‘I would have been angry too’

Labour needs to learn to let go, says Jim McMahon in exclusive interview with Liz Kendall and Steve Reed for their new pamphlet with Progress

‘If we had gone into marriage guidance counselling at that point,’ says Jim McMahon of the relationship between Oldham council and its residents two years ago, ‘the counsellor might have said: “Do you know what, it might just be time to part ways”.’

Oldham was not, says the man who has led it since May 2011, unique, but the disconnect between the local authority and those it was supposed to serve was ‘probably more evident in Oldham than in many other towns’. That relationship – which McMahon admits was ‘terrible’ – was apparent in the fact that, at 22 per cent, Oldham had the worst customer satisfaction in the country.

But even that pitiful figure does not quite do justice to the depths to which relations had plunged. ‘In some ways, that was only a number,’ argues McMahon. ‘You could feel in the way people treated each other, in the way that people spoke to each other, that the relationship had just broken really.’

As scrutiny committee chair – a post he believes he was given because he was ‘loud’ and needed to be kept ‘busy’ – McMahon saw first hand how bad things had become. A controversial plan to demolish poor housing, splintering the communities which lived there, had provoked deep anger. McMahon had carried out a review and planned to meet residents to discuss it. The council and police both advocated cancelling the meeting. ‘People had a massive mistrust of authority. I said: “Well, now we’ve agreed to do it, if we now don’t do it then all we’re going to do is reinforce the distrust of authority”.’ With police riot vans outside, the meeting went ahead and ‘quite a lot of angry people’ showed up. ‘When I heard what people were angry about I thought: “Do you know what, I’d be quite angry too if I was in that situation”,’ he recalls.

Councils and their residents cannot, of course, simply divorce. Instead, as the man who was recently named council leader of the year, notes, they need to find a way of ‘reconciling and rebuilding’. Over the past four years, that has been McMahon’s focus. Thus far the results are impressive: residents’ satisfaction has increased threefold to 66 per cent. But McMahon does not plan to rest on his laurels: ‘We’re not where we need to be,’ he suggests. ‘We want to be in the mid-80s which is probably about 10 points higher than the national average.’

McMahon’s focus on radical reform and devolving power has not only won him national recognition, the leadership of the LGA Labour group but also a place on Labour’s National Executive Committee, to which he was elected by fellow councillors this summer. McMahon believes that, as it prepares for power, the national party can learn from those who have actually been governing during a time of austerity. ‘My belief is that local government has moved at a rate of knots in a way that has left other  government departments in the dust, really.’ Many parts of central government – he cites both the Department for Work and Pensions and the NHS – have ‘not modernised anywhere near enough’. ‘The deficit isn’t going down because we’re paying for failure,’ he argues. ‘People need to start being paid for success.’

There is, though, a realism to McMahon’s empowerment agenda. ‘There’s always going to be a role for some kind of convenor/arbiter, because the community isn’t one, the community is often conflicting and the community doesn’t always put its long-term interests ahead of its immediate interests … But that’s not the same as the council doing everything, and I think, particularly for Labour councils, we’re used to determining our vision of what we believe should happen and then we do it to people.’

His experience in Oldham taught him ‘just how dismissive authority can be’. True leadership, he believes, is about ‘helping people through a process if it’s inevitable [but] if it’s not inevitable it’s about being flexible enough to change course and not feel as though that’s a U-turn’. McMahon’s aversion to more traditional ‘town hall knows best’ forms of governance does not, however, stem from weakness or insecurity. ‘It’s confident political leadership. So I’m confident enough to say: “Do you know what, I have no idea – tell me”. And I just listen.’

While not dismissive of their concerns, McMahon is careful to differentiate between ‘self-selecting campaign groups’ who are ‘loud and … the issues they pick are usually quite narrow’ and those who are ‘actually being let down by the system but … don’t complain about it because maybe they’re not equipped to complain about it’. Many of these people, he fears, ‘don’t even know they’re getting a rubbish service … because that’s all they’re used to’.

Faced with deep cuts in central government funding, Oldham has proved that, even in the most difficult of circumstances, services can be improved. In social care, the council opted to ‘reset the market’. Four hundred staff were transferred from the council’s provider into a new ethical care company. Shunning the ‘race to the bottom’ which characterised the private home care market, users received longer appointments at a time of their choice, while pay and conditions for staff were improved. Oldham Care and Support has won contracts from the private sector, and increased its staff to 600. While the council wholly owns it, the board is balanced between staff and councillors and it drives its direction. User satisfaction is, he says, ‘very high’, while ‘family focus groups’ ensure relatives are reassured that ‘we’re around when they’re not’.

‘We compete on cost because what people say is, within reason, we will pay a bit more to get quality in that market … The price difference is only £1 something an hour per visit, so it’s marginal in the scheme of it. But the overheads that we are able to do for the trading company are very low, and our directors don’t drive round in posh cars,’ explains McMahon.

McMahon has also begun to transform services for troubled families and the long-term unemployed. His approach is one of ‘tough love’: ‘What we say to people is … you will be able to determine for yourself what package of support you want to improve. So what’s happening now is where your kids aren’t going to school and you’re not going to work and every second Friday it’s a domestic where the police are being called out – that is no way to live. It’s got to stop, and it either stops because you decided it’s got to stop, and we’ll support you to do that, or actually we have got quite a large stick here and you’re not going to like it. Now for some people you have to play the stick, but most people actually just want to find a way through it.’ McMahon understands why many are reluctant to wield that stick – which can involve benefit sanctions or loss of tenancy – but is unapologetic about his approach: ‘I don’t think any benefit system should be about propping up people that just don’t want to contribute, but it should be about supporting people who [want to],’ he argues. Since Oldham took control of the work programme success rates have risen from 3-6 per cent to over 50 per cent.

McMahon jokes about some staff in previously failing services belonging to a ‘troubled professionals’ programme but says many have embraced his reforms: ‘Quite a lot of people [are] really empowered by it because they recognise that it wasn’t working [and] they didn’t quite know what to do about it. They were in this kind of mammoth institution that put them in a box, and even though they might have tried to do their best within that, they … didn’t feel they could do anything about it. What we’ve done now is to create the culture and the conditions where people can actually innovate,’ he suggests.

McMahon believes the lessons for Labour nationally from Oldham and other local government innovators go deep into the party’s psyche. ‘In the Labour party we’re not used to allowing for difference. We use the language of postcode lotteries because we’re scared of different places receiving different services. But actually the communities across England are so complicated and complex that you couldn’t even have a one-size-fits-all for Greater Manchester. It’s got to be community-led depending on the issue.’ He fears that Labour has still not ‘got its head around’ that fact. ‘The party believes that it can dictate centrally what it wants to happen, how it’s going to happen, and how people will be paid and judged for it. What we need to do is decide what country we want, and what standards we want, and then empower more communities to innovate, to deliver that. We’ll hold them to account, and we’ll make sure that the public in particular can judge whether the local authority and other public providers are delivering.’

Liz Kendall MP is shadow minister for care. Steve Reed MP is shadow minister for home affairs. Download the full pamphlet, Let it go: Power to the People in Public Services, here