Strengthening the bonds between public and private sectors

Christopher Philippou at Stef and Philips, discusses how strong relationships between the public and private sectors can help tackle the nation’s societal challenges

 

In today’s rapidly changing world, strong relationships between the public and private sectors are becoming more crucial than ever. As societal challenges become more complex, cooperation is now vital for driving sustainable development, encouraging innovation and addressing the issues we face as a nation.

 

Building strong working relationships between the public and private sectors can ultimately support the greater good rather than acting as competing forces. Announcements this year show £28 billion worth of budget cuts across a range of public services and local authorities, impacting everything from health and social care to libraries, education and homelessness outreach.

 

This means support from the private sector is becoming essential in plugging the gap of public finances.

 

While the public sector focuses on promoting the welfare of society, the private sector drives economic growth and innovation. By developing a strong working relationship, these sectors can effectively combine their resources, skills and knowledge to address common challenges.

 

The public sector brings its regulatory power, public funding, and access to data and insights, while the private sector can contribute agility, technological advancements and innovation.

 

Additionally, with the workforce in public services under significant pressure, the importance of additional capacity and appropriate support from private operators should not be underestimated. 

 

We have seen first-hand how collaboration can support public services in the social housing sector, where private investment has become a prominent source of funding over the last five years. Big Society Capital’s market data report shows that social and affordable housing now accounts for 48% of the UK social impact investment market.

 

New research from JLL suggests that even more investor strategies targeting affordable housing will see the sector account for 23% of private institution-owned rental housing by 2025.

 

But housing isn’t the only place where building strong relationships between private and public interests can offer solutions. The same principles are shared across other services, including healthcare and education, where the private sector can bring innovation and investment to the table to provide better public services.

 

Access to funding

One of the biggest advantages of building strong public-private collaborations is access to more funding. While governments can allocate public funds, private investors bring additional financial resources.

 

By building these public-private partnerships, initiatives in the public sector can attract private investment, significantly increasing the available resources for important projects.

 

By combining these funds with resources, expertise and a shared vision, it is possible to tackle the key issues facing our public services, including shortages in the availability of suitable healthcare and housing provision.

 

Investors can ultimately receive steady returns from these investments, especially in the housing sector. Crucially, they can improve the lives of some of society’s most vulnerable and tackle ongoing crises such as homelessness and poor mental health.

 

Big Society Capital’s report shows the UK’s social impact investment market was valued at £7.9 billion at the end of 2021. With housing accounting for a high percentage of this, other sectors have some way to catch up to attract investors looking to maximise social impact whilst also guaranteeing a robust and reliable return.

 

Promoting innovation and efficiency

Collaboration between the public and private sectors also creates an environment that encourages innovation and efficiency. We have seen this in the social housing space, where private investment has supported the Government’s work by introducing further innovation, such as new construction techniques, introducing more sustainable materials and providing more wraparound services to those in need.

 

Simply having the capacity to provide a service is not enough to solve problems in society – it is quality and tailored services that ultimately provide the outcomes that each individual needs, that will make the biggest difference. It is estimated that more than £250 billion is required to adequately respond to the chronic shortage of social and affordable housing in the UK. 

 

The Government has an impossible task of delivering this without private sector support, so collaboration – done correctly – is going to be crucial to improving our public services. 

 

Building strong relationships, therefore, is an essential first step. Government departments, organisations such as the NHS, NGOs, investors and private providers will not solve these issues individually. Having a safe space to communicate and collaborate – with the end user front of mind – is the first step to improving the state of play within our public services.

 

Just this month, The Department for Levelling Up, Housing and Communities said they were handing back £1.9bn to the Treasury after struggling to find projects to spend it on, highlighting the issues around suitable collaboration and cooperation within the sector. In getting around the table, all partners must also have the right intentions of benefiting society rather than focusing solely on the financial return on any investment.

 

All these partners have something to offer – be it data, creative ideas, insight from end users or technological knowledge. By sharing these and utilising each organisation’s strengths, we can improve the effectiveness of our public services.

 

Delivering social impact and community engagement

The collaboration between the public and private sectors in the social housing sector, for example, goes beyond bricks and mortar. It has the potential to deliver broader social impact and greater community engagement.

 

A recent Building Research Establishment (BRE) analysis revealed that investment in England’s worst quality housing could generate more than £135 billion in societal benefits – such as improved wellbeing, economic prosperity and reduced strain on public services.

 

By working with private investors and suppliers in the social housing sector and with a tenant-first approach, we have provided outcome-based programmes that make a real difference to lives, something we’re hugely passionate about at Stef & Philips.

 

Increased investment and innovation within the sector allow us to partner with other organisations to support tenants beyond just bricks and mortar. This ultimately improves how we can help some of the nation’s most vulnerable individuals.

 

Without private sector involvement, it is unlikely that providing this tailored support would have been delivered as efficiently and effectively.

 

Many societal challenges, such as homelessness, poverty, and public health crises, require collective action and a comprehensive approach. Therefore, the importance of strong relationships between the public and private sectors cannot be overstated, with investment or ideas alone not enough.

 

These two factors must combine to generate end results that benefit individuals across the UK, especially those in challenging circumstances.

 

Partners can use each other’s strengths to create solutions that drive economic growth, utilise innovation, and address complex societal challenges.

 

Governments and businesses must recognise the mutual benefits of collaboration and actively seek opportunities to work together. Public-private partnerships, therefore, offer a platform to benefit from collective wisdom, resources, and expertise, ensuring a sustainable, inclusive, and bright future for societies worldwide.

 

By building these relationships now, we can take the first step in tackling some of the greatest challenges of our time.

 

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Christopher Philippou is Chief Operating Officer at specialist accommodation services provider, Stef and Philips,

 

Main image courtesy of iStockPhoto.com