Recent psychosocial and organisational literature has illuminated how perverse social defences and systemic failures within institutions can act to undermine the work of an organisation. In this paper, I draw on psychoanalytic theory to consider the notions of perversion and fetishisation within the context of contemporary UK public mental health services which have been subject to New Public Management (NPM) restructuring. Illuminated by a case example based on my clinical experience within an expanded NHS mental health service, I explore how services that are subject to neoliberal regulatory and performance management systems sponsor a perverse organisational solution to the anxieties and difficulties of dealing with psychologically distressed patients.