Reservicing the Civil Service

Wednesday 6th June 2012

The role of the Civil Service is critical to ensuring good government and providing the public with key services which they fund through their taxes. That means the Civil Service is continually scrutinised to make sure that it keeps to its values as stated in the Civil Service Code.

However, with the biggest changes occurring within government in over half-a-century, as well as cuts to budgets in departments and public services, the spotlight has inevitably fallen on the new role of the Civil Service in light of this and whether it can operate effectively given the far-reaching changes currently being experienced in Whitehall.

The Institute for Government, an independent charity working to promote government effectiveness, and whose objective is to be “a part of the conversation” in Whitehall and Westminster, recently sent an open letter to Francis Maude, Minister for the Cabinet Office, Sir Bob Kerslake, Head of the Civil Service, and Sir Jeremy Heywood, Cabinet Secretary, outlining its proposals for “strengthening the corporate and collective leadership and capabilities of the Civil Service” to allow it to “respond to the spending and reform challenges”.

Peter Riddell, Director of the Institute, and formerly chief political commentator at The Times, welcomes many of the changes which have taken place within the Civil Service over the past decade believing that “within a smaller and reshaped state, a confident and effective Civil Service remains essential to the success of government”. However, Peter says that improvements can still be made to the way that government conducts spending reviews and formulates policy. And time is of the essence, according to Peter, who stated in the Institute’s open letter that “unless reforms are urgently introduced, there will be the risk of a downward spiral of cuts, inadequate services and a demoralised Civil Service”.

In this exclusive interview, Peter discusses how deep reform of the Civil Service should be, how difficult it is to reform the Civil Service, where it is failing today and how this can be remedied and how the public would benefit from the suggestions put forward by the Institute in its recently published open letter.

Q: How urgent is reform of the Civil Service? And how deep should it be?
A: It is very urgent because at the moment we are only about a fifth or a quarter of the way through the programme of austerity and there are more cuts to come. Furthermore, there will be an even tougher spending round next year compared to the one in October 2010. So in short, public spending is going to be squeezed even further. And in order to avoid a downward spiral of crude cuts in head counts leading to cuts in services and public dissatisfaction, the Civil Service has to improve its ability to deliver services at a lower cost. And the key to that is improving capabilities and introducing a diversity of skills.

We, at the Institute for Government, believe that reform of the Civil Service has to be very deep. One of the most striking comments I have heard from people within government is that things are going to get a lot tougher compared to what has happened over the last eighteen months but you still need a core civil service. That means it is imperative for reforms to deliver if the Civil Service is going to be able to adapt effectively to the major changes occurring in Whitehall.

Q: What do you make of the Government’s plans to shake-up the Civil Service?
A: A 10 per cent cut in numbers is no small feat-it took Margaret Thatcher 4 years to achieve this. We believe that some of the reforms have however been a little crude so far. For example, the freezing of recruitment into the Civil Service is not sustainable in the long-term because people retire, you need new people to replace them and you need people with specialist skills. Arguably, what you require is an overall target for the number of people and then allow some movement of people in and out. When you freeze a total it actually creates distortion and has an effect on efficiency. You also need to retain the best people and promote them in post or there is a ludicrous situation where good people have to leave to get promoted. The same point applies to across-the-board pay freeze or limits on pay when it might be better to focus on overall pay costs rather than individual pay rates.

The Government came into office wanting to do so many things all at once, like culling arm’s length bodies, but it has not carried this out in a very systematic way. The Institute recommends organising ALBs in a much more systematic way, so their form reflects their function. The scale of the fiscal squeeze coupled with dramatic reforms makes this a difficult agenda so it has to be systematic.

Regarding training and development, the Government has abolished the National School of Government and it is not entirely clear now what the whole structure of training and development is. Project management skills need to be valued and nurtured; our next report on improving management information shows why this is so important for effective decision making. The major projects academy is a good thing and hopefully will address the project management skills gap.

Q: Is the Civil Service one of the more difficult institutions to reform?
A: Without a doubt, yes. If you are changing a private sector company you have fairly defined goals and your real responsibility is to your shareholders to achieve a higher profit for them. The Civil Service cannot do that as it is expected to finance services while at the same time as it is cutting back. In addition to that, the Civil Service operates in a political environment. Inherently, the Civil Service works to politicians and politicians have their preferences. That makes reform of the Civil Service all the more difficult as it cannot operate in the same way as a private sector company can. By operating in a wholly politically environment, the accountability mechanisms and expectations are completely different.

Q: Today, which areas do you believe the Civil Service is failing on?
A: Before I answer that I would like to comment on how I think the Civil Service is feeling a little battered at the moment by the pay squeeze and by the cut in its numbers. We moved from a State which administered uniform services to one which is now expected to be flexible in delivery or implementation of projects. Adjusting to that change is quite difficult.

However, where I would, in a friendly way, criticise the Civil Service centres on adaptability, in particular having the implementation skills, running big projects and running IT, for example, where clearly the performance in these fields has been unsatisfactory.

But the Civil Service operates in an environment where the accountability lines are increasingly obscured. The theory is that civil servants report to ministers and ministers report to parliament. However, there is a complication to that because the permanent secretary in the department is responsible for finance and there is an increasingly blurred line between ministerial accountability for policy decisions and the permanent secretary’s responsibility for money. Factored into that are how parliamentary committees, particularly the Public Accounts Committee, are now much more assertive and want to question individual civil servants responsible for individual programmes as well as naming them, too, such was the case with Brodie Clark at the UK Border Agency. That presents a lot of difficulties for civil servants because they are accountable to ministers but are now being asked questions by committees. The blur is still to be resolved and there is currently a standoff between Whitehall and Westminster over accountability; this cannot continue. The IfG will work to gain clarity over the issues because accountability is important for the civil service, ministers and ultimately the public.

Q: In its open letter to Francis Maude, Sir Bob Kerslake and Sir Jeremy Heywood, the Institute set out suggestions on how to reform the Civil Service. Can you detail these?
A: Our proposals fall strictly within reform of the Civil Service in the context of austerity and do not cover the machinery of government.

Firstly, the Government has to find a better way of conducting spending reviews. The first spending review was rushed-they announced it in October 2010 having only come into office in May of that year. Consequently, cross-departmental programmes have suffered (such as those concerning social deprivation and law and order) because of the cuts process which is very much a silo process between Treasury and departments. Now, however, the government has an opportunity to carry out a far less rushed review because it has about a year or more to do so. The government must start looking at a more flexible way in which the focus is on delivering at a lower cost.

Secondly, Whitehall is a federation and departments are very powerful. And the head of the Civil Service has limited power because he is dealing with permanent secretaries and they can be very defensive and territorial. The Institute argues for a much more collective-style of leadership where ministers and civil servants have to all take responsibility if they are going to improve policy-making. And in order to make that happen, we believe that a lot of the central machinery has to be strengthened.

There are also other areas where we believe improvements can be made. Informed decision-making requires much better data on how programmes are working out; with the demise of the National School of Government something has to be introduced to replace it to strengthen management development; the quality of policy-making has to be looked at more closely and requires a benchmark to be introduced by senior civil servants; and there needs to be closer relationships with public chairs instead of how at present they are micro-managed and dysfunctional.

Q: How would the public benefit if the Institute’s proposals were implemented?
A: If you find a better way of running the Civil Service at a lower cost this means services will be better-the quality of services which people receive would be maintained at a higher-level than what they would be. Take, for instance, the UK Border Force which is a classic illustration of inadequacies in management where targets are not met and which has consequently had a direct impact on the public queuing at airports. So if you improve capabilities, if you improve management practices, if you improve the quality of information the appropriate government department will know that the body concerned is being mismanaged.

Two examples of government departments which are now better managed, and which has had a direct positive impact on the public, are the Department for Work and Pensions and the Ministry of Justice. People can now visit job centres at one site to enquire about discretionary benefits and job opportunities, for example. Regarding passports, people no longer need to queue up in Victoria and, instead, receive their passports much quicker.

So by improving Civil Service capability means the public will feel less dissatisfied than they otherwise would.

Q: What will the Institute be doing to maintain the case for reforming the Civil Service?
A: Almost everything we do on a daily basis concerns improving government, and we will keep the debate going about the overriding need to reform the Civil Service. We are best known for our research reports and public events but our Whitehall links and practical work with government and the opposition make us more unique than other think tanks.

We carry out a lot of private work with the civil service on areas such as internal transformation of government departments which, incidentally, we will be releasing a report on this autumn regarding lessons learnt from it. We convene seminars at Parliament, and we host private meetings, some of which I chair, involving Civil Service leadership and others. We are only three years old but already we are building up a body of research and recommendations. As we grow we will ensure we go back to our original reports and track progress, we produced a report about eighteen months ago on how government manages IT, which we will be following up soon for example.

Our mission is to improve the effectiveness of government, and we go about this by engaging people and saying how things can be improved. We act as a bridge between all kinds of different people who find it very difficult to talk otherwise amongst themselves.

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