The fight for the regional level
– A fight for the welfare state? As exemplified by the process of establishing Region Mid-Jutland throughout 2006
by Henrik Christoffersen and Kurt Klaudi Klausen, May 2007
Summary
The regional structure under the local government reform is an institutional innovation. The regional units are significantly larger than the counties, but more importantly the delimitation of tasks, conditions for political government and financing are organised in a significantly different manner compared to what used to apply in the counties. This means that the way the regions can develop and function is decided by a new set of circumstances. In this context, it seems logical to pose certain fundamental questions: What kind of institution is a region? What rationale drives it? And what opportunities does a region have to act in today’s world? These are the questions we seek to answer by examining the decisions and initiatives that have been carried out in Region Mid-Jutland as well as the conditions and circumstances under which they have been made.
The present report is the second from a project that follows the creation of one of the five regions, Region Mid-Jutland, from the preparatory stage to the early operational stage in 2007. The first report “Inventing the regional level – A study of the establishment of Region Mid-Jutland” from February 2006 analysed the early preparatory process. Now we examine the process from the rest of year 2006 up to the transition to the operational stage.
Whereas the first report, to a great extent, sought to paint a picture of how the creation of the Region had been formed by two aspects, namely the institutional set-up constituted by the local government reform, and the decisions the Region made, we now paint a picture of how the Region’s creation is sealed by the outcome of a fight and competition for the future. The “institutional set-up”/“choices”, “fight” and “competition” metaphors are thus consciously used to reflect a progression in the situation and the understanding of the situation in the transition from 2004 to 2005 and from 2005 to 2006. The “fight” involves, partly, the Region’s evolution and survival and, partly, the future development of the welfare state. We have chosen to study this fight through an analytical lens in the form of strategic arenas. The “competition” metaphor refers to the key players, each of whom has a very different concept of the perspectives in the regional project and calls attention to him or herself in this strategic fight “as playing the game” – and the “stakes are high”.
The process of laying the groundwork for the new regions began in early summer 2004. Up to the election in November 2005, this preparatory work took place on preliminary terms in which nothing was set in stone. At the same time, they only had about a year from the time of the elections until the new regions were to be operative. Thus, it was crucial that the newly elected political bodies could quickly make decisions on the basic framework for the regions’ functions. It was helpful that comprehensive preparation had already taken place and that a satisfactory basis for decision-making had been achieved.
In Region Mid-Jutland, the preliminary groundwork was initiated very quickly. Thanks to a clarification between the key political players in the four former counties, a temporary management committee was already in place by the end of 2004 that was able, on the basis of political support in the counties, to drive the preparations forward. This meant that there were already complete proposals for an organisational model and for the decision concerning the organisation of the political governance when the newly elected political management committee convened. The decisions regarding the formal structures of the Region, which were also decided at the beginning of 2006, were consequently based, in many ways, on preliminary ideas about the Region’s actual activities and options for manoeuvring – and thus actually on preliminary notions about what kind of an institution a region actually is. This is bound up with several circumstances.
While the local government reform retains the local authorities in a technically unchanged institutional form, the regions are given a fundamentally different institutional form compared to the former counties. The regions have no municipal authority. Their sphere of operations is, thus, negatively delimited in that they deal solely with the tasks that are expressly assigned to them. The regions’ financing is also changed so that the right to levy taxes has been replaced by dependency on sources of income. The form of government has also been changed from a model based on management by committee to a model based on councils. Thus, the popularly elected politicians have no direct influence on operations, but can be part of temporary committees. There are also narrow conditions for the political capacity in general in that firm restrictions are placed on the ability to remunerate political work. In principle, only one position can be accompanied by pay equalling full-time employment.
Thus, the local government reform has placed significant emphasis on making clear what the regions are not, namely decentral local government institutions in the traditional sense. In contrast, experience from the preparatory stage emphasises that it is much more difficult to paint a complete picture of what a region is.
The initial view was that there is a strategic choice with regard to the Region’s mission and rationale. But subsequent experience suggests that a fight rather than a choice is more likely to decide the fate of the regions. When we toured Region Mid-Jutland in connection with our interviews, we sensed a fundamental uncertainty. At the management level, we met a high degree of loyalty to the regional project, but also an emphasis on the sustainability and durability of the project. But in parts of the rest of the organisation there was an understanding of a more relative nature. A number of the persons we have spoken to have been completely open about the fact that the Region, in its current form, will not survive beyond the first couple of election terms. Thus, there is a sense that the Region does not necessarily represent a stable and balanced system.
The fight that will ultimately determine the Region’s and the entire regional project’s fate is not only taking place within the Region, where the fight concerns uncertainty. The Region’s meeting with its surroundings also leads to an adjustment of its self-knowledge. Because we have followed the process of creating Region Mid-Jutland since the middle of 2005, we are able now, at the beginning of the Region’s operational stage, to paint a picture of a region whose role, competencies and rationale have already changed in many areas compared to the concept and the ambitions that existed at the beginning of the process. We see these changes as an expression of the fact that early experiences gathered through interaction with the local authorities, the central government, regional organisations, etc. have been taken into account.
The strategic situation of Region Mid-Jutland has also, to a great extent, turned out to be decided from the outside – by the institutional set-up, which the local government reform has engineered, and by the external players, which the Region is dependent on collaborating with.
This is a set-up characterised by the aforementioned negative assessment of what the Region can and should do, and a set-up that builds on and invites conflict and competition rather than collaboration – as would be the normal procedure for the public sector. The stage is set for conflict concerning the social institutions and there is competition between the regions and the local authorities regarding responsibilities and financing in the health sector. Further, the key players in the fight for the Region make their positions clear so there is no doubt which interests they are pursuing. The Danish Government, represented by the Minister for the Interior and Health and his ministry, keeps a sharp eye on the regions and signals that it will not refrain from drawing ultimate consequences in the direction of shutting down regions if they do not live up to the demands of the Ministry. Similarly, Local Governments Denmark (LGDK) has drawn a sharp line of confrontation in relation to the social institutions. The health sector and regional development and the local authorities in the Region appear to be following suit.
This was the situation at both the beginning and the end of 2006: the Region had its back against the wall, surrounded by enemies, had weak alliance partners and was fighting for its survival. But Region Mid-Jutland is almost done regrouping, has initiated a rearmament and has launched a counter offensive in specific areas.
The strategic analysis is a study of the strategic situation and the choice of specific strategies and manoeuvres in a number of so-called strategic arenas. Strategic arenas in this context means “fields of strategy within which certain selected types of battles are fought concerning various issues with various means and on the basis of different ground rules” (Klausen 2004: 45). The strategic analysis shows us that in 2006 there was a focus on three arenas in particular: the political arena, the arena for production and the social arena. There was also some focus on the arena for consciousness-formation. However, it is the arena for production that has received the most attention.
It has not been possible to find written strategies in these areas. Instead, the strategic focuses appear to be formulated orally by our respondents and are evident in their actions. The written strategy work covers only principle considerations regarding the ground rules for how the Region should function, for HR and for internal and external communication. However, a business development strategy had been adopted by the end of 2006.
Developing an internal political platform in the Region has been problematic, although a new platform of sorts has been established for the regions’ collaborative work under the auspices of Danish Regions. In the political arena, the choice has been made in Region Mid-Jutland to assess the strategic situation such that it will not be possible to fight on all fronts at the same time and that it will be especially difficult to fight both the central and local governments. Accordingly, because of the strategic choice it was most important to attempt to break through the coalition that has, on behalf of the local authorities, worked against the Region. This was actually successful in 2006. Collaboration has been established in selected local authorities in a number of areas, and better partnerships have been formed with business and industry. Even though experiences with the regional development have been mixed and contain defeats as well as victories, collaborative partnerships and initiatives have been established, including a project concerning networking and entrepreneurship called the Anne Amalie Project. They have also succeeded in setting a number of political agendas in collaboration with the other regions via Danish Regions.
The organisational model that was in place at the end of 2005 has been expanded and the principles for its operation have been concretised into a proposed “Management and governance basis for Region Mid-Jutland” and a model for “Dialogue and results-based management”. The processes that preceded the determination of these principles have helped build up an internal understanding of what the Region is and what it stands for. This is also expressed in the preparation of preliminary values. In the strategic arena – the arena for production – 2006 has also seen intensive efforts concerning both the dismantling of the counties (liquidation of institutions, transfer to municipal and regional control, etc.) and the building up of the Region as a coherent system. The assessment has apparently been that the arena for production should be the necessary and unassailable point of departure for the further fight for survival of the Region. This prioritisation is associated with the idea that secure operations and being able to “deliver the goods” – including visions of e.g. having a world-class health sector – are a necessary prerequisite for the Region’s legitimacy in society and, thus, for the rest of the strategic collaboration. A key element in the strategy of “delivering the goods” is the ideal of the Region as characterised by high competency and professionalisation.
A comprehensive effort to recruit and retain employees in the social arena is closely associated with these initiatives. Again, there are mixed experiences since the Region, on the one hand, has lost key employees (which in some cases has delayed progress) while, on the other hand, having an image that has enabled it to recruit qualified workers easily. An actual human resources policy has been outlined, and they are in the process of building up the Region as an efficient social system – a process that points towards the establishment stage in 2007. This process has been influenced by the natural atmosphere and sense of losing old working relationships, being pioneers in building up new relationships, and, for many, working some of the time in the county, some of the time in the Region and the rest of the time on the road.
Naturally, this stage of the Region’s creation has been effected by the fact that a strong new shared identity has not yet developed (the arena for consciousness-formation and knowledge production). This is because we are dealing with the early stages of the creation of the Region and because what the Region stands for has not yet been articulated with the related story-telling about shared battles and victories. There has, however, been a very conscious focus on building up a comprehensive communication department. In addition to a brief memorandum on the principles for communication, we have learned that implementation of the communication strategy will begin in 2007. There have been sporadic attempts at a campaign strategy in relation to internal and external communication, for instance regarding projects such as the Anna Amalie Project and in relation to setting the national agenda.
Proposals for a vision and mission for the Region have been drawn up (arena for visions and trust), but they await political clarification, including the formulation of policies in key areas, namely a health plan, a social plan and a regional development plan. Part of the ground rules for politically governed organisations is that the administrative apparatus cannot take the initiative on its own accord in crucial areas. However, in the past it has been possible to obtain political acceptance for the administrative management to take control of the process in order to expedite the process. This is the reason why Region Mid-Jutland was able, at an early stage, to clarify the power structure and give the process direction and dynamics.
Even though there may, at this point in time, be many good reasons not to formulate strategies and put them in writing, it is assessed as a weakness that there are no overriding strategies and correlated sub-strategies that attempt to concretise how the vision, mission and policies can be met. This conclusion should be seen in the light of the strategic situation in which there is a great need to take strategic initiatives.
In all areas in the Region, year 2006 has brought battles and experiences that might possibly modify notions and ambitions regarding manoeuvrability and governance options. Experiences from the process of bringing Region Mid-Jutland to the initiation of the operational stage also paint a picture of a region that was not necessarily in balance at its establishment. By this we mean that the Region’s roles, competencies and rationales have, despite the adjustments that have already taken place, not necessarily found a form that can be retained at the initiation of the operational stage and in the longer term.
A brief summary can concretise this. In the social sector, the question is whether the Region’s institutions will actually meet a demand from the local authorities that corresponds to the capacity of the institutions that remain in the Region. Further, there may continue to be financial pressure from the local authorities, and the individual institutions may have new incentives to develop a self-knowledge in which competition rather than fitting in increasingly becomes the prevailing rationale.
In relation to regional development, the question is whether the Region will have the leeway and the support to coordinate and formulate broader strategies, or whether it will be retained in the role of decentral governing unit in relation to the schemes for business aid and service.
In the health sector, we should examine the extent to which it becomes possible to establish coherent treatment initiatives and an offensive preventive effort in interaction with the local authorities. Likewise, relations to the central government are crucial for the extent to which detailed management of the hospital system is developed. Another interrelated aspect is whether the regions move in a coherent organisational system where the individual region has limited manoeuvrability for independent policy development and where Danish Regions forms a focal point in the regions’ common association.
Overall, there is the open question of whether a political government at the regional level will be able to function and gain power and support to develop policies at the regional level. In this context, regional policy is under double pressure. On the one hand, they will have to fight both the local and central governments for influence. On the other hand, managerial organisation of the regions is particularly restrictive with regard to the framework for the involvement of popularly elected politicians. Consequently, there are limited political resources available in the Region’s battle for its existence and integrity.
The outcome of the upcoming strategic battles in the various arenas will indicate the future fate of the Region. There is a lot at stake – in the institutional set-up and in the initial positions of the players – but the battle is not over. The war is just entering a new stage which can lead to more results – the Region’s fate will be determined by the various battles for the Region’s future, i.e. by the strategies that are chosen and that are successfully implemented.
When the Danish Parliament considered the issue of local government reform in spring 2004, disagreement arose regarding the future of the regional level. The two sides of the debate spanned from the complete phasing out of a regional level to the continuation of a regional level with status and management in line with the counties. However, the political agreement on the local government reform that was reached in June 2004 can be seen as a compromise between these two extremities. Early experiences show that the regional construction is not necessarily stable and balanced. The construction may be associated with powers that over time will cause it to develop into something fundamentally different than what it was at the beginning of the process. Perhaps the project might even move in such a direction that there will be no real regional political level with an independent development and realisation of policies. In this instance, the question is whether the regions will still exist or whether the regional level will in fact be phased out.
It is not possible to know whether the founders of the local government reform have been able to predict this perspective. It is not unlikely, because it follows the premises of the reform to a great extent. A competition with respect to the regional level has at least been initiated with local government reform – with high stakes.
It makes sense to interpret the process of the creation of the regions such that also the local authorities and LGDK have a hand in the game. From the point of view of the local authorities, the regions should have an operational role in which they produce specific services to the extent that the local authorities demand them. These might include government aid schemes which require administration, such as patient treatment, the production of places at social institutions and service for businesses. In extension of this scenario, it is possible to imagine the regions ending up as a kind of new joint local government enterprise with a management that is actually dominated by the local authorities by virtue of their role as the “demander”, without leaving room for the development of independent regional policy.
The question is whether such a municipal position in relation to the regional project is not also an expression of high stakes. As Region Mid-Jutland views the regional project, it is crucial for a coherent public-sector effort that the Region be seen as a regional policy institution in coordinated interaction with the local authorities.
To the extent that the Region is realised in this manner, marketisation of the regional part of such a welfare system will seem to entail the view that a coherent planning of a holistic public sector effort is undermined. The consequence will be the weakening of the local authorities as well in relation to defending the ideal of a coherent and holistic public system. This can give cause for reflection on the consequences regarding the future role of local authorities in the welfare state.
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