Another wheeze comes and goes

Sometimes people ask why it is important for leaders to take a systems perspective. Yesterday, the Government gifted us with a wonderful example.

In 2008 the Justice Department raised its fee for court cases for taking children into care. The fee was increased from £150 to £4,800. It backfired – predictably.

In The Search for Leadership there is a discussion about the dangerous trend for publicly funded services to look out for commercial opportunities. A controversial initiative was launched in 2008 to treat the courts as a business. That was and is the wrong thing to do, not least because the bureaucratic mindset sits ill with a commercial one: the former may be corrupted, without benefiting from commercial success.

But the case here is more than that. It is what systems thinker Russell Ackoff calls ‘doing the wrong thing wronger’. In charging fees, the Justice Department was simply shifting money into its own coffers from local authorities, who receive most of their income in a government grant anyway. But even that wasn’t the most stupid bit. In order to cover the higher court fees the Justice Department decided to give local authorities an extra £40m.

In systems thinking terms, if you draw the system boundary around the Justice Department, or even one small part of it, you see what looks like a monopolistic money-making opportunity. If you draw the system boundary round the whole system, you immediately see what a nonsense it is.

The key point to make here however is that no one appeared to ask what the consequence might be from raising the fee level. The answer came: the high cost to local authorities was deterring some social services departments from applying for a court order to take abused and neglected children into care.

So the government has decided to scrap the court fees altogether. They are now £150 worse off!