Commodification of Welfare Essay

Independent Study Project 2010‘How has the commodification approach to welfare impacted on today’s drug services? ’                                                                              Author Mark PrykeIntroductionThis project is broken down into two main parts. Firstly it will explain what is meant by the commodification of welfare and why this project was chosen as a study piece. It will give an overview fitting the subject into a historical context mainly in Britain but with some international connections, then leading to the present day.

As the text progresses there will be correlations made from different sources regarding certain processes, phrases and models that are milestones in the development this study. Some criticisms and observations will be offered throughout the study. The second part is a research project that was undertaken in order to determine what knowledge employees in drug services had in regards to this matter. This part will be set out as a research study with a clear methodology and report. The study was completed by compiling a short questionnaire and disseminating across two third sector organisations.

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References to the ‘impact on today’s drug services’ will be continuously made throughout the text with a penultimate paragraph summing up before the conclusion. The conclusion will sum up through reflection and offer critique with options for further study. To understand the term ‘commodification of welfare’ we must first clarify what is meant by commodification and then secondly welfare. Commodification is a word first termed in Marxist theory. It is the transformation of services or goods into a commodity in areas where market terms were previously unused.

The commercialisation of services has brought with it a terminology and understanding that is more familiarly used in the private sector where trade is the fundamental purpose. Welfare is a word used to describe a person’s state of being. When used in conjunction with state it describes the provision of services that are offered to people who need specialist services to improve health and well being. Since the end of world war two in 1945 the welfare state has grown on a massive scale.

It has been the target of many critics both for and against its existence. Terms such as ‘welfare child’ and ‘welfare dependent’ have been well documented showing the impact the welfare state has had on society. In 1979 under a new conservative government, led by Margaret Thatcher, society as a whole faced unprecedented changes. For years the welfare state had been the brunt of many critics especially around its performance or indeed ‘lack of’ as the cost of running it had many a person wondering how the country would be able to fund its ‘spiralling costs’.

This perception of efficiency was the result of evidence gained form studies from the late seventies into the eighties that formed the belief that the welfare state had lost its legitimacy. The welfare state was targeted by the new government to apply radical changes from a ‘bureaucratic and administrative’ approach to a ‘risk management’ one. The conservatives were to bring in a new form of management that was performance led – an approach that was based on a style known as Neo – Taylorism.

Neo – Taylorism was a term coined by Pollitt (1993) to describe the first period of change in the welfare sector. The early twentieth century saw Frederick William Taylor applying ‘scientific management principles’ to management. He saw workers as ‘units’ that responded to punishments and incentives. When applied to public management this approach facilitated a strengthening of ‘control and measurement’ through processes such as target setting, performance indicators and results, (Unsettling welfare, 1998).

The conservatives were ever keen to monitor what they saw as an unproductive welfare state to justify any cost cutting exercises they introduced. The approach seemed to be a logical one considering the country was in the depths of a recession. The term ‘value for money’ became well used in public management, it was a term specifically used to describe the outcome of the 3 E’S –economy, efficiency and effectiveness. By the mid 1980’s the ‘managerialism’ approach or New Public Management as it became to be known as, had been implemented across the public sector and into the welfare.

Local area health authorities first used ‘indicators’ in 1983. This was in line with the Audit Commission’s decision to introduce and publish performance tables showing their results and findings. The private sectors approach to management had arrived in the public sector bringing with it a whole new range of principles and practices. These new ‘mechanisms’ were implemented to show ‘managerialism with a human face’ with the emphasis on quality and customer responsiveness.

The approach moved on from a neo- Taylorist one to adopt a hugely successful approach that used consultations, questionnaires, surveys and evaluations with customers in the private sector. These were tools that had been found in use in a number of organisations that had been involved in a study in 1982 by Peters and Waterman that came to be known as ‘In Search of Excellence’ – the 4th E. This study evidenced the relationship between the employee and their work. It focused more on the initiative and responsibility of the employee with the manger being the role model.

The productive nature of this relationship was so much as success that its principles of commitment, choice and customer centeredness were applied across the public sector. The introduction of this new approach came to be known as the consumerist approach. The commitment to furthering choice within the welfare state was a main theme of the John Major conservative government. The introduction of The Citizens Charter in 1991 saw greater focus being added to a ‘customer’ approach.

This new charter paved the way and most local authorities by the late 80’s early 90’s had introduced ‘Customer Charters’ using patient satisfaction surveys, Community Health Councils and used ‘Mission statements’ to set show their identity and aims to their ‘customers’. This in turn saw the increase in the consumer approach further than service delivery to the delivery of services themselves involving ‘citizens’ who were to share in the decisions and office of such organisations. Quasi – governmental, voluntary and private approaches to the delivery of welfare in education, housing and personal social services. Delivering Welfare, 1995; Unsettling Welfare, 1998; The Managerial State, 1997; Managerialism and The Public Services, 1990). The late eighties and early nineties saw a change in the political thinking of numerous left wing parties across the planet. The application, membership and pressures of the international market system could not be ignored. In Europe political parties in Germany, Holland, Scandinavia, Italy and France re-modelled themselves to adjust to the economic environment that now existed. In Britain and the USA this type of thinking came to be known as the ‘Third Way’.

As the name suggests,  the political parties of the left saw the need to remodel, reshape and rethink existing policies away from their present ones but not so far as to replicate those of the right wing parties, into the place that is not ‘between’ the two but  different from them. The labour party in Britain under their leader Neil Kinnock identified the need to move away from ‘loony left’ policies that were not the general public’s views and by using new ‘marketing, media and advertising’ changed the image and workings of their party.

The strategy worked and in 1997 with a new leader in place, Tony Blair, the ‘New Labour’ party came to power. This party had through a number of phases changed its approach to politics. They were similar to the Democratic Party headed by Bill Clinton in the USA that had also re-shaped itself and experienced success at the ballot box. What both these parties had in common was their ready use of the ‘Third Way’ ( Welfare State Change, 2004)The Third Way introduced concepts that were applied to society through politics that had many people intrigued.

The recognition of change had many commentators and players agreeing that the ‘three main dimensions to re-organising: mixed economies of welfare private, public,  voluntary and informal sectors and networks – these can all be seen in present day service provision of drug services; increased use of market like mechanisms…introducing competition and contracting into social welfare – the use by local governments of the bidding and tendering process for drug service provision and organisational forms of government tilting towards ‘quasi government’ growth of non elected agencies overseeing spending of public money in provision of public services’ (Clarke, Gewirtz and McLaughlin, New Managerialism New Welfare, p4-5, 2001. –Introduction of the National Treatment Agency in 2001as part of the National Health System that allocates and manages funding for drug treatment services, these dimensions will be discussed later – would be implemented. The third way brought with it a renewed vigour from its supporters to see new relationships built on good values and principles between the different aspects, peoples and sectors of society. It can be seen as sitting ‘outside’ or ‘alongside’ political parties even though it’s introduction was timed with the success of the reformed parties of the left  but it’s flexibility in an ever-changing political landscape has proved very useful. Both Bush and Blair expressed ‘enthusiasm’ for greater role for third sector organisations in the delivery of welfare provision. Third sector organisations are non governmental and non profit making.

They are often referred to as charities, although the ones that usually enter the service provision arena in welfare, including drugs, do not follow the traditional format of fund raising through events or commercial enterprise such as shops to secure the majority of funding for themselves. They operate in the Third Sector which is also known as the ‘civic’ sector alongside both private and public sectors. The inclusion of such organisations in the inclusion of welfare provision is directly in line with first dimension outlined earlier. These types of organisations bring with them the flexibility that is sometimes needed with the structure that facilitates between all of the stakeholders to offer a working option in such matters. There existence offers society an alternative choice in the provision of welfare, another important concept in the age of ‘consumerism’.

The relationship between the third sector and the government is outlined by four principles et out in the Home Office Compact 1998 which states ‘an independent voluntary sector is good for society; government and the voluntary sector have complementary roles in delivering social services; there is added value in public-private partnership and government and voluntary sector have different forms of accountability but similar values and commitments to public benefit. ’ With further suggestion that this is in part due to changes taking part in post industrial societies. (Welfare State Change, 2004) The third way has brought significant amount of change to the provision of welfare services including drug services. The use of market terminology and the appliance of the excellence model in such provision have provided much to ponder since its introduction.

It has adopted terminology taken from the private sector, implemented business models; on the whole it has provided an alternative approach to welfare that was previously administrative led. The progression of this ‘new’ approach has not been without criticism. The application of private sector approaches in response to an international market system haven’t sat well with some professionals who see their role as the holder of specific knowledge and experience that is sought by a person in need. This stance is certainly challenged by the third sector with its flexible ‘civic’ and practical approach to the management of welfare through a managerial approach and this has been seen by many politicians as the answer to ‘the perceived gap between rising needs and declining resources. (Hughes and Lewis, Unsettling Welfare, p356, 1998) The introduction of market led processes applied by the third sector are seen to carry a user friendly, customer centeredness  approach to services however it cannot be forgotten why the change to welfare provision was first started in the eighties –  in pursuit of  efficiency, effectiveness, economy and then to  excellence. One aspect of the consumer approach to welfare that implies it is a two way process and not driven ‘down’ from ‘up’ is user involvement or customer centeredness, depending which terminology is more comfortable which in turn maybe decided upon by the person(s) accessing a particular type of service at a particular point of health.

Whilst the increase in competition for the delivery of services leads to more choice for the users of such services in welfare, that deals both primarily and secondary with peoples health, the use of market approaches and terminology has left some people with the criticism that the ‘user led’ approach is only legitimised through a quality consumer approach that has nothing to do with choice rather to do with the repackaging and provision of resources through services. The needs and wants of person(s) accessing welfare services are two different things and the provision of these is ultimately the decision of the manager. This subject is a means of study unto itself and therefore will not be discussed here. Managerialism has evolved since first being introduced by the Conservatives and then adopted by New Labour.

It is a response to the market system that dominates societies across the world. It is a multi ‘headed’ approach to systems and offers innovative processes to established administrative welfare services. Managerialism is at the centre of welfare service provision across the board and as such has become de-politicised in pursuit of ‘what counts is what works’ (Hughes and Lewis, Unsettling Welfare, p369, 1998). The use of the four ‘E’s, market terminology such as Value for Money, Key Performance Indicators, Outcomes and Outputs and the implementation of Business Models in a Welfare world are all indicative of a managerialist approach to welfare provision that seem to have been introduced to services.

The decision to complete this Independent study Project was taken as a result of the author’s lack of clarification of approaches in the sector where he works. The author decided to research the matter through academic resources bringing together the text previously read. From the outset the author had a personal research study in the form of a short questionnaire in mind to clarify to what knowledge and to what extent other employees in this sector had regarding the subject matter. The second part of the project is written in the form of a research project. The pen -ultimate part brings the two together making observations and using reflection to compare and critique where applicable. The Independent Study Project will close with the conclusion.


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