The Other Invisible Hand

Book excerpt: How can we ensure high-quality public services such as health care and education? Governments spend huge amounts of public money on public services such as health, education, and social care, and yet the services that are actually delivered are often low quality, inefficiently run, unresponsive to their users, and inequitable in their distribution. In this book, Julian Le Grand argues that the best solution is to offer choice to users and to encourage competition among providers. Le Grand has just completed a period as policy advisor working within the British government at the highest levels, and from this he has gained evidence to support his earlier theoretical work and has experienced the political reality of putting public policy theory into practice. He examines four ways of delivering public services: trust; targets and performance management; "voice"; and choice and competition. He argues that, although all of these have their merits, in most situations policies that rely on extending choice and competition among providers have the most potential for delivering high-quality, efficient, responsive, and equitable services. But it is important that the relevant policies be appropriately designed, and this book provides a detailed discussion of the principal features that these policies should have in the context of health care and education. It concludes with a discussion of the politics of choice.