CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 983-i
House of COMMONS
MINUTES OF EVIDENCE
TAKEN BEFORE
PUBLIC ADMINISTRATION COMMITTEE
Thursday 17 July 2008
SIR JOHN BOURN KCB, SIR RICHARD MOTTRAM GCB and MS KATE JENKINS
Evidence heard in Public Questions 1 - 62
USE OF THE TRANSCRIPT
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corrected transcript of evidence taken in public and reported to the
House. The transcript has been placed on the internet on the authority
of the Committee, and copies have been made available by the Vote Office
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Oral Evidence
Taken before the Public Administration Committee
on Thursday 17 July 2008
Members present
Dr Tony Wright, in the Chair
Paul Flynn
David Heyes
Kelvin Hopkins
Mr Ian Liddell-Grainger
Julie Morgan
Mr Gordon Prentice
Paul Rowen
Mr Charles Walker
________________
Witnesses: Sir John Bourn KCB, former Comptroller and Auditor General, Sir Richard Mottram GCB, former Permanent Secretary, and Ms Kate Jenkins, former senior civil servant, gave evidence.
Q1 Chairman: Let me welcome our witnesses this morning. We are delighted to have you in front of us, Sir Richard Mottram, Sir John Bourn and Kate Jenkins. As you will know, the Committee has launched a rather ambitious-sounding inquiry called 'Good Government'. The point of this is to try and get behind some of the daily arguments to try and distil some of the underlying issues about what we do well in British government, what we do not do well and what we could do better, so we are asking a whole raft of people, who have got experience of these matters from different perspectives, to come and, as it were, distil their wisdom to us, and, I am afraid, all of you came into that category at once for obvious reasons. We have been reading what you have been saying and we want to draw from you in terms of this inquiry, so could I thank you all very much for coming along. Because you are all now free people, and, Kate, you have been free for a long time, you do not have to speak in the way that you might have spoken when you came in front of us when you were holding various offices and you can now tell us the truth! Now, I do not know if you would like us just to kick off or do you want to say anything by way of preliminary. We shall just kick off. Now, you are all incriminated by texts that you have produced, and I am going to use these to get us going. Now, Sir John, you, having run the National Audit Office for many, many years, therefore, have looked at government closely over this period, since you have left, you have been saying some pretty robust things about its infirmities. I quote back to you this article from The Financial Times back in May where you say, "My experience has taught me that fundamental improvements are urgently needed", and then you go on to say, "The whole culture of the senior Civil Service needs to be changed. The top jobs should go to those who have successfully managed programmes and projects - in health, social welfare and taxation, as well as construction and defence. At the moment they are given to those best at helping their ministers get through the political week. Changing this would produce a new breed of civil servants, who would concentrate on securing successful public services. It would alter ambition and behaviour right down the line". This is big, bold talk. What has brought you to this conclusion?
Sir John Bourn: Well, the 20 years' experience of being the Comptroller and Auditor General, when I was an Officer of the House of Commons, rather than a servant of the Executive, Chairman, and the 30 years' experience as a civil servant "helping the Minister to get through the week in politics". What I tell in that article is the consolidation of the experience that I have had in 50 years of continuous service and the consolidation of the reports that we made and the improvements that we proposed through the work of the Audit Office. You quote, as it were, the headline point that I make in the article and I also bring out that the Civil Service recognises this to a degree. If you look at Sir Peter Gershon's work on gateway reviews and you look at Sir Gus O'Donnell's capability reviews, they are saying, in a sense and in perhaps more measured language, what I am saying in that article you have just been good enough to quote. So Whitehall could move forward and you could get, as it were, a new view of what it takes to get to the top. Other things which I mention, and perhaps I would just draw that out as you have invited me, Chairman, to refer to my experience, first of all, I think there is too much change in government. The administrative machinery is in constant turmoil: new departments are created, old ones are dissolved, amalgamations take place. This often confuses the people who work in them and confuses the citizens who have to deal with them and often does not seem very relevant to the projects and programmes with which the administrative machinery is concerned. Regional structures, I think, often add complexity rather than clarity and often constitute fifth wheels on the coach of systems of administration. Risks are very badly assessed and managed. It is often said that civil servants are risk-averse. They are risk-averse about risks within the bureaucracy, but they are risk-ignorant about the risks of the impact of their programmes on the citizens of this country where the most colossal risks are taken, absolutely walking off the edge of a cliff, as we have seen, for example, in the scheme for the Child Support Agency. We all agree, fathers should bear the responsibility for their children, but, before you launch a great scheme, you need to think about how you are going to find the fathers who are not doing it now. These risks are, as it were, ignored and, as a further point that I would make, effective financial managements systems are not yet there in all government departments. People that I met when I was doing work for the National Audit Office, coming in from the private sector, were absolutely amazed that you can never find out what anything costs in government. Too often, as I said in the article, a figure that is put forward is a move in a game of, you might say, financial chess rather than being derived from a proper system of financial management and control. So all these are very important ways in which the government machine could do better, but that is not to say that the people who work for the government machine are anything but, for the great majority of cases, people who really want to do well for their fellow citizens, intelligent and anxious to make a real difference to the lives of people in this country. What is so sad is that all that effort, all that intelligence and all that commitment could produce so very much better results, and my argument, Chairman, in that article and other things that I have written, like the book I wrote at the end of last year[1], are directed at things that could actually be done and put into effect and, I believe, would result in even better services for the citizens of this country than we have now.
Q2 Chairman: Well, thank you for that. That is pretty dismal commentary on our state of affairs and we shall want to explore both the analysis and some of the remedies that you offer. Let me turn to Richard Mottram. The charge is that you spent your entire working life enabling ministers to get through to the end of the week. Do you recognise this description of what you have been about?
Sir Richard Mottram: Not in the least, no, Chairman, not in the least. The first point is that it would be amazing, I think, if we were not sitting around discussing, it would be very sad if we were not sitting around discussing how we could make the system of government in this country better. Why would you ever stop doing that? We should not be surprised that there is lots of discussion all the time about how we can make the system better. I have spent, I think, 39 years or something in the Civil Service and I never gave up on the idea that I could make it better the following week because I thought that, if we gave up on that idea, frankly, I would have stopped, but I think the reality is very different. I have worked with John, for instance, in the Ministry of Defence which has its strengths and weaknesses as an organisation, but I think no one could deny that it was an organisation that actually, over many years, was very effective in thinking about its strategy, developing new ways of working, adapting itself to the environment and, if you compared it internationally with other ministries of defence, it was very highly regarded. I worked latterly in the Department for Work and Pensions and John is quite right to say that the Department for Work and Pensions had an enormous problem in relation to the Child Support Agency, which is a very good case study of how not to do things and the difficulty you have where, if you get something off on the wrong footing, you are for ever putting it right. However, the Department for Work and Pensions was busily transforming every aspect of the way in which it worked to make itself more customer-responsive, even as it was reducing its staff and cutting its budget by very substantial sums of money, and those tasks require high-quality people who know how to lead and manage organisations. In the Department for Work and Pensions, there were plenty of people who knew how to lead and manage effective organisations, there were plenty of people who knew actually how to manage risk and there were plenty of people who knew something about financial management, so I do not myself want to overdraw this critique. What I would say is that there are all sorts of ways we can discuss in which we could improve the workings of British government involving ministers, officials, the delivery arms of government, which are mainly not actually in the hands of the Civil Service, but we should not spend our time being very bleak about the situation we find ourselves in.
Q3 Chairman: I am grateful for that, but you have not been entirely uncritical yourself of the way in which we do things. I have been reading your lecture at the LSE earlier in the year and you say, "The issue is how we balance and reconcile the culture and processes of political competition with the needs of management of large organisations", so you were actually saying that there is a problem about that at the moment.
Sir Richard Mottram: No, I was saying that I think there is an intrinsic issue there. There is an intrinsic issue in democratic government between the focus and interests of ministers in the political process and what is required in order to manage very large organisations, and we should explore why that arises. I think it does arise. I think it arises actually in every government system I have ever looked at, and what you have to is try find ways of reconciling some of those tensions because inevitably ministers have to get themselves re-elected, and that is quite a difficult thing to do, and they must have a focus which can actually be quite short-term. As I was pointing out in that lecture, I think we then compound some of those problems by the way in which the deployment of ministers and reshuffles and the whole political process makes that more difficult, but a minister has got a set of imperatives that relate to the political process. Some of these very large organisations, which are a world scale actually in their sort of complexity and the requirements of their management, they need to be managed on a consistent and coherent basis over a long period of time where actually, to bring about fundamental change, you really need to commit yourself to a path and stick to it, and the problem is to reconcile those imperatives. What I was, I think, trying to say in that article, Chairman, is that it is not a new thought, this, but I do not think it is focused on enough in government.
Q4 Chairman: But what you seemed to me to be saying, and you seem to be saying it now and I am trying to draw you out, is that, insofar as there are difficulties here, they lie on the political, rather than the administrative, side.
Sir Richard Mottram: No, I do not think that for two reasons. The first reason is there are difficulties on the political side of the kind that I sketched out in that article, but, secondly, what I think is the way forward, although it is a very difficult thing to achieve for reasons we could discuss, is for ministers to accept that these organisations, for which they are accountable to Parliament, have to be managed and led by people who know about leadership and management, and that may not necessarily be ministers. Some ministers have that background, but actually not that many, or it may not even be the natural thing they bring to the process of running departments, but then, if you go with that sort of model, you have to accept, and this is something Kate and I worked on together on Next Steps, for example, you have to accept on the Civil Service side of that bargain that, if you are going to be given the responsibility to deliver things, you can then put together teams of people, you can train up staff, you can have the processes, and you can have the organisations that will give ministers the confidence that things will be delivered. If you look at the track record of the Civil Service and you look at the track record of other public services, the answer is that it is mixed. So I certainly was not arguing in that article that the problem is simply in relation to the ministerial process. I have actually spent a lot of my official career trying to improve various aspects of the way in which the Civil Service performs as an institution and quite clearly that work is not done.
Q5 Chairman: Thank you for that, and let me just bring Kate in. You are still carrying the scars of trying to make change inside government some years ago and now you are an acute observer of these matters, both here and internationally, and you are very critical in what you say. You have written a book recently and you have been writing articles, and I quote from one of the articles where you say, "Even assuming that Parliament and the Civil Service carry out their constitutional functions with care and diligence, the structure is too odd and too fragile to withstand the pressures of a modern state". You are as dismal in your commentary as Sir John here, are you not?
Ms Jenkins: I think I could be very easily as dismal as Sir John because, for those who have been looking at this, as he has and I have and Richard now of course, for 40 years or so, what I think, is disconcerting is that it is not a new set of problems that arise. It tends to be the same set of problems and they tend to focus on the similar point, and I think Richard has very eloquently put the nub of the problem, which is the way in which decisions are taken and the way in which the management of government is actually handled by senior officials and by politicians. I have noticed, on reading through a lot of the material, that in particular, the role of politicians on entering government is something which tends to get neglected and it is quite a serious issue which, I think, repays investigation and, I think, would repay investigation by you because you are in a better position than almost anyone else or any other organisation to look at this seriously. The extent to which now, and I think it is much more the case now than 50 years ago, say, the functions of government are so complex, so fragile in the sense that they are both volume- and policy-vulnerable, it means that sudden changes in policy, sudden changes in volume and sudden changes in approach can destabilise these very complex organisations in a way which, if you have not had experience of running, or working inside, these very big operations, is extremely difficult to perceive. Certainly, from working with a large number of extremely well-intentioned ministers all around the world as well as here, I have seen over and over again this deep frustration about why the machine does not respond as they want it to respond, which is based on what I could only describe as a naïve innocence of the complexity of running these very big functions.
Q6 Chairman: So it is the fault of the politicians?
Ms Jenkins: No, I have not finished. It is partly the fault of the politicians, and I am not sure that "fault" is a very helpful expression because I think that this is something that has grown up over time, but I think we have reached the stage now, and this is where, I think, Sir John's points were very interesting, where the same complaints have been made now for 40 or 50 years. Fulton described a serious lack of understanding and competence in management and his ire was directed to the old administration, the administrative class of the Civil Service. When we wrote the Next Steps Report in the 1980s, we identified really quite alarming things about the way in which departments then were managed. On a number of occasions, I talked both to the secretaries of state and to permanent secretaries running departments and, on a number of occasions, they said in a rather engaging way, "Oh, I don't deal with management. He does it", but, when they both said it in the same department, we became extremely concerned. The theory of Next Steps, and I am sorry to keep using the shorthand, but the theory of setting up executive agencies was, in part, to push both ministers and senior officials into a position where they had to do this extremely difficult task, which most of them found very difficult indeed, which is to be specific about what your policies should mean in practice and what it is that is expected of a large government executive operation. Now, we found that this was very seldom spelled out and certainly in the mid-1980s, a lot of what happened happened because of the diligent, hard-working, honest, urgent sense of the need to get on of middle-ranking civil servants who were not given adequate and clear instructions on what they were expected to do, or even how much money they had to spend. The agencies were very much a structure which was, though not entirely because there were virtues attaching to things called 'agencies', an attempt to build that crucial link between the highly politicised, with a small 'p', definitely a small 'p', of the senior Civil Service and ministers in government whose concerns, with all due respect to Richard, were, certainly then and in very large measure, protecting their ministers, getting to the end of the week, the month or the year and dealing with the short-term horrors that hit them rather than the longer-term strategy.
Chairman: We shall want, as far as we can, to explore that and we particularly want to get into the remedies area for some of the analysis, but that has been, I think, a very useful set of introductions to all this.
Q7 Mr Walker: One of the criticisms that could be levelled at our distinguished panel is that you live in the gentle world of the academic where everything is frightfully consensual and nice. I am a new Member of Parliament, I came in in 2005, and the reality I see is politicians driven by today's or yesterday's headlines and the need to react, and I think this is more pronounced now perhaps than it ever has been. Really, I do not think you can have good government if you have government based on the headlines in The Daily Mail, The Sun, The Express, The Mirror and so on and so forth, and it does cause me some concern. I was talking to a former senior government civil servant who said, "Vast sums of money were knowingly squandered on initiatives, which, before they even started, it was known they were going to fail, just to appease the headline-writers and the sketch-writers and the commentators". Do you think that is a fair and accurate summary of part of the problem?
Sir Richard Mottram: I think that it is, I might say, just a slightly more racy way of putting the issue, what is called 'the interface' between the political and the administrative and all that. Absolutely, yes, there are real pressures on ministers in the nature of the political process, there is a lot of pressure inside departments to produce new ideas, new things, et cetera, and there has been even the idea that you pass laws simply for a demonstration effect as opposed to any other. I personally rather doubt whether the political value of some of this is quite what it is thought to be, so I think that the tempo of politics and the way in which it has been caught up in a sort of, to use the cliché, 24/7 media and so on, the tempo of politics has become faster and there is a lot of nugatory work. Personally, I think governments would be wiser to step back from some of this and actually, on occasion, to have their own pace and to try and lower the temperature, but this is a well-known thing. The problem inside departments is how you manage and moderate that process so that it has impact, but it only has impact when it is positive, and that can be, I think, a very difficult thing. I think it would be a difficult thing going forward actually in a number of government departments because now there is a lot more pressure because public expenditure settlements have been so tight in the last Comprehensive Spending Review, there is going to be a lot more financial pressure and officials are going to be going to ministers and saying, "Well, it might be nice to have an initiative on X, Y or Z, but actually we have no money". If I could just make my last point, I have never worked in a department where a minister would say to me, "I want to do A, B or C", and I would say to him or her, "A, B or C is a waste of money", and they said, "Well, I want to do it anyway", and I would simply shrug my shoulders. That is not the way in which a well-run government department works. In a well-run government department, you do not knowingly go out and waste money, and indeed a permanent secretary has a duty not to do such a thing, so in a well-run government department, there is going to be a lot of robust debate between ministers and officials about whether X, Y or Z is indeed a good idea. Then, conversely, you have to try and avoid a situation I have also been in as a permanent secretary, where you discover that all you are ever saying to your secretary of state is, "There is no money. This is a very bad idea. We don't want you to do it", because eventually, I think, they sort of switch off and get very bored. So you have got to try find ways of producing a political dynamic in the department that has an active effect on the ground and, in my view, containing the tempo because, and this is the last point, Chairman, one of the big problems in government is there is no understanding at the top, and this can include officials as well as ministers, of what life is like for the people who are doing the delivery and no understanding of their capacity to absorb frequent changes of message. They have no such capacity and one of the problems we have in government, I think, is that there is far too much change at the top which, it is thought, can influence people doing the delivery, but actually the delivery people are completely swamped by successive messages and, frankly, have reached the point where they just stop listening. So you have to get the tempo right and you have to get the tempo of communication also right and then you can produce some constructive result.
Ms Jenkins: I think that, if what you are wanting is some solutions, what Richard has been saying is very much, as it were, the classic handling of ministers and management of the department. It is an exceedingly difficult job and I think that is one of the first things I would say, that the process of managing a large government department is not simple, it is not a matter of short-term projects happening, and there are very large numbers of people working very diligently below it. The problem, however, which I think your work should address is, to some extent, not that there are all these problems because they have been discussed and talked about for a very long time, but it is to find a way out of what, quite honestly, quite often looks like a mess. I am trying to be moderate because, otherwise, I could become anything but on this subject. It has gone on for far too long. We have, as I said, 40 or 50 years of the same comments being made about the failures of government. Now, some of them are inevitable because government is immensely complicated, and I think this is where I would come back to the political experience point. Until you have actually sat at a minister's desk in a large department and begin to get some sense of the scale of what is going on, it is very difficult to believe how different being in government is from being in politics. There are a whole new range of skills, there are a whole new range of things going on that it is very difficult to get a grip of when you are outside and under the British system, of course, you are kept outside, you are kept very carefully outside, so what is really going on within the department is, to a large extent, unknown to a lot of people and, although we now have far greater openness and far greater freedom of information, I can tell you that the instincts of secrecy are in the blood of people who have been in the Civil Service for any length of time. It took me four or five years after leaving the Civil Service before I really felt I could say what I thought because it was drummed into me. Therefore, you are dealing with a difficult situation as a minister and you do need skills, understanding and experience, which is very difficult to acquire over in the Houses of Parliament.
Q8 Chairman: I thought you were going to give us the remedy. You said you would go round the circuit of all the arguments we have had for 40 years and then concentrate on the remedy, and then you did not quite deliver the remedy.
Ms Jenkins: Well, the remedy that I would put forward is, first, that politicians and senior civil servants need to think extremely hard, and I agree this is the process of getting to the remedy, about what a modern government needs. I think this Government, in its broadest sense, is at a very tricky stage when there are a lot of pressures both on how Parliament operates, on how Parliament is elected and on what Parliament actually is within the amalgam that is the United Kingdom now, which will ultimately affect the way in which government operates. Given the uncertainties of those exogenous factors, I think the senior Civil Service and ministers need to stop and say, "What is it we will need in the next century? The first, very clear thing we are going to have is some very difficult government decisions and processes to take, so we, as politicians, need to understand how difficult and complex those processes are and what our contribution, as politicians, should be to those discussions", and I would use that word both for people within the House and members of the Government. Secondly, the senior Civil Service needs to rethink and reassert its professionalism. It needs far greater skill in managing large organisations, in understanding the nature of contracting and in understanding the extent to which IT can, and cannot, help the processes of government, so we need a far more professional Civil Service in the sense of skilled, and I think we need a far more professional political class in the sense of a group of people who understand the complexity within government. That means that people have to start understanding that exceedingly unfashionable word which is "management" because this is half the economy and the decisions that are taken sometimes late at night by very tired people, affect an enormous number of people, and I would like to see far greater awareness of the implications of what they do, so I think there is radical rethinking to do.
Sir John Bourn: Perhaps I could, Chairman, pick up on that. Of course, in a democracy, politics should be king and it should be you who determine what is enacted and what is taken forward, but one of the big changes that I saw in the 50 years that I was in public service is that, when I started in the Civil Service so very long ago, you had a lot of people who came into politics, came into the House with experience in trade unions and they had an understanding of how organisations work. You also got a lot of people who came in from business, not from enormous companies, but very often from middle-range companies and they too had practical experience of what it was to run an organisation, manage a budget and meet the payroll, so on both sides, I think, the House had a wider range of experience among the politicians than perhaps the nature of the political career provides today. If you have that, and it is a problem, the difficulty that you have with the senior Civil Service, as Kate has brought out, perhaps can be put like this: that senior civil servants say, "Yes, Minister" too easily. There is an idea that something should be done and there is altogether too much of a willingness to say that it can be done next Tuesday. In fact, of course, when there is a programme, when there is a policy to be taken forward, more time should be given to working out, "How are we going to do this if we're going to succeed?" so you need a project, a programme, a budget, a risk assessment and, above all, you need to know, as Richard and Kate have mentioned, who down the line is going to implement this, "Have they been trained? Who is leading them? Who is managing them?", and sometimes to say, "This is what we're going to do. We're not going to do it next Tuesday. We're going to work out how to do it and make a real success of it". That goes back to what, I think, all three of us have been saying about how we could, in the Civil Service and the public service, manage projects and programmes more effectively and, thus, provide less waste of money, better services and more reassurance in fact to the citizens who would feel, "Yes, we are getting something that works". A lot of programmes do work actually, and again the point that Richard made about the media is that of course credit is not given to those which do go well, and I think it is important to recognise that ministers, senior civil servants and junior civil servants actually, in spite of all the difficulties, do have a lot of success, to their credit.
Q9 Mr Walker: You do not need to respond to this, but, just to pick up on you, Sir John, I was not in Parliament, but I remember when a penny was put on National Insurance to fund the NHS an additional £8 billion, and the breathless Secretary of State for Health came to Parliament the next day and he said, "My civil servants and I worked over takeaway pizza and curry to decide how to spend it". My God, that was a frightening prospect! If you did that in business, your stock price would collapse to 10% of the value the next morning, and that is the problem, loose talk by politicians. Of course, that was not the case, but it was a very silly thing for the Minister to have said.
Sir Richard Mottram: I just wanted to follow on from a point that John was making, which goes back to the fact that the backgrounds of today's ministers may be somewhat different from those in the past. What I have always felt about this is that ministers do come in very different shapes and sizes, so to speak, and what they nearly always, in my experience, bring to the process is a lot of commitment and a lot of knowledge of the outside world and a lot of ways of thinking about things differently from the machine. The job of the Permanent Secretary is to think of ways in which he or she can ensure that the Minister can engage effectively with the Department, and you can do that in all sorts of different ways and we could talk about this. But what it requires is mutual trust, so John is absolutely right, that you have to have the capacity to go to the Minister and say, "This is a very good idea, but actually it is going to take four years to deliver it and you can't announce it next week, and actually we don't have the money to do it, so we need to do more work on it, et cetera. We need to bottom out all the risks and we need to do the job properly". The issue is: do ministers listen to that advice? Do they believe that the people who are giving them that advice are themselves competent and can be relied on? One of the problems, I think, we have had in recent years is that they do not believe that the senior Civil Service itself knows how to manage things and they do not believe what they are told about the risks that are being taken and actually, as a result, departments take far too big a risk, so we need to restore trust, if we can, and, if we find that difficult, and we might do, we need to find also alternative voices that can help in persuading ministers that actually risk does need to be managed properly. There are therefore, issues, I think, about how departments are governed and how you get new voices, say from non-executive directors, who can help reinforce, or indeed contradict, what the Civil Service has said, so that you can then have that active debate.
Ms Jenkins: Can I just come in at that point because I think Richard has opened up a very basic issue, which is the relationship between ministers and their senior civil servants. Again, this is not a new topic, but it is a topic which, I think, is still not seriously addressed by the senior Civil Service. It has been the subject of comment for a long time, but one of the problems, I think, that politicians face coming into government is that they are dealing with a world, and I think I have said this before, which is very difficult to get inside. They are dealing with a world where the language is the language of "Yes, Minister" for some people, not for all permanent secretaries, but for a lot of them. A lot of the discussion takes place still in code and a lot of it needs decoding for politicians, I think, entirely understandably, but the responsibility for this lies with the senior Civil Service and, as I have said in my book, when you trace what has been happening, there has been an acceptance on the part of governments that something fundamental needs to be done to the senior Civil Service and it has never happened. I am no longer there, but we all had the same training, we all came through the same processes, there have been small attempts at modest training programmes, but fundamentally rethinking what that role is and what skills people bring to that job so that they are respected for the professional advisers they should be, I think, is one of the serious points, going forward, that needs to be looked at.
Chairman: Yes, I am sure we shall want to ask you more about how you think we are going to achieve that.
Mr Liddell-Grainger: Tony Blair famously said that he has got the scars on his back from trying to convince the Civil Service. Whatever you say is fine and dandy in a room like this, but the reality is that they are not going to change because they are all conditioned by the same process that Kate was just talking about, so how do you change them? Do you fire half of them? There is no sacking policy. A guy loses 25 million people's personal data and he is given a pay-off. Should there be more of a system of fear that, if you fail, you have got a problem? It happens in big business.
Q10 Mr Walker: They still get big pay-offs though!
Ms Jenkins: I think how we change it, and this is why I said it is fundamental, is that you have to start at the beginning and you have to say that the role of the civil servant is X, Y, Z. We take people in and one major breakthrough you could have is by saying, "We don't take people in until they've had five/six/ten years' experience outside. We do not take people straight from university with no experience". The second thing you do is you say, "We insist on two to three years' professional training of the kind any other professional in the United Kingdom has to undertake", and that can be defined and set up so that, by the time people become middle-ranking civil servants, they do have professional skills to which they can then add the skills that you need to run the government machine, in a sense, but it is that degree of rethinking. I do not think it is in fact reasonable or feasible to make radical changes to the way people behave in their 50s, with all due respect, because it is very difficult to change at that point. Some people can do it, but not everyone can do it, but we have to start at the beginning and bring different people in, but in a planned and systematic way, not just because they happen to have a few bright ideas and can make a contribution at the discussion table.
Q11 Chairman: You were shaking your head on that.
Sir Richard Mottram: Well, I was shaking my head on it in the sense that I think the Civil Service should make sure that it is roughly like the rest of the economy, as a first principle, and lots and lots of the rest of the economy have graduate recruitment schemes, rather like the Civil Service's scheme, and I cannot see why the Civil Service could not have it. I absolutely agree about training, but of course the model that Kate is laying out is actually the "Professional Skills for Government" model that I was myself working on. I do not think that departments should operate on a culture of fear. I quite agree with you, that there needs to be a strong sense of accountability and people who do not deliver have to be dealt with, and I think the Committee have commented on this in one of your previous reports, that there are issues around how easy it is for the Civil Service to get rid of poor performers, but what you do not want is a culture of fear. What you want in an organisation is a culture of optimism and pride when they are doing a good job and you are explaining to them how they get to the next stage in doing an even better job. There is probably too much fear already inside the Civil Service with a lot of disparaging remarks made about it and you spend a lot of your time trying to gee up people who, in the external noise of the system, are being demotivated by rather crass things that are said about them. Certainly expect very high levels of competence and have effective performance management, which the Civil Service has not quite achieved, but do not have a climate of fear.
Q12 Mr Liddell-Grainger: But the problem you have got, as we just heard from Ann Abraham, and I was just writing down some of the recent problems, tax credits, IT, financial regulation, procurement, data-loss, are the disasters, and they are probably the same now, but they have now become public because of the press, they have now become much more obvious because they are so big, they are a multi-billion, yet nobody seems to take responsibility for what happens and everybody gets shifted sideways quickly. Having some good governance, that is cover-up, white-wash and disaster management. There is no basis for management in any of that. Is that right, Richard, or not?
Sir Richard Mottram: Well, you are picking on ----
Q13 Mr Liddell-Grainger: You are the one who made the comment the other way.
Sir Richard Mottram: Yes, absolutely. I was not saying that you are picking on me, I was saying you are picking on individual cases which are impossible to defend. Downloading 25 million people's data and sending it off to Sir John Bourn in two disks or one disk or whatever is not proper process and, quite clearly, all Civil Service organisations needed to have a different approach to information management and so on. The only point I would make is that we should not think, and I have had debates on this with the Chairman, that what we are now facing is some great crisis where nothing has been learnt, where performance has gone down and rumty-tumty-tumty-tum. The British government system is, in my view, a lot more effective as a system now, and I said this, I think, in the article the Chairman was quoting from, than it was in the 15 years after I joined the Civil Service in 1968 when, frankly, this country was going down the drain. We had all sorts of government process and some of it may have been more elegant than what we have now, but the country was going down the drain. The country is not going down the drain now and, therefore, we should not exaggerate the problem that we have.
Sir John Bourn: I think the point which has come out of the last few exchanges is around the one that I made, that success should go to those who show that they have managed projects properly and well. That should be the message that goes down the line and people say, "If I'm going to get to the top, what I need to do is not be the Private Secretary to the Secretary of State, but what I need to do is to manage a project successfully and to show that I can design it, secure political approval for it, fund it, manage it, assess the risks, evaluate it and train the people".
Sir Richard Mottram: You could do both though, John, could you not?
Q14 Mr Liddell-Grainger: I was going to ask you, John, what do you do with the failures, the guys who set up the RPA, other than promote them, which seems to be the norm now? What do you do? Do you fire them? Do you say, "Look, I'm sorry, you're going to Stornoway" or what?
Sir John Bourn: Well, I feel that you have to approach this in the same way that you do in the rest of the community. For those people who are not able to make the contribution to the organisation, whether it is a university professor, whether it is a civil servant, whether it is a partner in an accountancy firm, you have to say goodbye to them, but say goodbye to them in a civilised way with some understanding and with some advice as to how they can move on to somewhere else. Of course, traditionally, you are right to say, in the British Civil Service, like all civil services, once you had started, you could be there for ever. That meant that people had assurance, more assurance perhaps than they have got today, in talking to a minister. But it did mean that some people, who were burnt out by 40, stayed until they were 60. But you could manage this much better and you could do it in a way that is on the same lines as the rest of the community and that would be the right thing to do.
Ms Jenkins: There is another snag about this, which is that very often major project failure is a consequence of very, very urgent political pressure to achieve a result and, on the whole, people do not like to say that, but I know of a number of instances where what has actually happened is that a project has not been properly implemented, has not been properly tested and has not been properly financed because the political pressure to move has overwhelmed the sort of sensible process of getting something up and running properly. It is not a very popular thing to say, but it makes laying blame exceedingly difficult because you can get situations where senior officials are actually scapegoated and I think that makes the rest of the system rather more defensive than it might be.
Q15 Chairman: You would have thought, would you not, by now, that we would have some kind of rubric or checklist of the conditions of policy success and the conditions of policy failure? Heaven knows, we have had so many examples of each. Why has the NAO over the years not distilled its wisdom in telling us what the conditions for policy success are?
Sir Richard Mottram: Chairman, we have these things, and a nice example of this might be that inside government, and I have to be a bit careful about what I say, the previous Prime Minister, for example, mandated an approach to the management of projects involving IT support and generally to risk management that was to apply in every government department. Some of this was based on studies by John and his people and the PAC and so on. But that does not stop a minister in an individual department asking the system to do something which is completely unrealistic. I have actually myself personally been in conversations with senior ministers where I have said, "Well, actually I don't think we can do this and, moreover, I think that it contradicts the instruction you have given me about the conduct of public business and, therefore, I don't think that I should do it", and they are all looking round in the room, saying, "What's he talking about? Why is he going on about this thing, the conduct of public business? We want him to do it". This is the political imperative in relation to the imperative of management and these things inevitably, in some cases, are going to rub up together in a difficult way and you have got to try and find a way through it.
Q16 Chairman: But, instead of having it hidden deep in the system, as Kate is describing, let us identify it, politicians making unrealistic demands as a condition of policy failure, so that we all know about it.
Sir Richard Mottram: Well, of course this might come about actually in relation to accounting officers because, in the worst possible cases, you ask for a direction and that process itself, I think, is very valuable inside departments. I do not think I have ever had a direction actually, but I have had a number of conversations with ministers where I said, "Well, if you insist on doing this, I am afraid you are going to have to direct me to do it", but, if you have too many of these, they do not really quite think you are on the team, so you have got to get the balance all the time right. These are living organisations, they are dealing with living events and that is why they are worth working for.
Q17 Mr Prentice: But what happened in the Treasury when the decision was taken to get rid of the ten pence tax band? Just go through the conversation between the then Chancellor, Gordon Brown, and the Permanent Secretary when the Permanent Secretary said, "Mr Chancellor, here is the distributional analysis. All these people are going to lose out as a result of this decision", and it went ahead anyway. Tell us what happened in the Treasury in that case.
Sir Richard Mottram: Well, I have absolutely no idea what happened in the Treasury in that case, but, ultimately, it is the duty of officials in that case to ensure that ministers are informed of the impact on individuals and, ultimately, it is a decision for ministers.
Q18 Mr Prentice: Well, I think that is a cop-out, is it not, really?
Sir Richard Mottram: Well, I do not know because I do not know what happened. Is it not, ultimately, a decision for ministers?
Q19 Mr Prentice: Well, there could have been a note, could there not, from the Permanent Secretary, if we are talking about new processes here?
Sir Richard Mottram: But the process was not the issue. Ultimately, this was not a value-for-money or a propriety issue. This was an issue actually about judgment of the impact of the decision.
Q20 Mr Prentice: It could be, for example, the Permanent Secretary saying, "Minister, I think in the Red Book in future... ", and then the winners and losers of any tax change, any change to the tax system, should be there, it should be flagged up and drawn to Parliament, and now we have the situation where it is costing the nation £2 billion with 22 million basic-rate taxpayers being given money when they did not lose out originally. That was a colossal failure, was it not?
Sir John Bourn: If I may say on that, I do not know the basis of the discussions in the Treasury on that issue, but, from the work we have done, we did see a lot of cases where, in a sense, a project or programme was worked out without enough attention to the impact on the citizens who would be affected by it. I mentioned the Child Support Agency, but others of course come to mind, like the programme in Defra for the new system of paying subsidies. The money is coming from Brussels on a different basis to be directed to farmers, Defra spent a lot of time thinking out the new way of paying the farmers, they thought of an over-elaborate system with the result that it does not work and the farmers do not get paid. They then of course write to their Members and write to the Minister. I feel in that case, and tax credits is another one, that, in designing it, there was not enough thought about the people who would be affected by it. What do they think about it? How will they behave? Will they actually respond? Here you can make in fact a sort of sociological point about officials. If you take the tax credit case, it is an interesting one where, in some ways, you can say, "How crazy to set up a system where you're going to pay people more money than they really deserve and you're going to get it back from them!" Now, we might say that most middle-class people that you find in the Civil Service would be prepared to pay it back and able to pay it back, but, when you think of who gets the tax credits, they are often very poor people without very much experience in handling money and budgets, so they get tax credits over the odds and they spend it and then the money is not there to pay it back. Therefore, of course you do not get the money back. But you leave the evidence of a failed project and disappointment all round, so greater attention is needed in planning it and how will the effect be on the people.
Q21 Mr Prentice: That seems pretty fundamental to me, that you design a system or a system is designed, knowing that it is going to be virtually impossible to claw money back from people if they have been overpaid and we, the nation, have lost, I think, about £4 billion, £4,000 million, in payments that have been made to people who cannot, for one reason or another, pay it back. Do you think that there has been a problem over recent years, and I am looking at Richard Mottram here, that -----
Sir Richard Mottram: I am associated with problems over recent years!
Chairman: Because you have been there!
Q22 Mr Prentice: There are some things I cannot quote you as saying, but this trend, I suppose, to bring in experts from outside to publish a report to inform the policy debate, and there has been any number of them, Kate Barker and so on and so forth, do you think that the senior Civil Service feels a bit frozen out, that the policy advice they are giving has been marginalised because of this penchant of ministers to bring in outside people and to act on their advice?
Sir Richard Mottram: I think there is a risk there, but I think the important thing really, building slightly on what John was saying, is to ensure that the people who write these reports, who are usually actually supported from within the Civil Service and usually by highly skilled people, are themselves informed about whether the recommendations they are going to come to are or are not implementable. I think the key point that we keep coming back to here is the importance of thinking about government as a system which is both about strategy and policy and also about whether what you want to do can be delivered, not necessarily by a direct programme, by influencing people or regulation or whatever, and it is ensuring that that implementation is achievable. So, if you are doing a report on X, Y or Z, it is very, very important, I think, that the system, including the department as well as outsiders who often have a lot of knowledge about some of the points that John was talking about, are properly consulted and the recommendations are implementable. The reports that would come to mind are not I think open to the charge that they were blue-skies things that could not be turned into something that could be delivered.
Q23 Mr Prentice: Well, we raised this with the Cabinet Secretary just a couple of days ago about the merger of the Inland Revenue and Customs and Excise and that was, I think, the product of thinking by, was it, Barney, and McKinsey was brought in for ----
Sir Richard Mottram: No, I think it was someone called Gus O'Donnell who was responsible.
Q24 Mr Prentice: Was it Gus O'Donnell? I would love to know.
Sir Richard Mottram: I think it was his report, was it not? I think, I do not know.
Q25 Mr Prentice: Maybe he was informed by a report written by an outsider as well, but the fact is that it was a complete cock-up and the latest Capability Review of the Revenue and Customs, just tells everyone who is prepared to read the report that the new merged Department is, in many ways, with its matrix management, completely dysfunctional.
Sir Richard Mottram: Well, I do not know because I have not read the report, but what I would say about that, and I think this is probably a point that also relates to some of the points that Kate has been making, is that I think you can make a very good case in terms of function and organisational design for merging together Revenue and Customs. Actually, the arrangements we had previously were very, very unusual in terms of the rest of the world, and I am always rather suspicious about uniqueness. But, once you had decided to do that, you had to realise that this was going to be a massive task and it was a massive task of organisation, of process and of culture and that is a very demanding thing to do. And it was being done in parallel with implementing, in the case of tax credits, for instance, something that was, well, of doubtful implementability, from someone who knows not very much about tax credits. Actually, you had got an organisation that was under enormous strain in terms of what it was trying to do and you were at the same time trying to reorganise it, and that always involves a lot of risk.
Q26 Mr Prentice: This is all cold comfort, is it not, another departmental reorganisation that really has not delivered the goods? That is the bottom line really.
Sir Richard Mottram: Well, it has not delivered the goods up until now, but are we arguing that it is impossible to imagine that you could organise the Revenue and Customs so that it was an effective organisation? I do not think that is beyond the wit of man.
Q27 Julie Morgan: I wanted to ask you about how politicians can be better prepared for government. We have talked quite a bit about civil servants and what could be done, but, Sir John, you mentioned the fact that Members of Parliament used to be trade unionists or used to manage small businesses, and I assume you were saying that that made them better prepared to be government ministers. I wonder if you could give us examples of people who came from those backgrounds, whom you saw operating well as government ministers because of that background and what do you suggest in the present situation where we have many fewer people from that background?
Sir John Bourn: Well, I think I can recall, from the time that I was a civil servant, a number of people who, for example, came as ministers in the Ministry of Defence. I remember a man called Bill Taylor a long time ago, a Conservative Member, he came in as a parliamentary secretary, and he had run a business. The interesting thing with a lot of these people was that they had not got great ambitions to be secretaries of state, but just to become a Member of Parliament was the achievement of a great ambition, so, in that way, they were perhaps more relaxed. They were quite surprised to find themselves ministers at all, I think, but they did bring to it some background and experience, as I said, of having to run a team, having to get some money and having to pay people, and, on the trade union side, we did get people who were very conscious of again how do you run something, they were very conscious of the financial side and the money side and they were very conscious about training and how staff could be managed. Now, you cannot say that they were able to transform the Civil Service and of course you cannot really say that because that was a kind of pattern which, to a degree, was a feature of political careers that time ago. Ultimately, it turns around, I suppose, who the constituency parties choose to be the candidates and it would not be for me to say they had made the wrong choices because, as I say, politics rules in a democracy, but perhaps, if there were a greater understanding and appreciation that there was something to be said for looking at what the candidates who came before the constituency party had done and thinking, "Well, what practical experience have they had at actually running things?", not that that should be the only thing that matters, but perhaps more attention might be paid. I do not think you could of course lay down this as a matter of law, but, in a way, it is the funding of experience and seeking the benefit from it.
Sir Richard Mottram: I can think of examples of secretaries of state who had a business background and this could both help and produce some quite interesting debate, but we cannot change reality. I do not think this is now the natural way in which the political class is going to be recruited and I, therefore, think that you have to think about what positively and what practically can we do. Now, this goes back to the point I was making a bit earlier about trust and I want to add another point. I remember, without giving names, a conversation with a Secretary of State for Defence where I was explaining to him that he was now responsible for a budget of, I do not know, £30 billion and 400,000 people or whatever, and he began to go a little bit sort of green and he said, in a very charming way, "But the largest number of people I have ever managed is three", at which point I thought, "Well, this is going to be good because this is a person who understands the nature of his experience and so on". I said to him - and I am not being funny about this - "That is not a problem. We have a system here that will ensure that you can run the Ministry of Defence. You will be responsible for a top team of 10, 15, 20 people or whatever, but you are not required yourself to manage 400,000 people, you are not required to manage £30 billion, I am required to manage £30 billion on your behalf." The purpose of telling you that story is that I think the really important thing is for the ministers to understand the things they are really good at and the experience they do not have. Have a process of induction or even pre-induction which has a livelier discussion with ministers about the nature of their responsibilities in relation to the Department, of what it means, for example, to be in a strategic management role in relation to some of these huge organisations, where the most useful experience they might have had would be, let us say, as non-executive chairman of a large company. You are not going to recruit people like that: the story has not been very successful at bringing in people later in their careers generally who have had that experience - although I could think of one or two cases where that was not true. Explain to people what their role is. Do not expect them to walk in on day one, which is quite a frightening thing, and think, "I've got to manage this organisation myself and I don't have the skills to do it." Have discussion about what the respective roles of ministers and officials are and should be and what they need to do, what systems they need to satisfy themselves are in place - just as any of us would do in relation to an organisation in which we held a non-executive role - and how they satisfy themselves by a variety of means that the organisation is delivering the goods. That is the discussion to have with people, that is the development to give them. And accept that the ones who have had direct experience are going to be quite a minority.
Sir John Bourn: Perhaps, Chairman, I could make a positive suggestion along those lines. In the private sector a chairman or chief executive would be quite likely to discuss some of those issues with the external auditor. I found when I was the C&AG one of the things that was not done as much as it could have been - and maybe that was my fault to some degree - was for a new minister to say, "I'd like to see the external auditor. I would like to see the Comptroller and Auditor General. I want a view from him. What does he see about our strengths and weaknesses?" In the private sector that kind of discussion would be commonplace. We had not really developed it inside government as well as we might have done - as I say, perhaps, to a degree, my responsibility. I found that when I did have the opportunity to discuss with secretaries of state and ministers our appreciation of, as I say, the strengths and weaknesses, this was appreciated. I appreciated the chance to go over the ground with ministers and I think that is something that perhaps could be developed further.
Ms Jenkins: I would like to add to this there is a process of understanding and education in the business of government which I think should take place within and around members of a shadow cabinet. It should not wait until the day people arrive and are minister. Richard's description of the kind of thing somebody with that role in a large organisation ought to understand is not something you can pick up in two or three discussions with your permanent secretary. You should be doing that before you are in government, and serious politicians wanting to go to senior level in government ought to make it part of their duties to begin to understand what the process of managing a large department is.
Q28 Chairman: On your point about respective responsibilities, I want to be clear whether you are saying, that we could do better in clarifying what these respective responsibilities and accountabilities were and we can do it more publicly and openly. It is one of the issues that Kate will tell us has been going around for 40 years and longer, and we still have not cracked this issue of who is responsible for what.
Sir Richard Mottram: The interesting point there, Chairman, is that there have been efforts in government to try to do this. There is a published guide to governance of government departments. When that was being developed, there was quite an interesting debate in government about the extent to which secretaries of state were content to have their role, in a sense, circumscribed. Perhaps I could explain what I mean - and I argue this in that LSE piece, for example. To take a business analogy - and big departments are not businesses, so nobody misunderstand what I am saying - big departments should be run on the principle that the secretary of state is effectively the executive chairman for strategy and policy and the non-executive chairman for the leadership and management and proper conduct of business of the department, and the permanent secretary should be held to account for all of those things. When I was in DWP, if I was talking to private sector people and they said, "What do you do?" I would say, "I am the group chief executive of the Department for Work and Pensions and also I am the permanent secretary. And we are not a business, but if you want to understand what I do I am the group chief executive." Everybody on the board of DWP could have explained how what they did had a direct analogy in a private sector company of that scale, which was world scale, and they could have a dialogue with people in those companies and learn from them mutually. That is what I would like us to do. Some ministers do not want to accept that. Some secretaries of state - and I am not criticising them: it is not for me to criticise secretaries of state - say, "No, I don't want to be the non-executive chairman. I want a much more hands-on role. I am not sure I can trust you. I want to get involved in all of this. I want to go and ask the staff. I will ask the staff what they think about the management. I will tell the staff that I think the management are rubbish." Ultimately you have to leave the discretion to different ministers to take a slightly different view about their role, but I think it would be a good idea to try to tease some of this out and it would be a very good idea to tease it out with a shadow cabinet or whatever. Perhaps I could add a further point which relates to this. In some departments the contribution of non-executive directors has been developed. In the Department for Work and Pensions, for instance, we had a series of heavyweight, non-executive directors, drawn from different private sector experiences, who used to hold me to account. They used to hold me and the top management of the Department to account - and they were an awkward bunch of people, and we had many constructive discussions with them. They would have been a very good group of people - to go to alongside the point that John was making - to give the secretary of state an insight, as one would in a private sector context, into the strengths and weaknesses of the management team. They had a very good understanding of my strengths and weaknesses; they had a very good understanding of the strengths and weaknesses of others. That would have been another source of advice. Thinking about governance, what Kate did in relation to accountability frameworks for agencies has really edged up to departmental level: departments are now much more thought about also in that framework - that is a useful thing to do. It can seem very nerdy, but I think it is useful.
Chairman: Thank you.
Q29 Julie Morgan: Who do you think should resign when things go wrong?
Sir Richard Mottram: The person who is responsible. I think it is very important to be cautious about this. If you have a problem in part of your department and you are trying to sort it out, you probably will not attract a wonderful candidate for that job if they feel that if the thing is not turned around in two years, or whatever, they are going to take the blame and they are going to be out, because people have to worry about their reputation. If you get too much into "somebody takes the blame", "somebody loses their job", you will find it very, very difficult to get really, really good people to take on the biggest challenges. If we look around the public service and we see some of the problems there are, they are partly a manifestation of this. But if I were the permanent secretary in this framework and the department was very poorly run in measureable ways, then I should resign, yes; not the minister.
Q30 David Heyes: I was thinking, Chairman, that I am really taken with Sir John's description of the good, experienced, amateur politician, the person who has good trade union experience, with experience of running an organisation and managing large numbers of staff. It is attractive to me because, in a way, it describes me. But I am no nearer to becoming a minister than I was the day I arrived here. What we have got now, however, is priority being given to professional politicians, to people who have seen politics as a career maybe from school days and certainly from university days. I thought that, Kate, you were advocating that in what you said earlier in the discussion: "We need more professionalisation in our politicians" is what I have noted down.
Ms Jenkins: Could I explain. I was not meaning that we needed politicians who had spent all their lives being politicians. I was meaning that we needed politicians with the skills that would equip them to be competent ministers when they became ministers. You do not need to spend all your life in politics in order to acquire those particular skills. The professionalisation was in the skills that politicians brought to the job of being a minister; not that they spend all their time as a professional politician. I personally think that is disastrous. It is as bad for politicians as it is for civil servants to be there from university. I would disagree with Richard fundamentally about that.
Q31 David Heyes: I have not uncovered a contradiction then.
Ms Jenkins: I am afraid not. But there is a contradiction about recruitment to any career, I think, these days. Most people have careers for short periods of time. We should not be embedding these very long-term careers in a single function which was a habit 30 or 40 years ago and is a different world. That is partly why I would still keep urging you to look ahead, not back, to see what the changes are that need to be made, because we can spend ages mulling over the last 50 years but it is what is going to happen in the next 20 that really matters.
Q32 David Heyes: Let me see if I can find another contradiction between you. Sir John was advocating the merits of the career civil servant concentrating not on becoming the private secretary to the minister but to showing that he or she can deliver a project. I think you said "to design it, to lead it, to deliver it". Again, that seems commendable. Kate, through advocating Next Steps Agencies and then, as a further consequence of that in more recent times, seeing many of the functions of the Next Steps Agencies becoming privatised/put in the hands of contractors, have you not drastically reduced the scope for those kinds of delivery skills being achieved by career civil servants?
Ms Jenkins: Those delivery skills are not the sole preserve of the Civil Service. There are plenty of places around the rest of the economy where delivery skills can be acquired. Running large organisations and making sure that people get their milk on the doorstep or their pension on Tuesday have a lot of similarities about them because you are running a large organisation with a lot of people in it and have some very complex processes to go through. The more complex the task is, the more difficult it becomes to manage. That is what is generically known as management. I would again argue myself that it does no harm to the Civil Service organisations to have people who come in to manage it who say - as I have had staff working for me say - "Why on earth are we doing it like that?" You do need people who will come in and say, "Why on earth are we doing it like that?" There will be lots of good reasons and lots of bad reasons, but that challenge is one of the real values you get from people who have broader experience and have not spent their entire lives within the very comforting ambit of the Civil Service, with its rules and its regulations and its relative security. There is a lot of change already, and we can go on with it.
Q33 David Heyes: Do you gentlemen have any views on what I see as the diminishing scope for career civil servants to acquire delivery experience?
Sir Richard Mottram: I do not agree with Kate about the idea that you could not have a career in the Civil Service because I had one - and I thought I did reasonably well. I think there are plenty of very successful other organisations in our society that have career patterns partly like that of the Civil Service, so I am quite suspicious about why that could not be the case in the Civil Service. There are delivery organisations that will remain in the Civil Service and one of the jobs of government, certainly on the "Professional Skills for Government" agenda, is to orchestrate and enable people to get the experience in those - which is not necessarily that easy for various boring administrative reasons, and it needs to be done consistently. I very much agree with Kate that you can also think about people who are going to have a substantial career in the Civil Service, not necessarily a lifelong one, being seconded out and going into other organisations. All that has to be organised. I have one last point: if we think about the training and development of people who come to the top of the Civil Service, those who are going to be permanent secretaries, for instance, we should not over-denigrate the idea that spending some time with ministers in private offices and so on is a valuable thing to do. I think the Civil Service now has a problem, in that people no longer see some of those more traditional career paths as something they want to do because it is a great hassle and it is very hard work and so on. When you get to be the permanent secretary of an organisation, you need a blend of experience that will enable you to do all the things a permanent secretary has to do. A permanent secretary has to be a strategist, a counsellor to the minister (in the nicest sense of that word), a leader, a manager and so on and so forth, and having previous experience of dealing with ministers I think really helps you when you are the last person in the room with the secretary of state, when everybody else has been told to leave, and you can have a discussion which understands the realities of ministerial life alongside the realities of being a civil servant. I think it is worth it. What was wrong with the old career path was that it was too much of the same thing, done time after time.
Sir John Bourn: I think there are sufficient projects and programmes in central government. Although some of them would be conducted by people from a very wide experience, and perhaps who have not spent a great number of years in the Civil Service, I think there is still plenty of scope for those whose career mainly lies in the Civil Service, although I agree very much with Kate and Richard that you do not want somebody who has only ever worked inside government. I think more attention should be paid to secondments, to careers which involve a variety of experience.
Ms Jenkins: Delivery is a word everyone uses now, but there is another skill which is linked to it which in many ways, I think, will come to be more important, which is the capacity to contract properly and competently for services to be delivered. That was always a gap that the Civil Service simply did not grapple with in the 1990s, when it became a much larger part of the waterfront. To understand who you are contracting with, what you can believe and what you cannot believe, what you need to put in and what you do not need to put in, is really a very tight skill for which people need experience and a lot of practical support to get it right.
Q34 David Heyes: Or is it better not to contract at all?
Ms Jenkins: I think it would be difficult to assume that that was going to be the case. In some ways I have a lot of sympathy. I still myself cannot quite understand why the public service is not better at doing things. Why it is that we think the public service cannot do something is a very interesting question to explore, I think. But, given the situation that a lot of contracts are now let for enormous sums of money, the skill of how that contracting is handled, so that it is handled in a sophisticated and effective way, I think is a very important gap that needs to be plugged at the moment
Q35 David Heyes: Sir John said that there were many examples of successes that just were not trumpeted. In the context of our inquiry looking into good government, we need to look at that as well. Where should we look?
Sir John Bourn: For example, when I was the C&AG we produced a report on successful IT projects, which of course was right against what anybody thought they could be. This was a set of projects which had worked well. The main characteristics of them were the sorts of things we have been talking about this morning. They were not attempts, as it were, to be right on the edge of technology; they were attempts to plan out something where there had been some experience of the technology and how to set it up. The top people at the department were behind them but did not claim to have the technical knowledge to plan and programme them. They were put together by people with that technical and managerial knowledge. They were properly funded. They were piloted where that was important. The staff who were going to put them into effect had the opportunity to contribute to the design of the project and they were given the training so they could work the IT. There were systems for evaluating the performance of the programmes. All those things were really about successful project management and programme management and where those things were done they did work.
Q36 Kelvin Hopkins: I have had the good fortune to spend 25 years of my life working in two political bureaucracies which are both slightly analogous to the Civil Service, if rather smaller, of course. After all that time, I was very interested in how they worked and I was a student of politics as well. I came to the simple conclusions that there were three golden rules. First of all, have systems that are very well thought out which work, set them up, establish them and keep them; have stable organisational arrangements over a long period; appoint the right people to the right jobs and make sure you get people to do what is necessary. These are elementary things. If you have those three things right, everything else will flow from that. I am very taken with what Sir John has been saying. I saw two bureaucracies, one which worked and one which did not. That is where I came to reach these conclusions. The one which worked had these three things and the other one did not. When they started to try to reform, we got into the turmoil that you talked about, Sir John. We saw senior people vying for jobs. Getting a job with bigger stakes, more pay, was more important than the structure of the organisation. In the end, the final abdication of responsibility, they started outsourcing some of their jobs because they could not do them themselves. The whole thing became expensive and chaotic and did not work. It strikes me that there has been a parallel in the Civil Service perhaps over a long time. I am always accused of being a golden ageist, but some of the things that were discovered perhaps by Northcote-Trevelyan were right and we do not want to throw things away which worked in the past.
Sir John Bourn: The points you make are very much, as you have said, part of what I was advocating and talking in favour of.
Q37 Kelvin Hopkins: In recent years we have had governments that want to transform. They are radical, they are trying to change things, and they perhaps see the Civil Service as a bulwark against what they are trying to do. Mrs Thatcher talked constantly about "Are they one of us?" - meaning civil servants - as do other politicians as well. More recently we have had the wilful Mr Blair. Sir Richard was talking about his desire to govern from the centre, press downwards, trying to get the appointment of civil servants who were in favour of his revolution. Is that not part of the problem as well?
Sir John Bourn: Those are big issues. In a sense, the reformers of Northcote-Trevelyan in its time led a great revolution, where the prime minister of the time might have then said, "Who is 'one of us' among those people?" The points you make are absolutely fundamental, which of course does not mean, within them, that you cannot and do not make changes. I do not think for a moment that you were arguing that, but they are the principles in which change takes place rather than being overturned by revolution. As the Chairman has said, for all the years we have been thinking about the quality of public services, and in spite of everything which is done - which is great compared with most other countries - why are they still disappointing? It is not surprising that politicians would sometimes think we should start off on a new course. I suppose you could say that in 1945, after the Second World War, the Labour Government said, "This will be a new course. It is going to be quite different from the 1930s. We are going to have the public control of industry, we are going to nationalise industries." Sometimes you will get that, but I think that whether you are in a programme, as it were, putting the emphasis on market forces or whether you are at a time when you are emphasising state development, the points that you make and that I have been trying to make are still fundamental, because, whichever is the broad historical canvass on which you are painting, those are the principles which are necessary to secure success and which are disregarded at your peril - as, of course, they often have been.
Q38 Kelvin Hopkins: When politicians want change, they sometimes use a technique called permanent revolution, which has been used in other, entirely different spheres. The process there is you keep on changing, to keep those who resist you off balance. Every time you get a department which seems to be resistant to the new wave of marketised, liberalised politics, you break it up into two and give it to somebody else. Does this not have an effect of demoralising and alienating people who ought to be working positively for society, for the state? Has this not had a demoralising effect?
Sir John Bourn: It certainly has on people in the middle of departments and people on the frontline. Maybe sophisticated permanent secretaries, used to this world, can manage the turmoil, but people down the line who are reading their newspaper on the way to the office and suddenly find that, in fact, as from tomorrow, they are going to be working for the Department of X rather than the Department of Y, might say, "Why is this change being made? What is the point of it?" and, of course, as you say, "What is it going to mean for my family and my career?" Then it begins to affect how people's attitude is to the services they provide to the citizen with whom they deal. I think that it creates worry and uncertainty down the line. We see this in all kinds of organisations, in private sectors as well: the attempt to fix things at the top for yourself has a price to be paid down the line, and I suppose history shows that you always, in the end, pay it.
Sir Richard Mottram: There is a bit of a danger that this is now a conversation that is taking on an anti-change flavour. Perhaps I am misunderstanding it. I look at it in a slightly different way. The reason why people are dissatisfied, for example, with public services, is because their expectations keep rising. And it is a very, very good thing that their expectations do keep rising. The only way in which we will give people better services - and which they will still, I hope, be quite disappointed about - within constrained resources, is if we can transform (to use a ghastly jargon word) some of the organisations that deliver in the public service. That is, in my view, the requirement. The requirement is to transform them. The argument is not really about whether it is reasonable to ask. For example, I was responsible for the Department of Work and Pensions, and some of the frontline staff at the Department for Work and Pensions, for all sorts of reasons, were quite resistant to change. I did not think it was my job to say, "I quite understand you are very resistant to change, so we will not change." It was my job to persuade them that it was absolutely reasonable for a democratically elected government to decide it wanted these services transformed in all sorts of ways - which, as it happens, I thought were very sensible ways and they were quite bipartisan ways, which always makes it a lot easier - and to expect them to change. But my concern was always that we made the process of change rather more difficult by the way we went about it. We did not think enough about how to communicate with people. We did not necessarily make sure that the way in which ministers were speaking about the staff and the way in which I was speaking about them and what we were reading in the newspapers all aligned together, to say, "We want you to change and that is because we really value what you do and if you change you can do something even more valuable and we will value you even more" That sounds very Pollyanna-ish, but there was no really effective model of change that challenged people to change their behaviour, to change the way they worked, often to change their physical location and so on, in circumstances where they could see "I get something out of this". That is what the best private sector organisations do. I think the challenge for the public service is to go from a nice cosy conversation with jargon words like "transformation" and so on, into the hard slog of how you persuade people to do it. That requires a lot of skilful orchestration and that is what I would like to see us focus on.
Ms Jenkins: I want to challenge what Richard has said about rising expectations on the part of the public. The public, the group we ought to be thinking about all the time, have two problems. One is they are promised things that are not delivered by organisations that in large measure cannot deliver many of those things. Secondly, the core functions of government, the absolute basics, are constantly failed. I think it is that. If one could concentrate the management of government on its core businesses and make sure that those will provide a tolerable level of service, we will have gone a very long way to deal with a lot of these problems. What tends to happen is people spend a great deal of time talking about things that are at the margin, or, indeed, a great deal of time in indulging in elaborate programmes of change, reorganisation and restructuring, when what is needed is to get the basic task done properly. More focus on that, I think, would produce a much better result for people than we have now.
Q39 Kelvin Hopkins: This is a theme I have raised many, many times. How much of our problems have arisen from the fact that we now seem to be governed from the centre, by the will of one person or a group of people? I understand, say, in the 1950s and 1960s within the Treasury, there would have been a range of views on the economy which would at least have had the countervailing view put. If we had had some Keynesians who understood what we would like to happen with the ERM strategy and who had had more influence, might we have not had that chaotic collapse of a particular strategy - which led, in fact, to the defeat of the Conservative Government - if we had had debate within government, within the democratic structures, with a range of views and an honest discussion, instead of one person's will being pushed through? Is that wilful approach to government not always a mistake?
Chairman: In a nutshell!
Sir John Bourn: Yes.
Q40 Paul Flynn: If you were introducing the Next Step Agencies now, what changes would you have made in the way you introduced them?
Ms Jenkins: I was about to say that I did the original thinking but I did the introduction.
Sir Richard Mottram: I did the introduction - but I can come in after you.
Ms Jenkins: Some of it. The main thing I would do is to make far more emphasis on the role of ministers and civil servants in setting the agenda for the executive operations of government, so that there was a very clear link between politics, policy and management which could not be ducked. We were, surprisingly enough, trying to be fairly tactful at that stage, because what we had discovered was so uncomfortable, and, again, we were trying not to be too aggressive in order to get nowhere at all. The achievement we had was to get somewhere. We did not get as far as I would want to get. But that is the weakness.
Q41 Paul Flynn: You were chipping away part of the empire of the ministers at the time. It was removed from Parliament. Parliamentary questions were answered and not reported in Parliament at the time. Was all this worthwhile? Do you see it as a great success, with the independence they have had and the way that they have behaved since?
Ms Jenkins: I think that with every single change of this kind you can see good things and things that have not worked as well. There were some agencies that were set up extremely poorly. There were some agencies which should not have been agencies at all, because there was much too much political sensitivity attached to the functions that they were carrying out. But there were some agencies which do a lot of very boring stuff in government and to which nobody pays any attention which are better run and are the better for it.
Q42 Paul Flynn: You said that public expectations are built up to a high level. Could you give some examples of that?
Sir Richard Mottram: I think I said that.
Ms Jenkins: I said it too, so maybe we both said it. Public expectations, for example, of the tax and credit system were a real problem, and there was a serious problem about the implementation of that one. There have been public expectations about the NHS which have bedevilled modernising the NHS for years and years. There have been public expectations of the system of justice in this country, which also have failed to be delivered. It is these things, the promise of policy which is sometimes quite right but which the systems themselves simply cannot deliver or are much too complex to do in a simple and straightforward way.
Q43 Paul Flynn: If we look at the Civil Service and the ethos of the Civil Service - and I do not want to denigrate their work in any way - there was a claim made about the monumental failures, the ones that stick out over time. Someone once said, that the policy on producing Concorde and the advanced gas-cooled reactor were the two worse civil investment decisions since the building of the Pyramids, in the view of decisions taken without any practical value at the other end of it. There were civil servants who said that in government, who said, "This is crazy. We can't go ahead, throwing billions at these projects that may not get anywhere" but, particularly with Concorde, there was a great issue: people felt it was a great virility symbol for the nation. The civil servants who opposed that, their careers withered. The civil servants who went along with the ministers, their careers prospered. It is based on the theory "The unimportance of being right" for the civil servants. Is that true?
Ms Jenkins: I would quite cheerfully say that in a large number of cases I would think that would be true.
Q44 Paul Flynn: The late Sir Peter Kemp, after his career, said that the best he could say on the Civil Service would be to get the auditors out and the innovators in. Is that true?
Ms Jenkins: I would adapt that. I would say that the Civil Service needs to learn to accept the existence of innovators and radicals within its numbers. It tends to extrude them. It needs to recognise that that is a necessary function of the Civil Service.
Q45 Paul Flynn: You mentioned the Ministry of Defence. If we look at the Ministry of Defence, there was the recent catastrophe of the Chinook helicopters. There was nothing wrong with them but they were vandalised by the Ministry of Defence. Eurofighter - a disaster on an oceanic scale. Hard to imagine it. Virtually ever major defence project of the last 40 years has turned out a product which costs at least four times what you can get it for on the open market if you bought it somewhere. All based on constituency nationalism - because we all like defence jobs, and in constituency. UK nationalism. Euro nationalism - because we do not want to buy from the Americans. It is a continuous story of waste on a vast scale. If it had been a public company, it would have been bankrupt once a fortnight. What is the role of the civil servants in that? Is it entirely the fault of ministers? Should there not be some civil servants saying, "For goodness sake, let's have sensible procurement"?
Sir Richard Mottram: There are a number of different categories of misprocurement here. With Eurofighter, for example, the issue was that by the time it had been developed and brought into production, the international environment had changed in a very fundamental way. You have something which is very expensive and which may not be ideally matched to the environment we face now. That is a fundamental problem in some aspects of defence procurement. But I certainly would not blame ministers for the issues that have arisen, the examples you have given, because, basically, the detail of the way in which all of these procurement programmes are managed, the way the requirements are defined, the way they are managed, the contracts are negotiated and so on, these are in the hands of the officials.
Q46 Paul Flynn: What should a civil servant in the Ministry of Defence, or whatever department it is, be saying to ministers about Galileo? - which is an example of European nationalism. What advice should they give. What takes the idea that this thing is out-of-date, redundant, is going to be replaced before it has even been created because there will be a better American system, a better Chinese system? We are carrying on only out of reasons of European nationalism: because it is ours and we want to have something that is ours and not necessarily something that works. If someone took that view, what should the civil servant be saying to the minister?
Sir Richard Mottram: I think you could safely assume that in relation to a project like Galileo, there would have been a fairly active debate in government about whether it is value for money and in the UK national interests or practical.
Q47 Paul Flynn: On your own work in the Department of Work and Pensions, you were there for three years, as I understand it.
Sir Richard Mottram: I was.
Q48 Paul Flynn: For the past 18 years the department had to sit down to qualifying by the NAO because of concerns about the level of fraud and error.
Sir Richard Mottram: Yes.
Q49 Paul Flynn: You mentioned that these things are not beyond the wit of man, or, presumably, beyond the wit of women, to get things running properly. Eighteen years.
Sir Richard Mottram: The person who kept qualifying my accounts is on my right.
Q50 Paul Flynn: Indeed.
Sir Richard Mottram: Unfortunately this is not a 30-second conversation. What I would say about fraud and error is that, in part, this is an issue about the way the social security system is designed; in part, it is an issue about how it is managed. We tried to open up a constructive dialogue with the National Audit Office about how we could improve our performance and how our performance compared with the performance of other countries. Out of that came a number of practical ways in which we can try to improve. I noticed recently, although I only read it in the newspaper, that DWP fraud and error had been improving, although official error had actually been worsening. These are things which you can take practical steps to try to manage better. If you look to that performance relative to other countries, I think it was quite good. But John is an expert on this because he kept qualifying my accounts. He had no choice, because under his rules he had to qualify them.
Q51 Paul Flynn: This is a very egalitarian committee and we have stripped all the titles away, but you are Sir John. Could you tell me if you would have preferred in your career - a very distinguished career - to have had an organisation that had the powers of the General Accountability Office in America? Do you think we need an office with those wider powers? It has been suggested that we have something called the National Performance Office that will look not just at the pounds, shillings and pence, but at the performance and audited that in a different way. Do we need a GAO here?
Sir John Bourn: In fact, we do have all the powers of the Government Accountability Office. Indeed, they traditionally have had fewer powers compared with the National Audit Office, particularly on the financial audit of accounts, which American departments did not have in the way that British departments did. In relation to the idea of a kind of National Performance Office, you could - and, indeed, we did in some areas - produce reports which were assessing performance to a degree in the round. You could do that within the present law giving powers to the National Audit Office. You could say that that would be an extension of its value for money report, because, instead of, as at the present time, where most of the value for money reports are about particular issues, you could, as it were, do an analysis of the strengths and weaknesses of a department in the round. It was one of the things we were thinking about before I left and I think my successors will want to consider it. I think you could do work of that kind within the existing powers that the office has. You might need to reinforce the range of expertise in the Audit Office to do it, but it could be done.
Q52 Paul Flynn: Could you reflect on the criticisms that were made of you personally about the alleged extravagance of your expenditure, knowing the role that you were performing?
Sir John Bourn: As far as that was concerned, all the expenditure was properly accounted for and recorded. It was all examined and shown to be within the existing rules, with no impropriety. Furthermore, during the 20 years of my incumbency in the NAO there were no points raised about the expenditure by the internal auditors and the Audit Committee, chaired by outsiders. Over that 20 years, there were four different firms of external auditors that did the external audit of the NAO - because the rule was we had to change the external auditor every five years - and none of those firms ever raised any issues. I think that shows that all the expenditure was properly incurred, accounted for and audited.
Q53 Paul Flynn: Can we get back to how we train ministers. There was an attempt made with the present government. They went away on weekends with the shadow ministers and so on, and they were introduced to civil servants and told how to be a minister and so on. Clearly there is a feeling, I think from all of you, that there are problems in the ministerial department, the pre-election tension and all the other pressures on ministers to do daft things while they are in government. What do you think we could do? Do you suggest that potential ministers in future governments should now be in training for their roles?
Sir Richard Mottram: I think there are two things we can do. In relation to ministers in the present Government, there are training programmes and development programmes for them. I think that programme could probably be enhanced and that would be a good thing. In relation to the Opposition, the potential next government, they are, indeed, interested in developing shadow ministers and there are institutions, like, for instance, the Institute for Government which is just being established, that might help them. All of that, I think, would be a good thing.
Paul Flynn: Thank you.
Q54 Mr Prentice: There are a lot of people out there who think about term limits. I had a conversation with a very senior, distinguished employee of the Commons who told me that 15 years was just about right for being a Member of Parliament and effectiveness declined after that period. Sir John, you were Comptroller and Auditor General for 20 years. Richard Mottram, you were Permanent Secretary for 15 years. Is there a case on the administrative as well as on the political side for some kind of term limits?
Sir John Bourn: I advocated for the future - indeed, this is set out in the Bill currently before the House - that a ten-year term would be appropriate.
Q55 Mr Prentice: Non renewable. Yes. And that was a product of your experience. Having been in the job for 20 years, you thought, "Phew" and you do not want that to happen to your successor.
Sir John Bourn: I was not the longest serving C&AG.
Q56 Mr Prentice: I do not believe that.
Sir John Bourn: The first one went on until he was 86.
Q57 Paul Flynn: Prime of life!
Sir John Bourn: I think, indeed, by all the standards that I was asked to follow, I made a success of it. But you will not really, private sector or public sector, now think that a period of that time was really appropriate, and therefore I recommended it for the future that there should be a term and that recommendation that I made was accepted.
Ms Jenkins: Perhaps I could make an additional point. As the civil servant who did leave after 20 years and go and do something completely different, it was the most refreshing and sensible thing I could do. I had become far too immured in the Civil Service, in spite of the fact that I was fighting it a lot of the time. I think there are very limited periods of time in which people are really effective, and especially in large organisations.
Q58 Mr Prentice: Richard Mottram will want to come in.
Sir Richard Mottram: I am not sure I do really.
Q59 Mr Prentice: Well it does not matter.
Sir Richard Mottram: I do want to come in.
Q60 Mr Prentice: Hang on a minute. The point I wanted to ask Kate Jenkins was that if you have some kind of system of term limits, it energises the organisation, it maybe energises the person. When we visited New York a year ago, Mayor Bloomberg had this ticking clock on his office wall, ticking down the four years, and he knew what he wanted to achieve in that four-year period. It was not open-ended.
Ms Jenkins: That is true. You do need the capacity, however, to look longer term. I think you have to get this balance, which is a very difficult one, between the organisation looking strategically to the longer term, but individuals within it moving - and I would prefer them to move in, out, in, out rather than staying in the same place and struggling with the same problems. Becoming "dyed in the wool" is not an entirely fair expression but you do become very institutionalised very quickly by large organisations. Breaking that institutionalisation is thoroughly healthy.
Q61 Mr Prentice: Did you feel, Richard, at any point that you were getting - and I do not want to be offensive ----
Sir Richard Mottram: You can be as offensive as you like.
Q62 Mr Prentice: -- just stale.
Sir Richard Mottram: I did not actually. I view this slightly differently. In relation to permanent secretaries, we have a view, broadly speaking, that you should not do more than seven years in one job. I think that is probably a sensible thing. You say to somebody, "You're not going to do more than seven years and you might or might not get another job." As it happens, I was a permanent secretary for 15 years because I was appointed to be a permanent secretary very young and I then moved around a number of departments - too many, I think - and you could have different views about whether at the end I was stale or not stale. I do not think that is the problem for the Civil Service. I think you have to be very cautious about the idea that the right answer to lots of these problems is to have everybody moving on very quickly, because some of our most successful private sector organisations have enormous continuity in their senior management. The issue for the Civil Service is not an issue about people generally staying in one place too long. It is an issue, in relation to ministers and officials, about whether they stay in one place long enough. Then, in relation to each individual, you have to keep asking the question: "Has this person run out of steam?" Funnily enough, after 15 years as a permanent secretary, while I was very happy to go, I was beginning to get the hang of the job. I am being serious about this.
Chairman: I detect no staleness in any of you. In fact, I think you are all as fresh as a daisy and we have had a very bracing session. We have gone on for a long time, only because it has been so interesting and we have learned so much. You know what we are after. If you feel you have not yet told us some of the things you really want to tell us or if you develop notions that you think we ought to hear about, please write to us and tell us, because we are shamelessly trying to draw on every good idea that is around and you are a big reservoir of these things. For this morning, thank you very much indeed.
[1] "Public Sector Audit; Is it Value for Money?" published by John Wiley (2007) Back