Economic Analysis and Productive Efficiency in the Personal Social Services: The Differential Use of Manpower Available to Purchase

Efficiency has not been the most familiar concept in the vocabulary of the personal social services in recent years. Some of the more obvious reasons for this having been the post‐Seebohm emphasis on expansion; the lack of clarity about service outputs and objectives; and the relative failure of the economics profession, with only a few exceptions, to concern itself with developments in this area in contrast with, say, the National Health Service. However, now that the post‐oil crisis economic recession has reduced prospects for growth in the personal and other social and public services almost to zero, in the short to medium term, the efficient use of resources assumes greater importance. This is in complete contrast to recent experience when, during the years of rapid expansion, efficiency was, inevitably, a poor second to the objective of maximising inputs. That is not to suggest that resources were deliberately wasted, but the development of new services in a growing number of areas, often on an ad hoc basis, meant that some inefficiency was unavoidable. Now the economic climate has changed and it is vital that the recession is used as a period of consolidation. Existing practices need to be rigorously examined in the search for more cost‐effective methods of achieving objectives. If this can be done at all successfully it will provide managers in the social services with much greater flexibility to meet the increasing pressures of future demands and conflicting priorities, and might even prevent that blunt instrument, the pro rata cut, being over employed. Of course, even the most efficient authority may not be able to avoid some cuts in service provision, but these will be most easily kept to a minimum by identifying areas where genuine savings can be made.