Evaluation, statistics and OR

So farewell, then...

Mark Heysom, formerly Chief Executive of the Learning and Skills Council.

I left the LSC about 6 months after he joined I guess, but even in that time he had made an impact on staff.  While that impact wasn't always regarded as a good thing, at least you knew he was somewhere in the organisation.  In many ways he was a more sympathetic character than his predecessor, known by many in the LSC as Monty Burns.  I met "Monty" once and introduced him to my colleagues on a show and tell style visit - I was impressed at his lack of charisma, and his ability to wind up my colleagues by being vague and uninformed.

I was not completely Mark Heysom's number one fan - the move from local to regional focus was not a good one in my view and the processes to move staff around meant that there was real hiatus and impact on learners and on projects.  This has been recognised in evaluations of ESF programmes at regional level and in more than one region too.  It did also seem that this was a reorganisation too far, being the third since the LSC's inception in 2001.

I did feel sorry for him when Gordon Brown sprung the split of the Department for Education and Skills and its delivery agencies on him and I gather with only 20 minutes to half an hour warning of the public announcement.  That has not helped performance or cohesion in the LSC in the past 18 months, and the next year promises to be as chaotic as the move from local to regional organisations.

However I have to admit to being very impressed that he has fallen on his sword, so to speak, over the issue of college rebuilding funds and related problems.  It seems a long time since anyone did the honorable thing, without ensuring a golden parachute, and Mark should be commended for that.  Good luck to you in whatever you chose to do next, sir!

Taking a Macro or a Micro view on funding success

Two stories have been reported in the media over the past two days, that can be taken at the macro level as an indictment of government policy, or at the micro level, as a great boon to individual beneficiaries.

One yesterday from the Audit Commission criticised the instability of funding and the administrative burden of bidding for funds and managing funds on work with disaffected young people, including young offenders.  The Government hit back saying that this was unfair on youth workers who did a marvellous job.  I couldn't help thinking that both were right - particularly having evaluated a project for young offenders in the Midlands last year that had just lost its funding.  The funding systems and the accountability that go with them are a nightmare, and must distract from the fundamental purpose of work in this area - to re-engage and inspire disaffected young people and get them ready to make a positive contribution to society.  Individual workers do resent this funding hash, and do their wonderful work despite it, not as a result of it.  On the project I evaluated, I spoke to the youth workers on the day they received their P45s, but all were positive about the work they had done, and some were still seeing clients that day as well.

Today the Public Accounts Committee have said that an unacceptably high number of people in England cannot read, write or count properly, and Ministers have defended their record of having pumped huge amounts of funds into Skills for Life in an attempt to redress this.  At an individual level, they reckon that something over 1 million people have benefited.  Again through various evaluations I have done in Plymouth and for Investors in People, I have been lucky enough to meet individuals who have benefited from Skills for Life, and heard their stories about how it has changed their lives. 

So much as it pains me to say it, I have to defend the politicians on that one, and say their activities, delivered by dedicated workers on the ground, have made a big difference.  However, the size of the task is immense and the funding and measuring rules that have been put in place have not been helpful and teachers and trainers all say that the tools they have to use to do the job do not meet everyone's needs apart from the funding regimes.

Ah - is there a link there?  Good work being done, but could be done better if the funding rules were not quite so silly?  The balance between doing good with public funds and being seen to purchase the right things with public funds inevitably brings perverse outcomes if it is not totally right.  I am not sure that the right balance has ever been achieved.  Perhaps that might be worth a study, carefully funded of course, and with a suitable procurement process...

It's official - it's a recession.

So there we have it - the official statistics point to a second quarter of falling Gross Domestic Product (GDP), which sets the definition of a recession.  Personally I always favoured The Economist's definition, which was also a lead indicator, which was the number of times the word recession was used in the press in a defined period.  If it hit a certain level, it was recession and the figures to confirm it would appear rather later.

Actually, on the official definition, we haven't seen a recession since the early 1990s - I am not sure where the Economist figures fit with that as I haven't subscribed for many years now.

Anyway, we can expect to see more misery in the news programmes, many more articles on how to survive a recession, how to manage the household budget in a recession, austerity food and drink, and pictures of people being turned out of their homes.  The early 1990s recession was grim I recall - I was lucky in that I had a job with a major company that wasn't about to make people redundant, but my husband had a new business start up that failed (albeit we managed to close it while it was solvent).  We had bought our first home, but interest rates went mad and property prices fell.  We lived in the North East too, where unemployment was already high and opportunities exceptionally rare.  My husband applied for one job with a drinks manufacturer that had 600 applicants - how can you chose the best person for the job in those circumstances?

This time round we both have small businesses, we have no mortgage, but our savings are being eaten away by low interest rates, poor investment conditions and performance, and inflation.  We are also affected by a weak pound.

So, 2009 promises fun and games for all.  However to be full of doom and gloom is also not helpful - if we all stop spending, retrench and focus in on ourselves and our misery, we will contribute to helping the recession thrive and go on for longer.  Perhaps it is time for a nice new pair of shoes in the knowledge that I am helping the economy?

Building confidence - or at least not destroying it!

Happy New Year to any readers that fall across this page during January!

It is a difficult time to find anything other than the weather or the economy to discuss, and both could be described as depressing - we have two inches of snow here already and no sign of it stopping and despite a slight climb in the sterling/euro exchange rate, I still feel poor.  Over the past month I have however noted a distinct difference in reporting policies between the BBC and teh nearest equivalent in France - France Televisions.

It seems to me that all UK news bulletins start badly and continue to pile on the misery for the full half hour at the end of which, if you are very lucky, they will show a film of a bird skidding on ice or eating a chip as the "light and fluffy" good news story at the end.  As this has been preceded by extensive forecasting of misery, death, penury, bankruptcy and the end of civilisation as we know it, the sight of a skidding bird or a pigeon about to indulge in too much saturated fats is not enough to promote the optimism and pioneering spirit required to face 2009.

France Television does cover the global economic crisis, but it is rarely the first item nor is it ever the last.  Instead, blowing up avalanche risks is always a top priority, plus pointing out the wonderful snow coverage at all ski stations is always favoured.  If retailers have had a good week, they tell you about it, they don't cast doubt on the figures and imply "they" are trying to hoodwink you.  The tone is to urge you that if we all work together we can get out of this, rather than we are all doomed.

With the New Year, there are a major run of politicians and the like giving their good will wishes for 2009, and the general note is that yes, 2009 is likely to be pretty grim, but there are opportunities, and we must all look out for each other, and if we work together, we will come out the other side stronger, happier, healthier and living in a nice world.

In the middle of the night, we all get those cold sweats about how 2009 will work out for us and our loved ones, but looking for the bright side and new opportunities is much more healthy, so why not give it a go?  I must remind myself of that at 3am this morning!

Fast Moving Markets

Normally I would use this blog to comment on the latest developments in the news in my chosen areas of interest - skills, employment trends, currency exchange rates and occasionally the economy.  However the unprecedented world economic climate is moving so rapidly that is currently almost impossible to do.

However others are not so cowardly as me and are prepared and paid to put their heads above the parapet and comment.  I feel for them, I really do!  On Monday morning I was intending to write something about pound/euro exchange rates - not least as they had finally edged up a bit and I was feeling marginally less poor.  Then Monday lunchtime happened and 4 cents down against the euro, and I felt poor again.  The FTSE is all over the place but I thought I could blag a blog on leading indicators and the relationship between theFTSE and the DOW, but yesterday the DOW went up and today the FTSE goes down.

A good FTSE indicator can be the investment decisions of a fellow blogger "Allatsea", but on that basis, I am sure that his predictions for today will go up rather than the usual down.

It is not even possible to discuss adult learning policy and unemployment as that is all moving at a tremendous pace at the moment as well.  The LSC is launching its Integrated Employment and Skills packages but they are having to be responsive to local needs which change daily.  Sadly the numbers losing their jobs changes on a daily basis as well, so all I can offer there is more gloom.

Perhaps I need to follow the route of the newspapers and pull together some recession busting Skills, stats and OR tips to make people's lives easier and cheaper?  No, I will make it a point of honour to comment on something soon that isn't likely to change while I write the blog!

Power bill rises and the dash for gas

In amidst the coverage of the American Presidential election on the 5th November, were comments on a finding from the OECD that gas and electricity bills in Britain had risen twice as quickly as in France and Germany and more than in most developed countries.  There was little analysis apart from the fact that Britain has less storage capacity for gas than other countries (only 13 days).  There was a quote from the Energy Retailers' Association that pointed out that OECD figures failed to demonstrate that British customers had historically had lower prices than their chums in Europe.

As a former gas demand forecaster and former British Gas worker, I think there are a few facts to be put in the public (albeit not well looked at) domain.  Something a little over 15 years ago, the then Conservative Government allowed electricity producers to use gas to fire power stations.  Up until that time, natural gas had been considered too precious and strategic a commodity to be used in that way, but with the mines effectively closed, the country needed a power source.  At the time, those of us in gas demand forecasting said that it would cause problems and that UK sourced gas, if used in such a way would run out in about 15 to 20 years, unless serious other sources were found.

North Sea UK gas is nearly gone now and there are a lot of power stations using gas to generate electricity.  If this wasn't the case, then the Bacton gas pocket plus the gas holders would enable the UK to store gas for rather more than 13 days consumption - it is our use of gas as a way of generating electricity that has in many ways caused that problem - that and trying to develop competition in the gas supply market.

In France, there is estimated to be 122 days storage potential, but then in France 85% of electricity is produced through the nuclear route, so stockpiles are not required for the generators.  In addition, natural gas supply networks are much more limited in scope and not everyone has gas central heating.  Electricity is cheap enough to be a viable alternative and domestic electricity supplies are limited by how much you are allowed on your tariff to take off the system at any one time.  This system limit is applied in France and Germany, but is unknown in the UK.  Our personal contract allows us a maximum of 9kW at any one time for example - which at the macro level helps to smooth peaks of electricity demand.

The other slightly mysterious take on this, is that Gaz de France is heavily regulated by government and limited on what it can charge domestic customers, and once you leave GdF, you can never return to the regulated market, making competition for domestic customers something that is much less appealing.

With such disparities in the system, are the OECD really measuring like for like?

Red Tail Lights

Currently everyone is obsessed with the movements of stock exchanges, exchange rates and oil prices.  Each news bulletin seems to start with the latest percentage fall in the FTSE, the Dow or the Cac40.  We are able to monitor the changes in near real time via feeds from the BBC, BFM or CNN and can feel close to the action and depressed or elated accordingly.  But is this a good thing?

I remember being at an Operational Research Society conference a number of years ago, and listening to another delegate commenting on the phenomenon of slowing traffic and stopped traffic on Britain's motorways.  His view was that there was a phenomenon of brake light traffic jams, where a car slows using its brakes, and the one behind slows as well using their brakes and as the phenomenon goes down the line of drivers, the effect magnifies until traffic comes to a halt for no obvious reason than weight of traffic compounded by someone using their brakes about 15 miles and 15 minutes ahead of you.  In areas where there is little traffic, you don't get the same effect.

Now I can't help wondering if an element of the current fall in share prices isn't following the same form of phenomenon.  Despite the extra funds being pushed into banks and the support from the IMF, at the moment (to be VERY precise as these things change by the hour - so 10:36am GMT on Monday 27th October) the main European exchanges are all showing falls of between 3.64% on the Dax, through 4.81% on the FTSE to 6.18% on the Cac40.  But they are following the lead or the red brake lights of Tokyo and Korea who fell overnight.  We need one of the indices to not show red, so that others can take their feet off the brakes and let the rescue packages do their thing.

Of course the fly in the ointment is always those who decide, once there has been some growth again, to take their profits, which can push things back again.  We do need to stop seeing red all the time however, if any sort of confidence is to develop.

Skills Implications of Financial Crisis

The world financial crisis is at the front of every one's minds currently - hardly surprising with 10% drops in stock exchange indices over breakfast, and international summits at every turn.  The Alex cartoons in the Daily Telegraph have been a joy, showing a possible view inside the institutions that are losing our pension funds.  But what will it mean for skills?

At one level, you think that with a chance of a global recession, having skills and experience will be valuable, and if not, welcome to the dole queue - but isn't that the case at any stage of the economic cycle?  Certainly, during a downturn is when it is more important than ever to have every one in your organisation clear on corporate goals and how to reach them in a cost effective manner - Investors in People should be selling like hot cakes currently. 

There is no slack in the system, so you have to ensure that every resource you have is working to its maximum potential, and that means keeping people upskilled.  On that basis, it should be boom time for providers who can do training targeted to the needs of the company, not to the needs of qualifications systems.

My first reaction was that the National Skills Academy for Financial Services could see a tough period ahead, but actually, there could be a need to ensure staff are skilled to communicate difficult or bad news and explain clearly options to client.  I'm not sure if that sort of thing is on their current syllabus, but I am sure it will be in demand.

With money tighter and individual's spending power reduced, there should also be a demand to learn the skills our mothers and grandmothers took for granted - cooking with leftovers and cheaper cuts of meat, darning socks, knitting, crocheting, tatting rugs, growing vegetables, and making jams and preserves.  Adult education groups and community groups should therefore be seeing a revival in interest, if not in funded from external sources.

Finally, and a bit tongue in cheek, there could be a bunch of people out there who need to learn how to live in the real world, not the world of massive bonuses.  It would be a good market niche to be in perhaps, particularly if tax deductible for the learner, although difficult to keep schadenfreude to a minimum for the tutor I suspect.

All in all, the crisis should not be an excuse for not taking an interest in training and improving skills - reducing or removing training budgets at this time would be a false economy, while for individuals, gaining and reinforcing skills has never been more important.  It isn't a bear market for everyone!

Financial Market Regulation

The current number 1 topic of news and conversation today is quite rightly the meltdown of the global financial markets.  The effects that this is having on anyone's day to day life and future prospects are awesome.  From employment prospects to housing to holidays to pensions, everyone is affected and it is nearly impossible currently to gauge whether it will be a passing pain or a fundamental restructuring of modern finances.

But should we be surprised?  Not really, as even this millennium there have been enough examples of corporate sharp practice and lack of serious regulation to warn us that not all is necessarily as wonderful as we would like to believe.  In May 2006 I reviewed for the Journal of the Operational Research Society an excellent book by Roy C Smith and Ingo Walter called "Governing the Modern Corporation" which went a long way to describing quite how the dot com bubble and the Enron fiasco could happen.

Contrasting with that, if one reads the Skills Assessments of various London based organisations such as the Financial Services Sector Skills Council or the London Development Agency, or even Boris Johnson (although as Mayor of London he isn't totally unbiased), one would think that financial institutions are philanthropic organisations purely out for the public good.  Yet how can the lure of seven figure bonuses or higher ensure that activity is scrupulous?

It seems to me, and I hope I am wrong, as it won't be pretty, that there could be a major and serious market correction and it will hurt.  It seems the public are no longer prepared to laugh off the City bonuses, the over-heated housing market is finally calming down, and we have got to a crunch point in market regulation.  As long as the financial institutions could ensure that normal people's wealth increased as well as their own, and that no one got embarrassed, they were free to find ever more "creative" ways to operate, and no one dared to say no to them as they might go elsewhere.

The potential blackmail is now loosing its force, failures such as Northern Rock, Bradford and Bingley and Lehman Brothers have embarrassed Governments and politicians will need to be seen to be acting.  [Quote from the 19th September 2008 edition of Private Eye "Number Crunching: $6.6 billion - losses by Lehman Brothers in 2008 up to point it went bankrupt; $8.7 billion - staff bonuses paid out by Lehman Brothers in 2006".]

And what of the little people like you and me?  Forget about a comfortable retirement, your pension pot value could well fall by a quarter this year!  But for those of us in our forties and younger, did we ever think we would be able to retire?  Make sure you enjoy what you do - you will be doing it a long time!

Measuring the benefits of Mentoring

The Centre for Policy Studies has published a report concluding that the benefits of mentoring are exaggerated and unproven.  It seems that the Prince's Trust and I disagree!

It seems that the Centre for Policy Studies does not think that there is enough evidence to prove the case for mentors, particularly children and young adults.  Well, au contraire say I and the Prince's Trust and from totally different bases too.

I have recently been involved in a number of evaluations of projects funded by the European Social Fund - the 2000 to 2006 monies have been spent and now need to be accounted for.  Those evaluations have been in the West Midlands and in the South West regions - quite different areas with quite different problems, yet both demonstrated benefits of having mentoring support, particularly for vulnerable people.

The projects ranged from support for ex-offenders and really hard to reach young people and encouraging them into learning or employment, encouraging the work-less back into employment, to helping people with mental health issues into learning and employment.  In all cases, the one to one mentoring gave the beneficiary (technical term for the person having the project done to them) the extra support they needed to face up to and overcome barriers, real or perceived, to learning or employment.

The mentor support included all sorts of things from the relatively mundane provision of bus travel tokens and assistance in completing application forms, through exploring an individual's career history to identify transferable skills, through helping young gang members to cross postcode boundaries, to providing the boundaries of acceptable behaviour and helping young people in particular identify what is unacceptable as well.

Those mentors that I met were special people as well.  They could fearlessly work with those that I would run away from.  They could encourage, empathise with and support people with very different backgrounds to their own.  They could inspire some of the most lost people in society to reconnect with the world around them.  They could inspire friendship and companionship with and among people with no real knowledge of how to relate to those around them appropriately.  And at the end of the day, the mentors could go home and lead a normal family life, and not be hounded with the sorts of self-doubt and worries that I for one would have after an intense day.

If, for example, just one or five of the several hundred young people in one of the West Midlands projects went on to get a job, and didn't commit any more crime, the substantial funds put into that project would have had a positive payback.  The cost of supporting someone on benefits or in prison for a substantial amount of time, plus the insurance costs, the social costs, the human cost to the victims of crime would outweigh the cost of that project.  In fact nearly 50 people gained jobs, and many more were living crime free existences at the end of the project.

To me, that payback is priceless, and I am a fervent supporter of mentoring programmes.  I suspect that my ESF funded projects evaluations would not cross the Centre for Policy Studies radar however, so they will never see the value.