The public-sector reform that is most needed is the one that is never talked about - that of the regime itself, the vast pyramid, hundreds of thousands strong, of people engaged in regulating, specifying, inspecting, instructing and coercing others doing the work to comply with their edicts.

This chapter is short because, in this case at least, reform is surprisingly simple.

It is to get rid of the whole thing: to close it down and simply to stop it.

When you say that to people within the present system, their knee-jerk reaction is incredulity at the idea's self-evident madness.

They accept that present arrangements may leave something to be desired, but the alternative is anarchy and the system going completely out of control.

What they cannot see is that far from exerting control, the present regime is driving public services out of control.

The system is already anarchic and unstable; at best the present regime is in control of nothing, at worst it is damaging services and morale by making the system even more unstable than before.

I often find myself telling ministers and civil servants that if they had witnessed all that I and my colleagues and clients have seen, they would hurry to dismantle the regime with relief and confidence born of the knowledge that they had at least stopped forcing people to do the wrong thing.

I appreciate that ministers hate admitting they got it wrong, particularly when election results may be affected by it; but that is exactly what good leaders do when they learn that something is wrong.

To be fair, perhaps equally paralysing is the unspoken, even desperate, conviction that there is no alternative.

Ironically, given their insistence on choice for residents, consumers and citizens, they have been led to believe by a vast retinue of advisers, consultants and vendors who have every interest in maintaining them, that they have no choice but to persist with, and indeed intensify, today's bankrupt courses of action.

Hence we see the apparently inexorable growth of the coercive specification and compliance industry.

For both these reasons, the inertia behind today's conventional command-and-control wisdom is truly stultifying.

In this context, stepping back from the regime would break the logjam at both political and implementation level.

It would help towards the avowed political objective of 'localism' and, just as important, it would remove a massive amount of waste, releasing far more in extra capacity for the front line than any efficiency review could ever dream of.

Perhaps the greatest prize of all is that it would unleash the innovation that ministers say they crave and that public services desperately need. I shall turn to innovation in a moment. First consider the waste that will be removed:

There are five types of waste associated with the current regime:

1. The costs of people spending time writing specifications

One reason for the inexorable growth of public-sector employment - more than 800,000 jobs added since 1997 - is the burgeoning army of people engaged in developing specifications, writing 'guidance', drawing up standards, devising targets and reporting schedules and such like.

The specifications are, as I have illustrated, based on opinion and ideology, not on knowledge, and drive the wrong activity and behaviour.

This is true for every public-sector service we have studied, without exception.

The specifications industry adds no value; getting rid of it will both release resources and prevent other kinds of waste.

2. The costs of inspection

Inspecting against specifications is costly as well as inappropriate.

It involves building protocols and checklists and a great deal of training for inspectors. This effort is a massive investment in unreliable evaluation.

It is the engine of compliance, the means by which the regime effectively stifles innovation and improvement.

As the inspection industry has grown from auditing for probity to auditing management and organisation, so it has become an instrument of the regime.

Cutting inspection back to its original focus and removing the power of inspectors to dictate method will increase the value of inspection at the same time as it releases resources. I shall return to the future of inspection below.

3. The costs of preparing for inspection

Local authorities, schools, universities and many other organisations in the public sector spend inordinate amounts of time and money preparing for inspections. The process of inspection begins with self-assessment methods that lack validity.

Many learn to window-dress their organisations for the benefit of the inspector.

Experts are engaged to write the self-assessments, what gets written is drilled into managers and staff who are briefed as to how to behave if an inspector drops in and activities that fit with the regime's aspirations are planned, executed and documented, since it is documentation above all that keeps the inspector at bay.

Specialised consultancies have grown up to coach organisations to pass inspections.

Whether these activities have any bearing on performance from the customer's point of view is not management's question.

It is not unusual to find 20 or more people employed solely to fulfil the requirements of, and preparation for, inspection. On top of that, everyone's time gets taken up in the months before the 'big day'. It is all waste.

4. The costs of the specifications being wrong

Perhaps the greatest cost is compliance with the regime's specifications, which actually results in worse performance: that is, in poor service at high cost.

For every service we have experience of, without exception - to be precise, housing benefits, housing repairs, letting, Consumer Direct, NHS Direct, the police, the ambulance service, adult social care - we have found compliance to specifications to be at the heart of the problems.

The specifications are all based on plausible ideas coupled with fashionable opinions, with command-and-control principles at their heart. These bad designs have driven enormous costs into public services.

Removing the privilege of the regime to promulgate arbitrary, opinion-based requirements will at least stop people being obliged to do the wrong things.

5. The costs of demoralisation

Demoralisation may be the most pernicious and insidious cost.

If goodness or badness is judged according to compliance with specifications, people are bound to become demoralised, especially when all their instincts tell them that the specifications and associated inspections are taking them in the wrong direction.

Talk to people who have been through an inspection and you will be struck by their sense of emptiness.

They have been through all that preparation, worry, unhelpful bureaucracy and stress, only to be met by someone for a brief time who sat over them in apparently arbitrary judgement.

Purpose is replaced with compliance. How can it be other than demoralising?

Systems Thinking in the Public Sector
Chapter 15
John Seddon, Triarchy Press 2008