands City several years ago.  In interviewing more than a few Police Community Support Officers (PCSOs) I asked about their interactions with local young people. “We refer them to the youth workers” was the response they all gave. I found out (and I kid you not) that in the area I was researching there were 77 PCSOs and 7 youth workers. You couldn’t make it up: 77 referring to 7. Doubtless, there are even fewer youth workers now given the slaughter of youth services up and down the land. At least PCSOs now seem to be getting it in the neck too; at least the maths might be ‘better’.

So there are issues about the amount of resources that exist in the first place and how they are spent. But addressing the question of ‘how’ is a nuanced affair and one to which the lifeworld – systems world analysis also offers some stimulus. Its one thing to consider on what money is spent (the reductive sense of ‘how’) and yet another to contemplate ‘how’ from a methodological standpoint. And especially then the question of ‘what works?’ There are extraordinary ironies here too. Although the government talks the language of evidence-based systems; typically insisting everything is demonstrable, it appears to be sanctioning a whole host of policies without any such evidence base. A recent example reported in the press include concerns expressed by civil servants about the efficacy of DWP sanctions, Review of benefit sanctions urged amid concern over regime’s effectiveness (The Guardian, 26th July 2015), a conclusion drawn by the department’s own inquiry. Then there’s the lack of evidence that performance-related pay (PRP) for teachers (now mandatory) improves educational outcomes. I corresponded with Ofsted about this and was forwarded links to the ‘evidence’. I doubt they expected me to read them, but I did. Not one provided evidence. I was also told ministers are not obliged to have evidence for the policies they implement. At least this is logically persuasive. It seems then that the demand for evidence is applied to everyone other than the policy makers themselves.

Interesting also that those who speak most lucidly about ‘what works’ are often those who have intimate knowledge and experience of the inner workings of an organisation. In the case of Kids Company testimony abounds from staff members and those closest to them. Listen to Henry Porter: I saw the great work Kids Company did myself. That’s why I mourn its passing (The Guardian, 9th August 2015): “Kids company has helped thousands upon thousands of young people survive the hardship and emotional damage that most of us have not the slightest clue about … still less do anything to mitigate.” This closeness is that of the lifeworld and often referred to as ‘proximity’ by those that appreciate it. It is at the heart of the wider ethos of ‘low threshold practice’, as employed by Kids Company.

These many testimonies, including from young people who used Kids Company’s services, illustrate how low threshold practice works: make services as accessible as possible and people will use them. Contrast this with the austerity driven systems world approach that often has to turn away those asking for help as support can only be offered to those deemed by the systems to be experiencing crisis.

These crisis intervention strategies are common today. Others, with ‘lesser needs’ (as validated by assessment processes) are left to fend for themselves or, perversely, told that it might be in their interests to get worse (lose more weight / put on more weight; become homeless etc.) in order to get assistance.

Conversely, ‘support’ is increasingly imposed on people ‘for their own good’. New narratives are created to sell coercion to on-lookers unaware, through a lack of proximity, of what this means in practice. Take, for example: ‘assertive outreach’, ‘non-negotiable support’, and ‘time-limited recovery’. And couple this with the wholesale emergence of mechanisms of economic incentivisation: removing benefits if you don’t “do the right thing or play by the rules”.

Low Threshold practice is very different. It implies not just being the last in line (to whom folk turn when all other services have rejected them) but also the first in line, helping them when they ask, and often before situations become dire. It is preventative. It saves money. I have anecdotes aplenty to illustrate this. The social worker, cognisant that a stressed single mother had resorted to violence to control her children, in effect, fiddling the petty cash to give that mother twenty quid every Friday with the injunction: “here’s a tenner for you to get down the pub tonight; and a tenner for the baby sitter”. Three hours off a week, and the violence ends. And the child protection system saves a fortune. Or another who pays for and plumbs in a second-hand washing machine having realised another mother was spending half her benefits down at the launderette in a desperate attempt to keep her (many) children’s clothes clean. Thereby putting better food on the table and reducing the stress all round. This seems to have been at least part of the economic philosophy of Kids Company. Choose for yourself: “money was spent without proper auditing” or, in Camilla’s words: “Kids Company kids should get a bit of pocket money also.” Again, the economic paradigm and reductive accountability of the systems world renders this not impossible but unimaginable.

All this adds texture to our understanding of the wider economic context to what’s happened to Kids Company, has happened to other organisations in the past, and will happen to others in the future. These are matters that rarely get an airing. Then remember that Kids Company was generating upwards of 80% of its income itself. Which is a world away from the thousands of voluntary organisations that now rely on funding from state-sponsored sources. I have experience of some for which the figure was 90% plus. Compared to them, Kids Company was a money spinner, subsidising the state. This ‘shadow state’ is administered through the heady world of contracting and commissioning. It’s now the singular mechanism for identifying ‘service providers’, a paradigm that those in power seem unable to think beyond. Strange then that history offers a response to the constant demand for innovation: permanent staff on permanent contracts working for well-planned local authorities, informed by proximity-based evaluation.

The reality is that these ‘new providers’ (as they’re increasingly referred to, albeit long-standing) are expected to take on the functions of the state, as the state withdraws like never before. But these organisations are more than ever living on a hand to mouth basis, on a diminishing diet of short-term contracts without any offering the kind of security the Kids Company critique demands. We should be greatly concerned about the economic well-being of these organisations and their sustainability and ask what will happen as they slide into oblivion. But other things should worry us too, such as the likely other outcomes of this wider neoliberal economic paradigm. In being the ‘shadow state’, these organisations tend to reign back on criticising the hand that feeds them. In effect, this constitutes an erosion of the capacity of civil society to offer the checks and balances needed to maintain a functioning democracy. We could easily add this to Norman Baker’s list of the defining features of an emergent one-party state: Former minister says the UK is becoming a ‘one-party state (The Independent, 11th August 2015).

Perhaps this is ‘the problem’; governments tend not like those who speak truth to power. But Kids Company was given money wasn’t it? Indeed, but that can sometimes be part of the age-old strategy of incorporation; funding always comes with strings attached – like holding off the criticism. Not that Camila Batmanghelidjh was ever shy to, as the French say, ‘rendre l’invisible visible’: make the invisible visible. Where we’re not up close, we can thank her and others for these insights into social reality, of a government that presides over dire poverty, what Yasmin Alibhai-Brown calls “planned poverty”: This is no country for young boys and girls (The Independent, 10 August 2015).

Consider the figures buried deep down in these systems (a value at last). Alibhai-Brown quotes them in her commentary on Kids Company: “Since 2010, the number of needy kids has risen by half a million. Whilst the nation was obsessing and making noise about numbers, there was little interest in the priceless nurturing the charity provided.” Value, as ever, seems to be understood only in monetary terms.

She goes further: “Suffering children from low-income families are still seen as dispensable trash by abusers and state institutions. They have no rights, no autonomy, no credibility.” Like Baker, Alibhai-Brown also worries about the future of our civil society and sees the treatment of Kids Company as indicative of an increasingly authoritarian government: Charities and NGOs are needed now more than ever — but they are under threat from this government (The Independent, 5th July 2015).

It’s this kind of analysis that suggests evaluation systems should take account of moral and ethical dimensions. Unfortunately then, further perversities are revealed: the shadow state represents a crossing of the Rubicon, to a land in which paying the bills becomes an organisation’s primary task, rather than meeting the needs of the people identified by the authors of their often worthy mission statements. How many of these organisations fully appreciate that the wider culture of ‘competitive tendering’, located within that of perpetual austerity, implies subsidising the work out of the meagre resources they have purely to secure the cash flow to keep them going. So despite the narratives of ‘working together’, ‘multi-agency partnerships’, and moving beyond ‘silo’ mentalities, collaboration is continually hampered by competition, it becomes mere hypothesis rather than reality. Perhaps that’s how power likes it, as collaboration can engender something deeply unwanted: a unified voice capable of bearing witness to the scale of the problems endured by the nation’s young, and the inadequacy of the government’s response to it. The end game is the wholly unsustainable situation created by the driving down of the very ‘on-costs’ that might have contributed to their economic stability, the very stability demanded of Kids Company and other agencies in the name of ‘prudence’. As Kathy Evans of Children England says: “It’s really not adding up any more. Some organisations have remoulded themselves so are very fit to tender and even they are not seeing enough value in the contracts to make it worthwhile delivering them. This market model is running up to the buffers because there is no profit left”.

The backdrop to this is the Charity Commission’s general advice that organisations have at least three months’ running costs in the bank. Sounds reasonable, but, hands up, which organisations have this? Furthermore, when we see that Kids Company’s annual budget was around £24m, this implies having millions in the coffers. Without exception, voluntary sector agencies, never motivated to make profit, would see this as cause for embarrassment. Few would countenance sitting on that amount of money when they could be helping the many desperate people beating a path to their doors. And no doubt the media would then offer a different critique, that of sitting on some kind of state largesse. Not that this is an option for the majority of the around 60,000 children’s charities who, being small, are unable to show the financial muscle now asked for by funders. They’re ignored, in favour of larger organisations; there‘s no place for them … in the system.

In viewing this ‘surplus’ as capital we are into different economic rationale again. Traditionally, voluntary sector organisations have emphasised using their resources to meet need, rather than accruing capital. In the realms of the state, such as a local authority school, there’s even external pressure to spend any surplus that does exist. Conversely, there are plenty of others for whom accruing capital is the name of the game. This, of course, is the world of commerce and business. One wonders then if service provider contracts based on ‘payment by results’ (PBR) were designed with businesses, rather than voluntary sector organisations, in mind, given they have the finance to pay for the work in advance in anticipation of getting ‘weighed out’ later. Compare this with agencies with little or no financial buffer; they’re forced to risk a great deal in getting involved in PBR contracts. But most have little option: I remember well listening to a government minister extolling the virtues of this kind of ‘entrepreneurialism’: “why would we possibly want to fund anything through any other system?”

Which is why we have seen the emergence of the likes of Capita and SERCO as key players in this new world of children and young people’s service delivery. Beyond finance, these players have other resources; let’s call it ‘business acumen’. Or perhaps, the knowledge of how to ‘game the system’. First, why worry about service delivery; simply use your resources (finance, marketing, P.R etc.) to win the contract (such as those associated with the National Citizen Service) and then sub-contract: get someone else to do the work. Of course, skim off some tidy management costs in the process. It’s the kind of behaviour associated with hedge funds; they provide the capital and sub-contract the heavy lifting. This ‘nous’ recognises that PBR contracts often come with penalties associated with not meeting, for example, diversity targets. ‘Nous’ means factoring these in; the hit you’re going to take. Penalties for failure become part of business planning and account sheet entries. The rationale is clear: why would you want to do all that (expensive) outreach (low threshold) work to get hard-to-reach kids involved when their ‘added value’ is relatively modest? So it’s likely then that a system-based response to the demise of Kids Company will lead to the vultures hovering, looking for easy pickings in the misery of others while statutory services desperately try to help those in crisis.

Allow me a final thought, of where economics and wider ideologies meet. It’s one that might shine a light on a divide in the Tory party, at least as big as that imagined by the right wing press to be present in Labour’s current leadership battle. I’m referring to what I once heard perversely labelled as Tory ‘anarcho-syndicalism’ and those of ‘Stalinist’ persuasions. Whilst both dream of a small state, the difference is that the Stalinists don’t want to cede any kind of control; see Gove’s manipulation of Ofsted when Education Minister, for example. Others for whom ideas associated with anarcho-syndicalism appeals see the world from a completely different perspective. Their view is ‘who cares whose offering services (and what form they take) so long as it’s not us’.

This leaves us with (and it doesn’t take a leap of imagination to think this) the idea of the ‘Big Society’ having emerged from a focus group of bright young things charged with inventing a narrative to sell us a small state and austerity. Flavoured then with ‘localism’ and we see the fabled independence it is intended to purport reduced to making decisions about (read ‘carrying the can for’) cuts to public services; cuts that will make many simply unable to function in the first place.

Perhaps Coldplay will save the day: Coldplay in talks over possible bailout of Kids Company (The Guardian, 9th August 2015). Their offer to ‘fix’ Kids Company will be greeted with glee by Tory anarcho-syndicalists and Stalinists a like. Although the latter will by now be leafing through their systems handbooks to dream up lyrics about performance indicators and targets and outcomes to be met.

One way of moving on from all this is to review our understanding of economics in the first place. The Feminist economics advocated by the likes of Professor Jane Humphries would be a good place to start. Life world appreciative, it values engagement with culture: learning through conversations with those to whom policy is directed, in order to tell it as it is: like calling a Pot Noodle a Pot Noodle.

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