Why investing now in children’s services will bring benefits to us all

Jody Aked is a researcher at nef‘s centre for well-being.

We can save money and put a stop to persistent social problems by investing now in a preventative system of public services for children and young people.

Gordon Brown succumbed to mounting pressure from the somewhat unrelenting Tory line on public spending cuts and used the “c-word” in his speech at the TUC conference yesterday. The message was that cuts under a Labour government may be necessary to restore public finances, but they won’t be as bad as under the Conservatives.

Of course, the devil is in the detail and neither party has shed much light on where these cuts will take place. Brown has assured us that “vital” frontline services will be saved from any future belt-tightening, because the cuts will happen in “low priority budgets”. What he didn’t say was how we decide which services are high priority and which are low. In the scramble for votes before the General Election, there’s a risk that all parties will try and score points simply by promising bigger savings and this will narrow the focus of the debate.

Quick fixes will be seen as cheap and attractive. Those services that generate significant social value by way of bringing wider benefits to society but which will not deliver an immediate return to the State may be brushed aside, in favour of those designed to provide a short, but temporary, solutions for our most critical social problems. Already professionals working in children’s services have expressed concern that preventative services – which typically work ‘behind the scenes’ to keep families together, keep children in school, and promote mental and physical health – will be some of the first to go. Yet, the work of these services, particularly in early childhood, has far reaching implications for generations to come, beyond the next term of office starting after the Election.

Consider, for example, nef’s analysis of the social and economic benefits of preventative and early intervention services, released today in Backing the Future: why investing in children is good for us all. Our reseach shows that if we invest upfront to rebalance our system of service delivery towards one that is more preventative than our current model, we can expect to save £486 billion over the next 20 years – even when the transaction costs of making the transition to a new system are taken into account. When compared to conservative estimates which show the UK’s preventable social problems – crime, mental ill health, family breakdown, drug use, and obesity – look set to cost the UK economy £4 trillion over the next 20 years, the case for investment is overwhelming.

And while it may seem like a strange time to be looking to temporarily increase and reconfigure public  spending on children and young people, the evidence indicates we can ill afford not to. At the moment it looks extremely unlikely that the UK will meet its poverty reduction targets, it is languishing at the bottom of international rankings of child well-being and the UK has the lowest rates of trust and belonging among 16-24 year olds in all of Europe. The current system of services has got things the wrong way round. It spends much more on children and young people when problems have become entrenched, when they are often impossible and certainly expensive to remedy. Despite being one of the richest countries in the developed world, our society is one of the most unequal and one of the least child-friendly. By not proactively tackling the root causes of our social problems, we have for too long allowed them to become a drain on public resources: the price tag of the UK’s social problems is a third more expensive than the next most troubled nation in Europe.

Even in a time of immediate crisis, any politician worth their vote needs to keep one eye on the future. Out of the ruins of the recession, we need to harness the opportunity to build a stronger society, with fewer social problems. To achieve this, we need policies that can improve the life chances of today’s most at-risk children and succeed in preventing the same root causes of social problems, including poverty and inequality, from having an adverse effect on the next generation. As the details of spending plans are unveiled, we should not be won over by easy political sells at the expense of funding decisions that will put the UK on a trajectory to a stronger, fairer and happier future.

Backing the Future: why investing in children is good for us all makes the social and economic case for switching to a preventative model of services for young people and children. This research was carried out by nef in partnership with Action for Children, whose Executive Director Clare Tickell makes the case for change in today’s Society Guardian.

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How to save public services

Eilís Lawlor is the acting head of the Valuing What Matters team at nef.

Hardly a week passes without news of looming cuts and fresh evidence of the implications of the recession for public services.

In a recession the temptation to cut back is strong. We have already had some worrying signals from Treasury – the hole in the government’s budget is to be clawed back in part through another £5bn in ‘efficiency savings’. So far these have amounted to stealthy cuts in frontline services under the guise of a leaner state. There is no reason to believe future rounds will be any different.

Yet government’s thin interpretation of efficiency is a false economy. Failing to invest now, when unemployment, crime and poverty are set to rise and an impending environmental crisis requires urgent investment, will only lead to costs of greater magnitude later.

Now more than ever we need to think about public spending less as a ‘carve up’ between competing ends and more as an investment in a better future. This cannot be achieved by penny pinching in the short term but by using the State’s resources to maximise the creation of public value – long-term social, economic and environmental outcomes.

A new approach to investment is needed that puts measuring and valuing what matters most to individuals, communities and societies at the heart of public sector decision-making. Such an approach, targeting positive social, economic and environmental outcomes, will lead to more informed policymaking, help build effective public services and have significant positive implications for the public purse.

nef research across three very different policy areas – economic development, children in care and criminal justice – shows the benefits of this approach. Valuing the improved well-being of children in care – rather than focusing on the unit cost of delivering that care – could help ensure that more appropriate placement decisions are made, improving the life chances of those children and offering a long term social return of £6 for every £1 invested. Savings over 20 years could pay for the entire annual care bill each year.

Women offenders are likely to fare better in life if custodial sentences are eschewed in favour of community penalties that enable mothers to maintain contact with their children. In the short-term money is saved on services for these children. Longer-term there is reduced risk of children becoming offenders and a better chance of the kind of educational attainment and social adjustment that will translate into lower societal costs through the welfare and criminal justice systems. Using Social Return on Investment we found that for every £1 spent on alternatives to prison that reduce reoffending, an additional £14 worth of social value is generated.

Measurement matters because it both reflects and reproduces the priorities of government and institutionalises behaviours. We are about to publish a set of principles for policymakers, that are a distillation of our research findings and can guide policy-makers who want to create better services. The first of these is about measuring outcomes: the positive and negative change in people’s lives, communities or the environment as a result of policy.

Despite rhetoric emphasising the importance of outcomes government still does not adequately measure the effects of its policies on long-term social, economic and environment well-being. Focusing solely on what is timely, tangible and easily quantifiable has not served us well: investment in public services has increased since the foundation of the welfare state, yet the place and circumstances of our birth predict our future health, educational and economic prospects now more than they did then.

Public services face the twin challenge of rising needs and increasingly constrained resources. Experience suggests that direct financial considerations on their own are not very helpful to meeting these challenges. As we lurch from one weak economic indicator to the next, it is easy to miss the opportunities this presents the State. There is too much at stake to get this wrong, not just in terms of social outcomes but also in financial implications for the public purse: ineffective public services cost us all more in the long run. To paraphrase Alistair Darling on banks, the response to the question, can we afford to invest in public services must be can we afford not to?

A version of this article was published in Public Servant Magazine.

I believe the children are our future

Sam Thompson is a researcher and a consultant at nef‘s centre for well-being.

As people start getting stuck into the polling data in the wake of Obama’s victory, some interesting patterns are emerging. This, for instance, is pretty striking:

Relative to 2004, the number of under 30s who voted stayed pretty much the same, but their preference swung strongly toward the Democrats.

Now, there are probably any number of ways of explaining this result, but it’s interesting when read in conjunction with recent research on the relative happiness of younger and older people. In short, younger people tend to be more optimistic about how happy they will be the future, whilst underestimating how happy there were in the past.

Needless to say, optimism was a central feature of Obama’s campaign. Rather than running on a negative, Bush-bashing platform (the temptation!), his core message – “Yes we can” – was about the possibility of change and a better future. It seems at least plausible, then, that the optimistic tone of Obama’s campaign was especially appealing to young voters who were already strongly disposed to see the future in a positive light.

Whether or not this explanation stacks up, it’s at least a worthy reminder of the power of optimism as a motivating force. In many respects the world is in a mess, and there’s no sense in pretending otherwise. But that doesn’t mean that emphasising our problems is the best way to make people want to do something about them. When we think about the scale of the challenge, especially on environmental issues, it’s all too easy to come across as downbeat and negative. But for the unconverted, it’s a short step from here to apathy, and from there the merest hop over the border into nihilism.

So yes, let’s make be realistic about the difficulties we face now, but make sure we tell an optimistic story about what’s to come.