Public Bodies (Diversity)

Nick Hurd Excerpts

Thursday 13th March 2014 Commons Chamber

[The Minister for Civil Society (Mr Nick Hurd)]

This issue is very important. I congratulate the hon. Member for Feltham and Heston (Seema Malhotra) on bringing it forward for debate today. She is well supported by her colleagues and has a credible track record of interest in this matter. Her well-informed speech has raised a number of interesting points.

I agreed 100% with the hon. Lady’s opening statement that this issue is not just about equality. As she knows well from her background in the private sector, businesses that reflect their customers are much better able to understand their needs and can offer them better services as a result. The same must be true of the public sector. There are about 8,500 people on the boards of our public bodies, which range from large public bodies to small advisory committees. All human life is here, from those who monitor the well-being of prisoners to those who govern great national museums. Board members exert significant influence over our lives. They deal with issues that affect a lot of people and shape the public services that we use.

Public services are there to serve the public—the clue is in the name. They can do that only if they understand the needs and priorities of those they serve and those they lead. The hon. Lady’s point about the NHS was a valid one. It leads to the obvious question of how on earth they can serve the public effectively if they fail adequately to represent the population. That has been a long-standing challenge, as she recognises. I will try to address her points and to set out that, although we are not where we need to be, we are making some progress.

I agree with the hon. Lady totally that it is extremely disappointing that the figures show a recent decrease in the representation of people from black and minority ethnic backgrounds. I hope that the work that the Government have done recently to encourage diversity in public appointments, which I shall explain, will reap the rewards and be reflected in the next set of published figures. However, I share her disappointment on this important matter.

As the hon. Lady suggested, it looks like the Government are making progress on the representation of women on public boards, after years of stagnation. Our challenging aspiration that 50% of new appointments to public bodies should be women is proof of how seriously we take the issue. In the last financial year, only 37% of public board members were women. However, we have seen a positive improvement. In the first six months of this financial year—from April 2013 to September 2013—the figure was 45%. The Government continue to focus on this issue by reaching out to talented women and making it clear that a range of fascinating roles are on offer, and by ensuring that those roles are as accessible as possible to all. I will go into more detail on that.

The hon. Lady did not mention disability, but I would like to say a little about it. The Government’s general approach is that the public appointments process should be open to all, regardless of who they are, and should be designed in a way that ensures that we get the best applicants. For the record, the picture is encouraging. Last year, 5.3% of the appointments and reappointments in which the disability status was known were made to candidates with disabilities. That is part of a consistent upward trend, which I hope she will welcome.

I will make some general points about the Government’s approach before moving on to the specifics. The Government have taken unprecedented steps to open up the public appointments process to new talent. My right hon. Friend the Minister for the Cabinet Office and Paymaster General has placed this matter at the top of the Government’s agenda, as the hon. Lady acknowledged, and rightly challenges all Departments and public bodies to ensure that their boards have the mix of skills and experience that will make them as effective as possible. The presumption against automatic reappointment of incumbents supports that. We have made the process more transparent to improve access to vacancies. Alongside this, we have placed a new emphasis on ability and skills, rather than prior experience, to ensure that key roles in public bodies are open to the widest field, instead of a narrow merry-go-round of the same old candidates that has been a feature of the system to date.

[Seema Malhotra]

Will the Minister confirm that there is a way for permanent secretaries to be held to account for their progress? Do they need to report progress, and is that part of any performance review process?

--- Later in debate ---

[Mr Hurd]

The system is independently regulated and I will come on to that. There is more transparency in the process and that is an issue my right hon. Friend the Minister for the Cabinet Office and Paymaster General has placed at the top of the Government’s agenda. My experience is that this is more actively monitored and more transparent than it has been in the past.

There was a debate on whether the process benefits from independent regulation, overseen by the Commissioner for Public Appointments. I think it does. It is key in supporting the merit principle, rather than other factors that might determine appointments. All panels have an independent member, who for chair appointments will be nominated by the Commissioner for Public Appointments. That is a welcome initiative. The Centre for Public Appointments, which is part of the Cabinet Office, is working across Whitehall, and with the executive search industry, to make practical steps that will help us to open up public appointments to the widest possible pool. I will provide three examples.

First, we are modernising the recruitment process to ensure that adverts are effective and non-exclusive, and that interview panels are diverse and reappointments are made only in cases of utmost necessity. No one seriously disagrees that appointments should not be made on the basis of merit, but talented people often do not apply for public appointments either because they do not know about them, or because they do not recognise what they have to offer. We are placing greater emphasis on ability rather than experience, because we do not want to exclude those who may not yet have acquired board experience but could nevertheless potentially be good board members.

Secondly, there is nothing more off-putting than an unnecessarily long application process, so Departments are increasingly switching to using a straightforward CV and covering letter. We are working to simplify job adverts and are cutting out jargon to appeal to as wide an audience as possible.

Thirdly, we are maximising the use of online and targeted advertising, and social media. Two years ago, the CPA did not even have a website, let alone a Twitter account. Now the former has more than 20,000 visits a month and the latter has 1,600 followers. These are sensible measures and independent regulation is important.

On the representation of women and BME communities, progress has been made, particularly in relation to women. The rise of women in the public sector during the 20th-century was agonisingly slow. We should not forget that until 1947, women in the civil service were still expected to resign when they married. They earned less than men into the 1950s. Indeed, when Dame Mary Smieton was appointed as permanent under-secretary at the Department for Education in 1953—only the second woman to reach this grade—she was paid the same as a man. It would be nice to think that that was because her Department was an early advocate of equal pay—it was not—but the Treasury had not worked out a women’s rate of pay at that grade because it did not think that it would ever need to. This is where we have come from. Thankfully, much has changed and continues to improve, both in the civil service, where 47% of employees are currently women, and across the wider public sector, where women continue to shatter glass ceilings. For example, the RAF has recently appointed its second female Air Vice-Marshal.

Significant areas for improvement remain. As the hon. Lady acknowledged, perhaps foremost among them is the number of women on public sector boards. Women remaining a minority in the boardroom—or worse, where all-male boards persist—becomes more and more of an anachronism every year that passes. In the last financial year, only 37% of public board members were women. I believe that transparency is one of the best ways to raise performance. This was the first year that the Government published their own statistics on the general diversity of appointments, something I hope the hon. Lady welcomes.

[Ms Abbott]

The Minister is of course the second generation of Hurd to serve in this House, but we know he is there on merit alone and we all believe in merit. However, does he not believe that, in 21st-century Britain, it is very important for public boards and the top of the public sector to look like Britain?

[Mr Hurd]

I hesitate to correct the hon. Lady, because the correction will not help my case, but I am actually the fourth successive generation of my family to serve in the House. However, I am increasingly, and thankfully, an anachronism. The hon. Lady’s point is entirely valid.

The issue of transparency is particularly important. The message that I am trying to convey to the hon. Member for Feltham and Heston, and to other Members, is that we are making some progress. In the first six months of the current financial year, the number of women on boards rose to 45%. That constitutes real progress.

[Seema Malhotra]

I can inform the House that I am the first generation of my family to enter politics.

May I ask the Minister to return to the specific point about aspirations and targets? The last Government had targets relating to gender, ethnicity and disability for new appointments, whereas under the present Government only gender seems to remain, albeit as an aspiration. Was there a reason for the removal of the other two targets? Can the Minister shed any light on that?

[Mr Hurd]

I sincerely hope that the hon. Lady will not be the last generation of her family in this place. I would not wish her to carry the burden that I carry.

As the hon. Lady probably knows, the present Administration are not particularly keen on targets. I shall provide a more detailed response to her question at a later stage, but I will say in response to what she said about the aspiration relating to women that I think that aspiration is fine as long as progress is made towards the aim of the aspiration, which is what I have argued that we are doing. I hope that the hon. Lady welcomes that. We are certainly not resting on our laurels. The public sector is doing better than the private sector, but I do not think that anyone considers the current figures to be satisfactory. We maintain our aspiration that 50% of new public appointees should be women, and we will continue to publish the figures every six months. We want them to continue to rise. Transparency is a new element. As we know, it is a great driver of behaviour and keeps people’s feet to the fire.

[Julie Hilling (Bolton West) (Lab)]

Does the Minister agree that one of the things that targets, and indeed aspirations, do is make people take action to meet them? Advertising in certain places often is not enough. This is about actively training people, educating people, and seeking people to fill those roles, rather than passively waiting for them to come forward.

[Mr Hurd]

I have some sympathy with that view, but I would not underestimate the strength of the new dynamics that we have introduced. There is a clear message from the top that this matters, and there is independent regulation of the competitive process. I have already described some of the things that we have done which we think will make it easier to reach out to people, and to remove barriers and obstacles. We have also made the process more transparent. In my experience as a Minister, the transparency factor is much more powerful than some arbitrary target with no transparency in regard to progress towards it The system knows that this matters and that it is being scrutinised—debates such as this are helpful in that respect—and we will be judged against progress towards the number for which we are aiming, whether it is set as an aspiration or a target.

I do not want to ignore the important issue of BME representation. I will be frank, and say that we are disappointed by the slip-back in the numbers. In their public appointments diversity strategy, published this year, the Government said:

“This is not just about gender; diversity is about encouraging applications from candidates with the widest range of backgrounds.”

It is regrettable that last year the number of successful BME candidates fell from an average of about 7.9% of appointments and reappointments since 2001-02 to 5.5% last year. We are disappointed about that, because it matters to us. We are hopeful that this will prove to be an anomalous year, and that the work that the Cabinet Office and the Commissioner for Public Appointments have been doing to increase diversity in public appointments will reap rewards in the next set of published figures, which will be transparent and will be monitored by the House and outside.

The Commissioner for Public Appointments regulates the competition for many of these posts. He also has a statutory responsibility to promote diversity and equality of opportunity in the procedures for making public appointments. He is actively concerned about the issues that have been raised today and he has already engaged in activity to try to improve the position. For example, he has run a series of workshops for different under-represented groups to identify the challenges to increasing diversity in appointments and will be coming up with practical suggestions to help Departments break down these barriers in the future. I am looking forward to the outcomes of this work and undertake to share them, as far as I can, with the hon. Member for Feltham and Heston, knowing and respecting, as I do, her strong interest in this area.

The public sector needs world-class leadership if it is to continue delivering the services that people rely on, and that means having diversity on the boards of public bodies—people with clarity of vision, who can make decisions, and rise above process to get things done. It needs innovators and people who understand the communities we are trying to serve. It needs people who can open up the system to new ways of doing things, who are prepared to take risks without being reckless, and who are willing to take responsibility and to learn and grow.

I do not think there has ever been a time in the public sector when this need to open up the doors to fresh thinking and people who bring different perspectives and insights and different knowledge has been more important. There are already great examples of diverse leaders making a significant contribution on public boards, but we are very aware that there is much more we can do and that is why diversity is genuinely at the heart of our public appointments strategy.

Question put and agreed to.