UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 97-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

PUBLIC ADMINISTRATION COMMITTEE

GOOD GOVERNMENT

Thursday 15 January 2009

SIR MICHAEL BICHARD KCB, LORD BIRT and LORD JONES OF BIRMINGHAM

Evidence heard in Public Questions 238 - 310

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Public Administration Committee

on Thursday 15 January 2009

Members present

Dr Tony Wright, in the Chair

Paul Flynn

Kelvin Hopkins

Julie Morgan

Paul Rowen

Mr Charles Walker

________________

Witnesses: Sir Michael Bichard KCB, Lord Birt, a Member of the House of Lords, and Lord Jones of Birmingham, a Member of the House of Lords, gave evidence.

Q238 Chairman: Let me call the Committee to order and welcome our witnesses this morning, Sir Michael Bichard, Lord Birt and Lord (Digby) Jones. It is a great pleasure to have you along. Normally in these inquiries we focus on a particular area and interrogate it to bits. Rather ambitiously, I think, in this case we thought we would try to stand back and see whether we could distil some of the underlying principles of government in this country to see what seems to work rather well and what does not work very well at all and whether we could say something about that, based upon all the work that we have done over the years and also all the work that all of you have been involved in. We have therefore tried to construct witnesses who we think have something to tell us about this and all three of you qualify and we have been interested in what you have been writing and saying. I do not know if any of you want to say anything by way of introduction but, if not, I would simply ask you to try and have an initial go perhaps, each of you, at this question of what in general do we get right in terms of the government of this country, and what we get wrong. Who wants to start with that?

Lord Jones of Birmingham: I will kick off. Good morning. I found it a very interesting experience, moving from the private sector into government as a minister. I thoroughly enjoyed but I really did form some conclusions about exactly the issue to which you refer. One was that I think that most people who enter, especially at the democratically elected end, all enter with very well-meaning, well-intentioned, firm beliefs about how they want to change society for good as they see it, whatever that may be, and then the system gets them. The true runners of the country, the Civil Service, get them and they become subject to the levers and the influences of advancement because they are building a career. That, of course, means the promise of preferment, the promise of advance and threat of sideways, backwards or out. If they work for one bank and they do not get on and their face does not fit and they have said something they should not, they can go and work for another bank; if they go and work for one car company and it does not work they can go and work for another car company. With politics, of course, if they go in to one there is nowhere else to go and they are trapped and so they start to make compromises and within a very short period of time they are the fodder of either, at one end, a party-political driver, or, at the other, the way that the Civil Service are implementing and driving the implementation of policy. If they then get up the path somewhat and become a junior minister, I feel that that is one of the most dehumanising and depersonalising experiences a human being can have. The whole system is designed to take the personality, the drive and the initiative out of a junior minister. The contrast then with the big beasts, the Cabinet, is huge. I think the Cabinet ministers are the drivers and the system does listen to and has a lot more difficulty controlling them, but I do think something seriously should be done. By the way, something I seriously applaud is the bringing in of specialists into government through the mechanism of the House of Lords; I think it is an excellent idea. If we are going to have more of that I do think the system has to be adapted to accommodate their specialism, their expertise and in some cases their independence. Lastly, I would say that the problem of the contrast with somebody who is coming in with that expertise, especially if they are coming from the private sector, is that they come up against an organisation in the Civil Service which is honest, stuffed full of decent people who work hard, but, frankly, the job could be done with half as many, it could be more productive, more efficient, it could deliver a lot more value for money for the taxpayer, and the levers of change, the ability to effect change, are so rare because of the culture. I was amazed how many people, frankly, deserved the sack and yet that was the one threat that they had never ever worked under because it does not exist, as long as they have not been criminal or whatever. I have always believed that if somebody is not doing it then you train them, you work hard with them. You do not tell them; you ask them, you work with them, you bring them on, you help them. If at the end of the day they carry on not doing it you have to have some pretty serious words about it, and if at the end of the day it is just not fitting then, "I am sorry, but this is not for you". When that system was being applied I was always told, "They will just be moved sideways and they will go off to another department", and that is something which, frankly, the taxpayer does not deserve. You cannot effect change on that basis.

Q239 Chairman: Perhaps I could just ask you one thing before I move on. I have read some of the stuff you have been writing about your experience, which is fascinating stuff too, some of which you have been describing now - pretty damning stuff on the Civil Service, "full of dead wood", "no attention to real performance management" and so on, but then you went on to say, "Ah, but it's the best Civil Service in the world".

Lord Jones of Birmingham: Definitely. I think its two greatest assets are that it is honest, and in my job particularly, both at CBI and at UKTI, I came across civil services of most of the world, frankly, and it is the most honest on earth and I think the British public are very lucky to have that. Secondly, I think especially at the top part it is stuffed full of some of the best in the world, so in comparative terms with other civil services I think we are lucky, but this is a relative game; this is an absolute game. If, as we come out of this current economic malaise, taxpayers are going to be asked to fund a lot of this borrowing, which is merely deferred taxation, they are going to ask for a lot more from the public realm than they have been getting for no more money. The need for change is enormous. That does not mean that you throw the baby out with the bathwater. It does not mean that we are not very lucky to have them. It does mean that they cannot rest on those laurels and therefore avoid change. The private sector is going through the most enormous change every day but you never get it in the Civil Service.

Q240 Chairman: I think the value is in having you come in from the outside and give a perspective on what you found. I will ask Lord Birt to do the same. We tried this with you, do you remember, before when you were still in government?

Lord Birt: Just out.

Q241 Chairman: You would not be entirely forthcoming with us, but we think now you are a free man you can tell us what you really think about us.

Lord Birt: Freer. I will start, Chairman, by observing that the Civil Service must be very effective indeed if it can stifle the drive and energy of Digby. It is not easy - and we discussed some of these things, I think, last time - to disentangle the role of politicians and politics and the role of the Civil Service and the wider public sector, though that is our job today and I think one can have a shot at it. I tend, possibly because of my greater age, to look at these things from a long term perspective. I would say, and I expect this will be common ground and Digby has already alluded to it, that the silky private office mandarin handling skills of the British Civil Service have probably always been world-class and probably best in class. What does that mean? It means that if you are in a crisis of any kind more than one politician has said to me that there is no group of people they would rather have around them than the British Civil Service. They are excellent at understanding where all the players are coming from - stakeholders, the party in power, the Opposition, the organisations, the groups involved and so on, and helping ministers to understand where the mines are and how to pick their way through them. That is not to be underestimated. We have seen over the last ten years increasing skill at handling major national crises of the foot and mouth variety, and again that is valuable and not to be underestimated. We have seen over 15 years the growing capability of the British Civil Service. I think it started under the Conservative Government with the introduction of Next Step agencies. I think - and we discussed some of these things last time - we have seen real advances in growing the capability of the British Civil Service for a very different and much more testing agenda of public sector reform than, frankly, we faced in the past, and the theme I would strike there is that much has been done and there has been very great improvement, and I have seen it for myself (and I think again this will be common ground) but an awful lot still remains to be done. We are nowhere near a position where you could describe the British Civil Service as highly effective at all the tasks that it faces, though it is work in progress and I am absolutely certain that we have seen the leadership, not only the top leadership, Andrew Turnbull and Gus O'Donnell, but also the people who work with them, drive that agenda pretty effectively over the last five to ten years. However, against the span of time I think you would have to ask how well has Britain performed as a country, and some of the common ground of what our agenda has been over the last five or ten years is an under-performing public sector against international standards. We were under-performers in education, we were massive under-performers in health. We have had and still do have the worst transport infrastructure in the developed world. We were ill-prepared for our energy challenges. Our national productivity has not been high. These big challenges that any political party would face I think have shown that the system has not been good at asking the big questions and not only not very good at analysing them but at where it has analysed them. The business of delivering better social outcomes involves running very large organisations and very large systems of which the organisations are a part in a way which would challenge the best managers in any environment anywhere in the world and we manifestly are not in the position yet where one might call the line managers, we have seen big improvements in functional support, in technology, in HR, there is still much work to be done, but we are a long way from having the line managers in government being as skilled as their equivalents in the private sector. I have not layered on politics, which is a vastly complicating factor, but much achieved, much still to be done.

Q242 Chairman: I was going to ask you, coming out of what you have just said, whether you thought the areas that needed the most attention were the political ones or whether they were the administrative ones or whether they were the connective rods between the two.

Lord Birt: Again, we touched on this last time. I do not expect British politics to change fundamentally in my lifetime. It is always going to be an uncomfortable mix. Obviously, not all politicians are the same. Some are truly interested in the big picture, better outcomes, delivering over the long term, long after they have left office, not many but some are. At the other end of the spectrum you find politicians of all parties who want wheezes and initiatives and stunts. They want to be seen to be doing something today to manage the public perception agenda, and a high proportion of that is the enemy of long term improvement in social outcomes. The whole system becomes highly short-termist, ends up doing things which are ill-considered, not bottomed-out, not robust, and it all fritters into the sand. A huge amount of energy in the system is taken up with the non-value-adding activity for political reasons and I would not expect that to change if there was a change of government. However, that does not excuse the public sector from needing to have the ability to deliver better outcomes whatever the government of the day. I echo what Digby said, that nobody should doubt that there is talent in the British Civil Service at every level. People could work anywhere in any sector in any part of the world - their impartiality, their commitment, their dedication is undoubted. He is also right that one of the many problems of the system is weak performance. Again, I think things have been done about this and the British Civil Service is not alone in struggling to deal with weak performance, but alongside the high performers there are poor performers and managing those poor performers out is not sufficiently well done at the moment.

Q243 Chairman: Thank you for that. Can I turn to Sir Michael and say you are both the insider and the outsider?

Sir Michael Bichard: I am just confused.

Q244 Chairman: We would like you to confuse us at a higher level than we are confused at already. We have obviously followed over the years things that you have been saying and writing. Indeed, you have often come and spoken to us. You have been a radical voice for reform inside the system and you have developed a critique of what is wrong, and I would like you to just tell us what you think that is.

Sir Michael Bichard: The first thing to remember this morning is that good government gives this country a competitive advantage. Sometimes we talk about issues of government and politics and Civil Service administration as if they are intellectual exercises. Good government gives you a competitive advantage; that is why it is so important. What are we good at? We are good at some important things. Some of them have been mentioned - the issues of honesty, integrity, neutrality are absolutely brilliant. I think the Civil Service is pretty good at analysis, not necessarily as good as we need it to be at anticipation and forecasting but good at analysis. We are good, I think, at dealing with crises but I am not sure I would say all crises. We are not as good at dealing with operational crises, or what I would call operational crises, as we are at, say, structural change. Throw a department or several departments up in the air overnight and the Civil Service (and actually ministers) will somehow find a way of making that work. I was not impressed as a marginal player at the way in which, for example, foot and mouth was handled because I think that was an operational crisis and there were not enough people who had had operational management experience at the centre of dealing with that. Finally, we are quite good at dealing with transitions, both parties and the Civil Service. Those are really important strengths. I am not going to say what are we not good at. I want to focus on just a few areas that I think we need to be better at. The first one I have talked to you before about, the issues of delivery. I do not want to go over that ground again today. I think we could still be better at delivery, we could still be better at focusing on the outcomes rather than becoming obsessed with the process. I think we still probably do not have enough people with real operational management skills. It is 15, 16 years ago that I suggested that it would be good if we did not even consider people for promotion to the senior Civil Service unless they had had significant and preferably successful operational management experience. I think if we had done that at the time we would have a very different sort of Civil Service as we sit here today, so delivery I think is still an issue. I agree with John. I think in these areas there have been some improvements but I think there is still some way to go. There are two or three things I want to focus on this morning that we have probably not talked about quite as much. The first is that we are still not good enough at joining up across government. It does not matter whether we are talking about the Civil Service or whether we are talking about the political structure. We have talked about it for a decade and one of our dangers, I think, is that we almost persuade ourselves because we have talked about it for so long that it must have happened, and, of course, there are some interesting examples of joining up across government, but nowhere near enough. If you look at the problems that are facing us in the next ten years - climate change, sustainability, obesity, all of those things will not be solved by one department working in isolation. Somehow we have to be better at how we join up our thinking and our delivery. That is the first thing. The second thing I think we are not good enough at, and again it is a word which is in danger of being overused and being dismissed now as a fad, is innovation. We still have a very risk-averse system. People talk about innovation for ever but what we do not talk enough about is what needs to change in order for our system to be more innovative. I do not think there has ever been a time when that was more important than it is today. I do not think we are going to get out of this deep recession by defending ourselves against it. We are going to have to find new ways of addressing the issues and new ways of designing our public services. Innovation is going to be at a premium and I do not think that we have yet found the right levers. I will just give you one example of what I mean by "levers". If the next round of capability reviews, which I think are a really good initiative and which people in the Civil Service now care about, does not assess the capacity of departments to innovate and to join up their thinking and delivery then people in the Civil Service will assume that the rhetoric does not matter, that we are not serious about these issues. I think joining up and innovation are key issues. Third and finally, I do not think that we are yet good enough at a package of issues which are around what needs to be done in-house by government, what needs to be outsourced, how do we commission services which are not being delivered in-house - I think there is a huge deficit of commissioning skills within government - and how we regulate services that are being delivered for the public good. It is not just in the financial services market at the moment that we should be asking questions about the regulatory system. I think we should be asking questions in government about how this is operating. It very often works against innovation. I think it very often works against joining up, because, frankly, if you are working in a police service in an area you may like to work with your chief executive of the local authority but if it comes to the crunch of whether you do something which he and your partners there want you to do or whether you do something which HM Inspectorate expects you to do it is a pretty easy decision for you, so I think we have to look at our regulation systems, we have to look at the data. You have looked at that in this Committee: how sure can we be about the data that we are using to assess performance? I think that is a very good question to be asking at the moment, not least after the Baby P issue in Haringey, so join up, innovate and be better at regulating and commissioning.

Lord Jones of Birmingham: Can I just add one point on that, and I am probably the most recent example of experiencing this? I can remember in very early days when I became a minister, I had this idea of how we could deliver one particular thing with a lot fewer people and with a better outcome. I put it up through the system and nothing happened, nothing happened at all. About a month later I went and saw a very senior civil servant and said, "I just don't understand. Why is nothing happening?". "Oh, yes, we tend to ignore things like that because you will get very busy and then you'll forget it and then we can carry on". I said, "I don't forget it and I'm serious about this and I want it dealt with". Someone like me, who was a different sort of minister, could carry on being a bit of a thorn in the side, but the greater majority of those junior ministers would have given up; they would have just carried on.

Q245 Mr Prentice: What was it that you wanted to do?

Lord Jones of Birmingham: I am not going to go into all the detail here this morning.

Q246 Mr Prentice: Why not?

Lord Jones of Birmingham: Because I think it would monopolise it and certainly it would be very unfair on one or two civil servants who did not have the right to reply; I do not think that is fair. The point is that I carried on pushing that and forced it through. Most ministers would not have done. They have got a career to worry about.

Q247 Chairman: Yes, but this civil servant -----

Lord Jones of Birmingham: He was serious, by the way.

Q248 Chairman: Yes, but he probably would have thought, because he sees ministers come and go all the time -----

Lord Jones of Birmingham: I remembered what I had put and I wrote it down here to remind me. It is this risk-averse point to which both of them have referred. One of them said to me, "But you don't understand this. You'll be gone in 18 months and I've got a career to build and I am not going to put my name to something which might fail because my career will be in ruins whereas you will just move on to other things", and he looked me straight in the face and told me that.

Q249 Chairman: He was right, was he not?

Lord Jones of Birmingham: Of course he was right, and it is not his fault. Do not blame him; he is a human being. If I were him I would do the same. It is the system's fault.

Q250 Chairman: Can I just raise one question and then I am going to ask colleagues to come in. It relates very much, Digby, to your own experience but also to what Michael has been saying about getting clearer the relationship between the politicians and the administrators. Let us compare the situation confronting the United States at the moment with the new President coming in who can appoint anybody he wants to his political team, all the talents in the country, and can bring people into the administration that he wants from whatever source, and contrast it with a Government here which comes in that has only got the resources of its own party people to draw upon and has got a Civil Service which is simply given to it. We get into a great tizzy when we try and do something about this, as we do when we try and bring people into government through different routes, as we do through special advisers and as we do when we try to bring new people into the Civil Service. Do we have to go further down this route to make it easier to get movement in and out both on the political side and the administrative side?

Lord Jones of Birmingham: I could give you an hour on that, so maybe these two can start.

Sir Michael Bichard: I think there is a lot being made about how there are lots more outsiders coming into the Civil Service and, of course, there are two or three permanent secretaries now, a couple who came from local government and one or two came from elsewhere. I still think we have some considerable way to go. I would not, however, be too pessimistic about the ability to do it. I know I am getting old as well but if you think back to 1997 when David Blunkett, the Secretary of State, wanted someone in the department who knew a bit more about schools and how they operated in literacy and numeracy than he felt (and actually I agreed) we had in the department, Michael Barber came in and I think did a very good job running that unit and then went on to other things within government. That was - and I suppose I would say this - fairly well-managed transition and you had the right person in the right place. I think you have to be very clear what role you want these people to perform and give them support when they do come in. I think it can be done. In terms of getting the right people within the Civil Service in the most important jobs at the right time, that is important and I think we do not often talk enough about it, somehow as if it is a bit tacky, but I think it is important and there are ways in which that can be done. In any organisation you are trying to get the right fit at the right time of the skills and competence of the individuals and I think that can be done in the Civil Service. Too often the problem is that it is presented as politicians interfering for political reasons in the way in which the Civil Service runs. I do not think it is necessary to do it in that way and I think permanent secretaries and the Cabinet Secretary have an important role when there is a transition in handling that.

Lord Birt: I would see nothing wrong in that. We know that the advent of political advisers has been very controversial. I do not share the general concern about them. I think boosting ministers' cabinets with a wider range of skills to allow them to be more effective and less dependent on sometimes Civil Service attitudes would be a good thing but I personally am not attracted to the notion that the solution to the problem of having a more effective public sector is to pour in resources to it from the top. I would be sceptical that that is a solution and that it might make things better and actually I much prefer myself to try to make the existing system operate more effectively. I work a fair amount in France at the moment and one of the things that is striking when you work in French institutions is the high degree of movement between the private sector and the public sector such that the French have developed in my judgement an extremely capable, well-educated group of people who are equally at ease (which we have not got) in the private and the public sectors. We have seen a big movement from outside, and Michael is an example of that, into particularly things like the technology function of government. We have seen a lot of people with very great private sector experience coming into government and it has changed the mood music, but we have only just dipped our toes in the water here and I personally would like to see the Civil Service itself being more open to drawing in outside skills. The other thing I would like to say here, which I think is an absolutely essential point, and Michael has touched on it, is that a lot of Whitehall departments are a dreadful tangle of strategic "capability" on the one hand, and I put that, frankly, in inverted commas, and delivery responsibility on the other. I think for all sorts of reasons, not to do with politics but to do with how you can get organisations to work effectively, the more rapidly we move to lean, mean Whitehall departments, very much smaller than they are now, whose role is to understand the big questions, the big systems, to have high analytical capability, the better. Michael and I part company on how high the analytical capability is in Whitehall, but I endorse some of the things that Michael has said - the ability to get systems to work, to supervise and govern institutions, to understand how to use the private sector in the most intelligent way. Obviously, we have made some progress on these things but I personally am much more attracted to a model of a lean, mean centre and the maximum of devolution of delivery, and indeed competition for delivery, which is not the hallmark of most parts of the public sector now. I believe from a lifetime of experience in different institutions in the public/private sector not that competition does not bring problems but that it brings huge benefits in innovation (Michael's word) and efficiency and the hallmark of much of the public sector is that it faces no competition at all. The private sector, and I have had a fair amount of experience of that over the last ten years, is a mix too between high achieving, extremely impressive companies at one end of the spectrum and low achieving companies at the other, but there are remedies in the private sector when you have low achieving organisations. Those remedies are very weak indeed in the public sector. They do exist when there is chronic failure and in the end the politicians do something about it, but the mechanisms are nowhere near so efficient as they are in the private sector for remedying failure. Greater competition in the public sector for delivery of services of all kinds would undoubtedly bring huge improvements and a much smaller, more fit-for-purpose Whitehall.

Sir Michael Bichard: If I say nothing else can I just add to that? In terms of your inquiry we could argue that we are at a turning point, a crossroads, in what good government is. In the last 20 years in this country good government has been judged very much in service terms: how can we deliver more efficient services, more responsive services? You can argue that the Labour Government in 1997 was elected on the basis that they were going to improve the quality of the services. If you look at the kinds of problems that government will be facing in the next ten to 15 years I do not think that that is going to be sufficient. If you look at obesity, which I mentioned earlier, you do not solve obesity by delivering an obesity service. You have somehow got to find ways in which your services connect up to tackle obesity. At the end of the day you do not even then solve it by delivering a service. You solve it by influencing people, citizens, to behave in a different way. The whole issue, I think, of influencing behaviour is given nowhere near enough emphasis in government. I very much agree with John. I think maybe the time is coming when we need to move away from this preoccupation with services to a more strategic sort of government which is more about influencing behaviour, which is much better at joining up the issues, which is agile, quick on its feet and innovative, and maybe - and we have not talked a lot about this - a bit better at forecasting and anticipating some of the issues that are coming down the track rather than being good at reacting to them when they are right in front of you. If you put all of that together, and your point also, I suspect, outsourcing more, I know this is controversial but more of the micro-management - and I talk as someone who ran the Benefits Agency, do not forget - you will have more energy and space and time to focus on the things that really matter. If you put all that together it is a very different kind of government than the kind of government, whatever the colour of the controlling party, we have had for the last 20 years.

Q251 Chairman: But was not the Next Steps agency model designed to do a lot of this?

Sir Michael Bichard: No. The Next Steps agency model was very much focused on how can we improve the delivery of services by giving agencies a greater sense of pride and identity. They will be more effective. The chief executive will be more accountable. I was chief executive, I think, of the largest of them. I had 168 targets to make me more accountable. Make the chief executive more accountable and you will improve the quality of service. What they did not do, and it was a struggle at the time and I think most of them did not achieve it, was the ability to really influence policy in the way that I think they should have done, so there was still this distinction between operations and delivery and policy and there was not a knitting together of those, but they were not about the kinds of issues I have just been talking about. They were not about making government better joined up. They were very much about silo-based delivery.

Q252 Chairman: Digby, do you want to come in?

Lord Jones of Birmingham: Both John and Michael referred in their opening remarks to the fact that an efficient and productive Civil Service and everybody else in the public realm is a hallmark of a successful advanced economy, and in the 21^st century with a changed dynamic after the last couple of years I think it is going to be even more relevant for our children's generation. I think it calls for a fundamental shift in the way we go about it. You mentioned America and how Obama can just pick and choose and bring experts in. They are not the only country. France does it. Germany does it to a limited extent. Is it not strange but when this Prime Minister decided that he would try and do that, he would try and move slightly towards that, and I was one but there were many others - Mervyn Davies was appointed yesterday and I think that is a fabulous appointment - loads and loads of people start arguing about judging it on the criterion of the old way and yet someone has got to get on the page of tomorrow. If you look at delivery, one of the problems as to why junior ministers get swallowed up and basically just become depersonalised, dehumanised people is because the departments they are in charge of or are working with know a lot more about the subject than they do, and what they are after is a political career of advancement in politics which means that in a couple of years they will go and do something entirely different for which they are singularly also not qualified, and they will meet another load of civil servants who know a lot more about the subject than they do, and so it will carry on, whereas if you do bring in these specialists as ministers to deliver in one specific thing where everybody knows that they are not after a more rounded political career, they know more about that subject than the civil servants by and large who are helping them do the job, it shifts the dynamic fundamentally. That happened to me. Because of the CBI and what I did in internationalising that I knew a lot about the work of UKTI. I knew quite a few of the people but I also knew a lot of the markets and a lot of the businesses with which we were going to work every day, but it was a fundamentally different way of handling UKTI which led to some serious success. I do not expect everybody wants it to carry on running in the way it has, to say, "That's a great way of doing it", but if someone can think of a better way of getting ministers in to do this as specialists I will listen. I applaud the Prime Minister for being bold enough to try and change it on delivery. I do think there should be a democratic connection and total democracy in setting policy with democratic accountability. I think that is absolutely right, but in terms of various delivery mechanisms of implementing that policy or doing things for the country I have to say that getting specialists in is first-class. One of the impressions I was left with of the existing system was that so many people in the Civil Service, and I include in that the NHS, I include in that the Prison Service, are far more interested in process than they are in outcome. They pay lip service to outcome because they have got targets to meet. They will pay lip service to outcome because it ticks boxes, but the culture is one of process: "If I have done what I was told to do and I can stand up and say, 'I did all this'", the fact it did not get a result is secondary because, "I have been a good boy, I have gone and done the process". So often I heard that. One of the lasting impressions I have, if you look at the private sector, is that what comes first, second and third is the customer. To keep the customer happy you need good people whom you have to look after. You need investors with whom you have to communicate. There are a lot of other things which work towards keeping the customer happy but the customer comes first. If you look at the public sector their own job comes first. There is a culture where they exist to look after their jobs. Oh, and, by the way, after that there are lots of other things which are very important and to which they will definitely pay attention, but it exists in a self-continuing basis. That is why it is so very difficult to get rid of people. That is why it is so very difficult to end up doing the job with fewer people without those people just being moved to somewhere else in the Civil Service. The reason is that it exists for the jobs and therefore the culture is one which is totally different from keeping the customer happy; therefore delivery is second to process.

Q253 Mr Prentice: There are some grotesque generalisations here.

Lord Jones of Birmingham: Of course there are, but there again I have read you many times in newspapers where you are grotesquely generalising.

Lord Birt: Chairman, we have done too much talking but forgive me if I make one last point of my own. We should not be naïve about how the political market place works. The balance between reward and risk is fundamentally different in politics from the private sector. In the private sector there is reward for creating long term value. In politics, it is the brave politician who cares, as I think he or she should, about making things better for everybody over the longer term, and most things that are worth achieving do take a very long time and are very difficult to achieve. Nobody will remember who initiated that work when the value finally arrives and no political credit will accrue. We all know the way our politics works, that the reward for taking risks is very poor indeed, and that not only affects politicians but also affects the civil servants that serve them and we know that the punishments meted out by our political system and the media in the wings for getting things wrong, which is an inevitable consequence of taking risks, are horrendous and that affects everybody's behaviour and will continue to do so.

Q254 Mr Walker: Having listened to your analysis, it reinforces my view that our political system is probably past its sell-by date. I think there are many advantages to the American political system. First, there is the separation of powers between the executive and the legislature but also, more importantly, in America when you are a politician you focus on being a politician. You do not try and run things. As the Chairman pointed out, you have Presidents who bring in experts to run things. Do you think that really under our existing political constitution we are constrained from making the changes to improve the overall performance of the public?

Sir Michael Bichard: The point I was making was that I am not sure that I am convinced that we are. If you want the American system we can have the American system. It does have its own downsides and I think we are seeing some of the downsides now - the issue of continuity and transition. I think it takes rather longer and to some extent leaves a vacuum of power. I do not think that happens in the same way in this country. The second point I was making was that I think you can get some of the benefits that you are looking for within our existing system. Yes, we should be more open to bringing in externals, whether they are into the Civil Service or into the political structure. We should be much better at supporting them which, before Digby gets worried, is not about making sure they are obedient to the Civil Service class but enabling them to work effectively in what is for many of them a very different setting. It took me some time to get used to the Civil Service. Some people might say I never did, but it does take you a while. I am not selling the Institute for Government here today but I think the Institute for Government, for example, could help some of the people who are coming in in different roles to be effective earlier. I think you can do a lot of that within our existing system. Personally, I would be very loath to throw all of that out of the window and go for the American system in the UK.

Lord Birt: I would too, for this reason, that we require real expertise in the public sector in Whitehall, as you do in any walk of life. It simply is not correct in my judgment that you can infiltrate very large numbers of outsiders into the top end of these systems and have them overnight become more effective. I just do not think that would happen. We must not underestimate the real expertise that truly exists in the public sector. I have made it clear that real expertise is not enough. All sorts of additional skills are needed. We do need to see continuing reform in the public sector but that, I think, should be the direction of travel, to have much more effective public institutions. Again, as I said earlier, it should be more porous, more people moving in and out from the private sector, but I personally doubt things would be better if we had a very large influx of outsiders. My own experience of outsiders coming into the public sector, not just in government but in the BBC sometimes, is that even the best managers from the private sector can struggle in a public sector environment and some never learn to understand the differences, so I do not think that is a way forward that attracts me.

Lord Jones of Birmingham: That begs the question that the outsiders would work better if the system was changed because I think John is right, that the outsiders have a problem if they are dealing with the existing system. I am with both of my colleagues. I would not fundamentally change the system. I would flex it, finesse it somewhat and take some of the best from the American model. The one thing we forget in this country is that we judge Presidents from over here because of their foreign policy by and large, because it is the one thing they have executive power over, but in so much of their domestic policy, over which they are judged at the ballot box so often in America, they are powerless. They have a real problem in getting stuff through. One of the great advantages of our system is that they go to the manifesto, they say, "Vote for us and we will do that", and the electorate by and large know they can if they get a majority. That does not happen in the United States, so I think that aspect of it is right. As Tony Benn said many years ago, the downside of that is we basically surrender power to a dictator except for one day every five years because of the fact that we do elect somebody who has the ability to implement - and we know they do - everything in the manifesto. That does not happen in America. That is quite a good idea if you want to get things done, but getting it done I think is a call for a greater input of private sector expertise for some time to help on the delivery mechanism as opposed to the policy setting.

Sir Michael Bichard: May I just add to that? At the risk of making you glaze over, leadership really matters in this area. If you bring someone in from outside, in the Civil Service or as a minister the leadership provided politically and by the permanent secretary is very important because otherwise these people will not be clear about their role and the rest of the ministerial structure or the Civil Service will not realise the importance of integrating these people. Whenever I brought someone from outside into the Civil Service, and we brought a hell of a lot of people into the department, I always had them into my office if they were reasonably senior, and said, "I did not bring you here to be a silky mandarin. I brought you here because you have particular skills and a different perspective that I want to see influence the way in which this place works. If you experience insurmountable problems that door is always open and I want you to come and talk to me about them". A lot of them have said to me since that that was really quite important because it gave them power and clout and it gave them a sense that the very top management was behind them. I do not think that often happens; I just do not think it happens that people are brought in, whether it is into the Civil Service or as a minister, and they are just left there.

Q255 Mr Walker: How are you going to bring people from the private sector in? It cannot be about remuneration because, quite frankly, the taxpayer is not going to wear significant numbers of civil servants earning more than the Prime Minister. That is just a fact; it is not ever going to be tolerated by the taxpayer, apart from beyond probably the current levels, and even those might be excessive, so how are you going to persuade the best people in business, the private sector, to come into government? Are you going to do it a bit like football clubs, where a player will go out on loan in a sense - a Manchester United player might go to QPR and Man United would pay the majority of that player's salary while they were at QPR and QPR would pick up part of it? How are you going to be innovative about the transfer of talent?

Lord Birt: We have common ground in that we do need to see a further influx. It has been happening but we need a further influx of the best of private sector skills into government. For instance, in the finance function, which is chronically weak in government, Whitehall has very weak capability in analysing money and understanding how much things cost and how we can get better public outcomes at whatever level of cost. I have already said we can help boost ministerial capability by giving the minister greater muscularity with advice of a kind that can come from outsiders. Again, that has started. We could certainly do better there. I think the critical thing is to look at the nature of Whitehall departments. We frankly need more managers in what I call line management positions, of which there are very many in a big Whitehall department. Many more of those managers need to be different kinds of people from the ones that are there now. I think the Civil Service has got to look out to bring in different kinds of talent. The sorts of silky mandarin skills are not sufficient in a modern delivery environment. They do not know enough to do their jobs properly. As I said earlier, we need to use the private sector by devolving delivery outside of the public sector so we have greater competition and greater skill and force innovation, force efficiency in delivery. The British Civil Service is not failing. It is by any standards a very strong British institution and, as I said earlier, it is getting a lot better. We do not have to throw out the baby with the bathwater. We have to strengthen it.

Lord Jones of Birmingham: To answer your specific question about how do you persuade people to come in when they are earning more, I have a very simple and a very firm view about this. I was earning a lot of money and I gave it all up and as a minister I earned £82,000 a year. I believed that there was an element of service to my country. I believed that there was an element of fulfilling a dream of how I thought UKTI should be run. I would not have accepted an offer to go and do anything else in government. It was specifically because I wanted to deal with trade and investment promotion and I was very pleased the Prime Minister took the trade policy side of life away from my department because that is not what I saw the job as, and for a period of time I was prepared to give everything up - and I talked a long time to my wife about it - so that I could do something for my country. I know business people have used a lot of their own talents and they have taken huge risks, but we are fortunate people and if they have got to an age where I hope they would put a few other values ahead of earning money "incumbent" is too strong a word but I think that there is something in it to do a couple of years for your country. It is as patriotic and as simple as that. I do understand how, if you are Alan West coming in from the Navy or Ara Darzi coming in from the Health Service, the figures may be different but the concept is the same. They all gave up money to do it. It is something as noble as just doing it for your country. That implies that you would not do it for ever; it implies you do it for a period of time and then go back into what you were doing, which again supports my view of, "Don't get involved with the policy. That's for democracy. Get involved with the delivery of something at which you are skilled and have expertise". Afterwards, when you then finish, the country can continue to benefit because if the mechanism of the Lords is used --- I have moved to the Cross Benches and I hope that I can champion wealth creation and business in the House of Lords in the process of legislation and the debate around legislation, and I guess, as your Alan Wests and your Ara Darzis move away in years to come, they will add value to the legislative process on an ongoing basis although they are no longer in government, because those who criticise the make-up of the House of Lords do not understand its work. The experience that can be called upon is enormous and the experience I gained as minister of UKTI is huge. There is an added benefit to the country going forward after you have done the job and, remember, you do not get paid in the House of Lords. You are not earning money doing that; you are doing it for your country again. I know this sounds all sort of wishy-washy but it is a genuinely held belief I have.

Q256 Mr Walker: I am going to have to bite my tongue, Chairman, because I do not want to get down the route that you were in government for a year and a half, you will be in the Lords for the rest of your life; it will not have harmed your career or your own potential in the slightest.

Lord Jones of Birmingham: I agree. Why is that a criticism?

Mr Walker: So to sit there --- I am sorry, Chairman. I am going to have to stop.

Q257 Chairman: I think I would like to hear what Michael was going to say just then.

Sir Michael Bichard: I was going to say that there are some people that you will never attract in because they are motivated largely by money. I am thinking about people maybe a touch earlier in their career than Digby, but they are motivated by money. What you have to convince people about is that if you do get into these positions, whether it is in the Civil Service or as a minister, you have the ability to make a real difference on a big stage in a way that is not possible in most private sector companies. Some people are going to be switched on by that, they are going to think that this is a real opportunity, and some are still going to think that money is more important, and probably we do not want the latter group there anyway.

Q258 Mr Prentice: Lord Jones, when the Prime Minister offered you a job did you tell him that you wanted to do it for a couple of years, just like you told the Committee a few moments ago?

Lord Jones of Birmingham: Yes.

Q259 Mr Prentice: You did?

Lord Jones of Birmingham: And I told my department when I joined it.

Q260 Mr Prentice: You have said that being a junior minister was "dehumanising". Did you have a kind of exit interview with the Prime Minister where you said to him, "Gordon, you have really got to do something about this because in my 18 months in the department I was just dehumanised"? Did you have that exit interview?

Lord Jones of Birmingham: No. I did not say I was dehumanised. I said, "The process is dehumanising".

Q261 Mr Prentice: Did you have an exit interview -----

Lord Jones of Birmingham: No, get the words right. The first thing is, I did not say I was because I was not. Secondly, do I think the system does it? Yes, it does. Did I have what you would call an exit interview with the Prime Minister? No, I did not.

Q262 Mr Prentice: Do you regret that?

Lord Jones of Birmingham: Regret what?

Q263 Mr Prentice: Not having an exit interview with the Prime Minister.

Lord Jones of Birmingham: It is not like that.

Q264 Mr Prentice: Why should it not be like that?

Lord Jones of Birmingham: No, because there will come an occasion, and I do not know when it will be, when I will have an opportunity to have a discussion with the Prime Minister, I hope, about it all, and there will come an occasion - I do not know when it will be - when I could have an opportunity to discuss it with senior civil servants, so do I think that it will be a good idea? Yes, I do.

Q265 Mr Prentice: Let us not try and talk over each other here. The Prime Minister would be very interested in your views, I am sure, and I would just invite you to write to the Prime Minister and tell him directly what you are telling the world. You have told us repeatedly that specialists should be brought in, and I hope I am not misquoting you again, but you told us, "You have got to accommodate their independence". How does that happen in practical terms, because you did not take the Labour Whip? You served as a minister in a Labour Government. You did not take the Labour Whip. How is your independence, the independence of the specialists that you want to bring in, going to be accommodated? By voting against the Government on it?

Lord Jones of Birmingham: You are actually wrong that I did not take the Whip in terms of voting. I did not join the Labour Party and I would not have joined any other party either, so it is not a party political point either; I value my independence, but there is no way I would ever have voted against the Government while I was a minister. There is no way that I would have abstained while I was a minister, and if I was in the Lords when a vote took place, because my job took me to 45 different ministries -----

Q266 Mr Prentice: I read that - 31 countries, 45 overseas visits.

Lord Jones of Birmingham: Exactly, but if I was in the Lords I would have voted with the Government for sure, because you support the captain of your team, do you not?

Q267 Mr Prentice: You trumpet this independence but in 18 months, even though you have been outside the country on 40-odd occasions, you would always vote down the line with the Labour Government? Were there never any occasions when you thought, "I am doing this but in my bones this is the wrong thing for me to do because I am an independent kind of guy"?

Lord Jones of Birmingham: I can truly tell you that I was never put in that position because I was not in the Lords at any of the votes.

Q268 Mr Prentice: I see, so that is how this system accommodated you.

Lord Jones of Birmingham: Actually, I was never in the Lords on a day when there might have been a policy to vote on which I -----

Chairman: Let us just draw breath and at least make sure that we talk one at a time.

Q269 Mr Prentice: I am just trying to understand how the system accommodates people like Digby Jones. You told us earlier that the system has got to flex and finesse.

Lord Jones of Birmingham: Yes.

Q270 Mr Prentice: And the fact is that if you had problems with a government policy you were out of the country so you never had to vote down the line on a government issue that you felt strongly against. That is the reality. That is how the system accommodated Digby Jones.

Lord Jones of Birmingham: De facto.

Q271 Mr Prentice: Yes.

Lord Jones of Birmingham: Yes.

Q272 Mr Prentice: I am glad we established that.

Lord Jones of Birmingham: De facto, not that that was intended.

Q273 Mr Prentice: I am glad we established that. Can I just move on to Lord Birt, if I may? You said something which was quite astonishing earlier when you were talking about the "failings" of the British system. You said, "We have got the worst transport infrastructure in the developed world".

Lord Birt: Yes.

Q274 Mr Prentice: On reflection, do you seriously believe that to be the case, because in the United States they have got crumbling bridges, a rail network that is nothing to speak of, highways that have potholes, recognised by the American administration, and you come here and tell us that we have got the worst transport infrastructure in the world?

Lord Birt: As you may recall, I led the long term strategy on transport project when I was at Number 10. I worked with a large team of excellent and talented civil servants, many of them from the Department for Transport, as well as outsiders and lots of others represented on the team from the Treasury and so on. I cannot remember whether the fruits of 12 months of our labours is among those bits of my work which were leaked or released under FoI, I am afraid, but you could not but read that - and I emphasise, though I led it, the very large number of the Government's best and most analytical minds at work here - and come to the conclusion at the end of the day that, whether you look at our rail system or our road system, we are simply the worst in the developed world.

Q275 Mr Prentice: Fair enough, we are not the Transport Committee.

Lord Birt: That is not a matter of opinion but rather the result of a great deal of hard work and labour.

Q276 Mr Prentice: Fair enough. The Chairman is going to admonish me if I continue going down that road. Can I ask you simply, because you have talked a lot about leadership, is any government only as good as the person at the top?

Lord Birt: Are you asking me this?

Q277 Mr Prentice: I am asking you, yes.

Lord Birt: Because I think it is Michael who rightly emphasised leadership.

Sir Michael Bichard: I am happy for you to answer.

Lord Birt: No system of any kind, including government, can be wholly dependent on the person at the top. The person at the top matters more than anybody else because that person provides leadership and tone and manages the broad direction of government policy, so of course the quality of the person at the top is critically important, but in no organisation can you survive unless alongside a good leader you have a good team and every part of the organisation, and here we are talking about the Civil Service, is as good as it possibly can be. You need a lot of things to be in place before you can deliver.

Q278 Mr Prentice: Indeed, but it is the Prime Minister - one person - under our system who selects every minister in the Government. Michael, did you want to comment on that?

Sir Michael Bichard: There are some things that only the person at the top can do. That is one of the points that I was making earlier, whether it is the Permanent Secretary or Secretary of State or Prime Minister, leadership is something that you have got to have right through the organisation. I think the most depressing thing I have heard this morning is Digby saying that his experience was totally dehumanising, not that he was dehumanised (and clearly you can see he was not). I think as a Permanent Secretary, and I know that my different secretaries of states would have been really, really depressed. I do not think I have come across any minister that I have worked for or worked with who would have said it was dehumanising. I think that has got to be to some extent down to the leadership.

Q279 Mr Prentice: Yes, well, I talk to ministers all the time, and I am going to ask them, following this session, whether they have ever felt dehumanised. That is what I am going to do, and I think I may write to the Prime Minister after Digby writes to him. There are a couple of things that you have said that I just want to follow up. On the question of joining-up government, the way in which things are moving now is towards personalised services. If you have joined-up government with personalised services there has got to be much more data-sharing, yes?

Sir Michael Bichard: Yes.

Q280 Mr Prentice: How do you reconcile this business of joining-up government with the regulation which is essential if there are going to be massive transfers of personal information about individuals between departments? How do you strike that balance?

Sir Michael Bichard: It is such an important issue and I am glad you have raised it really because I do think that good, effective government in the future is going to require much better management and sharing of information. Whether you are looking at the Health Service or whether you are looking at the Police (which I know a fair bit about as a result of Soham) we have got to find some way in which we use information better for the benefit of the end user, whatever you want to call them. The technology of course is now available to enable you to do that better than ever before. All of that is good news, all of that is accepted. Unfortunately, at this particular moment in time, public confidence in management and use and sharing of information by public agencies is going in the opposite direction. I do not have a solution to that although I think both Governments could have shown a bit more leadership around this issue of data and privacy over a long period of time. I do not have an answer, and it is something the Institute wants to look at, but somehow we have got to bridge that chasm. If we do not bridge that chasm then I do not think we are going to get the level of effectiveness in government which we need and which the people out there are expecting.

Lord Birt: I wonder if you would allow me to come in on the back of what Michael has said about this and the point he has made a number of times that you have alluded to, namely how can we get better collaboration across government. Collaboration across any institution is a fantastic challenge. It is probably the most difficult thing that you can do because you have got people with different line management responsibilities, and often the people involved may be quite a way down any bit of the line management. This is in the real world, and this is true in the private sector but it is manifestly true in the public sector, as Michael has said, where you quite often find yourself in a position where to achieve a better outcome you need to galvanise very large numbers of different bits of the system. It is a huge challenge. I would say that Gus O'Donnell has picked up this challenge in the last couple of years and things are, as so much else, a lot better than they used to be, but we should not under-estimate just how big a challenge it is. A number of times when I was at Number 10, I can remember three or four occasions when I was involved in discussing big challenges, and you would go to the meeting expecting to find half a dozen people there and you would actually find a room of 40 or 50 people there, each of them (sometimes they double-bank them) representing some part of the system, sometimes in the same department, more often in a variety of different departments. There are a number of issues, and we have not got time to talk about them today, where you cannot deliver radically different and better public outcomes unless you can galvanise all those people. It is a huge challenge. What would you need to do to achieve it? It is a politically unpopular thing to say but you need a strong and capable centre because the centre has got to help develop, talk to all the people, understand the challenges and get the master plan. You have got to identify the accountabilities in the system and those accountabilities go up to the Permanent Secretary and go up to the Minister. They may not be, frankly, always something that the particular minister cares about, so you need quite a complex apparatus, so to speak, to get the programme plan or the project plan and then clarity about the accountabilities, and clarity about the incentives for those individual civil servants to deliver, which are often extremely weak, and, as Michael said, there is often a technological take on the back of that; you have got multiple systems, how do you integrate them, for example. These are huge, huge challenges and they are the challenges of our time. We will not be able to meet those challenges without an infinitely more effective, sophisticated and rigorous set of capabilities in the public sector than we have now.

Sir Michael Bichard: We can talk about what we need to achieve them. My frustration is that often we do not break that down and say what actually needs to change, not with new mechanisms and new structures but how can we use the existing mechanisms to exert influence? How could we use the select committee system more effectively. I bring it home to you. I think you are the only select committee, and I am probably now going to be proved wrong, apart from the Public Accounts Committee, that looks across government. Most of the others are actually still silo-based. What message does that send out when we say we want more joined-up government? We need to look at everything that we are doing and ask whether this is sending out the right message on how we should join up our thinking and our delivery. I know that is a different point to your point about information, but I worry about information because I think, unless we crack this, then patients are not going to get the service which they could expect in the future and which they would expect in the future. We are going to continue, although the Police are making progress, to have problems with the sharing of intelligence which needs to be shared around the country between forces. Somehow government, of whatever colour, whenever, has got to give some strong leadership and get a public debate going about this issue.

Mr Prentice: I would like to continue this but my colleagues are waiting.

Chairman: Thank you very much. Paul Flynn?

Paul Flynn: A few weeks ago we had a group of four very distinguished former Cabinet ministers sitting where you are sitting and we were struck by the way that they were relaxed, they were very much humanised people, they were talking to us, they were humorous, they communicated freely, and the comparison was made at the time by saying, "When you four were in front of the dispatch box you behave like lobotomised automatons and now we see this transformation, ie now you are free of the burdens of office." I was struck, Lord Jones, by what you said about this dreadful experience of being junior ministers, which thankfully every member of this Committee has been spared that torment ---

Kelvin Hopkins: I wonder why actually!

Q281 Paul Flynn: Do you think that this is permanently damaging and was passed on to the Cabinet ministers we saw before us and then were they transformed back into human beings now they have left office?

Lord Jones of Birmingham: I am literally going to answer your point by just using two words: "case proven".

Q282 Paul Flynn: Can you describe the damaging effect of it?

Lord Jones of Birmingham: Because of the fact that I was not on a career path as a politician and because I had no political ambition, I did not have to suborn myself to all those influences that are part of the depersonalising cannon-fodder process. It is true to say that the system militates against the personality of people, especially junior ministers, but also probably Cabinet ministers. The trouble with the word 'dehumanisation' is that you can make headlines out of it, it can become exaggerated, it can become almost offensive, so perhaps we ought to think of a better word, but the personality of people and the ability to be frank and the ability to speak their mind and the ability to be the person that made you attractive to an electorate, if you are on one side of it or to an appointer if you are on the other side, those very qualities so often get suborned to the system. The word dehumanisation is probably the wrong word so we might like to think of a better one before headlines are used. However, I do think the cannon fodder idea of this and this idea that the Civil Service say, "This is how we are doing it and you will actually do it the way we do it, not the other way round," is very relevant, and I think your experience of the four Cabinet ministers probably proves my point.

Q283 Paul Flynn: You mentioned one of the other pressures on junior ministers and the Civil Service is that they are terrified of the Daily Mail. Could you explain why this makes cowards of them all?

Lord Jones of Birmingham: I said that in the article, did I not?

Q284 Paul Flynn: Yes.

Lord Jones of Birmingham: Two or three times I went and saw one or two pretty senior civil servants and I said, "Why don't we ..." "Don't blame us; blame the Daily Mail." They actually used the words to me, "We have got to do it this way because of the Daily Mail." I said, "If we are right and we are strong and it is the right thing to do, do it." "No, no, don't blame us; blame the Daily Mail." It is this risk-averse attitude and that is probably what I mean by this.

Q285 Paul Flynn: There was a series of Reith Lectures that took place probably when the three of you were in school under the title "The Unimportance of Being Right". It was about the Civil Service and it suggested that civil servants who had the audacity to be found in the possession of an intelligent idea their careers would wither and those who followed the line that was laid down, by the Daily Mail presumably or some other lowest common denominator, their careers would prosper. I put that to Gus O'Donnell who was very insulted by the question suggesting that his career path was determined by the unimportance of him ever being right on anything. Is that a fair comment?

Lord Jones of Birmingham: I would distinguish there. What the civil servant was really saying to me and where I think that Gus is right in this is that it is not the civil servant who is frightened of the Daily Mail. The civil servant is doing his job as defined, which is to protect the backside of the minister, and it is the minister, and therefore the elected government, being sensitive to the media, which is really what that means, that the civil servant is trying to deal with. It is not that the civil servant is going to get into the Daily Mail, but he will be judged in part by how his minister got through the media mire. I do not think it is about the risk-averse civil servant being worried about him being in it; it is about waking up one morning and finding his minister is in it.

Q286 Paul Flynn: One of the conclusions that you made in one of your strategy papers, Lord Birt, was that our drugs policy is costing the country £24 billion, and thousands of people are dying as a result, more than in any other country in Europe. That paper was not published, it was released under freedom of information, and there was virtually no action as a result of it. What are your feelings about that now?

Lord Birt: I think drugs is a really good example of what I talked about earlier and, indeed, when I said earlier that there were a number of occasions in my time in government where you went into a room and there were very large numbers of people there, drugs was one of those occasions. The reality is that you have a multiplicity of agencies and interests involved. They are all passionate, dedicated and concerned with the task in hand that they have in their bit of the system. They are doing their best. They do not want to change the whole system.

Q287 Paul Flynn: They are not concerned with outcomes.

Lord Birt: There is too much invested - and this is a general truth in a lot of public policy - in the status quo. Do not under-estimate the extraordinary inertia within the departments and within the Civil Service itself on many questions. It is honest and it is well-intentioned but it is inertia and it is the enemy of change.

Q288 Paul Flynn: Would you regard that period, particularly on that report and the other blue skies things you did, as a failure? Do you see anything worthwhile coming out of what you did?

Lord Birt: I do not want to go into detail, like I said the last time, because I do not think it makes a difference. I think that what happens with a lot of that work, and again I would like to keep on emphasising that I never did anything by myself, there were always large numbers of other people involved in the process - I do not want to go into detail, but I am absolutely satisfied that in most instances it changes people's exposure to solid evidence (because that is what we are talking about). It was not opinion; it was the gathering of evidence from all over the world, and an intensive data-gathering exercise in the UK itself that had never been done before, understanding, in this instance, how many problem drug users are there; how did they fund their habit; what did they do to fund their habit; what is the evidence across the world of what you can do most effectively with problem drug users. There was not, I would like to say, half-baked opinion in it anywhere; it was all hard evidence. I have all sorts of reasons for believing that an awful lot of that analysis then becomes digested and becomes part of people's understanding. Again, my experience over time, not just in government but in other places, is that often there is a big delay between insight and action.

Q289 Paul Flynn: I do not want to go on too long about this because it is a bit of a hobby horse of mine but really we have a situation where you have pointed out, quite rightly, that on this rational evidence - and I praise your report and continue to - and like many other reports that have been done by distinguished bodies you came to the same conclusion that our drug laws are not working and they are killing people in very large numbers and costing £24 billion. This situation is dreadful but there is no-one on the political side that has the courage to do anything but what is popular in what appears to be the lowest common denominator which is the Daily Mail.

Lord Birt: In that particular instance again I am very hesitant, as I was last time, and I do not want to reveal too much about what happened when I was in government, but I do not mind saying in this particular instance that I think the Prime Minister supported the totality of that analysis and the implications of it. Do not under-estimate, even if you are the Prime Minister, if you have got a solid array of vested interests - and I do not use that in a disparaging tone because, as I said, I do not at all doubt the good intentions of those vested interests of all kinds, both from the security services and the police and the health services, and so on - they have got so much invested in the status quo, and so the notion that you are going to fundamentally change the system, the policies, the way we deal with these things was just too much for them to take, and the politics did not allow the Prime Minister of the day to take it on. That is a reality in much of politics; some things are possible and some things are not. The job of people like me was, frankly, to ignore the difficulties to a degree and try to lay bare the evidence.

Q290 Paul Flynn: Okay. I will turn to another subject. You were associated in the BBC and in Government with 'Birtism' as it was called, managerial speak which most of find incomprehensible. If we had a look at bad language you might well star in that report. You were also associated as part of this with bringing in consultants to do work that one would expect the Civil Service to do anyway, and there was an explosion at that time. This seems to be going out of fashion now. I believe that people are rather critical of the poor results and the poor outcomes when many of those consultants were brought in. What is your present view on that?

Lord Birt: My present view is the same as my old view which is that there are good consultants and there are bad consultants. Good consultants bring analytical skills and they bring insights from across the world. The major consultancies are present in every market in the world and they do a great deal of work for a lot of different kinds of institutions. They can syndicate those insights, they can be invaluable, but you need a system to act on those insights, and that is often where it goes wrong. The delivery occasioned by those insights just does not happen sufficiently well.

Q291 Paul Flynn: We are looking at performance in government. Do you think we need some kind of judgment on these consultants who are becoming hugely expensive on what the results have been, that someone should make a judgment on this and other matters, and we should have some kind of performance body to actually measure the results?

Lord Birt: I think it is really dangerous to be hostile to consultants. To be honest with you, most of the hostility against consultants within the system itself is people not wanting outsiders to turn over stones and uncover what really lies beneath them. I do not share the hostility. As I said, not all consultancy is good but the best consultants can be very helpful. Actually at the top end of government there is not very much consultancy. A lot of the work that I was involved in was done by the Strategy Unit, which is essentially an in-house government consultancy in many ways, and many of the people who work in the Strategy Unit come from other places such as the major consultancies, some of them come from the City or business backgrounds, as well as bright sparks from the Civil Service itself. I think the work of the Strategy Unit, which this Committee praised, as I recall, in one of its reports, and I share your regard for the Strategy Unit, is a good example of how evidence-based consultancy can really aid intelligent policy formation.

Sir Michael Bichard: I think consultants is part of a wider problem. It is the issue I mentioned earlier about commissioning and procurement and whether government and the Civil Service is good enough at commissioning and procuring services. There are some occasions when it does make sense if you need a short injection of skills which you do not have and which you are not going to be able to get. If you are going to use consultants though you need to be very good at specifying what you want from them and managing that process. I think we need to be better at procuring and commissioning all sorts of services. When I came in from local government into a central government department I found that there were at the time over 200 consultants from one particular company working in that department. I did not feel that that was an example of good procurement or good value for money. I do not think that happens in the same way now but we need to be better at managing. Consultants get frustrated sometimes that they are not actually used effectively.

Q292 Paul Flynn: Sir Michael, there has been some progress. There is no such thing as an Education Committee, there is only a committee with Education in its title now, so there has been an attempt to do this. I want to ask you to develop what you were saying about global warming and how you would like to see that develop. We are having a decision on Heathrow Airport which some people see as an environmental issue and other people see as a transport issue now. How would you see the challenges of the next ten years, particularly in view of the world possibly following in the slipstream of Obama on the environment with his likely to be very more progressive policies?

Sir Michael Bichard: We do now have a Department for Climate Change and personally I think that is a step forward. I am not someone who believes that structural change on its own actually solves a problem, but I think it is such is a big problem that it good to see it reflected in government structure. Please, I am not an expert in sustainability and climate change, although I think my work at the Design Council is making me a bit more informed, and I do not have the answer to that in policy terms. What I am asking is are we organised sufficiently well to address a problem like that because it is not one department, it is not even the Department for Climate Change, it goes right across government, are we flexible enough to be able to move quickly to address elements of that. Do we use our existing various processes better to ensure that this issue is given a priority. Those are the questions I am asking and I am just saying in the future there are three or four big issues like that. I am just not sure that government is currently best organised or best skilled to deal with them as effectively as we would need to. That is what I am saying.

Q293 Chairman: On the issue about ministers, not the dehumanisation point, but another point which is ---

Lord Jones of Birmingham: I think we have thought of another word for that.

Q294 Chairman: --- Okay, you tell us in a moment, but we have had it put to us, and Geoff Mulgan, the former Head of the Strategy Unit put it strongly when he was here, and he said that the number of ministers now was dysfunctional to government and Ken Clarke agreed with that. Leave aside whether it dehumanises them but I just wonder whether we need all these people.

Sir Michael Bichard: I would think that we had too many ministers at the moment, yes, and that maybe it would be interesting to look at whether the Cabinet itself is too large to provide the coherence and the leadership in the joined-up way that I have been talking about. I can now look at that in a rather more dispassionate way than I did in the past. I understand that these are big political issues. These are not issues that are taken entirely on the basis of rational thought. They are, "We need a Cabinet of this size because we need to have these people in it," and I understand that but I think there is a case for saying maybe the Cabinet is too big and maybe we have got too many ministers, yes.

Lord Jones of Birmingham: If we look at the system and not the people for a minute, the system militates towards more ministers and a big Cabinet. The system militates towards, if I may say with great respect to the gentleman, the number of MPs that we have. 21st Century Britain and the way that certain things should be delivered probably calls for a smaller Cabinet, fewer ministers and fewer MPs.

Q295 Mr Prentice: And a smaller House of Lords?

Lord Jones of Birmingham: I cannot sit here and say all that and disagree with you on that either. It calls for a different way of doing it, for sure. You cannot just say fewer ministers if you keep the same system. The system leads you to all these people so it has to be the other way round.

Q296 Chairman: You want a tighter system, do you not, Lord Birt?

Lord Birt: Under the present system I think we probably do have too many ministers and having too many ministers undoubtedly leads to the "something must be done" tendency and it certainly leads to, "I need to attract attention because I am keen to have promotion," so a lot of junior ministers are extremely keen when they get into office to find the six sound bytes that can get them noticed by the higher-ups in their party over the 12 months that they are likely to be in the position. I do not think most of that helps the better government agenda that we have been discussing today. However, I said earlier that ministers need more muscularity. If you do away with junior ministers you have an increasingly isolated minister, if we do it as at the minute, surrounded by the Civil Service. I do not expect that many Cabinet ministers would want to be so friendless, so I think, yes, fewer ministers if we carry on as we do at the moment would probably be a good thing but if we were seriously interested in better government and really using those ministers well and intelligently, then I have no problem about their number.

Q297 Kelvin Hopkins: Just a simple question first of all. There has been a lot of criticism of the Civil Service by yourselves, but which particular layers of the Civil Service are you most concerned about? It is a multi-layered animal and there are the mandarins at the top but there are many other layers even in central government departments. Where are the key weaknesses?

Sir Michael Bichard: I just want to say that improvement is a journey. I know that sounds awfully glib but we are on a journey and I think that things are improving. I am a great fan of some of the things that Gus O'Donnell, the Cabinet Secretary, has done to try and support that. I do not want to give a totally negative picture here. I think things are improving. I think the two areas you really need to focus on are leadership at the very senior level (and I think that has improved but there is always room for further improvement) and also at the level of middle management. I know that is almost a cliché but I think that is where you have got to focus. Someone mentioned just now the word 'promotion'. I think it was mentioned in terms of politics. Promotion is a hugely important issue and the messages that you send out by who you promote to the very senior positions and indeed to the positions below that, really matter. People watch whether you are promoting, for example, the people who can work well with other departments or whether you are promoting the people who are focused solely on their one department, whether you are promoting the people who are very good at consolidating safety first advice or whether you are promoting some people who have got fresh ideas, who manage the risk rather than take it and who every now and then may have something go wrong (but that is the cost of innovation). I am not sure that we yet - and this is a point I keep making - use processes like assessment and promotion to make sure that the right things are being valued and the right people are getting up the chain. When I was in the department we said at the beginning we want more people who have got operational management experience. Fine, okay, we all agreed with that; no-one did anything about it. We said after a year or two, "In the future we are only going to promote people who have had good operational experience." "Hang on, they are a bit more serious than we thought we were." Towards the end of my four years in that department we sent out a request for people to apply for promotion to the senior Civil Service and we put in the advert: "We will only consider people who have got a wide range of experience". People were flooding through my door at that point looking for secondments into the private sector and local authorities because they realised that at last we were serious about this. All the rhetoric in the world does not change the culture of an organisation. It does not make it behave differently. You have actually got to take some difficult decisions.

Q298 Kelvin Hopkins: It is my impression - and I may be wrong - that the esteem and the power of the Civil Service has been diminished relative to the political world and it is perhaps less attractive to the best minds than it was.

Lord Birt: That was not my experience. I am sorry you characterise what we have said as having substantial reservations about the Civil Service because I think we have all cast to varying degrees the notion that the Civil Service has considerable strengths. We have inevitably today been talking about the way in which it can be improved but, as I said earlier, I do not think there is a talent problem. I think that the people at the top, in the middle ranks and a lot of people I have worked with in government who were front-line civil servants who were junior people in their 20s or early 30s either from the departments or from the centre, these were some of the most talented and capable young people that I have ever worked with, and I have now worked in a variety of different institutions in the private and in the public sector. I said earlier that alongside that there are some under-performing civil servants, and dealing with poor performance is a real issue, importantly, for many of the best civil servants themselves because they feel trapped in a system which does not deal firmly enough with some of its problems. As we have all said to one degree or another, things are getting a lot better but the challenges of modern government are such that we do not need things to get better, we need real transformation; and we are some way from real transformation. I think that we are some way in Whitehall departments from having a properly integrated top team of all the talents where people from non-managerial backgrounds play their part, particularly in the oversight of these complex institutions that we have been talking about for much of the morning. Again as I said earlier, I think many of the line managers, and Michael is right, we have seen a change, there is greater emphasis on delivery, just being in a private office is no longer a passport to promotion in the way that a successful career in private office used to be, but things happen quite slowly in this world. You do not have the urgency and the attack and the speed of action that you get in a private sector environment, so these things need to be addressed. Ideally they should be addressed more speedily but the cup is half full.

Lord Jones of Birmingham: If you look today at recruitment bright minds do go into areas where it is not hugely remunerative; they do it for other reasons, and to join the best Civil Service in the world is quite a come on, quite a hook. Pay and conditions have improved enormously over the last few years, so the comparative with the private sector, other than at the absolute top, is very healthy indeed. I tell you in private sector comparatives these days the private sector probably comes off worse in many areas. If you are looking at right now and you are coming out of university, you might think, "I will go into a job where job security is still so much better than in the private sector, where the pension is just in another league to the private sector, what is more it is going to be paid for by the private sector, and, thirdly, at the end of the day, I have got the chance of stimulating my mind in a way that might not happen in certain areas of the private sector." I would not worry too much; in fact I would not worry about it at all.

Q299 Kelvin Hopkins: The quality of political decision-making, in my modest view, has deteriorated. I use an example, the 1967 devaluation, a friend of mine who had worked in the Treasury in the 1960s said that the decision was taken essentially by civil servants on D-40 and they told the Chancellor on D-11. It was done by the Civil Service and the Chancellor went along with it and then it happened on D-Day. By contrast, the decision on the Exchange Rate Mechanism was very political and the politicians hang on until the very last moment, costing the Treasury vast sums of money to prop up the pound when it could not be propped up. Had the same civil servants been involved from the 1960s that disaster would have been avoided and the Conservatives might even have been re-elected in 1997, who knows. That disaster caused a serious political change. The wilfulness of politicians is now much more obvious than in those days and the power, independence and calibre possibly in the Civil Service is less good. I was struck very much by what Sir Michael said about the consultants. To walk into a department and find 200 consultants in a department is astonishing. Sir Humphrey would not have tolerated that.

Sir Michael Bichard: I have always preferred, and I think most civil servants want to work with strong politicians. They want to work with politicians who have a sense of vision, who want to make a differences and add value. However, if you are going to have strong politicians you have got to have strong civil servants too who can engage in a real dialogue and conversation. I do not know whether it has got worse or whether it has got better. When I leave here I am going to go and talk to an academic who wants to do a substantial piece of work on policy failure. What I am going to say to him is we do not start out saying it has got worse but it really would be interesting, and we do not do enough of it, to look at is there a pattern in some of the policy failures? Why did they happen? What can we learn from them? I think too often when things go wrong (and sometimes when things go right) we walk away from it and we move on to the next issue. Just a little bit of reflection. I am agreeing with you that there have been some pretty awful policy failures, but I want to learn from them rather just stick at the point where we say there have been more than there used to be.

Lord Birt: I have known different generations of the Civil Service and I have no doubt myself that this generation is as talented and, in important respects, more skilled than the previous generations, so I do not think that that is a difficulty. I would be in some agreement with what you say but I think the cause is different. It is the thing that I alluded to earlier which is that our political environment has changed and there is certainly more short-term, ill-considered policy than there used to be. Things moved at a more stately pace in the past and there was a greater opportunity to consider things and now there is often a big rush to say something or to do something and the proper amount of time, the proper amount of rigour is not always brought to bear.

Q300 Kelvin Hopkins: Just one more question which is really about a phrase that we use a lot here about the importance of civil servants telling ministers, telling politicians how it is, speaking truth unto power, and having the capability and the intellectual calibre and the strength and independence of mind to be able to do that. Lord Birt talked rightly about the failure of transport policy in Britain. It is a chaotic; it is a mess; and it compares very poorly with the continent of Europe. Did any civil servants say to you the difference between the continent of Europe and us is that they have kept their public transport largely in the public sector as an integrated system; we have fragmented and privatised and liberalised it and ours is a mess and theirs actually works. Looking at the railway systems on the continent of Europe, Lord Birt, would you not think that you could advise the Prime Minister to look again at rail privatisation and the privatisation and deregulation of buses? Would it not be sensible to suggest to the Prime Minister that we bring it all back into the public sector and integrate it, like they do in Germany, France, Italy and Holland?

Lord Birt: I did wonder if Mr Prentice had been to Europe recently. I say that in humour and jest. As the Chairman I am sure will say, this is not the Transport Select Committee and there simply is not the opportunity to address your questions at length. However, I would say that I think the reasons for our poor transport go back a very, very long way, and at the heart of them is a lack of investment, and there are very easy-to-see reasons for that. You have to go back to the 1970s and the 1980s and the state of our economy is what the priorities of public spending were. If you actually analyse our spending over a very long period of time, we have invested far less than most other countries in our transport infrastructure. I think that is the key reason and, frankly, it is the responsibility of all parties. Again, I say that sympathetically because if you look in detail at why it happened, it is perfectly easy to understand, given some of the horrendous periods that Britain went through in that period, why transport was not a high priority, but we have paid a price. Different political parties will take a different view about what is the best way of getting transport infrastructure, whether through public funding or private-public partnership, and there will be honest differences on that, but I would think everybody should unite behind the evidence that the infrastructure does not match up to that of other comparable countries.

Q301 Kelvin Hopkins: Just to reinforce the point, was there any civil servant who put the view that I expressed which I think is commonsense, and the average person in the street knows it to be commonsense, was there one civil servant that said that to you?

Lord Birt: I do not honestly remember but what I can remember very clearly is that a lot of the civil servants who worked in transport, and some of them were quite excellent in terms of their understanding of the really semantically powerful modelling capability for instance in the Department for Transport, which allows them to look quite a long way ahead and understand what is going on, had felt neglected for decades and that no government had properly focused on it. I am bound to say that we could all list a long list of transport issues which have been addressed something has been done about, but I am talking big picture here and how effective is our rail system, how effective is our road system, where are we heading in terms of congestion, that sort of much more macro agenda has, by and large, been ignored so a lot of those civil servants felt that they were being ignored. By the way, they wholly welcomed the notion that they had a Prime Minister who at least was willing to suggest that we needed a proper, long-term, integrated transport policy.

Q302 Kelvin Hopkins: But who was wholly opposed to bringing things back into the public sector.

Sir Michael Bichard: At the very top of any department you have got to develop a culture in the place where people can speak their minds because then there is some sort of sharing of the mission. I have to say that I never found that I had civil servants who were unable to speak truth unto power and, indeed, once or twice I had to take one or two of them aside and say, "Yes, that is very important but if it is the only thing you do, people get a bit fed up after a while, and there are other ways in which you can present bad news which takes the Secretary of State with you." I must say I never found that. You are absolutely right that the stronger the politician the more protection by and support of civil servants at a middle-ranking level you need to be able to do that.

Q303 Chairman: Can I just nail down one thing because we keep coming back to this issue about weak performance being a problem with the political system and not being adequately dealt with. I just want to make sure that we have got from you your analysis of what it means to adequately deal with it. What could we put in place, whether structure or whatever, to change a culture which everyone seems to agree does not deal well with poor performance?

Sir Michael Bichard: I think Digby actually came up with a form of words earlier right at the beginning which personally I would not disagree with. People need to be absolutely clear what is expected of them. If they are not delivering it then you need to discuss that with them. If they continue not to be performing, then at some point you have got to be prepared to take action. I am afraid I did see too many examples of that not being done and people being allowed to stay in a post or to be moved around (not I have to say in the department I was running, he said quickly!) I think there needs to be strong responsibility and accountability visible in a line management sense. If you are asking me more generally across government how we can improve the levels of accountability and performance management, if you like, I do not like your idea of a National Performance Office. Sorry, it was not your idea, it was Robin Butler's idea. I think we have enough people around already who are working in the field, not the least of which is the NAO (which will shortly have a new leader and has a new Chairman) and I think the NAO could play a much more constructive positive role in this area. You also, if I may say so, missed out the possibility that the National Statistical Agency, which is beginning to establish itself, could also play a part particularly in validating some of the performance data that is around, and you might find a conversation with the National Statistical Agency helpful and constructive at the moment. I have reason to believe that you would. I think what we need to be doing, in other words, is looking at our existing agencies and making sure that they are more effective and focusing on what we believe to be the real priorities. If joining up is a priority, what are we doing to look at whether people are joining up? If innovation is a priority, what are we doing through our systems of accountability to look at that. Finally, the real worry I have is that if you look right across the public sector at the moment, we have in some ways the worst of all worlds. We have an accountability system which is not very effective but which is stifling innovation, and somehow we have got to get the balance between accountability and innovation and we have got to have a better balance across the public sector than we have at the moment. It is a much longer debate but it is an important debate.

Lord Birt: Weak performance is an issue in many organisations, not just in government, and you ask what is the best way of dealing with it. In well-run, modern organisations you have a performance management system where individuals understand what is expected of them, they will have personal objectives, they will have objectives associated with their role whatever it is, they will have a proper review process at least once a year, a really serious review process which looks at their performance, looks at their capabilities, understands how they need to improve their capabilities, and helps them if they are struggling to acquire new skills, sends them away for training or gives them counselling or coaching or whatever. If they are manifestly failing to meet their objectives then in most workplaces they will have the equivalent of a yellow card, and if they continue to fail they will be asked to leave. I do not think we are at that point. This is not an issue that is not discussed in the Civil Service and, again, as with everything else we are discussing, I think some things are being done here, but, again, is it being done with sufficient urgency and attack? I do not think so.

Lord Jones of Birmingham: If you find so many areas coasting and then acute stress levels because people know that they are not in any way being encouraged to deal with their deficiencies and they are just being talked about behind their backs and criticised, that puts enormous stress on people, so it is not even a system which develops the people as human beings, and then at the same time, John is absolutely right, to bring in that system of performance management would be an enormous culture change in the Civil Service. If it works the taxpayer would get more bang for the buck (and you would have fewer civil servants, by the way) and the same time you would have a better result for the United Kingdom, but it would call for some serious change management at the top and the courage to see it off with both the unions and also, I would submit, the entrenched culture of the organisation. It is something where really you are trying to deal with a 21st Century competitive economy with a 19th Century organisation, and that is a huge problem.

Q304 Mr Prentice: One point briefly, we have heard a lot this morning lionising the private sector and every year we spend £79 billion outsourcing to the private sector and they have been truly spectacular failures ---

Lord Jones of Birmingham: Not true.

Q305 Mr Prentice: I had an adjournment debate on the Educational Maintenance Allowance ---

Lord Jones of Birmingham: --- Completely untrue.

Q306 Mr Prentice: I had an adjournment debate on the Educational Maintenance Allowance which was being administered by the private sector, by Liberator, only a couple of months ago. Sir Michael, you said one of the things that we must address, and you gave us a list at the very beginning, was commissioning outsourced services, and in the case of the Educational Maintenance Allowance, which you may have followed because of your previous experience, it went through all the processes; it was subject to a gateway review; it was waved through, and it was a colossal delivery failure. If you were in charge of the commissioning aspect of central government, and you had this for the next six months or a year, what would you do to tighten up commissioning of private sector organisations to make sure they actually deliver what they say or are contracted to deliver?

Sir Michael Bichard: There are bad private sector companies and there are good private sector companies. Some of them will perform well and some of them will not perform well. Sometimes the failures are not because you have a bad private sector company; they are because the Civil Service or the Government itself has not specified clearly enough, has not set performance indicators and has not monitored and managed those, and has not acted upon failures as they develop in the system. I am not close to EMAs so I would not want to comment on that, but in looking at any failure you need to look at the extent to which it is a failure of commissioning and the extent to which it is a failure of the management within the organisation, could you have picked it up earlier and acted upon it. I do not know the answer to those questions in that particular case but you need to look at all of that. The commissioning process on paper may look very strong. I have been involved in gateway reviews. I was chair of the Legal Services Commission until very recently and we were involved in some gateway reviews. Were they as stringent and incisive as I would have wanted, well, maybe not? You can always have a process which looks good on paper, you have to look though at whether or not that process is actually being implemented effectively and that is what I would want to do. I am not close enough to the gateway process but I am never convinced that a process alone is the answer. It is who the people are who are involved.

Lord Birt: I do not think we have lionised the private sector. I have had experience of a lot of different organisations in the private sector. Some are quite excellent and achieve things that are not matched anywhere in government. Many are not well managed and some are even less well managed than some parts of government. There is a huge variety. Surely the job is to try and learn from the best managed private sector institutions and try to draw into the public sector some of that experience. I think you are absolutely right, we have had some spectacular failures on major projects in government. This was something that I was party to in many discussions when I was in government myself, particularly with the technology community. I am sure that the commissioning process can be improved, but I think the main hallmark of failure, from my own experience - and there will be others who know more about this than me - the main reason for the failure of many of those projects, frankly, I think rests in some of the things we discussed earlier, which is the lack of skill of line management in government. You have to explain why some of these outside organisations collaborate very effectively in the private sector environment (not always but more often) and struggle to be so effective in the public sector environment. If you talk to the technology community in government, most of whom have come now from the private sector (these are generalisations) but what most people will say is that it is extremely difficult to manage major projects in government given the quality of skill that many line-managing civil servants have.

Lord Jones of Birmingham: The point I was saying is not true is that £79 billion of public money has been spent on abject failure. What is right is that not every private sector organisation or indeed every relationship between the public and right sector has produced the results that you and I would want.

Q307 Mr Prentice: Fair enough, can we leave that there. Just one final question from me to you, Lord Jones. Baroness Vadera is plastered all over the papers today and people are saying it was a big gaffe talking about 'green shoots'. You have been very critical of the Civil Service but on the other hand you have praised it. Were there instances over the past 18 months where your civil servants saved you, Digby Jones, from making a gaffe?

Lord Jones of Birmingham: Yes, often.

Q308 Mr Prentice: Would you like to tell us about it

Lord Jones of Birmingham: I had a Permanent Secretary, we called him the Chief Exec, Andrew Cahn, and many times he would come in and say, or usually because I was in another country he would be on the phone or on a text or something ---

Q309 Mr Prentice: Yes, travelling.

Lord Jones of Birmingham: I am serious about that actually. He did not just say, "Well, I couldn't get hold of you," or, "You weren't around". He was very proactive in finding me in some embassy somewhere in the world. I am deadly serious because that to me was part of a good Civil Service and he did not just hide in his office. At times he would say, "You have left me a voicemail saying you are incensed about this and you are going to say this. That is probably not the right way of going about it. I am absolutely with you in where you are trying to go and I am not going to persuade you not to say anything because that is not Digby, but how about using these words, not those words?" And usually it was to get me to have a little more temperate response to the same issue. May I say a good quality civil servant is worth his weight in gold in that respect. I feel sorry for Shriti this morning because this is a first-class operator. Her job is not the microphone, her job is not the news conference, her job, at which she excels is in other years, rightly, horses for courses and because my job is often behind the microphone perhaps I can benefit from good quality advice from the Civil Service more than most.

Lord Birt: Can I say that I think it is a terrible indictment of our politics that such a modest slip should invite such disproportionate opprobrium.

Mr Prentice: I agree.

Q310 Chairman: The Daily Mail again.

Lord Birt: Quite of lot of papers carried the story this morning.

Chairman: We thought when we put this panel together that it would be both interesting and add considerable value to our proceedings, and it has proved to be so on both counts, and so we are extremely grateful for your time. Thank you very much indeed.