(10 years, 7 months ago)
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Mr Deputy Speaker (Mr Lindsay Hoyle)
I call Mr Bernard Jenkin to speak for between 10 and 15 minutes.
Mr Bernard Jenkin (Harwich and North Essex) (Con)
I beg to move,
That this House has considered the Eighth Report from the Public Administration Select Committee, on Truth to power: how Civil Service reform can succeed, HC 74, and the Government response, HC 955, and the First Report from the Liaison Committee, on Civil Service: lacking capacity, HC 884, and the Government response, HC 1216.
I shall be as swift as I can, Mr Deputy Speaker.
I am grateful to the Backbench Business Committee for giving me the opportunity to speak about these two reports. The main conclusion of both of them is that our civil service faces challenges that can be addressed only through the establishment of a cross-party commission on the future of the civil service in Parliament.
Let me make clear at the outset that there is far more on which we can agree than disagree. I support many of the current reforms, such as those involving procurement, the work of the Efficiency and Reform Group and innovations in IT and digital government, but who would disagree with the suggestion that reforms such as those, although necessary, are not sufficient? This is not to denigrate Ministers or civil servants; indeed, this is an opportunity for us to thank all civil servants and pay tribute to their dedication and achievements; but when concerns do arise, they all raise questions about accountability, trust—particularly trust between Ministers and officials—and leadership. Those are fundamental, and determine whether reform will succeed or fail.
The civil service is one of the great institutions of state. Under our constitution, the Executive exercises the royal prerogative, and enjoys substantial control over the legislature and appointments to the judiciary. Governments come and go, and, in the absence of a codified constitution or formal separation of powers, it is this body of permanent officials that underpins the constitutional stability of our country. That is why a permanent and impartial civil service was established. The civil service has no separate legal personality: the Crown, Ministers and the civil service are, in law, indivisible. However, under the Constitutional Reform and Governance Act 2010, Parliament rather than the royal prerogative is now the legal source of authority for the management of the civil service, and it therefore falls to Parliament to address the future of the civil service. The only question is how that can best be done.
Some take the view that Ministers need more power, especially power to appoint and dismiss officials, while others believe that any move in that direction challenges the very principle on which the present civil service is founded. These questions should therefore be decided by Parliament, which is the only institution with the legitimacy and authority to do so. We can all agree that reform should be based on cross-party consensus, but that consensus cannot be a private one between Ministers and aspirant Ministers. It should be based on the widest possible range of evidence from those with practical and academic expertise and experience: think-tanks such as the Institute for Public Policy Research, Reform, and the Institute for Government. However, Parliament as a whole should be the guardian of that consensus, which is why any commission on the civil service should be a parliamentary commission.
Mrs Caroline Spelman (Meriden) (Con)
Over the last 17 years we have been in a unique position, as Ministers in all three main parties have had relatively recent experience of working with the civil service. Would not cashing in on that recent experience—particularly coalition Government Ministers’ experience of interacting with the civil service—be very valuable to the understanding that Parliament can bring to this matter?
Mr Jenkin
I wholly agree. I am extremely grateful for my right hon. Friend’s support for the proposal, and for her indication of willingness to serve on the commission should the House of Commons invite her to do so.
The launch of GovernUp today—to coincide with the debate—by two of the sponsors of the motion is something to celebrate, but it is also further evidence of the urgent need for a commission. I congratulate my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) and the right hon. Member for Wentworth and Dearne (John Healey), but I am sure they will agree that too many excellent think-tank reports on the civil service have sunk without trace. Only Parliament can put the necessary authority behind a programme of reform: a parliamentary commission could not be ignored.
Dame Anne Begg (Aberdeen South) (Lab)
Will the commission’s remit include the Scottish civil service, which after all is the responsibility of the home civil service? It is not clear at the moment where the demarcation lines lie, or, indeed, where accountability lies, especially as there is quite a fevered political atmosphere in Scotland at the moment and it is not always clear that the Scottish civil service is acting with the impartiality one would expect.
Mr Jenkin
I am grateful for the hon. Lady’s intervention, and I can in fact inform the House that the Public Administration Select Committee is doing something very specifically on the impartiality of the civil service—and we still only have one civil service in the United Kingdom—in respect of the conduct of referendums. I am going to avoid being distracted by that topic, however.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
On a pure point of fact, since 1922 the civil service in Northern Ireland has been separate.
Mr Jenkin
Touché, as they say. I am most grateful for that information. I am sure it would have been in the Government’s evidence to our Committee.
Before I continue, I draw the House’s attention to the names on motion 36 under “Remaining orders and notices” in today’s Order Book. Motion 36 would set a more limited remit than we originally proposed and determine the Commons membership of the commission on the civil service. The other place indicated last week that it would reciprocate and I can inform the House that the former Lord Justice General of Scotland and the former Deputy President of the Supreme Court, Lord Hope of Craighead, has indicated that he would chair this commission if invited to do so. The names of former Secretaries of State, former Ministers and the clear majority of chairs of Select Committees on our motion, along with the support of the other place, represent a real and powerful cross-party consensus that would give civil service reform the impetus and urgency it needs.
As we consider accountability, trust and leadership at the top of Government, it is important to understand what extraordinary demands we place on Ministers and senior officials. Ministers are accountable to Parliament for the performance of their Departments, like directors to their shareholders, but unlike in almost any other walk of life they have to rely on people they do not appoint and cannot easily remove. In addition, today’s Ministers feel accountable for a system that has become somewhat unaccountable.
PASC has watched the Government’s policy on the civil service evolve. To start with there was much talk about change in Government but no plan for how change would be led and implemented. In our 2011 report “Change in Government: the agenda for leadership”, PASC recommended that the Government should formulate a comprehensive change programme articulating what the civil service is for. The civil service reform plan of 2012 indicates that the experience of Ministers in Government has had an impact on their thinking about the civil service, but it does not meet our recommendation.
Mr Mark Harper (Forest of Dean) (Con)
On the urgency of the task, I note that the date for this commission to report is my birthday, which will be a lovely birthday present, and I also note the juxtaposition of that date with the timing of when this House will be dissolved ahead of a general election. Does having this commission reporting just before the House is dissolved meet my hon. Friend’s desire urgently to address this whole issue?
Mr Jenkin
The alternative is that we put it off. Perhaps the commission could finish more quickly, but these are very large and difficult subjects to deal with. The proposal one hears in the corridors of Westminster is that people want to put this off until after the general election. I suggest we cannot wait and I will come on to that point.
The civil service reform plan was published two years later and most Ministers past and present today still agree that getting things done takes far too long and what is often presented to Ministers or implemented is too late or not of sufficient quality. The Minister for the Cabinet Office himself told us there had even been examples of “deliberate obstruction” of ministerial decisions by officials. My right hon. Friend has also described civil servants as:
“Fabulous...Able, bright, energetic, ambitious to change the world.”
I am sure he would agree that no one joins the civil service to block Ministers or Government policy. People join it with the best of intentions and motivations, to serve the country, so why would Ministers feel that those same civil servants are blocking or frustrating their decisions, or not giving truth to power? Why would officials feel that that was the right or only way to act?
We do not need to rehearse examples of recent Whitehall failures, but we do need to ask why they occur and how Whitehall can learn from them. What are the common factors? We all agree that there is too much churn at the top in Whitehall, leading to discontinuity and loss of experience. How did it get like that? Problems such as a lack of key skills and competences are far from new, so we must also ask why, after repeated efforts to reform Whitehall in the conventional way over the past few decades, the same problems persist. The hardest thing to reform in any organisation is people’s attitudes and behaviour, yet there is little reference to attitudes or behaviour in the civil service reform plan, even though they should be the primary consideration.
There has been much attempted reform over the years, focusing on organisation and skills, but those leading change need to understand why people behave as they do. Unless they can change that, the job titles might change, but few will change how they work. Indeed, much of Whitehall is fatigued by reform. Many feel they have done all they can to embrace change but have become cynical and learned how to keep their heads down until the latest initiatives pass by. I think that Ministers refer to that as the “bias to inertia”—a prevalent attitude and a common behaviour that together militate against risk taking and undermine accountability.
When we speak of accountability, it is not simply a question of forcing obedience to ministerial orders so that instructions are carried out more directly, or finding who to blame when things go wrong. Accountability is much more about trust: not just about trusting people to take responsibility for carrying out their tasks and using their judgment, but about those people in turn trusting that the problems they face will be taken seriously, now and in the future, by those to whom they are accountable. Accountability and trust depend on shared understanding—it is a two-way street. Within that framework, people become willing to take responsibility and to be held to account. And when things get difficult and mistakes are made, as always happens, openness and trust become even more essential if there is to be learning and improvement.
This is the only way to improve accountability to Parliament and to citizens, and to avoid repeating mistakes. We need to analyse what accountability feels like in Whitehall today, given today’s intense pressures of the 24/7 media, freedom of information and more active Select Committees, and then to imagine what it should feel like. What, if any, change can be achieved unless we identify what attitudes and behaviour destroy trust? We need to identify those attitudes and develop a plan to change them. We do not have time to wait for attitudes to change. Far too many good people have got fed up with waiting, and they just leave. Also, far too much money is being wasted. As the Institute for Government pointed out this week, the spending challenge in the next Parliament will be much harder than in this one.
Another point on which all four signatories to today’s motion agree is that these challenges cannot be fixed by Whitehall from within. That is not to disparage the present Whitehall leadership. No organisation facing this kind of challenge can change without external analysis that is both independent and, in this case, democratically accountable. The lack of such analysis is the reason other reforms have failed. A sustained change in attitudes and behaviour has to be initiated by a renewed, united and determined leadership of Ministers and officials that encourages mutual understanding and co-operation and is enthusiastic to learn from external scrutiny and analysis.
This will mean Whitehall’s leaders listening and learning to develop new skills. Ministers and officials are so pressed by the immediate economic, political and international issues that they will surely need external support and scrutiny to achieve this. Of course, some will find this difficult to accept, but what is the alternative?
The remit proposed in motion 36, endorsed by the Public Administration Committee and the Liaison Committee, concentrates on the key issues: accountability, trust and leadership. I am pleased that the proposed parliamentary commission commands widespread and respected support. Professor Lord Norton of Louth, a leading constitutional academic, told my Committee that he supports a “full-scale proper review”. The Government’s lead non-executive director, Lord Browne of Madingley, said that such a review is “long overdue”. He also said that
“the biggest single obstacle to progress in government”—
was—
“the question of organisational learning, in particular from experiences of failure.”
He made the key point that
“stories of failure... are the only powerful mechanism for learning.”
Jonathan Powell, the former chief of staff to Tony Blair, told us that without a commission
“we will lose opportunities to be better governed and to get more stuff done”.
We understand why Ministers fear that it could be a distraction from implementing current policies and reform programmes, but without this wider review no civil service reform will be sustained.
Some fear that this review will become too vast a project, but this is not another Fulton committee. Not only was Fulton allowed to take far too long, but the committee was not based in Parliament and so it became divorced from the reality of government, lacked parliamentary authority and had a flawed remit. In a brilliant “Yes Minister” act of sabotage, its remit denied Fulton the right to consider any aspect of the relationship between Ministers and officials. There is no vote on the commission today, but I hope that colleagues on both sides will endorse the view that the proposed parliamentary commission is not just a good idea, but Parliament’s duty. I hope they will join all those already pressing for this to be brought to a vote in the Lobby as soon as possible.
Mr Deputy Speaker (Mr Lindsay Hoyle)
May I suggest to Members that they take up to 10 minutes only?
Kelvin Hopkins (Luton North) (Lab)
It is a pleasure to follow the Chairman of the Select Committee, of which I, too, am a member. May I take this opportunity to applaud him on his strong, intelligent leadership of the Committee? I strongly endorse the report’s conclusion, which is that there should be a parliamentary commission on the civil service. Different views will be taken on this, and I have a different view from many other members of the Committee. I am an unapologetic and unreconstructed statist—indeed, as a student I wrote a paper in praise of the French prefecture system, which is statism par excellence.
As you can see, Mr Deputy Speaker, the report is substantial, and most of it is evidence. The evidence given to us was fascinating. It came from former Cabinet Secretaries, current heads of the civil service, academic historians, political commentators and, most importantly, trade union leaders. Listening to them all and asking them a range of questions was a fascinating experience.
The report came to some conclusions—not recommendations, as such. First, it supports the Northcote-Trevelyan principles, established in 1854, on the political impartiality of the civil service. That is fundamental and I want us to retain it for the long-term. Secondly, the Haldane doctrine of ministerial accountability is supported, although it is questioned. That may be discussed by the commission, as and when it is established. I was one who was appalled when a Labour Minister in the previous Government chose to blame a civil servant in this Chamber. That was a break with tradition; it was shameful at the time and it caused some consternation, and I am glad to say that it has not been repeated. I hope we will continue to retain the principle of ministerial responsibility.
I want to see the historical features of the civil service retained, although obviously we will look at every possible reform to improve it for the future. We should continue to recruit the brightest from the universities to be senior career civil servants, and we want both generalists and senior specialist professionals. I believe the Minister has a similar view to mine that generalists do have their place in the civil service. We do not just want technocrats; we want people who have a broad philosophical view of the world, who understand politics and economics, and who have some sense of history. We cannot have just scientists or just economists—especially not economists, and I say that as one myself.
There is a range of views. Some think that the civil service should be entirely politicised, which is a view that I utterly rejected in Committee. We have now confirmed that we do not want to see the civil service politicised as it is in countries such as the United States of America. We have a unitary system of government; we do not have separation of powers or balance of powers. The civil service has to have power to speak truth to power—that private responsibility to advise Ministers.
Some of our best Departments have made serious mistakes in recent years, so clearly there are things that are wrong, and I think I know why. The Treasury seemed to be stuffed full of monetarists—unfortunately, this was after my time at university—who had a particular view on how to run an economy, and they made some serious mistakes. When we joined the exchange rate mechanism in 1990, I predicted that it would fail, and sure enough it did. We might not have joined that mechanism had some civil servants in the Treasury said, “Ministers, this is a mistake.” If we had had some Keynesians in the Treasury, they might have said, “We have to retain currency flexibility for our economy, and if we don’t do that, we will be in severe danger.” Had someone said that, we might not have made that mistake. That decision led to the 1992 collapse, which destroyed the credibility of the Conservative Government at the time and led directly to the election of Labour in 1997. Some might like to claim credit for that, but it was, in fact, the collapse of the ERM and everything that went with it—the housing problems and so on—that led to political victory for my party.
We need a range of views. When I was student of economics, one of our lecturers was a former Treasury civil servant, and he said that within the civil service or the Treasury, there was always someone working on the alternatives. For example, in the 1967 devaluation debate, we had on the one hand, the sound money people arguing for preserving the pound’s parity and, on the other hand, others working on an alternative devaluation proposal. Eventually devaluation happened, which was sensible. What was important, though, was the range of views, which were privately held within the civil service. Those views were not political; they were based on, among other things, academic research.
I wish to submit my own views, as and when the commission is established. I have already written a paper on what I think is wrong with the civil service and submitted it to a recent conference. Although the civil service is not politicised as such, it was driven in a particular direction after the 1970s. Those who had a critical view of neo-liberalism, monetarism and the markets were marginalised, and it was taken as holy writ within the civil service that the market was right and that we should devolve as much as possible to the private sector. I thought that was profoundly wrong then, and I still do now and would like to see it reversed.
I want to see insourcing, not outsourcing. Outsourcing has been disruptive. It has reduced accountability and led to all sorts of failures, such as the failure in IT. Many of the IT catastrophes in the public sector come about because the civil service does not have the capacity to manage IT contracts. I would establish a public corporation for IT, where those changes to the way we run things would be done inside, not outside, the civil service. We would not have to give gigantic contracts to private sector companies, which then make mistakes and say, “Well, Ministers, if it is all wrong, would you like us to do it again?” They then get a second contract and make even more money, and the civil service is blamed for failures. Such a service should be in-house not out of house.
Outsourcing has caused all sorts of problems. In a recent report, the National Audit Office said that there was a
“crisis of confidence caused by some worrying examples of contractors not appearing to treat the public sector fairly, and of departments themselves not being on top of things.”
That is precisely what I have described in relation to IT.
There are so many details that one could go into. Some Departments have had serious problems, but I am reluctant to name names. However, the Department for Transport was in chaos over railway franchising; clearly, there were people involved who were not able to handle the situation. We had the west coast main line debacle. I understand that because of churn, those who had some vague understanding of franchising were quickly moved on, and there was nobody left to do the job properly. Keeping experienced staff—avoiding churn—is vital. That means not cuts at all costs, but making sure that we retain those civil servants with experience and skills rather than just reducing staffing come what may.
The vast tax gap has been caused, at least in part, by savage cuts to personnel in HMRC. Everyone knows—I have said this in this Chamber many times—that one tax officer collects many times their own salary in additional tax, so why not put in place hundreds if not thousands more HMRC officials and collect the billions that remain uncollected? That would perhaps help to solve some of our financial problems.
There are all sorts of problems that I want to address when I make my modest submission to the commission, when it is set up. There are issues that have to be addressed. I want to see the restoration of the strong big state that we had after the second world war, under which the lives of working people were transformed. A small state with privatisation and marketisation will, I think, bring no good to working people or the economy overall. I have a particular view, I want to put that view and I hope that others will think likewise.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
I congratulate the hon. Member for Harwich and North Essex (Mr Jenkin) on bringing this matter forward so determinedly. Indeed, I am glad that the debate will be responded to by a Minister who I know to be a reforming Minister, but we still feel he needs to raise his reforming game from the specific and valuable things that he has been doing to deal with a wider concept of the future of the civil service. We have a civil service with excellent qualities, and I will refer to some of them in a moment, but as the Government themselves have said, we want a
“world-class, 21st Century Civil Service capable of delivering”
future
“Government’s priorities and the best public services.”
When the Public Administration Committee produced its report, the Liaison Committee wanted to support its conclusions but also to bring together several Select Committees’ experience of failings in the system. That led us to question the Prime Minister last September, at one of our thrice-yearly sessions with him, about the civil service. He responded well on specific matters, but I am still not at all convinced that he grasped the fundamental problem that the civil service is now facing very different circumstances, and we need to assess how far it can change the way it does things without losing some of its essential features.
We published a short report that highlighted some of the problem areas, such as the electronic monitoring of offenders, the west coast main line franchise and universal credit, where there had been serious implementation problems. We also gave praise where it was due, for example for the success of the Olympic and Paralympic games organisation. We concluded that there was significant evidence that the civil service is not equipped to support consistent contract management and tends to be driven by short-term pressures rather than long-term value for money for the taxpayer. We were unconvinced that the Government’s civil service reform plan for Whitehall is based on a strategic consideration of the future of the civil service. We gave our support to the idea of a parliamentary commission, jointly involving both Houses.
The Government responded to our report earlier this week and published their response in time for this debate. They deal with all our specific points, but still do not, I think, grasp the overall point. They say
“the Government does not agree that these examples indicate a wider failure, nor suggest that there is any systemic problem of trust and honesty in the critical relationship between Ministers and officials.”
However, the Institute for Government recently published a report saying that there is a “lack of collective leadership” at the centre and that “short-termism” is weakening Whitehall’s ability to plan ahead, while there is
“no co-ordinating…narrative for the Civil Service to lock into”,
and although:
“Leaders of reform report strong Prime Ministerial support for civil service reform in private...this has little visibility within Whitehall.”
The argument that the Prime Minister used was that a parliamentary commission could displace current reform efforts, which are urgently needed. If that view ever had any significance, it does not in the last year of this Parliament, when so many of the Government’s reform initiatives have already been introduced. We ought now to be considering what we can bequeath to the next Parliament. We in the Select Committees inherited a significant bequest as a result of the Wright Committee’s work and, in many ways, we would like the next Parliament to inherit some worthwhile things, including a clear concept of how to develop the civil service to meet modern needs. A joint commission would make that possible.
The other place has a ready supply of former Cabinet Secretaries, people who have run large private and public sector organisations and people who have political experience, who can join with those who have recent and immediate experience in this House in analysing what is needed and making proposals.
Mr Harper
I have studied the motion on the Commons Order Paper and the proposed names of Members of this House. On the point about membership, I was a little worried, given the right hon. Gentleman’s enthusiasm for reform, that he seemed to suggest that the Members of the House of Lords who should serve on the commission would be former Cabinet Secretaries. Is that a way to get reform or to ensure that reform does not happen?
Sir Alan Beith
I understand the hon. Gentleman’s concern. My list was much longer than that. It included people with experience in the private sector and—as I was about to say but did not due to the shortage of time—in the armed forces.
Sir Alan Beith
I suppose I ought also to say that it would be an amendable motion in any event. Before I was elected to the House, I used to give university lectures about the civil service at the time of the Fulton report. My lecture notes would be of little use today as so much has changed. The Fulton report was itself trying to catch up with change, but so much has happened since then. The civil service is now far less an administrator of services and much more a buyer of services. Back-office outsourcing has been a major development. The Minister knows that I have some concerns that we will not have a footprint of the civil service in the smaller towns and communities around the country if we do not manage that carefully to take advantage of good people who are available, as in my own constituency.
The civil service can no longer be treated as a protected environment where private sector disciplines of personal responsibility, value for money and management of risk have no place. Much policy making is now international—in the European Union, the World Trade Organisation and the United Nations. We are a less centralised state, at least in Scotland, Wales and London, with some devolution to cities and combined local authorities. Departments cannot continue to operate as sole owners of policy, living in separate silos, when so many of the problems we have to address—crime prevention, public health and skills for employment, to name just three—can be solved only on a cross-departmental basis. This means that money needs to be spent in one Department when the consequent savings will be earned in another Department. Money spent dealing with alcohol problems will save money in prison places, for example. Our system is not designed to accommodate such decisions.
The Prime Minister’s office expects to be much more closely involved in many areas of policy, and questioning in the Liaison Committee has been developed to get at that and establish just what the Prime Minister’s office is doing when it has a guiding role—some would say an interfering role—in policy. Perhaps that is an unfortunately pejorative term. Many would say that it is right that the Prime Minister exercises a significant influence on policy development, but it has made a different character of work in at least some Departments.
The Treasury’s role is nowadays quite often one of encouraging specific expenditure as well as blocking other expenditure—a more active role than it sometimes played in the past. Select Committee scrutiny has pulled back the veil of ministerial responsibility and rightly opened up much more what actually happened when decisions were taken. Coalition Government has required new procedures to be developed, and Ministers are as impatient as ever to deliver policy change. The Government have sought to accommodate that through the idea of extended ministerial offices, but I am still unclear whether any Department has followed the Cabinet Office with an extended ministerial office. Perhaps the Minister can tell us.
Amidst all this there are key features of the British civil service that most of us are very anxious to keep, including political impartiality—a civil service that can serve any Government—high ethical standards and the ability to attract people of the highest ability. Resolving these things is not a simple matter. It needs some careful thought. We need to hand on to the next Parliament a well-thought-out understanding of the future of our civil service and how it can be achieved.
Margaret Hodge (Barking) (Lab)
I congratulate the hon. Member for Harwich and North Essex (Mr Jenkin) on securing this hugely important debate, even if it is taking place in the twilight hour of a Thursday afternoon. I also congratulate the Minister for the Cabinet Office on undertaking important reforms, and we should wish him well across the House. I welcome the work that has been done by bodies such as the Institute for Public Policy Research and the Institute for Government to try to tackle some of the complex issues that we face. I am delighted by today’s launch of GovernUp, so I congratulate my right hon. Friend the Member for Wentworth and Dearne (John Healey) and the right hon. Member for Arundel and South Downs (Nick Herbert) on their hard work. I also congratulate the hon. Member for Harwich and North Essex on his Committee’s important cross-party work, as well as on the proposition that we should have a commission. My view on such things is that we should let a thousand flowers bloom given that, as there are so many complex issues, every new idea will add value.
To get to the meat of the debate, wherever we sit in the House the challenge that faces us all in an age of austerity is how we maximise the value of constrained expenditure to meet the pressing and ever-growing needs of our constituents. That interest in best value crosses political divides and, I hope, unites Members on both sides of the House. If we are to achieve that, however, radical transformation is essential, and that, too, should be a shared objective. Bringing about such transformation is a huge challenge that requires absolute commitment and will take a long time, so we need to work together across the House so that the vital reforms that are needed to deliver more effective and efficient government are taken out of crude party politics, which is why the work that is being done by the Public Administration Committee and in other forums is important. We need to build a cross-party consensus on reform that can be delivered across electoral cycles.
I want to talk about three issues, although I could talk about more: the capability of the civil service; the organisation of Government in managing and delivering projects and programmes; and responsibility and accountability to Parliament and the taxpayer for services and projects delivered. First, on capability, I think that we all agree that the civil service recruits the brightest and the best, and people who are committed to public service, yet all too often the Public Accounts Committee finds that they fail to deliver major projects and vital services efficiently. We find that they too often cannot manage major business transformation, such as universal credit, and that they waste money on big projects. For example, with the aircraft carrier project, which has spanned Governments of both parties, the original proposal was for two aircraft and delivery in 2016 at a cost of £3.65 billion, but now, if we are lucky, it will involve one aircraft by 2020 at a cost of £6 billion. All too often, people working for the Government liberally use other people’s money—taxpayers’ money—in a way that they would never use their own, and our Committee has seen the NHS and BBC pay-offs as cases in point.
Although people come into government with the best of motives and abilities, they are not trained in the skills that they need to carry out the job that is required of them today, so they do not have commercial, project management, financial and IT skills that we need in a modern civil service. My Committee has seen many examples of things going wrong, most recently with the letting of the interpreter contract by the Ministry of Justice and the contract for offshore power transmission to the grid.
Kelvin Hopkins
Managing contracts is the issue, because if less was contracted out and more was done in house, some of those problems might be overcome.
Margaret Hodge
I know where my hon. Friend is coming from, but we need the capability in government effectively to manage contracts whenever and by whomever they are delivered. There is a legacy in the civil service of focusing on policy, which is valued, but not implementation, which is vital, so we must challenge that culture.
Jackie Doyle-Price (Thurrock) (Con)
Was the right hon. Lady as impressed as I was by Michael Spurr, the new head of the National Offender Management Service, who started his career as a prison officer, has front-line experience and is now chief executive? He was a breath of fresh air when he appeared before our Committee, because he really focused on what we have to do to deliver good public services.
Margaret Hodge
I entirely agree, and that takes me very neatly to my next point. Promotion in the civil service is all too often about moving to a job in another area, rather than focusing on one job and seeing it through to the end. I think that the hon. Lady would agree that the worst example the Committee has seen was the attempt to implement the new FiReControl policy, for which we saw 10 senior responsible officers in a matter of five years. It is no wonder the project went horribly wrong.
I think that there is still a culture in the civil service of being hostile to outsiders, rather than embracing the talents that can be brought in from all sorts of backgrounds and experiences, which I think are often seen as a threat. When I was a Minister, I brought three incredibly talented women into the Department for Education to try to implement policies. None of them now works anywhere in Government, even though they could contribute to policy implementation.
I also think that too often the civil service and Government are—dare I say it?— exploited by consultants. My Committee will shortly be looking at the sale of Royal Mail, which might be just the last in a line of examples of that. I recognise that some steps are being taken, such as the development of the Major Projects Authority and the academy for training in project management. They are all steps in the right direction, but they are not enough and they are not happening fast enough.
Secondly, Government are just poorly organised for delivering what is wanted and needed. Government still work in silos, which always leads to unintended consequences. To take a current example, local authorities have had massive cuts, which inevitably has an impact on their social care expenditure. At the same time, we have a health policy that is trying to get people out of hospitals and into the community, but without any money to support it.
Working in silos leads to a failure to learn from mistakes, with one Department simply replicating the mistakes made by another. The Committee has seen that in the mistakes made during the early implementation of the private finance initiative, for example. If we look at how the contracts for energy have been implemented, we see that lots of those errors have been duplicated in the current contracts that have been signed by the Department of Energy and Climate Change.
There is a failure at the centre to recognise the importance of a strong centre. My Committee has just received a letter from Sir Bob Kerslake, Nicholas Macpherson and Richard Heaton. We had written to them about the importance of having a strong centre. I will quote a few lines from their letter:
“Your Committee urges the Cabinet Office and the Treasury to take a strong strategic lead, as the Government’s corporate centre, in civil service reform and associated issues… However, the… central direction and integration that you appear to recommend does not reflect the model that this government and previous governments have operated.”
I do not know whether that is true. I have asked the Minister whether he agrees.
The letter goes on to state that
“the Centre does not and cannot take decisions or set a strong direction on every item of the £720 billion of public expenditure… the government machine is not like a holding company dominating its subsidiaries from a corporate centre.”
Well, I do not know what business of that magnitude would not have a strong centre and would wash its hands of its responsibility for the performance of its constituent parts. Since when have we, as politicians, signed up to the mantra? It is almost like claiming that there is no such thing as Government; only Departments with their Secretaries of State. Reform, if it is to ensure that coherence, efficiency and effectiveness are delivered across Government, must mean that we have strong central direction and much better integration than we currently enjoy.
Sir Alan Beith
I agree with the point the right hon. Lady is making. It comes back to what I was saying about the role of the Prime Minister’s office, which often seems to get involved in specific policies because they are politically significant, rather than to exert the central management she describes.
Margaret Hodge
I entirely agree with that comment.
Finally, I want to talk about the conventions on responsibilities and accountabilities within the civil service and between civil servants and Ministers. The system is no longer working, and we need to rethink it. That is the extent of the complexity of the issues we are confronting. We need to deliver this in a sustainable way that will work across the political parties. The current position is frustrating for Ministers and for civil servants. We can look at the situation at the Ministry of Justice and at the Department for Work and Pensions, where I think there is a reluctance to speak truth to power, or at the Home Office, with the experience regarding the UK Borders Agency and the frustrations felt by Ministers.
As the hon. Member for Harwich and North Essex said, the doctrine of ministerial accountability is constructed on a basic lie. If Ministers are to be held accountable for the work of their civil servants, it is nonsensical that they can neither hire nor fire them. If we do not challenge that basic lie, we will never achieve the effective changes that we require.
Mr Jenkin
The right hon. Lady might be surprised to know that when I addressed 200 civil servants at lunchtime today and asked how many had read the Haldane memorandum, which remains the absolute basis of the doctrine of ministerial accountability and should affect every one of their working lives, no one put their hand up. Does that not suggest that we need to rework the whole concept of accountability into the education of civil servants so that they understand why they are accountable?
Margaret Hodge
The hon. Gentleman has had a very telling experience, and I agree with him.
Right across today’s world, not just in Government but in every sphere of life, better accountability and more transparency should be the order of the day, and that must feed into the way that we govern ourselves and are governed. Analysing the fact that we have a problem is much easier then finding a sustainable solution over time.
In this short contribution, I have been able only to skim the surface of some very tough issues. We need a radical overhaul of how we do Government. We need cross-party co-operation if we are to make progress. We know that we have the brightest and the best working for us in Government and the civil service, and we need to work with them to ensure that between us we properly serve the people in whose name we are privileged to govern.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I appreciate that Mr Deputy Speaker advised the House that if everybody takes approximately 10 minutes for their speeches, then everyone who has indicated that they wish to speak will have an opportunity to do so. The arithmetic has changed a little since he made that pronouncement. If everybody who has indicated that they wish to speak takes approximately seven minutes, all their colleagues will have an opportunity to speak.
Nick Herbert (Arundel and South Downs) (Con)
In 2010, when I accepted an invitation to join the Government of Britain, to coin a phrase, I found myself as a Minister in two Departments—the Home Office and the Ministry of Justice. My experience was precisely that outlined by the right hon. Member for Barking (Margaret Hodge) as regards the problems of silo Departments. They were two Departments created from one, and they found it very difficult to co-operate to address holistically the problems that clearly needed to be addressed; how to tackle crime, at source, at the earliest possible stage. Just as people were trying to deal with those problems in a joined-up manner on the ground, the Departments had been split nationally.
It was a salutary experience. When I walked into the Ministry of Justice for the first time, I was shown the lifts by my private secretary. The MOJ had a more intelligent allocation of lifts than the Home Office: you indicated the floor you wanted to go to and the right lift would arrive for you. My private secretary told me that it was possible to override the programme in the event of a Division so that a lift would immediately arrive for me, the Minister. I tried this out on what I thought would be a quiet afternoon. The lift hurtled to my floor, and a sign on it said, “This lift is under ministerial control.” The doors opened, and out stepped the then Justice Secretary, my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), who questioned whether the lift was indeed under his control. If so, it was about the only thing there that was under ministerial control.
The serious point I want to make is that, just as my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) and the right hon. Member for Barking have said, although set by an historical doctrine, questions of accountability arise today. If, in the mid-19th century, a form of permanent government was effectively created, that is fine when that permanent government happens to do things in the way that accountable Ministers like and that is satisfactory, and when it happens to be performing well. The problem comes when that permanent government does not perform well. Accountability then falls on Ministers who have little ability to wrest improvements from the system.
As my hon. Friend the Member for Harwich and North Essex suggested, the failures do not need to be rehearsed. As the right hon. Member for Barking said, there have clearly been major and costly project failures. When this Government came to power, only a third of major projects were running to time and to budget, and the problems have persisted. There are issues with skills, given the commissioning failures we have seen. There is also the issue of poor financial control. It is a paradox that in our centralised state the willingness of the centre to exercise careful financial control over Departments is actually very limited. The Treasury does not wish to exercise that detailed financial management or scrutiny, and it shows. All these things often lead to poor value for money, a waste of resources and poor outcomes. It is the weakest in our society who pay the price, but we all pay a price through higher taxation. I think it is common ground that these issues need to be addressed.
Every time a Government come to power, they arrive believing that there are few problems that cannot be solved by the arrival of an enlightened Government with a different set of political objectives, and that all the problems are the fault of the outgoing Government. That was certainly the case in 1997 and in 2010, when most Ministers—my right hon. Friend the Minister for the Cabinet Office was one of the notable exceptions, and it shows—had little experience of government. Soon the scales drop from Ministers’ eyes as they realise that not all the problems can be laid at the political door—the door of the Opposition—and that there are systemic problems.
As my right hon. Friend the Member for Meriden (Mrs Spelman) said, we have an opportunity for forging a cross-party agreement about the changes that need to be made. Why? Because, for the first time since the second world war, every party has had recent experience of being in government and understands that while the political debate goes on, there are issues that we need to address. That is why I am pleased today to have launched GovernUp with the right hon. Member for Wentworth and Dearne (John Healey), a non-party project with cross-party support. I am delighted that the Chairman of the Public Accounts Committee is a member of the advisory board. The board also includes the Government’s lead non-executive director, Lord Browne; Lord Bichard, a former permanent secretary; Lord Birt and Baroness Lane-Fox—all Cross-Bench peers with important experience to bring.
Over the course of the next year the project will do important research in the areas of accountability, skills and international comparisons—work that needs to be done. It will not do that work alone, or simply be an isolated research project, but will draw on the experience of former Ministers, in this place and outside, and of civil servants, whom we wish to appoint to a reference panel. We have secured agreement to that proposal from the leadership of the civil service and the Minister.
That approach will be evidence-led, will involve detailed and careful research, will be open, involving outside bodies, will involve dialogue with the civil service itself and will draw on the experience of parliamentarians in both Houses. I want to suggest that that is a better approach than that of a parliamentary commission. I have grave doubts about the capability of a parliamentary commission to do what is necessary. Indeed, I think that the concept of a parliamentary commission—an old-fashioned, inquisitorial model—is entirely wrong, quite apart from the question of who would be on it. The real question is whether it is a body that looks backwards or forwards: do its members wish to be a part of it because they think that proposals for civil service reform are dangerous and wrong, or are they looking forward to addressing the challenges that face this country and the kind of system we need to develop? The danger of the commission as currently constituted, with a judge leading it, is that it would be the worst kind of backward-looking and reactionary body, so I do not support the proposal.
Although the Public Administration Committee report has some interesting content, I think it is evidence of some of the weaknesses of a parliamentary approach. After months of deliberation and evidence-taking, what is the report’s conclusion? It is that there needs to be an inquiry. Where are the detailed recommendations? Where is the detailed analysis and evidence of the kind of change we need? We have only a year left and I believe that now is the time to do the careful work.
Kelvin Hopkins
I am disappointed at the right hon. Gentleman’s criticism of the concept, but the fact is that there are enormously wide ranges of views about the civil service. A conclusion would not have been consensual: there would have been serious division among members of the Select Committee and we would have gotten nowhere. A parliamentary commission could do that job.
Nick Herbert
I find great difficulty in understanding how a cross-party Select Committee would find it impossible to come to a conclusion, but a parliamentary commission would not. Perhaps the hon. Gentleman could explain that.
Mr Jenkin
Why does my right hon. Friend think that the think-tank he has set up would be any more objective than a parliamentary commission? Indeed, how would it be more objective when it has been sanctioned and approved by the Cabinet Secretary and the civil service—the very thing he seeks to reform?
Nick Herbert
I agree with the right hon. Member for Barking that we should let a thousand flowers bloom. Many will wish to do work in this area, but I doubt very much that the GovernUp initiative, which I and the right hon. Member for Wentworth and Dearne have set up, is sanctioned by the leaders of the civil service. What I specifically said was that they had agreed that civil servants could perhaps sit on a reference panel. That does not mean that they would have control over any of the body’s work. My argument is that we now need to do the work. It is the detailed research and analysis that we need to do; we do not need political grandstanding or an inquisitorial approach. That is why I think that the proposed parliamentary commission would be wrong.
I believe that the narrative of Whitehall wars, whereby Ministers are at loggerheads with civil servants, is wrong and misplaced. There is plenty of evidence that civil servants themselves seek change. Indeed, the Public Administration Committee report notes that Lord O’Donnell, the previous Cabinet Secretary, said in his evidence that
“if you really want to improve public sector outcomes, I think there is a radical transformation necessary.”
It seems to me, therefore, that the question is not whether change is necessary, but what is the nature of the change and who will make the case for it? Do we have a system that is equal to the challenges facing this country, with rising demand for services, the need to adjust to further spending reductions in the next Parliament and in the future, and the fact that we face ever greater international competition? All parties need to understand that Government reform is as significant as, and essential for, public service reform. That is why this is such an important issue.
Mr Nick Raynsford (Greenwich and Woolwich) (Lab)
May I at the outset draw attention to a non-pecuniary interest? I chair the Centre for Public Scrutiny. I think it is right that that should be placed on the record before I make my comments.
I congratulate the hon. Member for Harwich and North Essex (Mr Jenkin) on securing this debate and I strongly support his Committee’s recommendation for a parliamentary commission on the civil service. I listened carefully to the views of the right hon. Member for Arundel and South Downs (Nick Herbert). I do not wish him ill with his initiative, but I cannot see how a think-tank set up in the spirit of letting a thousand flowers bloom will be able to produce an authoritative report that carries the weight necessary to lay the foundations for the future of our Government and civil service for decades to come. Frankly, it is a distraction. I note that the Government, in their grounds for rejecting the PASC recommendations, have said that they do not see the need for any more analysis or evidence gathering, but want action. If the Government welcome this initiative, I am not quite sure why they believe that evidence is not necessary, but are happy for this particular think-tank to gather evidence.
Few people would dispute the fact that our system of government faces huge challenges, partly because public confidence, which was badly damaged by the parliamentary expenses scandal, remains fragile, but equally because people are worried about the series of well-documented failures of the current Government and previous ones. The Chair of the Liaison Committee, the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), has highlighted a couple or three examples, and Ivor Crewe and Anthony King’s book, “The Blunders of our Governments”, provides much more documentation.
All that is reflected not only in negative perceptions of the system of government, but in evidence of increased tension between Ministers and civil servants. As the PASC report demonstrates, there is too much evidence of a blame culture, with Ministers seeking to evade responsibility for their failings by blaming civil servants and civil servants responding by showing a less-than-eager appetite for implementing policies they believe are inept or driven by party political motivation. Those serious and corrosive problems need to be addressed and dealt with, and we must have an authoritative group of people who are genuinely seen as impartial and as seeking a serious long-term solution to the kind of tensions that, sadly, are all too rife.
We know only too well that the architecture of our system of government—based on the doctrines of civil service impartiality and ministerial accountability to Parliament—evolved in a very different world, when the scale and nature of the civil service and the responsibilities for which Ministers were held accountable were very different from today’s, and when the Government had time to reflect and discuss collectively how best to respond, rather than being driven remorselessly by the demands of 24/7 media, as they are today. All that suggests that we need a proper, strategic cross-party assessment of how those doctrines should evolve or be changed to meet today’s different circumstances. That is precisely why I strongly support the idea of a parliamentary commission.
As the proposal for a parliamentary commission has received the backing of not only the Public Administration Committee but the Liaison Committee, I am surprised that the Government are so resistant. Frankly, when I read the Government’s reasons, my surprise turns to incredulity. The Government’s alternative, which is offered as an excuse for rejecting the idea of a commission, is not just inadequate, but in some respects counter-productive. Essentially, the Government case is that their civil service reform programme is sufficient, and that a commission would effectively be a distraction.
The first problem with that analysis is that the Government’s approach is neither strategic nor coherent. It has been well described as comprising a number of disjointed initiatives, some of which might be very productive, but some of which will not. The second problem is that the Government’s response is partial, and will not generate the cross-party consensus that is vital for any truly workable reform. The third problem is that the Government’s approach totally fails to address some of the key problems underlying the current negative perceptions of the system of government.
To give just one example, in one of the most highly centralised systems of government in the world, we have a serious problem of overload on Ministers, with far too many relatively minor issues being decided by central Government, rather than devolved to the lower tiers of government that are far better placed to handle them. One consequence is that there are too many Ministers, as the PASC report points out. Against that background, it is astonishing that a Government who used to proclaim their localist credentials—I note that they are rather tarnished these days—are simply not, as part of their civil service reform agenda, considering how to reduce overload on central Government through devolving powers that are more appropriately discharged elsewhere. The bizarre consequence is that although there is a clear objective to reduce the size of the civil service, the number of Ministers is not falling and the number of special advisers is growing, contrary to what the governing parties aspired to before they came into power.
I mentioned that some of the approaches in the Government’s civil service reform plan might be counter-productive. One example is the attempt to increase political influence over civil service appointments. I wholly concur with the views of Lord Hennessy, perhaps the foremost historian of 20th-century British government, who described the Northcote-Trevelyan reforms as
“the greatest single governing gift of the nineteenth to the twentieth century: a politically disinterested and permanent Civil Service with core values of integrity, propriety, objectivity and appointment on merit, able to transfer its loyalty and expertise from one elected government to the next”.
By contrast, the viability of the permanent civil service has now been called into question, against the background of an extraordinarily high turnover of permanent secretaries and the hollowing out of expertise from several Departments, which threatens their collective memory and experience, and leaves them increasingly dependent on external sources of advice, many of which will have partial, if not party political, agendas.
I have absolutely no doubt that the problems that afflict our system of government, which undermine trust between civil servants and Ministers, which contribute to ill-thought-out and poorly implemented policies and which leave the public increasingly sceptical about our ability to give them the good governance that they rightly expect, will persist and will not be remedied by the Government’s reform programme or the proposed think-tank. Some day—I hope that it is not too far away—Parliament will have to flex its muscles and insist on a full cross-party parliamentary commission to address the issue properly.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I have tried the polite and honourable approach, but it has not worked, so I have to impose a formal time limit of five minutes.
Angie Bray (Ealing Central and Acton) (Con)
The civil service is a critical national institution and part of the very fabric of politics. Since the 19th century, our administrative system has been based on the model of a politically impartial bureaucracy that serves the political masters of the day. One hundred and fifty years since Northcote and Trevelyan’s report, it is our duty to question whether the system is fit to meet the challenges of the 21st century. For that reason, I welcome the chance to debate the question of civil service reform and to put on the record my support for the Government’s programme, which was launched one and three quarter years ago.
I was the Parliamentary Private Secretary to the Minister for the Cabinet Office and Paymaster General when the Government’s programme was formulated. It was painstakingly and carefully developed through consultation with civil servants, including the current leadership of the civil service. Sir Bob Kerslake and Sir Jeremy Heywood approved every line of the reform plan, and the actions were drawn from suggestions made by civil servants, from permanent secretaries right down the hierarchy.
I speak as a Back Bencher with no huge experience of governance, other than in my former role as a PPS, but my overriding sense is that we need to get on with the reforms because they are badly needed. Many of us have understandably been appalled by failures such as that over the west coast main line franchise. It is clear that there are serious lessons to be learned. The Government must drive ahead with their programme to improve the commercial and contract management skills of the civil service. We also need to improve the way in which major projects are delivered. The appointment of John Manzoni, formerly of BP, is a significant boost to the Government’s Major Projects Authority. Taxpayers expect every pound that is spent on such projects to be carefully checked and managed. The Government must therefore push ahead with their reforms to ensure that projects are scrutinised properly.
As the Minister reported in June last year, the Government have not yet achieved the reforms that they want, but a great deal has been done in some areas. Anyone who has accessed the Government’s new website will have been impressed by this country’s online offering. The programme to move 25 key public services online will make a material difference to my constituents when they apply for a new driving licence or an apprenticeship.
One key proposal in the reforms is that Ministers should have a greater say over the appointments of the most senior civil servants in their Departments. Surely, it is not unreasonable and is, indeed, sensible that there should be some ministerial choice over the people who play such a key role. I am aware that the concern has been expressed that such a change would or could lead to the politicisation of the civil service. I think that such worries are misplaced. As I understand it, the proposal is that all candidates will have to convince an independent panel that they have the requisite merit for the role. The panel, which will be overseen by the Civil Service Commission, will ensure that politics plays no part in their selection for consideration.
This modest change will instead ensure that the most senior civil servants are in tune with the agreed policies of their Department, as well as with the direction of travel towards achieving the desired outcome and with policy implementation. I understand that. My time working with the Cabinet Office demonstrated how important it is that Ministers and their civil servants work together.
We have heard proposals for this place to support a parliamentary commission on the future of the civil service. At one level I thoroughly understand the desire to have another look at things, but Ministers and officials are not short of advice on how to reform Whitehall. There are endless reports—some more radical, some less radical—all advocating different elements of reform: historians, political scientists, Select Committees, august think-tanks, retired permanent secretaries, former Ministers, and a host of other pundits have thrown their suggestions into the mix. The danger is not a lack of advice but rather an excess, and as I have made clear, the Government’s reform plan drew heavily on suggestions from civil servants about how best to change things.
Without doubt, a parliamentary commission would delay the Government’s reforms. Indeed, the commission is a suggestion of which Sir Humphrey himself would have been proud. I urge the Government to press ahead with their important programme.
John Healey (Wentworth and Dearne) (Lab)
It is good to follow the hon. Member for Ealing Central and Acton (Angie Bray). I welcome this debate on the reform of the civil service, and congratulate the hon. Member for Harwich and North Essex (Mr Jenkin) on securing it. I do not think, however, that his proposal for a parliamentary commission at this stage of the Parliament is the answer, and had the House debated that proposal 12 months after the previous election, rather than 12 months before the next one, the case might have been stronger. I did agree with the hon. Gentleman when he said that there is more on which we agree than disagree, and this is a unique opportunity for us to start to forge a strong, cross-party consensus on the analysis of the problems, and the conclusions about changes that must be made to our system of British government if we are to do right by British taxpayers and those who depend on services.
In some ways, and for several reasons, I feel pretty confident about that. First, I was struck by the Minister for the Cabinet Office’s recent description of the civil service leadership as having a “bias to inertia”. I am not prone to quoting Tony Blair, but that echoed a comment he made in his book when he stated:
“As I discovered early on, the problem with the traditional Civil Service was not obstruction but inertia.”
The second reason for being confident about the potential for a cross-party, wider consensus is that excellent work has been done by think-tanks such as the Institute for Government, the Institute for Public Policy Research, the First Division Association, and the Public Administration Committee, chaired by the hon. Member for Harwich and North Essex. A lot of that tends to be about the nitty-gritty weaknesses of government—the wiring, perhaps—and there is need for a much bigger view. Thirdly, for the first time since the second world war, all three major parties include people with recent or current experience of government, and all are looking forward to a closely contested election next May. We therefore have the potential and a unique opportunity to forge a consensus on how and why we need to change the civil service.
Despite its strengths, the civil service is still designed and run principally on a system that was established in the mid-1850s, but it is now simply not equal to the task given the changes and challenges of a modern society. In the time available I will mention four dimensions to the debate that I think are overlooked, but that I consider to be central. First, we cannot talk sensibly about civil service reform—or the civil service at all—without recognising the distinctions between policy and delivery staff, and between the 20,000 core policy officials or the 50,000 Whitehall-based staff, and more than 300,000 people who work in agencies and bodies, often outside London. Secondly, we cannot talk sensibly about better government if we look only at the civil service, because the questions are just as much about politicians as they are about civil servants: the capacity and culture of Ministers, the role of advisers, the adequacy of parliamentary scrutiny, the tyranny of short-termism, and 24-hour media.
I know when I was at my best as a Minister and when I was at my worst. When I was at my best I had a complex but clearly defined challenge. I had authority from the top to lead, including across Departments, and I had a team of good civil servants, some of whom were policy and some of whom were operations. I was at my worst when I came into sub-committees of the Cabinet with my lines to take from the Department and very little preparation or knowledge beforehand.
Thirdly, we cannot talk sensibly about a modern system of government if we do not get to grips with what the powers, roles and responsibilities should be at the centre, and what would work much better locally. Fourthly, we cannot talk sensibly about civil service reform if we do not have an accurate appreciation of civil service staff. It is not just their commitment to public service and the values of integrity and incorruptibility. There are only 1,900 fast streamers out of more than 400,000 civil servants. This time last year there were only 3,695 senior civil servants, yet still they do a dedicated, committed job with a strong sense of public service.
I was proud that one of the first reforms of the previous Labour Government was to reintroduce trade union rights at GCHQ. Trade unions have a part to play, speaking up on behalf of staff and offering views on the sort of change we need in the civil service, just as they do in many of Britain’s best and leading companies.
Jackie Doyle-Price (Thurrock) (Con)
We in this House can make whatever decisions we like, but unless the machinery of government is fit for purpose we will not achieve the policy outcomes we desire and we will not achieve value for money for the taxpayer. It is therefore very important that we come together and debate the future of the civil service to ensure that our machinery of government is fit for purpose in the 21st century.
I pay tribute to the Minister for the Cabinet Office and Paymaster General, my right hon. Friend the Member for Horsham (Mr Maude). He is delivering a quiet revolution and is one of the unsung heroes of the Government. Dare I suggest that the kind of the leadership we are getting from the top of Government in driving change is far more effective than any initiative, such as a commission, think-tank or anything else? He is driving change from the top and showing real leadership.
As the right hon. Member for Barking (Margaret Hodge) told us, we on the Public Accounts Committee are witnesses to, and becoming experts in, government failure. It is a bit like “Groundhog Day”: over and again we see the same reasons for that failure. She has described some of those reasons today: poor skills and a failure to have consistent management and senior responsible owners who see projects through from start to finish. We need real accountability in the system. The Committee found that only a third of big projects are delivered on time and to budget. We see the same failings over and again, and there is no excuse for that. The machinery of government should learn from what works and what does not.
I welcome the introduction of the Major Projects Authority. It has started to do a good job to improve performance, but I think it could a lot more. I have a plea for my right hon. Friend the Minister: we would like see another performance review of major projects and I would like it to be as candid as possible. Departments need to be put on notice when they fail to deliver what the Government expect of them. In particular, I would like to know what is happening to deliver items in the national infrastructure plan. The Major Projects Authority can play a positive role in holding Departments to account for delivery.
Skills are hugely important. I completely agree with the right hon. Member for Barking that the culture in the civil service puts too much emphasis on rewarding people who pursue policies and interests rather than commercial skills. That reflects the culture of a civil service that was borne out of a 19th-century approach to government administration. Today, the emphasis is not on government administration, but on delivering services to the public, often through third parties. We therefore need to reward commercial skills, not focus on policy. That will require behavioural and cultural change throughout the civil service. Ministers can only do so much: those values need to be adopted by those at the top of the civil service.
I welcome the Minister’s efforts to deliver the Government’s capabilities plan to address skills shortages, but over and again we see that these values are not being adopted throughout government. Every permanent secretary needs to be a champion of ensuring that those behaviours are rewarded. If we do not, we will see poor value for money for the taxpayer. We have already seen that when Departments are not comfortable with managing commercial contracts, they tend to go with one supplier. That is creating new private sector monopolies funded by the taxpayer, which is bad for performance and bad for accountability. We need to ensure that our civil servants have the skills that will give them the confidence to manage contracts properly; otherwise those monopolies will get bigger and bigger. Let us have more rewards for civil servants who are actively grasping commercial challenges and actively pushing competition. There have been some good examples of that.
As I said during the speech of the right hon. Member for Barking, it was refreshing to see a prison officer reach the top of the offender management service, and to note the perspective he brought to that position. We are always encountering permanent secretaries who talk in a policy-wonkish way, but I am talking about real service delivery and real operational performance. Someone who becomes a chief executive after being a prison officer working on the front line will understand the whole business. He will know where the bodies are buried, and what needs to be changed. That is so much more effective: let us see more of it, please.
We have become used to very poor management of transport projects, but the senior responsible owner of the Thameslink project was the same person throughout. Let us see more of that as well.
I do not think that we need a commission. I think that we have seen enough government failure on the Public Accounts Committee and the Public Administration Committee. We know what is wrong; let us just get on with fixing it—and my right hon. Friend will.
Andrew Miller (Ellesmere Port and Neston) (Lab)
I congratulate the Public Administration Committee The hon. Member for Thurrock (Jackie Doyle-Price) is absolutely right: we need behavioural and cultural change to be at the heart of the system. Successive Governments have argued in circles about the structure of government—about which bit belongs where, and all the rest of it—and have never come up with the perfect structure, simply because there is no perfect structure. Let us take the Department for Culture, Media and Sport. Where does the science bit belong, where does the sport bit belong, where does the culture and museums bit belong? The arguments are enormously difficult, and no one will ever come up with a perfect solution.
It is blindingly obvious that there must be a much better porous membrane between the structures of Departments to make things work, but there are massive cultural obstacles in the way of that. During the 1997 Parliament, I did some work for the then Prime Minister, Tony Blair, on the delivery of technology. The paper that I produced for him pointed out that the problem was not about the technology itself, but about the people and the business processes. For far too long, we have been stuck in the rut of saying “We do it this way because we do it this way.” In case after case, I was able to demonstrate that a fundamental shift in the way in which the business processes operate will produce better efficiencies, better productivity, and—most important of all, as the hon. Member for Thurrock observed—better services for the people whom we are here to represent.
I think that the arguments for having a good look at the structure and the mechanisms that operate are not just philosophical arguments but practical arguments that matter a great deal to the people whom we represent. The way in which we should do that is a matter of debate. My Select Committee recently undertook some work on horizon scanning, which is covered by the Minister’s Department. We heard some very fine evidence from Jon Day, who leads that work for the Government, and who described very clearly the problems of silo government and how it can be broken down. I am sure that that evidence will feature when we write our report, but it is already in the public domain.
A number of Members have talked about the problems of contract management. That, too, has been a massive problem within the system. We need a professional contract management system that is fit for purpose and very few Departments can claim they have cracked that problem.
I conclude, contrary to my very good friend my right hon. Friend the Member for Wentworth and Dearne (John Healey), that the place to do this work is inside the House. I agree with the Public Administration Committee. We need the practical experience Members of Parliament bring to this debate: knowledge of what is missing from the delivery of services to their constituents and knowledge of the practical problems of dealing with the complex structures within government. That is where Members of Parliament from both Houses can contribute significantly to the debate.
These are not issues that will necessarily cause any rift between the parties because I think there is a genuine desire to improve the business processes and the way in which the civil service relates to us, the Government and the people we represent. I do not see this creating a great divide, therefore, and I do not think the Government should be worried that it will slow their reform programme at all. This can happen in parallel, and I urge the Secretary of State to think about how we can make that happen and deliver a profoundly important report by the PASC.
Jonathan Ashworth (Leicester South) (Lab)
This has been an extremely good debate, with exceptional speeches from all Members who have contributed. I congratulate the hon. Member for Harwich and North Essex (Mr Jenkin) on securing the debate. His speech was very thoughtful, and in “Truth to power” his Committee has produced a weighty, detailed report that must be taken seriously. I hope in my remarks to give him a bit of guidance about what the Labour Front Bench thinks of his report’s recommendations.
Our deliberations have also benefited from recent reports from the Liaison Committee and outside bodies such as the Institute for Government. In addition, today my right hon. Friend the Member for Wentworth and Dearne (John Healey) and the right hon. Member for Arundel and South Downs (Nick Herbert) have launched GovernUp, which is described as an independent cross-party project
“to consider the far-reaching reforms needed in Whitehall and beyond to enable more effective and efficient government.”
Based on the thoughtful speeches of my right hon. Friend and the right hon. Gentleman, we look forward to GovernUp’s research and recommendations with some eagerness.
We have benefited from many former senior Ministers’ insights this afternoon. I am not a former Minister, but I am a former special adviser and had the privilege of working closely with my right hon. Friend the Member for Wentworth and Dearne. In my time in government, I found the civil servants who supported Ministers on policy advice to be wholly dedicated, impartial and exceptional men and women. I think sometimes we should be careful in debates such as this not to reinforce the stereotypes of civil servants as faceless bureaucrats. Thankfully, nobody has done that in this debate, but sometimes in popular culture that can happen. The reality is that civil servants are public servants. As well as serving Ministers, they serve our constituents, sometimes on a daily basis. and they serve some of the most vulnerable people we represent at their times of greatest need. Civil servants prosecute criminals, represent British interests abroad and help to protect our borders.
The model of our civil service has stood the test of time, ever since Sir Stafford Northcote and Sir Charles Trevelyan’s reports 150-odd years ago. It is a model of political impartiality, objectivity and integrity. Those values should be maintained at the heart of the civil service, and they are values to which I reiterate our absolute commitment.
The function of the civil service is not only to serve Ministers and the Government of the day. Civil servants prepare and transfer their expertise from one Government to the next. A fact that is sometimes overlooked is that the civil service enables us in Parliament to hold the Government to account. It is civil servants who draft answers to parliamentary questions—of course, Ministers sign them off and sometimes change them, but it is the civil servants who draft them in the first place. The civil service also provides factual information to our Committees and Libraries. A healthy, functioning and impartial civil service is important not only for a healthy, functioning Government but for enabling Parliament to hold Ministers to account. As “Truth to power” points out:
“Nobody…argues that the Civil Service should be immune from change.”
I am sure that everyone in the Chamber would agree with that.
I was impressed that my right hon. Friend the Member for Wentworth and Dearne, in making a point about the inertia of the civil service, managed to quote both Tony Blair and the Minister for the Cabinet Office and Paymaster General. That is quite an unusual coalition. My right hon. Friend was right to make that point; that is what the debate is about. It is about ensuring that we reform the civil service so that Ministers are able to pursue the agenda that they were elected to implement and that the British people supported when they voted for them.
We should also bear in mind that the civil service is undergoing a significant reduction in numbers, with an overall reduction of 138,000 planned by 2015. In that context, we need to ask ourselves what the policy-making functions and the implementation of policy in a much-reduced civil service will look like. We will need to make sure that a civil service with those numbers can continue to serve Ministers and to enable Parliament to hold those Ministers to account.
My right hon. Friend the Member for Barking (Margaret Hodge) said that her speech was merely skimming the surface. I thought she made an incredibly powerful speech, however, and I am impressed that she would describe a contribution of such depth as skimming the surface. She rightly talked about the way in which Departments work in silos. She also made a point about the nature of the Government and how the concept of individual Departments is completely alien to many of our constituents. The citizen is increasingly frustrated and baffled as to why their interaction with the Government has to be conducted through so many different agencies. How many times do they have to hand over their personal data—whether for a driving licence, a passport, a tax return or benefits—to many different Departments? We understand how it works, because we are politicians, but our constituents find the number of Departments increasingly baffling. Any Government who wanted to make changes in those areas would probably run up against the type of inertia that my right hon. Friend the Member for Wentworth and Dearne was talking about, but these are the issues that we have to confront in the modern world.
The right hon. Member for Arundel and South Downs made a thoughtful and, at times, quite sparky contribution to the debate. I was not expecting such a sparky debate, but I enjoyed his speech. He too alluded to the way in which Government Departments work in silos, as he did in his joint article with my right hon. Friend the Member for Wentworth and Dearne in The Times today. We really have to confront the problem of departmental silos, because many of the issues that we are going to have to deal with—long-term trends in health, climate change, the opportunity of opening up big data and raising the trend rate of growth over the medium to long term, for example—will require increased cross-departmental working. That is why I am particularly interested in the outcome of the research of the think-tank that my right hon. Friend and the right hon. Gentleman have established.
My right hon. Friend the Member for Barking, the hon. Member for Ealing Central and Acton (Angie Bray) and many others have referred to the skills gap and capability problems in the civil service. We are all familiar with the horror stories that have appeared in the press, including those relating to the west coast main line and to the contracts for broadband roll-out. The Minister for the Cabinet Office and Paymaster General has been candid about the failures in introducing universal credit—indeed, there have been some spiky exchanges across the Dispatch Box on that subject. His candour has been refreshing, but we have to acknowledge that there are commercial problems within the civil service, and we must tackle them.
The report pulls no punches in its assessment of the skills gap across the civil service. Lord Adonis, in evidence to the Committee, said that, in his experience, some civil servants were
“poorly trained and their experience of the sectors in which they work is very poor”.
The Institute for Government has recently found that the civil service has suffered from “weak corporate leadership”. I think I am correct in saying that the data published by the Cabinet Office when it launched the civil service reform plan showed that out of 15 permanent secretaries at the main delivery Departments, only four had significant operational delivery or commercial experience. We would warmly welcome initiatives that increased the commercial experience of the civil service and developed the skills of the work force. I hope that the Department and Ministers involve all the workplace trade unions in meaningful discussions about and in the design of any such initiatives.
I am also worried about the general sense that there is a quick turnover in civil service posts. I recall from my few years working in government that civil servants moved quickly and Ministers would sometimes be surprised that a civil servant with whom they may have had a close working relationship on a particular project was suddenly moved to another part of the Department and working in a different area. My worry is that we sometimes lose, or we can lose, expertise in that way, although I understand that civil servants want to develop their skills. Again, we need to think about this carefully.
None the less, Labour Members believe that a number of the Government’s reform proposals have merit, such as requiring greater scrutiny of major projects, reducing the turnover of senior responsible officers, and the plan for integrating corporate functions. On the latter measure, may I press the Minister to say something about the shared services centres for functions relating to IT, human resources, pay and payroll? When they were created, some TUPE-ing over of staff took place, with time-limited agreements on no compulsory redundancies. We now understand that there will be job losses and offshoring of work, so will he give us his views on that? Is he confident about the data security issues?
Some Members have referred to the extended ministerial offices. We will want to study the Government’s proposals on that and what they mean for accountability of Ministers and of civil servants. More generally, when we are discussing these issues, we must remember that the morale of civil servants is important—a happy work force is a more productive work force. We have previously had exchanges across the Dispatch Box about check-off, and Departments are reviewing that. I would be grateful if the Minister updated us on those reviews and when he expects Departments to report back, if it is not going to be the Cabinet Office doing this.
The Opposition are examining and thinking carefully about our views on civil service reform. We warmly welcome the initiatives taken by my right hon. Friend the Member for Wentworth and Dearne and the right hon. Member for Arundel and South Downs. The case for a parliamentary commission made by the hon. Member for Harwich and North Essex should be taken seriously. We are not going to commit today to supporting such a commission. It would need to have cross-party support, and some Members have spoken in favour today and others have spoken against. We are not ruling such a commission out indefinitely, but today we do not feel we can commit to supporting it. None the less, these debates should be taken seriously and I look forward to the Minister’s response.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
First, I congratulate my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) on securing this debate. It has been a really good debate, conducted with a lot of intelligent, thoughtful comments and insights. It has been particularly marked by a very bipartisan, consensual approach, with a high degree of agreement from those in all parts of the House. I am particularly grateful for the remarks made by the right hon. Member for Barking (Margaret Hodge) and I wish to pick up on a couple of points she made. She is absolutely right to say that we need to work on the ability of the civil service to accommodate and assimilate people coming in from outside. I also completely agree with her on the issues about women succeeding in the higher realms of the civil service, which is why I have just commissioned some work on examining exactly where and why the problems arise, so that we can address this in a substantive way. She is right to draw attention to it.
I start by saying that there are many absolutely brilliant civil servants. I have no doubt that we have some of the best civil servants in the world. Just this morning, I was with a number of civil servants in Birmingham. One example stood out, and it involved part of the Department for Communities and Local Government. The national planning casework unit, half of which is based in Birmingham, told me that its casework has risen over the past four years by 24%. The speed with which it is delivering the outcomes has improved markedly, and it is doing that with less than half the staff it had to begin with. That is a remarkable improvement in productivity.
As has been pointed out, there has been a significant reduction in headcount across the civil service. It is already down by some 16% or 17% with more reductions to come, and yet no one would say that the civil service is delivering less. There is a significant improvement in productivity. The downsizing has taken place through the recruitment freeze and through reforms to the civil service compensation scheme—the scheme was so generous as to be broadly unaffordable for the Government—for sensible voluntary redundancies to reduce the size and to reflect the need for things to be done differently. Some Departments, such as the DCLG and the Department for Education, have halved in size.
There have been significant improvements, with some brilliant civil servants doing terrific and important work, but we need continuing and significant further improvement. No one argues otherwise, and no one in this Chamber today has said anything else. It does not matter whether we call it change, reform or improvement. We need to recognise what is great. We talk about the British civil service being the envy of the world, but what is the envy of the world is the essence of the Northcote-Trevelyan settlement. Northcote was a politician and Trevelyan a civil servant—an early example of collective leadership. What that said was not primarily about impartiality, but about permanence, and appointment and recruitment on merit. The principle of a permanent civil service capable of serving the Government of the day, regardless of their composition, is crucial. The values of impartiality, honesty and integrity are really important, but they are passive values and to them need to be added the dynamic values.
The Northcote-Trevelyan settlement is a bargain, which says that a new Government cannot replace existing civil servants with their own appointees, because the other side of the coin of impartiality and permanence is the ability to deliver the priorities of the democratically elected and accountable Government of the day. That means that the civil service must be able to deliver it. If it falls down for too long on that side of the bargain, the case to allow the Government to bring in their own appointees and thus to disrupt the settlement, which none of us wants to see, will mount.
The truth is that in the public sector productivity flatlined for too long. That happened across the public sector as a whole, and the civil service represents only a part of that work force, but none the less it was a concern. Things have improved markedly over the past four years.
When people talk about the British civil service being the best in the world, as they often do, we should just reflect on the fact that in the World Bank’s Government effectiveness index, we ranked 15th, behind countries with systems similar to ours, such as Canada, Australia and New Zealand. We need to deal with the constant concerns that are expressed about the leadership and management of change. Those concerns are also expressed by civil servants themselves in people surveys, which is an excellent institution that will continue. The capability deficit in commercial and digital project management is repeatedly flagged up by the Public Accounts Committee, the Public Administration Committee, the Liaison Committee and the Institute for Government and we are on the case, as we have been for the past four years. Some of the problems that have arisen with contracts have come to light precisely because of the improvement in contract management. They went unnoticed for far too long and came to the surface in an alarming and distressing way, and we are working hard to deal with them, including by setting up the Crown Commercial Service, the Major Projects Leadership Academy and the Major Projects Authority, to which the right hon. Member for Barking referred. We have strengthened the hand of senior responsible owners by making them directly accountable. The Government Digital Service is almost, but not quite, what the hon. Member for Luton North (Kelvin Hopkins) was proposing—that is, a public corporation for Government IT. None the less, it is an agency within government that has massively improved capability. I rather agree with him about the need to insource some of the capability, as too much IT capability was outsourced.
Much work has already been done and the problems are well understood and are being addressed, but we need to do that much more quickly because too much public money—taxpayers’ money—is at risk.
Impartiality is, of course, important. That does not mean and has never meant being impartial to the Government of the day. The civil service must be very partial towards the Government’s getting their programme implemented; otherwise, the bargain starts to fall apart. The essence of impartiality is not indifference to the Government of the day but the ability to be equally passionate and committed to implementing a future Government’s priorities and programme. It is important that this impartiality does not turn into a cold indifference. It must be a passionate commitment to delivering the Government of the day’s priorities. That is hugely important.
There is much that has been done and much that needs to be done. Let me now come on to the proposal for a commission made by my hon. Friend the Member for Harwich and North Essex. Differing views have been expressed on both sides of the House and a huge amount of work and analysis is already going on. I congratulate the right hon. Member for Wentworth and Dearne (John Healey) and my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) on setting up another institute to study the issue and make proposals. That is very important.
As it would run alongside an active reform programme commanding very widespread support—it has slightly surprised me how little controversy has attended the civil service reform programme—one must ask what a commission would add at this stage. There would be scope-creep: the right hon. Member for Greenwich and Woolwich (Mr Raynsford) would like to add localism, the hon. Member for Luton North would like to add the size of the state, the hon. Member for Aberdeen South (Dame Anne Begg) would like to add the Scottish civil service, and the hon. Member for Ellesmere Port and Neston (Andrew Miller) would like to consider a wider joining-up across government than that which relates to the civil service.
I am afraid that my hon. Friend the Member for Harwich and North Essex has slightly added to my concern about whether a commission would delay the implementation of the existing reform programme. His Committee’s last report suggested that the Government’s modest proposal that the Prime Minister should be able to choose between two appointable candidates should not be implemented until a commission had considered it, thus lending support to exactly the concerns we have expressed for some time. If relatively modest proposals that command such widespread support can be successfully implemented, the current system will have been reinforced. If they cannot be implemented in the way we are proposing, I suggest that that would be the time for root-and-branch examination through a commission.
Mr Jenkin
I thank my right hon. Friend the Minister and everyone who has spoken in the debate. I agree that it has been an interesting debate in which there has been a great deal of consensus and agreement. Let me just respond to the last point made by my right hon. Friend. The point we are making in our report is that it would be wrong for the Government to overrule the Civil Service Commission without Parliament having some say in the matter, because the Civil Service Commission was established by Parliament to provide precisely that kind of check and balance in the system to stop the Government making such a decision merely on the basis of royal prerogative. Personally, I am sympathetic to the idea that ministries should have more influence and choice, as they had in the past, over decisions about the appointment of permanent secretaries.
In all the speeches today, I have not heard a single solid argument against the civil service commission. Every argument in praise of GovernUp and the work it is doing is an argument in favour of the civil service commission in Parliament. How can we let one thousand flowers bloom, as the right hon. Member for Barking (Margaret Hodge) said—my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) endorsed that—if we stamp on the one flower that has democratic authority and legitimacy on the question of the civil service in Parliament?