CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 983-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

PUBLIC ADMINISTRATION COMMITTEE

GOOD GOVERNMENT

Thursday 16 October 2008

MS ZENNA ATKINS, MR GEOFF MULGAN, SIR STEVE ROBSON CB
and MR MATTHEW TAYLOR

Evidence heard in Public Questions 63 - 127

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Public Administration Committee

on Thursday 16 October 2008

Members present

Dr Tony Wright, in the Chair

Paul Flynn

David Heyes

Kelvin Hopkins

Julie Morgan

Mr Gordon Prentice

Mr Charles Walker

________________

Witnesses: Ms Zenna Atkins, Mr Geoff Mulgan, Sir Steve Robson CB and Mr Matthew Taylor, gave evidence.

Q63 Chairman: Welcome to our witnesses. We are delighted to have with us Geoff Mulgan, Zenna Atkins, Sir Steve Robson and Matthew Taylor. We have asked you as a panel - and you have all agreed readily, for which we thank you - to help us undertake a rather impossible task probably, which is to step back a bit from the daily grind, to see if we can distil some of the underlying operating principles of good government, things that we may have learned over the years which we could then try to bring together. We have asked you all because, in different ways, you have had different kinds of experience in government and writing about government and observing it, and all of you have said interesting things about it. That is what we would like to tap. I am not going to ask you all to make a speech to start with, if that is all right, because that would keep us going for some time, but perhaps I could start the conversation going. I have been re-reading, Geoff, some of the stuff you have written in your book Good and Bad Power and some of the articles you have written around that, and you are really saying, "We've been round the circuit many, many times. We broadly know what makes good government and what makes bad government." Could you tell us what you think they are?

Mr Mulgan: That particular book is an attempt to look at human history and how different governments around the world have thought about goodness and badness. As you say, there are surprisingly consistent views about what governments should do in terms of, essentially, their service to the public: protecting them, guaranteeing their welfare, overseeing justice, but also how they have done that and what service means when it is built into the day-to-day operation of a government. I argue that much of this depends on external pressures on government: the work of committees like this, auditors, inspectors, free media, civil society. In some ways, good government is as much a job of society as it is of government itself, but, equally, governments have to perpetually renew themselves, and certainly their ethics and their sense of mission, or otherwise always risk not only stagnating internally but also being captured by external interests. I see good government as a perpetual battle rather than a simple formula which you just apply.

Q64 Chairman: Against that background of the constancy in this over history, where does government in Britain sit, do you think, in terms of this distinction between good and bad and the ingredients of each?

Mr Mulgan: I think we are quite good at some things. We are low on corruption; able to be fairly decisive (as we have seen in the last couple of weeks); fairly analytical and open to evidence, by comparison with many other governments; not so rigidly hierarchical as many others with which I work around the world; and reasonably focused on delivering outcomes, particularly in the last ten or 15 years. But we have very many fairly elementary vices as well. Like other governments, but perhaps more than most, we are very captured by the media, by the need to feed 24/7 media; the short tenure of ministers; the urge to have many, many initiatives rather than focused strategies, which is a major problem. We are overcentralised by comparison with almost anywhere else, which means an almost constant problem of competent people having to operate fairly incompetently because they are trying to do too much at the centre and not able to do it. We are still not very good at big projects in government. A theme which this Committee has looked at many times in the past: the bias against practicality and implementation, is still there. Although there has been some progress, you are still promoted faster for writing nice White Papers and minutes than understanding how things work on the ground.

Q65 Chairman: That is a cue for bringing other people in. Listening to Geoff giving that brilliant summary of virtues and vices, how do other people react to that? Zenna could I start with you?

Ms Atkins: I do not think there is anything I would disagree with. I do not want to repeat any points. Some of what I have written more comprehensively about is probably in relation to the last point about some of the practicalities of how you deliver. I think it is affected by a lot of those governance and government issues. Just to pick up on some of those things, in terms of the administrative side I think that we are particularly bad at performance management, for an example. We give people very long tenures, we do not move them out. In fact, if you want to really rationalise your business, as I am doing in some of my non-executive roles within government, the process for compulsory redundancy, for example, is unbelievable. I think we also undermine our strategic efforts at rationalising what we do by making it very, very complicated: we introduce very complicated procedures and sets of rules and regulations for ourselves. The other side of the media side, one of the good things about this government, is that we are very determined to be transparent. We really want people to understand and see what we do, but at times that limits our ability to do what we know is right because we are more worried about how it will be perceived than doing the right thing. I think that is a real tension with a transparent and open government.

Q66 Chairman: Thank you for that. You have been more robust even than that in some of your reported comments. It is always embarrassing to quote this stuff back at people, but you do say, "I could say without doubt that significant parts of the Civil Service are broken. The machinery of government is not even in the 20^th century, never mind the 21^st century." This is powerful stuff.

Ms Atkins: I think those comments were particularly about the administrative side rather than the governance side. It is quite strong language, but I came in from the outside and was genuinely shocked at some of the procedures and practices, which are not driven by standard business practices - so we introduce new IT systems and we still produce everything in paper (although we are getting better) - compared with what was happening outside, in my experience. Some of it is about culture as well. It is not just about the machinery. There is a code of behaviour that is acceptable within the administrative side within the Civil Service, and when we try to bring people in .... For example, I came in as an outsider, and people expect me to behave like everybody who has been here for years. Those sorts of challenges, because of the way you behave, are quite well defined. Also, there is a real lack of diversity in the Civil Service. By that I do not mean the ticking of boxes: "Do you have a black person and a woman", I mean, genuinely people who have different backgrounds and experiences. It is very difficult to find people who have not been through the straight university system. When they are then making policies that are supposed to recognize vocational learning, there is inevitably going to be a challenge. Those are the sorts of things we have not necessarily been able have the impetus behind to change particularly, and so they remain. We want to do things differently, but in the main we have the same people trying to do them and we have the same methodologies and processes for doing them. It is incredibly process-laden. Part of that is about to this desire to be able to show to be doing the right thing, to be doing the fair thing, irrespective of whether you get the right outcome. Geoff touched on it, but there is a real obsession with projectitis. That can get things delivered, and there are examples in the Civil Service where that has been delivered excellently well, but there are many, many examples of which this Committee is all too well aware when they might have delivered on time and on budget but the quality or the product is entirely wrong because there is not that kind of quality control checking that benchmarks back to experience and external expertise. I think there are a number of things. I do not want to give a diatribe but I could say many more things, probably a lot more controversial than I was quoted there as saying, particularly about the Civil Service but probably less so about government.

Q67 Chairman: Thank you for that. Could I go straight to Steve Robson and ask if that is a description of the administration that you used to work in?

Sir Steve Robson: To a degree, I guess it probably is. I would just pick up Geoff's point. If you ask, "What does government do well?" - it deals with crises well. If you say: "What does it not do well?" - almost anything that involves leading and managing large organisations of people is not done so well. If you ask, "Why?" - I would suggest that if you want to have a well-run organisation you need three or four things. You need determined leaders, you need clear objectives, and you need good communicators of those objectives down the organisation. That should give individuals in the organisation a good understanding of what they have to do to be judged successful. And you have incentives that fit with that definition. In government, we come closest to that situation in handling a crisis, and we come furthest away from it in dealing with large organisations of people.

Q68 Chairman: That is interesting. I would like to come back to that in a moment. Could I just ask Matthew to come in and give his take on this conversation so far?

Mr Taylor: First, in response to what Steve just said, I think one needs to be careful that one does not conflate the problem of large organisations in the modern world with the problem of government. I think all large organisations have problems. As government is full of large organisations it has more of them, but to an extent this is an issue about large organisations rather than simply about government. I broadly agree with the points that have been made. I guess if I had my very short list of things that government is not terribly good at in my experience, it is delivery, as Geoff said, and it is learning. I think government is very bad at learning. The particular characteristic of this is that government does not learn that certain actions have consequences which are inevitable. There are certain consequences which result from regulation or from centralising power or from decentralising power. Ministers and civil servants seem to come along and take an action unaware of the fact that there is lots of evidence that this action will have certain consequences. That does not mean that you should not take the action, but you need to be aware of the consequences. They are then kind of surprised when those actions have consequences. When they regulate, they are surprised that it has perverse outcomes, when there are decades of history from which they could have learned. There is a problem about institutional memory, I think. Also, I think long-term infrastructure is a difficulty. I think that is as much to do with our electoral system and our political culture as it is of government per se. The other point I would make is that I absolutely agree with Geoff's contention that, in a sense, the government you get is a reflection of a broader state of society. What is government? Government is the idea that there are things that we should do collectively when we can do them more effectively collectively than we can by doing them individually. I think there is a broad collective action problem in society at the moment, which is, to put it in incredibly simplistic terms, that there are certain ends that people want aggregately in society which they do not seem to be willing to will. There is lots of polling evidence to support this. I can think of one statistic that three-quarters of people think that climate change is the biggest challenge facing the country but 16% of people say they are doing nothing about it. That is why one of the issues that has come to the forefront of debate across the political spectrum and in government is how does government shape behaviour. The sense is that the problem is how you get citizens themselves to do things differently, because there is an understanding that what government can do without citizens participating is pretty limited. It is interesting to me, notwithstanding recent events, that for once the two major parties agree about what they disagree about. They both agree that getting citizens to do the right thing is a problem. The Labour Government argues that the answer is in enabling state; the Conservatives argue that it is to withdraw the state in order that society can flourish. I think these are both interesting arguments. I think neither of them stands up to much scrutiny in terms of a compelling account that this will make a difference to the way in which people do things. My last point is that one of the symptoms of this broader collective action problem in society, is that government is subject to a pretty dramatic mission creep. If I look at the priorities that Labour had in 1997, they are all still there, and then there is an awful lot of other ones that have been added. I have mentioned climate change, but Britishness or the Olympics. The list of things which any minister would find it difficult not to say were a priority seems to me to be growing year on year as a result of government having to take ever more responsibility for this collective action problem. I think, therefore, in closing, that there is an argument for looking quite radically at the centre and the overload of the centre and the need to do some quite profound things to make the centre manageable.

Q69 Chairman: We would be interested to hear any suggestions any of you have on how we might do things better. I am interested in this proposition that we do not do routine government terribly well but we do crisis splendidly. That is a fascinating proposition, because it takes you to the heart of our system in a way. Is it the case that we are leading the world on bank rescue, that Gordon Brown is the colossus striding the world stage? Because we have a phenomenally centralised system of government that can galvanise into action around crisis. We do not have a Congress that messes you about all the time. We do not have coalitions that you have to broker. We do not have this, we do not have that. In a sense, some of the usually reported defects of our system - the lack of checks and balances, centralisation of power - maybe are the things which make us rather good at crisis.

Mr Mulgan: I do not agree with the analysis that we are very good at crises. A defining feature of British government for much of the last 20 or 30 years was being really bad at crises: the ERM debacle, BSE, and a whole series of matters around the economy beforehand. We rather lacked machineries in fact for dealing with crises well. Some have been created in this decade, COBRA and so on, and the Government has got its act together, but it was after a long period when it was visibly failing on crises - not quite as bad as Bush and Hurricane Katrina but not so far away from it. Some of our routine functions, whether it is things like pension services or the NHS, are by global standards not that badly managed. I think there is a deeper issue here. Most central governments responsible for 60 million people do not try and run large-scale services delivering directly to the public. I am not aware of anywhere in the world that does that sort of large organisational routine function well at that scale. Everywhere else, it is devolved to local government, regional government, states and so on. Therefore, to believe that there is some sort of magic formula which would enable us to turn these huge direct delivery institutions into being competent and efficient is quite a leap of faith with no evidence to support it.

Q70 Chairman: Steve, do you want to defend your proposition that we do crises rather well?

Sir Steve Robson: Yes. It does, of course, depend on what you think is a crisis. The essence of my view of crisis is that it is a time-limited thing. It is a moment of danger of some sort or other. Its temporary nature is an essential part of my view of what we do well in those circumstances where there is a finite amount of time, where there is something to be focused on. To take one extreme, let us say that one of you has put down a private Member's question to the secretary of state. That will amount to a time-limited moment of danger for that secretary of state and his department will bend to it. Equally, I would tend to agree that what the Treasury appears to have done last weekend to address the banking situation is a similar sort of crisis. Why do we do well in those circumstances? I think it is because there is, first of all, a clear objective. Second, you are dealing with a small team, so you are not challenging the government organisation to do what it does badly, which is to deal with large teams, large organisations. You are working with limited time, it is usually a policy issue not a delivery thing that you have to organise. There are very clear objectives, very clear definitions of what success is at the end of it, and there are strong incentives on the members of that small team to deliver that success. Everything is playing to the strength of the government machine in those circumstances.

Mr Taylor: I think it is a job for a historian to work out whether, objectively speaking, we have or have not handled crises well, but I would link what I was saying earlier to why it may feel as though we do crises well, and that is a legitimacy issue. Both internally and externally legitimacy is strengthened by crisis because nobody says, "Why are you doing this?" because it is obvious why you are doing it. I have a teenage son who does not like me very much and who I am sure would like to leave home. If the house was burning down, I am sure he would do what I told him to do. It does not necessarily mean that a week later he is going to have a stronger relationship with me. I have to say I am slightly overstating it for the sake of argument, but when you have a crisis outside, the public accepts that this is what government has to do and says to government "Get on with it" and internally people give up their departmental silos and their jealousies about their position or whatever it might be and say, "Yes, okay, all hands to the pump." It would not be surprising, would it, that it would feel that government was working well in a crisis, because a crisis gives you the glue for collective action which is very often missing at other times.

Chairman: I am going to bring some colleagues in and we can extend this.

Q71 Kelvin Hopkins: At least three of you have been at the centre of government driving it in a particular direction since 1997. You are not necessarily there now, but you were. We now have the biggest crisis we have faced possibly for 75 or 80 years. It derives from the privatisation, deregulation, and giving freedom to the market that you drove from the centre of government. Are you not guilty of engendering this crisis, the three of you in particular?

Sir Steve Robson: If you want to go into what has caused the credit crisis the world is facing at the moment, I would suggest there are three main causes. One is an incredibly lax monetary policy in several jurisdictions, primarily the USA, for a prolonged period of time, which created a large amount of cheap money which has been invested in assets.

Q72 Kelvin Hopkins: It has been ---

Sir Steve Robson: Hear me out. The second reason was the absence of any sort of regulation in the US mortgage market. The third reason was a complacency about risk on just about all the economic players around the place.

Q73 Kelvin Hopkins: I understand the economics of it but I am talking about the government. You, in particular, Sir Steve, have mentioned when you have visited the Committee before that you want private sector incentive structures, you want private people coming into government, and you do not believe there is anything really like the public service ethos. It is all about the business world, really. That is what works. You have been an associate director of the Royal Bank of Scotland. Is that an example of the very success of the private sector?

Sir Steve Robson: No, it is not an example of the successful private sector. I am not quite sure what the quotes you just gave have to do with the credit crunch, but let that pass. I do come back to the fundamental proposition that if you want to have an improvement in performance, the place you look to get that improvement is at the question of changing behaviour, and that is inextricably intertwined with the question of the incentives that the individuals face. I do believe that the incentives faced by a lot of people in the public sector are not ones which encourage them to give their best performance. In Al Gore's phrase: These are good people trapped in a bad system.

Q74 Chairman: I do not want to get wider than we have to.

Mr Mulgan: I have two comments on this. Earlier on in this decade the Cabinet Office looked at crisis management, partly prompted by the view that with foot and mouth disease and various other things, the British Government had not been very good at dealing with crisis. There was a series of conclusions about machineries and processes, but the heart of it was that government needed to be better at spotting the potential risks and crises and planning for them. I think it is an entirely legitimate criticism to make that, although the Government has responded decisively now, very little work was done previously to think through unpleasant scenarios of credit crunches, collapses, and so on. I am pretty certain that almost none of that work was done. The same criticism can be made of some other governments. The second thing which perhaps will change irreversibly now, is that we have been through a long period where probably there was insufficient confidence in a public service ethos, too much deference to business methods in inappropriate fields in relation to policy advice. Being wealthy has been taken as a proxy for wisdom with very many wealthy people involved in advising governments, not on business but on social policy and other things, and, indeed, having a senior corporate position was taken as qualifying people to advise on running large public services. One of the effects of what we are seeing now will be a major culture shift, which will make it look rather odd that for a long period there was quite such deference, not based on evidence, to particular kinds of business and particularly financial expertise.

Q75 Kelvin Hopkins: You said that there was not sufficient, in a sense, debate in government. You did not have, within government and within the highest circles, alternative views expressed. Was it not the case that, particularly under the Blair regime, opposition at every level was squeezed out - within the party, within Parliament, within government, within the Civil Service - because a particular view had taken hold that this was the way to run the world and we did not want anybody challenging it. Was that not the reality?

Mr Mulgan: On some topics there was in fact plenty of internal and external debate. All of you are aware of that. I am talking much more narrowly about the expectation that certain things would carry on in a straight line, in particular our economic growth. It is very hard in any government to really face up to the facts of a business cycle, the likelihood of recession and so on; in part, because of a fear that if you do start preparing and planning for that it may leak out, it may be taken as a sign off lack of confidence in the system. It is not easy for any government; nevertheless, there should be within the heart of any government some proper argument about less pleasant potential scenarios as well as more desirable ones. On economic policy, as I say, in most governments there is very little evidence that happened. This is not a UK-specific phenomenon.

Q76 Kelvin Hopkins: In general terms, is it not the case that the traditional pluralism in British politics - strong local government, strong Parliament, strong parties, strong Civil Service, all rubbing against each other a bit - has been combed out and got rid of? It started with Mrs Thatcher abolishing the local authorities, which she did not like, and, under the Blair regime, trying to weaken local government as much as possible by forcing them to privatise and outsource, centralising their funding and so on. Any opposition at any level was really not welcome in Downing Street, both under the Thatcher regime and the Blair regime, and this has led to our problems.

Mr Mulgan: I think at least two of us have said that centralisation and overload is a significant part of this story. Whether in fact British society and government did better with economic crises in the 1960s and 1970s is debatable, and I think the Government has responded pretty well in the last few weeks by contrast with previous eras, so it is not entirely a negative change.

Mr Taylor: First of all, I think anyone who has served in government over the last ten years should be publicly willing to accept responsibility for the fact that they did not read the right people and say the right things at the right time. But I think this is a general social failure, so if what you are looking for is people to say, "Yes, I was in government, and, yes, I should have stood up and said, 'We are heading towards the abyss' and I am having to take responsibility," I guess everybody should be taking responsibility for this. There are three lines. First of all, I think part of what has happened is a consequence of having global economic systems that have massively outrun global governance. Second, reinforcing Geoff's point, I think this crisis points to the need for a genuine capacity in government to deal with strategy and complexity. It is possibly the case that if you have a lot of people working on a national strategy for children's play, you have left people who have the capacity to sit and think about these kinds of big strategic and complex issues. The third point I would make, really reinforcing what I said earlier, is that part of all this is to do with the fact that government finds it hard to say no to people. The debt-fuelled economy was partly to do with the difficulty for government - which I think is itself related to overload but also to broader social things - to say to people, "You can't have your cake and eat it too." Geoff is right when he says there was an obsequiousness to business opinion but there was also a refusal to say to ordinary people, "Spending more than you are bringing in, ultimately is something that is going to get you into trouble. It will get us into trouble as a country and it will get you into trouble as an individual family." Politicians did not want to give that message. Just ask yourself this question: Two years ago or a year ago, had government said, "We are going to regulate to stop poorer people being able to get mortgages," what would have been the newspaper reaction? They would have said, "Hang on. So poor people want mortgages, banks are willing to give them mortgages, all the middle-classes have benefited from the housing boom and the Government is going to step in and stop other people from benefiting from the housing boom simply because they are fond of regulation.". There would have been, I think, an unstoppable outcry against such an intervention. I am not saying the whole crisis is simply to do with unwise mortgages being given to people who could not sustain them, but that is a fairly significant part of it. I think we need to understand the political culture into which warnings would have dropped.

Q77 Mr Walker: I do not think the Government would necessarily have had to have said, "Don't sell mortgages to poor people," maybe the FSA could have taken a more robust role in examining the type of financial information that was being provided to these people taking out mortgages. But that is just an aside. Mr Taylor, you wrote in the New Statesman, ".... the state is unable to address the issues it most cares about - immigration, hospital infection, overcrowded trains - even as it seeks to expand its influence in other areas, from children's play to obesity plans, that used to be seen as the responsibility of the individual." Why is there a collective loss out there amongst the public in the power of government to address the concerns that matter to them?

Mr Taylor: There is a number of points bound up in that. I have said already that there is this mission creep problem and the Government is taking on new issues where its efficacy is not necessarily clear, whilst it could arguably be better spending its time on issues where it demonstrably is able to have a solution. That is partly what I was arguing there. I think that it is partly to do with this kind of drift in government away from what government does and increasingly focusing on how government can influence people. I think that is necessary but it is leading to a certain amount of confusion about what government is there to do. That, in essence, is what I am arguing. It would take me back to this overload issue. It would take me back to a greater realism in the centre about what the centre can achieve: a willingness to start not with the question "What would it be nice if we could do?" but a question "What is it we think we probably are good at doing?" Unless we are absolutely certain we are good at doing something, it is probably better for somebody else to do it or for it not to be done.

Q78 Mr Walker: You are arguing, I think with some merit, that government should focus more on the basics, the things that really concern people on a day-to-day basis, such as overcrowded transport. We have just heard today that there is going to be very limited new capacity on the trains, for example, so that they are going to become even more crowded. There is still continued concern about immigration, and that concern may grow as unemployment rises. You think the Government has ceded ground on the big issues of the day, for some reason, loss of confidence amongst its own people, and focused on the peripheral stuff that may make a good headline on breakfast television and GMTV, for example.

Mr Taylor: I am not making that accusation. I think you get cycles do you not? Infrastructure is now back in fashion. I think there is an argument that would say that government should be focusing more on those areas of infrastructure and system. It is taking action in certain of these areas, but transport is a good example, and, in those areas which require the state to engage with people in order, as it were, to shape outcomes with them, that is almost always something that is better done at the local level. It requires a partnership of national/local action. That engagement around changing behaviours, for example, and one of the things the centre needs to recognise, is that it is not very good at that kind of thing. That is one of the bigger changes that I think the centre has to come to terms with.

Mr Mulgan: Clearly, governments do not have infinite capacity. If they try to do everything, they will do everything badly. We have seen shifting patterns over the years. Many governments greatly expanded their economic functions from the 1940s onwards and then had to recreate because it was clear they were not performing it very well, they were not good at running utilities, et cetera. As Matthew said, there has been a fairly substantial growth of government activity in many social fields - care, environment, and so on - and I think we are again asking the question: "Is government able to do all these things well?" Crudely, if you think there is a problem of overload, there is only a few options of what you do. Either you devolve, which is what most countries do: you share those responsibilities with other tiers. You can drop some other things you used to be doing and hand them over to an international organisation or just say to the citizen, "It's your job now to look after yourself." Or you can try to find these halfway houses. In the 1980s and 1990s many looked to regulation as being the answer; that, instead of direct provision, regulation would enable government to retain power but not to have to keep the capacities to do things. That worked reasonably in some fields and really badly in other fields. The behaviour change agenda in a way is another example where its promise to governments is that they can have lots of influence over obesity, learning, and so on, without having to pay lots of teachers, doctors, and so on. The Strategy Unit, when I was there, published five or six years ago an overview of what was known about behaviour change policies, what worked and what did not. The truth is there is still not a very strong evidence-base of what does in fact work, so I suspect, a bit like regulation 20 years ago, the promise is going to be ahead of the reality to square this circle of growing demands and limited capacity. If there is one feature of really good government, I would say it is a degree of focus: knowing what really matters and being willing to say, "We won't try to do everything. There are some things we cannot do now."

Q79 Chairman: There is a bit of a paradox here, is there not? When the new Labour Government came in 1997, in a sense it knew a good deal of this and it took steps to make sure it did not fall into some of the predictable traps. It knew about the importance of strategy and we had the Strategy Unit to do the long-term thinking so it did not get bypassed. You ran it. It knew about the importance of bringing more powers to the centre and the worries about departmentalism, which is why it is sought to strengthen the coherence of Number 10. It knew about the need to focus on delivery, which is why it had its Delivery Unit and its focus on particular delivery targets. In a sense, we have been around this circuit, have we not? We know some of this, yet we are still reciting these as some of the endemic problems of governing.

Mr Mulgan: Many of us in our own lives know what is the right thing to do but do not necessarily do it.

Mr Taylor: When we talk about the new Labour Government and the Blair regime, presumably we are talking about the same thing. Symbiotics are fascinating. One of the things that Labour did not really get - and this goes back to the institution memory point - was that you could pull a lot of levers in the centre with not having a great deal of impact. It is a caricature, but ministers spent time in their offices pulling levers and it was not for a couple of years before anybody bothered to tell them that those levers were not necessarily connected to anything outside. Possibly, in all the preparation for government, that was the one thing I have learned, but if you give someone a new set of toys, it is quite hard to say to them, "By the way a lot of these toys don't work." I would link that to the more difficult point about renewal for governments, which is that, arguably, one of the reasons that governments have to change from time to time is that when you have been in power for a long time it is very hard to say something is not a priority. It is very hard to say, "I'll get around to that," because people say, "You've been around for five years, ten years, 15 years, you've got to do it now." One of the advantages for incoming governments is they do have a space in which they can say, "No, these are our priorities. We are not going to do those things - we will do them one day" or whatever. It is simply a fact that the longer a government is around the more it suffers mission creep. I think a question for long-term governments is what strategies you adopt to allow you every once in a while to throw off some of the stuff you have built up.

Sir Steve Robson: I do not think this is simply the fault of government. We live in a society where people do tend to turn to government to solve their problems. I fear, also, that politicians as a group tend to encourage people to do that: "Bring us your problems, and we will solve them." This is not simply an issue of the centre, this is not simply an issue of the Prime Minister of the day, this is part of the way that society and politics works in this country.

Q80 Chairman: It would be an interesting kind of politics that said: "Bring us your problems and we cannot solve them."

Sir Steve Robson: It would, indeed, but it would probably be very realistic, and it would probably in the long-run mean that politicians would be held in somewhat higher regard. People tend to feel, "Yes, we brought our problems and you didn't do anything with them," so they do not have quite so much confidence in you.

Q81 Chairman: Can I bring Zenna in.

Ms Atkins: In terms of: "We had great strategies, what went wrong?" and those sorts of issues, if you take for an example some of the stuff in the National Health Service, I got involved as a chairman at the time because I read the ten-year plan and thought it was really rather good. When I got in, I was confronted with a 1.2 million workforce who had not, in the main, read the plan and so did not really know what they were doing, and certainly had not had anything to help to encourage them to buy into it. They thought what was happening was that the name on the top of their name badges was changing again - which had happened repeatedly. I use that example because I think it is the largest example we have. Their behaviour did not change because there was not an investment in getting everybody you needed to deliver that behind the concepts and the ideals. It was a great plan. There were a few key planks, that we managed to charge through, which became distorted priorities and distorted targets because they were not seen in the context because the context had not been invested in. People felt they were pulling levers and not a lot was happening. The other things that is happening across the piece is that small pots of delivery go off and deliver, and they may be set up as the Financial Services Authority, to use your regulatory body, and we do not effectively risk assess centrally what our risks are, who we have delegated the management of those to, and how we are ensuring that they are doing that competently. I think there is a real issue about that. That I can put a regulator hat on is that I do not know how many ministers could really say, "We fully understand that Ofsted is doing what it says it will do competently." I can tell you that we are, and we are going to get increasingly more competent at what we do. However, that whole risk assessment area is weak in big organisation generally, I think it is critically weak within government, and it becomes particularly weak where we have, in government, set a strategy and are allowing others to deliver. Whether that is something very small, like letting the private sector deliver foster placements, and when they go belly up there are suddenly very vulnerable children with nowhere to live, or whether it is something major like not being able to deal with overcrowding on trains because we do not run them and control them, we do not understand how you manage that relationship through good governance, good risk assessment, and good partnership working. We kind of hope it is going to be all right. I do not think we have very good failure regimes: we do not really know what to do when things start to go wrong. That is the same whether it is a school or a primary care trust or the delivery of a railway or anything else. We do not have a clear set of strategies which says that this is what we do when it goes wrong and this is how we put it right again. We have kind of evolved without that. Then, suddenly, we want to centralise it all again, because we did not know what to do when it had gone wrong. We go from 302 to 150 PCTs - and soon it will change again, I am sure - because we do not understand how to manage failure. The flip side of that - as a couple of people have mentioned - is individual incentivisations. It is unbelievably difficult to incentivise good performance in central government: so, if for your own department you say, "We want you to make lots of savings because there is not enough money to fund what you do" and you do not then incentivise them, they make all the savings and there is no departmental benefit. We equally do that to our arm's length bodies or the people we have subcontracted to deliver our vision. Those are a couple of basic things that we could really address and so make a significant difference to how we manage that relationship.

Chairman: I am sure we will come back on some of that.

Q82 Mr Walker: Government might go a little bit red in the face at some of the accusations being levelled at them, because they could say, "But we have devolved responsibility and that is demonstrated by the marshalling of quangos around the length and breadth of the country." Of course, we have all these quangos and they secure huge amounts of hostility from the public, who see them spending large amounts of money and wonder how they are earning this money and why the politicians are not worrying about this: "Why do we have these arm's length relationships?" There are these pressures on the system. I was wondering if any of you have views on that.

Ms Atkins: There are several issues. One is that we do not have the governance of the quangos right. We really do not understand how we assess in central government how they are taking risks with our money. We do not have our roles and responsibilities and accountability right - and I think that applies centrally as well - so we do not understand when they go wrong. When SATs are not marked, or whatever it might be, we do not understand who is responsible and we do not know what action to take and we do not have a  failure regime. Often we populate them with people who, because we were not able to get rid of them in our own government departments, we put on an outplacement. So we do not necessarily always pick our best people. There are lots of cases where we have - I do not want to deeply offend everybody in a quango and I am sure they are riddled with some of our best people. Those are some of the issues. Also, we often just dump problems that we do not really know how to sort out on delivery. The worst you can do when you are commissioning anything in the private sector is to give it out half-cocked. If you do not know what it is you want a partner agency to do for you, the last thing you do is go into a contracting arrangement - which is what we are doing with quangos, because we fund them. We do this time and again. We have some vague notion of what it is we might hope they will achieve for us and we say, "We'll give you the money. Go away and sort that out." Frankly, as a property developer in another life, if I go to the builder and say, "Vaguely build me some houses. Vaguely build me a community," and I do not have any idea what I am commissioning them to build, they will not build what I want, and then I will get the flak for not delivering what was wanted in that particular community. I think there are a number of issues that we could do better. Finally, I would say that we keep trying to kill quangos - which is not always the right thing to do because there are some very good ones - but we never quite manage to stop them, so we just move them around and give them new names. I think that is another thing that we need to get much braver at, saying, "I'm not doing it any more. It is ending. It is stopping," but we just recreate it or move it into another department or another body. We are not very good at saying, "No, we're not going to do it." That is for a whole range of political reasons as well.

Mr Taylor: I want to go back to the point I made earlier about large organisations and that the problem of government is a subset of the problem of large organisations. One of the things it took me a long time to understand in government but was a journey I went on, was to recognise the dynamic nature of policy-making. I went from being interested in whether a policy was clever and ended up asking the question of people whenever a proposal came to me: "What is it about this policy which means that when it is implemented, that which is good about it will grow and that which is bad about it will fall away? What is the DNA of continuous improvement built in?" That is why the Blair regime became increasingly interested in system reform as a way of understanding public service reform. "What are the ways in which it changed the system so that the dynamics within the system create improvement?" One of the reasons I think it is difficult for government in terms of delivery is that the staccato nature of decision-making in government, which is partly to do with the legislative process and partly to do with systems of accountability such as this, mean that it is very difficult to be continually adaptive. Anyone who was advising a large organisation in the private sector or the third sector would say, "You need to understand that you now work in a complex environment where continuous adaptation is a secret to organisational success." But it is very difficult for central government to be continuously adaptive. Picking up on one of the points Zenna made, all policy is doomed to failure on one level because policy is created in one particular set of circumstances and not only do those circumstances change but the policy itself changes those circumstances, which is why it is that regulation produces inevitably perverse outcomes, and why it is that whatever regulations you put in place for the banks now will simply provide the framework for some new exuberance and excess in ten years' time which will be built around the contours of that regulation. The understanding of the lifecycle of policy, the inevitability of unintended consequences, the need for adaptation, are all the kinds of things which if we really understood them would lead us to say that the centre has to change profoundly, not because people are bad or because the Government is stupid or because it has done things wrong - it has done lots of things very well - but simply because there is a fundamental problem about large organisations in the modern world.

Sir Steve Robson: I agree with almost everything Zenna has said and a lot of what Matthew has said as well. Yes, there is a problem with large organisations but I think there is a particular problem with large organisations in the public sector. Coming back to this question of delegation and the question of quangos: delegation only produces good results, it seems to me, looking at organisations I have seen where it has produced good results, first of all, when what is delegated is a very clear set of objectives and then the responsibility for delivering those objectives is delegated as well and there is clear personal accountability for the success in doing that. One of the things that I think gets in the way of delegation in the public sector in a profound sense - and until it is addressed delegation is more of a slogan than something which is particularly meaningful - is ministerial accountability. As long as you guys in the House of Commons, for example, demand that the Secretary of State for Health is prepared to come to the House of Commons and answer questions of the sort: "Why did Mrs Smith spend eight hours on a trolley in a hospital in Newcastle?" it is going to be very hard for the centre, in this case the Secretary of State for Health and his department, not to want to interfere a lot in the running of the hospital in Newcastle, not to give it clear objectives, not to give it delegated responsibility, and not to leave it with clear accountability, because he is accountable.

Q83 Chairman: Is the implication of what you are saying that we have to have clearer accountability of public servants themselves beyond ministers?

Sir Steve Robson: I think the delegation route is a good route to go. It would bring profound benefit, but it is only going to bring profound benefits if ministers cease to be responsible for accounting for micro issues within those delegated organisations. I think you have to draw back and say that ministers account for the broad policy, they account for the structure that they put in place. So they account for the structure they put in place (Ofsted), they account for the top hires (Zenna), and they account for the incentives they give their top hires - and that is it.

Q84 Chairman: You are arguing that we should break apart the traditional doctrine of ministerial responsibility.

Sir Steve Robson: I am not saying that you should break it apart. I just say that as long as it exists, delegation is not going to bring the benefits it can do because it is never going to be real delegation.

Mr Mulgan: I would agree with Steve on that, but I think that even if you do not deal with this fairly central structural problem which lies behind all the issues on quangos, ultimately, I think there are issues of culture which could be changed. A lot of what Zenna is talking about is how we have a public service which often does very slow what it should do fast - things around mediocrity in performance management and so on - but does fast the things which should be slow - like endless structural reorganisation as a proxy for dealing with things. I want to mention two domains where I think this is really serious which have not been mentioned yet. One is communication. Government does much more communication than it did 20 or 40 years ago, feeding the media. But it is almost entirely one way and tactical communication, not the sort of two-way and more strategic communication you need if you are trying to take 1.2 million health sector workers through a major process of change or if you want the public to really own responding to climate change. I think our communication machinery is out of sync with what good government needs. The second domain where you see this very clearly is around innovation, where the advice of highly centralised governments is that they innovate on the whole population at once. Rather than doing what we do in science and medicine and so on, where you test things out on a small scale, debug them, learn what works and what does not and then spread them throughout the system, it is still the case - though slightly better than a year ago - that within central government there is almost no centre of expertise, protocol methods of how to do really good innovation in fields like health, education, and welfare. I think this is going to be a critical issue for governments in the next ten or 20 years, and it is particularly vital for highly centralised governments, like the British one, which, as I say, tends to experiment on 60 million people at once, which is an incredibly inefficient way of doing it.

Q85 Paul Flynn: Do you still think, after all that was said, after all the preparations of the Labour Government, that the Labour Government, like all other governments, starts from the year zero, generally blind to the lessons of history, and is still producing policies that are evidence free? Matthew, we have had before us Lord Birt talking about the Strategy Unit, a bleak document on drugs policy, which the RSA has talked about. We have had a civil servant, retired, Julian Critchley, who was enforcing the policy but did not believe a word of it. The Strategy Unit has said that the prohibition does not work. We know the result of it not working is that there are at least 1,000 deaths, with the cowardice, the failure of government to implement a policy. Portugal implemented a policy that was suggested by the RSA, suggested by the civil servant, proposed by the Strategy Unit, but nobody takes that policy. There is this great gulf because it would require a degree of political courage to introduce it. The Government is about to take a decision that is contrary to this mountain of evidence, virtually all informed opinion that prohibition does not work, that prohibition kills people. How do we get over that? I turn to Matthew because you have been very much involved.

Mr Taylor: I think your point is the perfect follow-up to what Geoff has just said about communication. I do think that government is able and has demonstrated its ability over the years to get across difficult messages, but only when it genuinely decides that it is going to press that message above all others, that it is going to let all the other messages lie down for a while, relegate those for a while, and it is going to push the message despite what the headlines are on day one, day two, and day three. There is an economics of communication and I do not think government understands that. It does not understand that every new message you layer on reduces the impact of the already existing messages. This is particularly important in an area where change does not just rely upon government action, it does rely upon public action as well. In particular - and this goes back to Steve's point - one of the critical things about the message is that you have to get people's attention long enough for them to understand that there are going to be some difficulties with this policy, so that when those difficulties occur people do not say, "The policy has failed, let's abandon it." The difficulty with innovation in drugs policy is that, unless government is willing to say, "Not only are we going to do something radical, but when we do something radical there will be some things that will happen in the short term which you will not like, but that is the price you have to pay the long-term" people do not hear that. Then, when things do go wrong and newspapers print front-page headlines of the things that have gone wrong, which are anecdotal - there is no assessment of the quantitative scope of these problems - ministers are confronted in Parliament, prime ministers say on a Wednesday morning sitting in their study in Number 10, "I can't deal with this at PMQs. Why has this happened? I want this problem to go away," and you get a retreat from courage. Geoff's point about the need for a smaller number of messages, which are driven through and where people are prepared for the full consequences of major changes in policy, absolutely fits what I think you are saying about drugs.

Q86 Paul Flynn: The point Geoff made earlier on was suggesting that major policies are determined on the need to sell newspapers; it is the newspapers' hegemony that works. We had a meeting here yesterday about knife crime. It was pointed out that knife crime is 6% this year and it was 6% last year. There has not been any great increase that is reported to have taken place. What drove the hysteria about knife crime - and it is spread right throughout the country, the country is having a nervous breakdown, there is a great fear of crime, it is becoming at the top of the priorities in the Home Office - was a media campaign which was generally untrue. There was not a huge increase. And we find that it is not just the mass media; it is the whole media world that is determined by this. Is this a sensible way to run a country, on the priorities of the press?

Mr Mulgan: If you can fix that, I would be very impressed

Q87 Paul Flynn: You have written about it.

Mr Taylor: Nationalise the press along with the banks.

Q88 Paul Flynn: We have made a start.

Mr Mulgan: On the drugs policy, I oversaw the team which did the drugs review you mentioned, which was in many ways a good exercise: gathering evidence, analysing things, and challenging quite a few bits of government about their assumptions. Equally, I think it was legitimate for elected politicians to say, "We don't agree with it. We're going to do something different." Part of the role of those sorts of teams within government - and France is setting one up, Australia is setting one up: the British model is being copied quite a lot around the world - is to offer a wider menu of options, but still to leave it essentially to accountable politicians, perhaps influenced by the media, perhaps influenced by their constituents, to decide to ignore it.

Q89 Paul Flynn: What happened in Portugal, coming back to this example, was that the policy was hugely unpopular amongst the public, the press and lots of politicians, but a courageous politician carried that policy through and halved the number of drug deaths. Certainly that was successful, there is an example to follow. Do you think it is fair to say that politicians are history blind? I will take another example, which is Afghanistan. Would there be a change of policy if all parliamentarians got a 15 minute briefing on the success of previous invasions of Afghanistan, so the last 300 years would be beneficial to policy? There is a kind of blindness to what is the rational answer and people are blind to the evidence there. Is this fair comment on much of the frustration of policy, that it is media driven and divorced from the evidence?

Mr Mulgan: It is partly media driven. I have got a book coming out next month on public administration and I actually use Afghanistan and drugs as an example because one of the more striking experiences for me in government was hearing a presentation on delivery plans for eradicating opium production in Afghanistan. I had never felt such an air of unreality in my life. I had been in the region a bit and it was clear that this had been developed by people who had no understanding whatsoever of Afghanistan, of its history, its culture, the dynamics of power and so on. Nevertheless, ministers committed very large sums of money to following this wholly unrealistic plan and, in the event, opium production actually went up rather than down during the period of the plan. That was partly, perhaps, media driven, but it was also another vice which perhaps we should mention which is when decisions are made in government with no-one in the room who actually understands what would really happen on the ground. This relates to Zenna's point. We need much more systematic work to ensure that the practitioner on the ground with streetwise knowledge is present when decisions are made, and the most consistent vice in many governments is you see very important decisions being made without anyone in the room who really has a deep knowledge of the field being influenced. In this particular Afghanistan example, consultants had been brought in who again, as so often, had very generic knowledge, no deep contextual knowledge whatsoever and, therefore, were almost bound to get it wrong.

Q90 Paul Flynn: We talk about these things in general terms, but the truth is that more British soldiers have died in Afghanistan than died in the Charge of the Light Brigade. They have got a great deal in common, both entirely futile operations taking place in the Helmand Province and the Charge of the Light Brigade. Is it not extraordinary that we have decisions like this on going to war, and the Iraq War was a clear one where the evidence was untrue on which we, all round this table, who voted on the Iraq War had evidence that was mainly fictitious? I would not go so far as to say it was lying, but the evidence put before us was untrue for all sorts of reasons. Is there a feeling amongst yourselves that these decisions that are of enormous importance are not taken on a rational basis?

Mr Taylor: I always say, and quote in speeches, that sometimes we do not have evidence-based policy making, we have policy-based evidence making. Sometimes you do not have evidence. It was I who said earlier that I think there is a problem about institutional amnesia within Whitehall, which I think is partly to do with the political system, the first past the post, everyone out, everything changes kind of system, but it is not just about that because even when I look across ten or 11 years of Labour it seems there are lessons that do not seem to have been embedded even in that time. I would just say there are times when there is no evidence in a sense because what you are embarking upon is something which is new. I am not disagreeing with what Geoff said about the need to have people who do have a kind of embedded textured knowledge of the issue you are confronting. Government will always involve politicians having to make some decisions on the basis of a hunch or values or a sense that they can achieve something which has never been achieved before. I am not commenting on the individual issues of Iraq or Afghanistan, I do not want you to get the idea that in every decision government makes if only all the evidence was there the conclusion would naturally follow.

Q91 Paul Flynn: About 30 years ago someone said that the overarching ethic of the Civil Service was the unimportance of being right, that those civil servants who got policies right, who were farsighted, were the ones whose careers actually withered, and those who went along with whatever the conventional wisdom was, the foolishness of the day, were the ones whose careers prospered. Is this a conclusion that you have about the Civil Service? Is it still unimportant to be right and unimportant to be wrong?

Ms Atkins: I think what I found surprising coming into the Civil Service was the number of people, so it is very difficult to know whether you are individually right because in every decision --- My first thing is where is the scheme of delegation. In the Civil Service, once you have gone past the ministers are responsible for everything, who is actually making the decisions all the way down the chain? Below a very top level you get very few people who have any sense of what decisions they are actually making, so things go up and down a very hierarchical system. In terms of having sense when you come in, I spoke to the fast-streamers or fast-trackers, whatever they are called, the new Civil Service intake, and to have any sense that you could do something that was right and you would be able to have some personal ownership is lost because very quickly things get very muddied. I was shocked at that because to promote the best people they have to have a sense of where they have made mistakes, and made genuine mistakes, and learnt from them, and where they have made negligent mistakes which you fire people for. The Civil Service does not seem to understand the difference between making a mistake in the name of innovation that was a genuine mistake is a good thing and making a mistake because you were negligent or careless or did not give a monkey's is a bad thing and those are the people you get rid of, or making a mistake simply because you were too frightened to do anything else. It is true to say that there is a wariness of people who deliver and actually have a position because of this code of behaviour that often says, "You are not the ones who lead, the ministers might lead or that might go right up through a hierarchy". There is a very strong wariness of leaders which, again, does not promote the likelihood that you are going to be able to back the winners. In any business, the way to make your business fly is to back the winners and deal with the people who are not part of your winning team. Helping people grow to be winners is a good thing to do, but eventually you realise - I do not want to use the word "losers" but once you have started with winners you have only got losers on the other side of the spectrum - you do need to deal with and move out the people who are not actually helping towards your vision.

Q92 Paul Flynn: Finally, can I ask Sir Steve Robson, you were involved with the introduction of rail privatisation, I understand, and there was a report published by a select committee in this House under the very distinguished chairman, Robert Adley, who was a great expert on the railway, a unanimous report from all parties that was entirely opposed to the fragmentation of the railway. It is one of those reports that stand well if you look back at it in time because virtually every claim they made about what was going to happen did, in fact, happen. It was disastrous in the ways that they suggested. The process was driven by a political imperative that said all other privatisations worked, the rail privatisation would work. I just wonder what part that evidence from the select committee, or other voices at the time who were saying that fragmentation of the railway was not a good thing, played in your work in acting as midwife to bringing in the privatisation?

Sir Steve Robson: All the evidence that there was, which, frankly, in the railway context was not that much, was looked at, all the opinions were looked at, and decisions were taken. It goes back to Geoff's point that ministers hear the evidence and the decisions they take will be influenced by a number of things, not simply the evidence.

Q93 Paul Flynn: Would you be familiar with the report? Is it lively in your memory now, what Robert Adley and the committee said?

Sir Steve Robson: It is not, I am afraid.

Q94 Paul Flynn: Complete nothingness?

Sir Steve Robson: You are asking me to recall a report from a select committee which must be at least 12 years old now. I do not have the breadth of knowledge of a British Library.

Q95 Paul Flynn: You have been involved in the introduction of many things, some of which have been successful and some of which have been disastrous. The FSA and Equitable Life is something that is going to occupy us greatly. Is there any sense of mea culpa from you about anything you did in introducing the FSA?

Sir Steve Robson: No. I think the FSA was a good, distinct improvement on the ten separate regulatory agencies that preceded it, who now, it tends to be forgotten, were not covering themselves in glory.

Q96 Paul Flynn: No, they were not.

Sir Steve Robson: Hector Sants said that the FSA could and should have done better in relation to Northern Rock and other things, but that does not mean it was the wrong structure.

Q97 Paul Flynn: The cost to the country of a bill of £4 billion is hardly covering the country in glory either and the FSA might well be responsible for that. Do you move from one project to another and that is behind you, there is no sense of any guilt or responsibility when things go disastrously wrong?

Sir Steve Robson: Of course you feel responsibility for what you did.

Q98 Chairman: Just on this question of government and other large organisations, and whether the problems are common, is there an issue, and this comes out of Paul's line of questioning, about the fact that increasingly in government the political side is people who never ran anything in their lives, they increasingly come from a world of the political class and PR, and is serviced by civil servants who traditionally have not had front-end experience either? That is a peculiarity of doing government as opposed to doing other large organisations, is it not?

Sir Steve Robson: I think you are absolutely right about that on both counts. Politics has become a profession that people enter at 20 years of age and do it pretty exclusively, so that is their experience set. It is equally unfortunate that senior civil servants tend to come up a policy route and I think that has been a great mistake. The consequence of that within the Civil Service is that when issues about performance, about organisations, are addressed, they are addressed in a rather abstract and detached sense. There is a lack of recognition of a point we touched on earlier, that in many ways the key issues about the way organisations behave are to do with the incentives and behaviours of the individuals in those organisations. That sort of idea is a very foreign idea to people who have grown up through the Civil Service policy streams.

Ms Atkins: Can I just respond to that one. In terms of people in the Civil Service who have not had any external experience, I think it is very true that quite a lot have not, but I also see an effort to bring people into the core of the Civil Service to help them understand what might be the consequence of some of the policies and the actions, and that is bringing people into the Civil Service itself or it is putting people from the outside on boards of particular aspects of the Civil Service or delivery authorities. From my own experience in having watched other people it is very difficult not to do one of two things. One is to go native and just go along with what the public sector has done and to buy into, "That's the way it's done here", so your external experience suddenly becomes very devalued. Or the other thing is you are continually banging your head against the wall and are not able to navigate your way through the way things are done. Certainly I think there is a lot of need to address that key level of diversity in the Civil Service. You cannot make it a requirement that a politician has had some previous experience before they stand in front of their electorate. You could concentrate on doing something in the Civil Service that helps people. There is also the cultural element, which is what Paul was getting at. It is very difficult because people are not given ownership of something to then say, "Actually, I put all the evidence in front of you and I genuinely believe, Minister, the right thing to do for the country is this, it is not against your party politics, and I am afraid if you are not going to do that I'm going to have to resign", which is what I do in the private sector. If I inherently disagree with the direction a company is going in, if I am sitting on the board or I am an officer there, I leave. You do not see that because of the impartiality of the Civil Service. They absolutely need to be politically impartial, but I do not think you need to be evidence-based impartial. There is this sense that you just roll down and implement something you think is drivel, so even if you have come from the outside and you know it is drivel you are down this track of having to implement it because it is a ministerial wish. That is a cultural challenge and one that I think having a much more robust performance management framework might begin to address in some ways.

Q99 Chairman: That is very interesting.

Mr Taylor: Try this as a thought experiment. How would it be if you reversed the logic of government, so that instead of lots and lots and lots of decisions being made at the centre, and not many decisions being made at the frontline, in fact it was the reverse? Imagine a world where you said to ministers, "You are only allowed to make one decision a week". I think that part of the problem of government is that ministers are asked to make 20 decisions a day and on what basis can they make those decisions? They make them on the basis of scant evidence, on the basis of reacting to newspapers very often, they are based on the kinds of pressures that arrive at the department. I am not sure that politicians do not have the right skills for modern government because communication, vision, values are important things, but the problem is we do not ask them to do the thing which they came into politics to do, we ask them to do something very, very different from that. In a sense, I think of watching my son's football team on a Sunday. The manager makes two or three big decisions, who is going to be in the team and what the formation is, and then at half-time tries to rally the troops, and that is what they do. The players have to make constant decisions, they are constantly adjusting because the game itself is unpredictable and that is how it works. It feels to me sometimes the public sector is completely the other way round, you have got a football match in which every three seconds the match is stopped in order for the manager to make another decision about what they should do and, of course, immediately it does not go quite the way they think it is going to go and the players are completely demoralised because instead of being able to react to the game they are constantly being stopped. There is something here about if we can change the ordering of decisions and impose upon ministers a kind of discipline for how many decisions they are able to make, maybe that would improve the situation.

Q100 Julie Morgan: Just following on that point, I think, Matthew, you said there should be many less ministers. Could you expand on that?

Mr Taylor: I think there should be fewer ministers, yes.

Q101 Julie Morgan: Fewer ministers. Why?

Mr Taylor: Because if you have got a job you create work to do in that job. This is a broader issue and I do not know whether it is one you might want to look at in your work if you have not looked at it already. I think there is a real problem about the status of junior ministers. What are they there for and how exactly do they fit in? It can be a very miserable existence, I think, for an awful lot of people. It is not a very coherent job a lot of the time and people facing a job that is not terribly coherent generate work and advisers feel they need to generate work for the junior ministers and that adds to this kind of decision-making overkill that I just described.

Q102 Julie Morgan: So you would get rid of a lot of the junior ministers?

Mr Taylor: Yes. Geoff will know better than I, and in fact Geoff may have been the architect of it, there was a thought some years ago which never got very far which was to have fewer ministers in Whitehall but possibly create stronger roles for politicians outside London in terms of regional roles, which happened a little bit at the margins but does not seem to have taken off. You could have given them a greater role in communicating things outside London but you would have had fewer based at their desks fighting for their little bit of the Queen's Speech.

Q103 Julie Morgan: Any thoughts, Geoff?

Mr Mulgan: I developed a wholly unsuccessful proposal along those lines. The UK is a complete outlier in the number of ministers we have, executive ministers, who therefore do have a whole machinery around them and feel the need to make announcements to justify their existence, and generally clog up the effectiveness of government rather than helping it. The proposal, therefore, was to develop a whole series of non-executive ministerial roles, relating to major cities or regions or particular groups, in part to improve the two-way communication of government. Obviously that has not been taken up, but I think it is very hard to argue that the current number of ministers is actually functional for good government in any way whatsoever. That is one of the ways we are an outlier. In some respects it links to the previous conversation. We are quite an unusual Civil Service in having so little emphasis on delivery and implementation as opposed to words. There has been a lot of progress in the last 10/15 years on a greater emphasis on delivery experience and skills to rise up the hierarchy, many more people moving in and out of the system than a generation ago. I think it is much more effective to bring in talent that way rather than through sitting on boards, which is a very ineffective way of getting other views of things. I would love to see our political parties encouraging people to have done real jobs in local government or elsewhere before going straight into Westminster and national politics. In a way it is up to the parties too to say that they have got both the formation of ministers wrong but also, as Matthew said, their deployment is not right either, that is to say there are too many of them with inherently ineffective and unsatisfying roles. That would be a wonderful topic for this Committee perhaps to take on.

Mr Taylor: Just as Geoff had a plan rejected, I had a different plan rejected which was that you should take junior ministers away from having responsibility for areas of department but you might have junior ministers responsible for delivering a particular project on a time-limited basis. One of the advantages of that is that you might be a junior minister for two or three years, try and deliver something working with a team that is brought together to deliver that, and then you can leave government for a year, renew your contacts with the outside world and that would not be seen as a sign of failure. Part of the problem of the ministerial game is you have got to hold on to your job and move it up to the next thing and too many junior ministers simply see the job they have got at the moment as a stepping stone to the more exciting job they have got ahead. Giving some politicians in government the opportunity to deliver an outcome within a time limit might be an interesting experiment.

Chairman: We have quite a track record of proposals that were rejected as well. I suspect there may be another one in the making!

Q104 Julie Morgan: Can I just ask one more question. I think Matthew said all policy is doomed to failure. Could you give an example since 1997 of a policy, not a crisis intervention, that you think has been successful and carried out in the way you think it should have been?

Mr Taylor: I will give an example of something which I think has both been successful and doomed to failure, and the Government has recognised it just yesterday, and that is the testing regime in schools. I think it was absolutely essential to do something to tackle a very, very long tale of under-performance in schools and to address the fundamentals in schools, and the testing and inspection regime that Ofsted is part of was necessary to address the problem. Over time, that solution stops working, the adverse consequences it generates outweigh the benefits it is delivering, and it has to be dismantled and replaced with something else. It has probably taken the Government slightly too long to understand the adverse consequences, but if you look at the way in which Ofsted has changed its working arrangements over the last few years you will see there has been an evolution of policy. When I say policy is doomed to failure, that is not the opposite of saying that policies can succeed; they succeed and then they fail.

Q105 Julie Morgan: Has anybody else got any examples of that?

Ms Atkins: I think banning smoking in public places was a fantastically brilliant policy. I can now go and eat in restaurants with my kids, including the one who has asthma, instead of making her stand outside. I think that was brilliant. There are elements of lots of policies that are really successful. If you take the policy and, in fact, the legislation that drove through creating a single Ofsted, which was also about reducing the number of inspection regulation bodies across a wide number of things, Ofsted did it and others are moving towards it, so we are getting the new Health and Social Care Inspectorate coming together soon. However, then to presume that this is going to work everywhere and is a solution is where policies also go wrong. One size does not actually fit all. When you have a blanket reduction of 30% off your budget, in some inspectorates that would work brilliantly and in others it would be a disaster. When you suddenly have a realisation that government seems not to be able to hold on to a laptop, a Blackberry or even a piece of paper for very long, you introduce a sudden blanket policy across the whole of Whitehall that you cannot take a laptop out, so every inspection in England grinds to a halt and you have to go through a process of getting special dispensation to be allowed to take a laptop into a school or a children's home or an adult learning placement to do an inspection. It is about actually understanding that one size does not fit all, a policy that is right for one area will not be right for another. That is the problem of big government, there are a lot more complexities that often these blanket dictats do not understand and realise. There are elements of our health policy that have been absolutely phenomenal. People are now living longer in Portsmouth than they ever did, and that cannot be said to be anything other than a good thing, and they are living a better quality of life. There have been elements that have been hopeless. It is about understanding the sensitivities and the subtleties, but if you want just one brilliant one, quitting smoking in public, fantastic. I love watching all the smokers hovering about trying to be invisible, it is brilliant!

Q106 Chairman: It is interesting that we spend all our time talking about, as it were, the deficiencies of government and spend little time talking about what government gets right. A simple-minded approach would say if only we could identify, as it were, the conditions of policy success, which is your trade, and the conditions of policy failure and apply that in a rather systematic, subtle and sensitive way, as you say, we might make some progress.

Mr Mulgan: But if you look at some individual policy successes, things like smoking bans, minimum wages, congestion charges, those are individual things that have worked and they have usually been based on copying others who have learnt how to do them and they fit within a larger context. It is generally wrong to look for the individual policies, it is where a cluster of policies, a strategy, has been pursued consistently over a long period of time and been adapted to different circumstances, which I think has happened in large areas of social, economic policy, health and environment over the last ten or 20 years, and government by and large has been fairly successful in achieving the outcomes it wanted to be judged by. The conventional wisdom of 20 years ago, which was that everything government does is futile, doomed, inefficient, just hand it over to business, that is absurd if you look at the real achievements of government on most of the outcomes the public judges them on. Crime is another great example. If you take crime reduction, it is not a single policy which achieved it, there are lots of different things working cumulatively being adapted to different conditions at different levels. The search for the single bullet policy, the single bit of legislation, is asking the question in slightly the wrong way.

Q107 David Heyes: I think there is a theme emerging here which is that ultimately it is politicians who are to blame for the lack of good government. Geoff says that ministers clog up government, Matthew thinks we should limit or take politicians out of decision-making altogether, and I just want to try and develop this. To what extent is our ability to achieve good government limited by our democracy and our electoral system?

Sir Steve Robson: What is good government? As far as I am concerned, good government is advancing the peace and prosperity of the nation, and I think the Western liberal democracies have been incredibly successful in doing that, much more successful than any other form of government I can think of either currently or historically. We should not beat ourselves up too much here. We are not talking about abject failure, we are simply saying can something which has been done relatively well by any historic standard be done even better.

Q108 David Heyes: You are all saying in one way or another if it was not for the politicians we could do better.

Sir Steve Robson: No, I do not think we are saying that at all because they are an intrinsic part of the Western liberal democracy.

Mr Taylor: I am not saying take politicians out, I am saying politicians should focus on the things that politicians are good at, which there is a deficit of, which is going back to the point we made earlier about communication and engagement with people. If you accept the analysis which I suggested at the very beginning that we have a kind of collective action deficit in society, politics is the answer to that in many ways. Unfortunately, in a way, the problem with government is that it is insufficiently political, it is far too concerned with administration and an attempt to technocratically manage this massive organisation and too little concerned with fundamental questions of the leadership of public opinion, winning of legitimacy, building the fundamental capacity in society. I would have more politics in government but I would have politics where it makes a difference.

Q109 David Heyes: That leads to the situation that you criticised before where politicians do not want to give a negative message. You used the words, "retreat from courage". Your example about the cowardice of stopping poor people from getting mortgages - you used the word "cowardice" - I would say that was more an attachment to an ideology that led to that. The Government could have said, "We will boost public sector housing, increase the supply of housing to rent", but the prevailing ideology prevented that. It is not a question of politicians lacking courage, it is the fact that there is an electoral system that the politicians are accountable to. That is the limiting, constraining factor. I repeat my point: you seem to be saying that if it was not for that, we could have good government.

Mr Mulgan: I would say the opposite of that. You are very unlikely to get good government without very active democracy, which is often a pressure, a challenge, the scrutiny of government. Many people do genuinely believe that if only you got rid of politics and the politicians it would all be run efficiently by smart technocrats and perhaps consultants helping them, but that is not the way the world works. There is a creative tension in government and the tension comes from the relationship between democracy, the people and politics, and delivery, management and professionalism. Many of the fields we have discussed where the problems are most acute, ones like quangos, are where there is a deficit of democracy. Over-centralisation is a deficit of democracy, not an excess of democracy. If you accept that you then do have to move on to the question of what kinds of politicians and political role best link the public with their many needs and wishes and aspirations to the machinery of legislation, public services. I think several of us believe that the political role is not quite working as well as it could be in all sorts of ways.

Ms Atkins: I think most of what I have said has not been about the political side but about the administrative side. I do not think that if you removed politicians things would get better or if you removed democracy. I certainly think there are things we can do to make politicians more effective, not least in my role in the MoD. I have often talked about it. As a new minister going into the Ministry of Defence it will take you at least six months to be able to understand a single piece of paper that is put in front you. The garbage that is written because of this protectionism about making sure nobody can understand what on earth is going on. I am not talking about the secret stuff, that is written in plain English, I am talking about people's names and things. There is some of that. In terms of the politicians, politicians have not caught up with how this generation is communicating to the extent that I think will happen. A lot of politicians feel very remote from young people. Young people are communicating, moving and doing things that to a lot of the people who are there democratically elected to represent them is a completely alien and different world. There are some things that we could be doing to make it more relevant to the next generation that is coming through who are, in fact, operating in an environment that is not naturally very comfortable to a lot of politicians. The other thing is that there is a real challenge across the Civil Service and in government about the speed of life. The Civil Service does not operate at the speed of life that the citizen expects the politicians to act at. That is where I think we are getting to a potential danger point because the rest of the world operates at a certain speed and expects decisions and opinions from you as politicians at a certain speed. The Civil Service still works at a much, much slower speed than that. One of the dangers that we have not yet faced is one of the things I really admire about the Civil Service is its ability to prevent a corrupt government, but unless the speed the Civil Service is able to operate at accelerates to the rest of the world's speed we could be heading towards having some real dangers with our politicians. I do not think we are currently facing that, but we might.

Q110 David Heyes: One of you said, and I forgot to make a note of who it was, that the centre needs to allow local engagement in decision-making. That kind of theme has come out from each of you. How does that sit with democracy and elected politicians because at the local level local government is virtually completely disempowered nowadays, there is not any real political decision-making taking place locally, most of the major decisions about health, for example, are in the hands of quangos and you said, Zenna, we do not pick our best people for quangos? Maybe if we elected them, by definition if you elect people you get the best people.

Ms Atkins: In terms of the non-executive roles in the National Health Service and the elected member roles, I am not sure that you are going to address the quality gap by just electing people. I do not think that elected members of a local government, and I use Portsmouth, are necessarily of any greater quality than the people who serve on the boards of the Portsmouth National Health Service system. I do not think that necessarily gets you a quality issue, but what it might get you is a public engagement issue because they understand a greater degree of control. I would not necessarily agree with you about the quality issue.

Q111 David Heyes: This is the basic tension. Geoff almost shrivelled when I said that you get the best people from elections. I understand that you could quite easily argue the opposite, that the quality of people who are involved in local democracy, locally elected people, could be higher, I do not think any of us would dispute that, but it is the product of having democratic elections, of having an electoral system. It is the same process that produces the political control that you say should be taken out of the decision-making process that Geoff says clogs up government.

Mr Mulgan: I am a believer in rebuilding local government. I think many of the things we are discussing cannot be solved with a highly centralised government of the scale of the UK. Achieving that is no mean feat, it requires a combination of transfers of power, tax raising power, alongside persuading different sorts of people to stand for election and a different make-up for councillors developing their skills, and then encouraging them to bring in other sorts of expertise to help them run their local council because, as Zenna said, simply depending on election does not guarantee you get the right people, the best people, the right expertise. There is no alternative to direct election as the heart of any effective good government. That is the lesson of 100, 200 years of democracy.

Sir Steve Robson: There is a bit more to it than that. If one is going to get delegation within organisations like government, I think you have got to tackle ministerial accountability. If you are going to have elections at other levels, you have got to bring three things together at that point. You have got to bring decision-taking to the same level, you have got to bring financing to that level and democratic accountability so that the three are there together. One of the troubles with local authority today is that those three things are not there together.

Mr Mulgan: I would agree with that. We have been through a great experiment in a way with using managerial techniques, performance management, delegation, principal/agent splits as an alternative to local government for the last 20 years. This long predates New Labour. The promise was this would increase the quality of our public services relative to other countries with much more devolved systems. The basic message over the last 20/30 years of this huge experiment of new public management, and so on, is the countries which implemented those ideas most, like New Zealand, America, Britain, are still at the bottom of the league tables on public service performance. If you are an open-minded, evidence-based person, you have to therefore say perhaps we learned a lesson from that.

Q112 David Heyes: Because it became detached from democratic and local accountability, that has been the problem.

Mr Taylor: I agree completely with the points about local government. Whenever people use the word democracy as a kind of clinching argument I want to take a sharp intake of breath, because democracy is such an under-theorised concept the way it is thrown around, partly because it is just a kind of hooray word and no-one can possibly say it is a bad thing. Representative democracy, direct democracy, participative democracy, these are all different forms of democracy and often the outcomes of them conflict with each other. We have a representative democracy which is not representative because of the first past the post system. I am not entering into that argument, I am simply saying not only have we got all of these different layers of democracy but even within them there are huge issues. One thing I would say is I wish that we were able to be more innovative about democracy itself, about the ways in which we conduct democracy. One of the other many ideas - Geoff and I both have files of them and can publish one day ideas that never got taken forward - is I would have argued very strongly for an upper chamber that would have been a hybrid upper chamber. I would have had a third of it directly elected, a third of it representing various interests in society, and there should be a public debate about who those interests should be, and a third be balloted from ordinary citizens themselves for the public to understand how they themselves would have responded to the kinds of dilemmas that policymakers face. Democracy itself, it seems to me, is in need of innovation.

Q113 Mr Prentice: Can I ask, as a former Assistant General Secretary of the Labour Party, would you like to see more direct democracy within the Labour Party on policy issues, one member one vote?

Mr Taylor: I am surprised at having to comment in this context but, no, I do not think I would in the sense that the thing about policymaking is it depends what the issue is. It is fine to do that on issues where there is clearly a yes/no choice.

Q114 Mr Prentice: Let us take the Post Office. Should the Post Office have a branch network of 11,500 or should it be allowed to go down to its natural level just keeping the post offices open that make a profit, which is probably about 4,000 post offices? Would that be something that we could ballot members of the Labour Party on?

Mr Taylor: My own view, and it is not because of an opinion on the Post Office issue, is it is very difficult to ballot people on issues like that because the problem is that the issue is not a self-contained issue. For example, if you were to have a more extensive Post Office network which required a greater public subsidy, the issue is where does that greater public subsidy come from. The issue cannot be defined.

Q115 Mr Prentice: Let me try another one. Again, this is direct democracy of members of the Labour Party. What about nuclear weapons, whether we want to spend billions of pounds replacing Trident, would that be a suitable subject for direct democracy of Labour Party members?

Mr Taylor: I think the issue of whether or not the party would adopt a position of unilateral nuclear disarmament, for example, is more amenable to a direct democratic process because it is a more self-contained issue. Again, within the Labour Party you have different forms of democratic process, you have national policy.

Mr Prentice: I am just trying to cut through this because direct democracy has a downside but it has a certain elegant simplicity, does it not? What I want to hear from you is some kind of commitment to direct democracy in the Labour Party on certain issues that are amenable to direct democracy.

Chairman: I am not sure, Gordon, if I may say so, that is quite within the terrain of our inquiry.

Q116 Mr Prentice: Just two questions, if I may, because we are talking about good government. Is the Cabinet a decorative part of the constitution? I saw a photograph in The Guardian a couple of days ago and there were a huge number of people around that Cabinet table. Is it a decorative part of the constitution now?

Mr Mulgan: The most decadent?

Q117 Mr Prentice: It could well be decadent, but decorative.

Mr Mulgan: I actually wanted to comment on your previous question.

Q118 Mr Prentice: You had better not because we will be ticked off.

Mr Mulgan: But in relation to government rather than political parties, because I think what Matthew said about innovation in democracy is quite important to improving government, you cannot separate it from the quality of democracy. It is why people are nervous about giving power to local government on turnouts of ten, 15, 20%. There is a lot happening which is not just classic direct democracy, although we do have a petitioning site on Number 10, so you are free as an individual citizen, let alone as an MP, to petition for any issue you want, which is an interesting innovation. Many parts of the UK are involving the public in budgeting decisions, participatory budgeting is becoming fairly mainstream. In Australia earlier this year I was involved with what the Prime Minister there did in gathering 1,000 people for a weekend in parliament to discuss the big issues facing the future of the country. Equivalents happened in every town, every city, schools and so on. It was a quality of democratic conversation which I have never seen in the UK. Obama, partly because of the role of social networking in his campaign and his thinking, has talked very creatively about how if he wins the presidency in America a different kind of democratic conversation might sit alongside the US Federal Government. This is important territory to look at. On Cabinet specifically, Cabinets in Britain have been decorative at certain points and I suspect at other points, when a prime minister has less power, have become very, very important. I was glad that last month we did see, at last, another innovation in Cabinet government, borrowed from Australia again, which was the idea that Cabinet should actually meet in other parts of the country and when they meet in Birmingham, or perhaps in the future Glasgow or Newcastle, the members of the Cabinet actually use that occasion to have a discussion with the people of the city and the institutions about what is happening on the ground. Both of us proposed this many, many times over the last ten years and eventually in September 2008 for the first time the British Cabinet did it.

Q119 Mr Prentice: Can I just interrupt you for a second because you were at the very centre for seven years and you know how things work. One thing that really perplexed me was the 10p tax debacle which really put the skids under the Prime Minister; recovered now, of course. How was it possible for the decision on 10p to go through the system, and we have had evidence from the Cabinet Secretary on this issue, and for the tax reduction, 22p to 20p, to be implemented, and no-one said, "Hang on a minute, there are serious downsides here" There are still one million people who have not been properly recompensed as a result of that policy. Is it not the case that the Cabinet must have been asleep on the job?

Mr Mulgan: Since, I think, none of us were in any way involved with any of those decisions, I will take that as a rhetorical question.

Mr Prentice: You must be astonished because you are an observer of these things. You must be astonished that the system allows a policy, which has been acknowledged by the Prime Minister to have been a terrible mistake, to have actually gone through to implementation.

Q120 Chairman: We could ask Sir Steve on that as a former Treasury man. You are looking at this from the outside now, here is an example of clear policy failure and political failure. Given the magnificence of the Treasury, how could this have happened?

Sir Steve Robson: As to the Cabinet point, it used to be the case, I do not know whether it still is, that Cabinet had very little role in the making of Budgets and was usually told on the morning of the Budget what was actually in it. If that is still the case, it is hard to blame them for any part of the Budget that you did not like.

Q121 Mr Prentice: I understand that.

Sir Steve Robson: How this decision was taken, I do not know. I suspect it was a very well-informed decision about the distributional consequences because the Treasury spends ages looking at the distributional consequences of tax changes.

Mr Taylor: I have two comments on that. I suspect the reason that policy was made goes back to a point that came out earlier on and throughout, which is the Government, like any organisation, can get set in a particular strategy and pursue that strategy - it is the kind of policy equivalent to the Peter Principle - to the point at which it breaks down. The Government had a broad strategy on tax which was to favour people with children and people who were retired as against people who were deemed to be without children and of working age. That was a policy which worked in certain ways up to a certain point and was linked to a broader strategy about tackling worklessness. It broke down with the 10p tax. My only assumption is that politicians were told again, "This is mainly going to affect people of working age without children" and, therefore, the assumption which had built up was that they were not a problem and the solution for them was to have jobs or better jobs. That insight got to the stage at which it ceased to be a useful insight and then it led to what was a disastrous political decision. In relation to Cabinet, my only observation on this is I think the Cabinet as a place where a very large group of people gather together to exchange information and to be given a kind of pep talk is fine, and organisations have that kind of thing, but as a place for making decisions, it is demonstrably problematic because it is 20 or 30 people sitting in a room together. I do think ---

Q122 Mr Prentice: Involved in a decision to go to war, for example, is that ---

Mr Taylor: I do think, and this is beyond my area of expertise, and I am sure it is an issue you have looked at in other contexts, the Cabinet Committee system seems to be extremely problematic because that should be a place where smaller numbers of people are able to focus on issues in detail. My experience in Number 10 was that the Cabinet Committee system seemed very tangential to what was going on. I wonder whether the renewing of the Cabinet Committee system is still something that is worth looking at.

Q123 Mr Prentice: Before Kelvin comes in, and this is my last question because this is a huge landscape, we could talk about this for 24 hours. Geoff, you have written extensively about renewal, how governments can avoid stagnation and so on. My question is this: would you like to see term limits as a way of forcing parties to renew themselves?

Mr Mulgan: No. There is a question of what is the optimum tenure in different roles. I think for ministers there is little point having less than two years in a job, and I would actually have longer tenures for junior ministers, yet another inefficient feature of our system, and a norm for Cabinet ministers of a whole parliamentary term, which was the intention when Blair first came to office. As for the tenure of governments, or prime ministers, the only term limits which do exist are for representatives, people like you rather than for governments. In other countries I do not think they work very well and at a deep level are fairly undemocratic in that in a sense they take away choice from the people and give it to constitutions. That said, there are very few heads of government who remain good in their jobs for more than about ten years but usually in democracies the public realise that.

Q124 Kelvin Hopkins: We have been told by some of the retired mandarins who have been before us that in the 1970s and before typically a Cabinet would see up to 200 policy papers a year and the range of debate would be between people like Roy Jenkins and Tony Benn and everybody in-between. That was a key policy-making chamber, if you like, a forum for the nation. Since then, we are told, they now see typically two papers a year, if that, and Cabinet is made up of leadership loyalists who do not challenge. Is that not what is at the heart of what has gone wrong with government?

Mr Taylor: I think there has been a concerted attempt that was started at the end of the Blair regime and continued into the Brown period which was to engage Cabinet ministers in thinking beyond their brief, in thinking more strategically. There has been a whole series of exercises to try to do that. There is a recognition that the Cabinet, apart from major moments of national decision-making, is little more than an information exchange and a pep talk, and that is kind of a problem. It is starting to be addressed.

Q125 Paul Flynn: We have been looking back on all the things that go wrong in government and the problems are ones that have occupied humanity since the dawn of civilisation. Socrates talked about the guardians and their role in society. I think we have all greatly enjoyed and benefited from what you have had to say this morning, but from your experience how would you regard as the example to follow? Geoff mentioned the tabloids, and probably the best advice we can give to politicians is to urge them to stop taking the tabloids and they should act like Clement Attlee who read the papers only to check the cricket scores. He lived a sort of priestly existence, monastic existence, where very little touched him except the things that he wanted to be aware of. Can you think of examples, particularly from your experience throughout the world, of a leader, a prime minister, whose example we should urge politicians to emulate?

Mr Mulgan: A contemporary one?

Q126 Paul Flynn: Anywhere.

Mr Mulgan: Attlee is not a bad example. Thomas Jefferson also did not read the newspapers and did pretty well for that. Any leader has to be careful about their psychological energy. One of the reasons not to read all the newspapers first thing in the morning is it tends to get you very annoyed if you are leader and certainly distracts you from the things which really will matter two years, five years down the line. Equally, it is very important for leaders and other ministers to carve out enough time in their diary both to think and reflect but also to meet people who they are not line managing to, in a sense, remain in touch with reality. The vice of very busy, very pressured 24/7 modern government is, on the one hand, this pressure to respond all the time, to be too fast actually rather than too slow, and simply not to leave enough time for wisdom and reflection. The good leaders get this, and there are quite a few around the world who have designed their diaries with that in mind. The bad ones are driven by events, driven by those external pressures and cease being masters of their role and just become slaves to external events.

Mr Taylor: In response to this question about an example, I often cite the speech that Kennedy made after the Cuba missile crisis announcing his commitment to the Test Ban Treaty. The reason I cite that speech is it was quite an amazing speech in which he argued to the American people that the issue of whether or not the world would slide towards nuclear disaster was an issue for the American people themselves, they had to decide whether they wanted peace, and it was all very well worrying about the Russians but did the American people want peace. That kind of capacity, at that moment, to make a speech of that kind that connects with people. I thought Barack Obama did it on race when he had the courage to say, "This is an issue for us". I believe what we need more than anything else at the moment is politicians who are able to articulate issues in ways in which we understand the implications for us and we feel part of that issue rather than simply sitting back in this kind of passive/aggressive stance towards decision-makers. That would be my answer to the first question. I do want to say something, because I guess we are drawing to a close, about the importance of this work. I think that the limitations of Westminster and Whitehall, and I think it is both sides, the political and governmental, are these problems are very urgent and I do not think they are simply expressed in terms of overload and mission creep and competence and these kinds of questions. I think that part of the centrifugal forces within the United Kingdom are related to this. My worry is if central Government is not able to become a more effective tool, particularly in relation to communication and connection, doing the right things. What we will see is that in Scotland, Wales and other places, particularly in Scotland and Wales, what people are expressing is not hostility to the idea of the United Kingdom, they are expressing hostility to the idea of being run from Westminster and Whitehall. The consequences of central Government not having a clearer account of its efficacy and focusing on what it is good at and doing it well and communicating, could be not just bad policy-making at the margins, it could have much wider ramifications for the constitution of the country.

Q127 Chairman: I had a slight worry when you were talking a little while ago about how government should be in the business of the vision, the communication, the capacity building and so on, because the question I wanted to ask was what happens to good basic administration? It seems to me that what citizens require of government is something that does not relate highly for politicians, or indeed perhaps for civil servants trained in the policy tradition, which is rather prosaic good administration so that when citizens have contact with state organisations they have a good experience. Do you not miss that going in this rather high-flown direction in terms of what government should be about?

Mr Taylor: The point is what you see as a contradiction I see as being two sides of the same argument, which is that if politicians focused more on the issues I am talking about and less on the need to make 20 decisions every day and intervene in everything then we would have better administration. On the one hand, we would have better administration because it would be less cluttered and, on the other hand, by devolving power more to the local level, as Geoff and others have argued, we would have better administration because the administration would be more responsive to local people and local circumstances.

Chairman: Let us not take that any further. I hope you all feel that you have said enough of what you wanted to say because we have spoken about many things, albeit rather rapidly. We have found it hugely important and interesting, and we are grateful for that. When the Committee went to New York a year or two ago it was much struck by Mayor Bloomberg in New York City Hall who sat in this open-plan what he called the cattle pen in the middle of this spider's web with all his people around him doing various bits of city government with a big clock on the wall which was ticking down the seconds to the expiry of his term of office. I read in the newspaper that Gordon Brown has been much taken with a meeting with Mayor Bloomberg and is now moving from Number 10 to Number 12 so he can also have a big open-plan arrangement like this, but it has not been said whether he is having the clock ticking on the wall or not. Maybe this is the next thing we will have to look at. Thank you very much indeed for this morning.