Whitehall wars

14 Dec 11
There’s trouble at the top in Whitehall, with senior civil servants taking to the streets and relations with ministers becoming increasingly dysfunctional. Colin Talbot tests the temperature in the corridors of power
By Colin Talbot | 1 January 2012

There’s trouble at the top in Whitehall, with senior civil servants taking to the streets and relations with ministers becoming increasingly dysfunctional. Colin Talbot tests the temperature in the corridors of power

FDA Strikers PA

There is an old anarchist slogan – ­‘Whoever you vote for, the government will get in.’ It has an element of truth because in our system we have a government composed of two parts – ‘Westminster’, the elected politicians, and ‘Whitehall’, the permanent civil servants.

But is the Whitehall part of ­government really up to the job? Recent events, such as the Adam Werritty affair, the Border Agency controversy and Revenue & ­Customs’ tax waivers, are creating an air of crisis.

Why did the civil service not oppose the strange arrangements between the then defence secretary Liam Fox and his friend Adam Werritty? Why did no-one apparently brief the home secretary properly on border controls? Why did Revenue & Customs apparently allow major companies to settle tax disputes for a pittance, so badly that parliamentarians are thinking of ­calling for the head of the agency?

If relations between Westminster and Whitehall are looking a little dysfunctional right now, it might have something to do with the rock-bottom morale of senior civil servants.

As the November 30 public sector pensions protests illustrated, members of the FDA senior civil servants union – along with other staff – are deeply upset at the prospect of cuts to their pay and pensions. Chancellor George Osborne’s announcement in his Autumn Statement of a further 310,000 public sector job cuts hasn’t helped either.

Meanwhile, Sir Gus O’Donnell’s bowing out as Cabinet secretary and head of the civil service is only the latest in a swathe of departures of top mandarins in the past year. Whitehall is now led by more new permanent secretaries than at any time in recent memory. As one former minister said to me: ‘We now have several perm secs with less experience than their ministers.’

With O’Donnell stepping down, there will not be a single ‘head’ for the civil service for the first time in three decades. Instead there will be a troika consisting of: Jeremy Heywood as Cabinet secretary; Sir Bob Kerslake as head of the civil service (alongside his demanding job as permanent secretary at the Department for Communities and Local Government); and Ian Watmore as permanent secretary at the Cabinet Office.

Few Whitehall veterans or outside experts see these arrangements as sensible, or workable, as evidence to a recent hearing of the Commons public administration select committee showed. Five former top civil servants, three academic experts and three media analysts concluded almost unanimously that it wouldn’t work  (although I might be biased as I was one of them). Almost everyone believed the new structure meant there was not a clear place where the buck stopped, as there was on the political side.

Meanwhile, Whitehall faces ­challenges unprecedented in peacetime. It has to implement huge cuts to public spending over a whole Parliament alongside massive reforms to most of the public service outside Whitehall. Education, health, policing and local government are all being ­subjected to a virtual tsunami of change.

Discontent has been simmering for some time, and morale has now reached a new low. When the FDA and Prospect joined PCS and other public sector staff on the November 30 walkout, it was indicative of the strength of feeling.

Despite this level of opposition, the government is determined to push ahead with reform to what it sees as ‘gold-plated’ pensions. It also wants to shrink the civil service radically.

This is not just about cost-cutting, it is also in line with ideas developed by the Conservatives before the past election about moving towards ‘post-bureaucratic government’. Can Whitehall cope with a radical reform agenda at a time of unprecedented cuts? History does not suggest a positive outcome.

There has been no shortage of attempts to reform the civil service in the past. The modern Whitehall of today is still largely a result of the ­massive reforms in the latter half of the nineteenth century and the first half of the twentieth. The old corrupt systems of patronage were slowly replaced with a modern bureaucratic and ­meritocratic civil service.

The first big assault on Whitehall’s bureaucratic culture came with the 1968 Fulton Report – an attempt at introducing ‘managerialist’ reforms. Fulton said that Whitehall was too obsessed with internal rules and ­processes and insufficiently interested in results and active management.

But even these managerialist reforms had to wait another decade before they began to be implemented under the Thatcher government from 1979. Mrs T appointed an ‘efficiency adviser’ (Derek Rayner) and the Efficiency Scrutinies that followed were the first of a series of reforms over the next 18 years.

New Labour started to pay some ­attention to the policy-making core of Whitehall with its ‘joined-up government’ policies, the creation of the Strategy Unit and Public Service Agreements.

But the history of reform in Whitehall over the past four decades has been one of glacial slowness and little real change at the top. For Prime Minister David Cameron’s vision of ‘post-bureaucratic government’ to become a reality, Whitehall would need to be doubly transformed – both internally and in its relationship with the 90% of public servants outside the civil service.

Internally, it would probably mean the civil service divesting itself of most delivery functions. Prisons, tax and customs collection, jobs and benefits, passports, drivers’ licences and all the rest would have to be pushed out into much greater arm’s-length agencies and quangos – or mutualised, privatised or devolved to local government.

Whatever the solution, it is hard to see how Whitehall could become ‘post-­bureaucratic’ while still having to manage these big hierarchies.

What was left would then have to be transformed in the way it deals with both the arm’s-length agencies and with the rest of the public services. It would have to relinquish all forms of micro-management and regulation, become much more ‘strategic’ or turn into what some have started to call ‘systems stewards’.

But it would need to include lots of people with good implementation-world experience, not just fast-stream policy-wonks, or it would be incapable of formulating policies that will work in practice. Such a change in the route to the top would be fiercely resisted by those who had ­benefited from it themselves.

In some ways this post-bureaucratic perspective meshes neatly with a narrative developed by some academics in recent years. Proponents of ‘networked’ theories of governance have proclaimed that the state is already ‘decentred’ and ‘hollowed out’ or even that we already have ‘governance without government’. The so-called ‘localism’ and Big Society agendas also fit this paradigm rather well.

However, ministers are not even talking the post-bureaucratic, Big Society, localist talk very well. The radical rhetoric has already faded after a short time in office. Hardly a day passes without a secretary of state issuing some edict about NHS waiting lists, or regularity of dustbin collections, or how to conduct passport checks. Not much ‘post-bureaucracy’ there then.

Instead of transformation being led from the top, what is happening is that the new de facto head of the service – Jeremy Heywood as Cabinet secretary – has apparently been allowed to dictate his own terms for doing the job. As far as he’s concerned, that is about co-ordinating policy-making, not ­transformational change. Talented as he might be, he has no experience of leading a Whitehall department that actually provides services, much less any experience of the wider public sector.

I quoted to the PASC an unnamed ­permanent secretary who, in relation to ‘Next Steps’, said: ‘Those that can, do policy; those that can’t, run agencies’. The job of transforming the machinery of government has been delegated to the part-time and nominal ‘head of the civil service’ and the permanent secretary to the Cabinet Office. The ‘post-bureaucratic revolution’ might be a bit delayed.

So, if it all starts to unravel, who will take the blame? It seems clear that ministers are already planning to get their revenge in first.

British governments have often seemed to have a contradictory attitude to Whitehall. On the one hand, they think we have a Rolls Royce civil service that is the envy of the world, especially when they are abroad. They like to celebrate how suave, sophisticated and free of corruption the Whitehall machine is, especially when compared with developing countries and even some of our (mainly southern) European neighbours.

At home, more often than not, when disaster strikes, the politicians will happily dump on Sir Humphrey and chums, whether deserved or not. Tony Blair complained about the ‘scars on his back’ from trying to carry out reforms, while David Cameron complains about the ‘enemies of enterprise’ in Whitehall. In more specific cases, individual civil servants have been singled out – Michael Howard’s sacking of Derek Lewis as director general of the Prison Service in the 1990s and Theresa May’s recent attack on Brodie Clark from the Borders Agency.

It certainly looks like at least some in the current government are already lining up Whitehall to carry the can for failures – Daily Telegraph journalist James Kirkup recently reported that ‘blame the officials’ is now part of the Number 10 credo. And failures there are almost certainly going to be.

The reform plans for the NHS have already been partially derailed, and rather more urgently the saving of more than £5bn a year in ‘efficiencies’ has been sidelined and simply isn’t happening. Instead, NHS organisations are starting to cut staff and waiting times are creeping inexorably upwards. The hopelessly ambitious IT plans for the Universal Credit are already looking shaky, as I predicted in Public Finance last January.

On a deeper level, the government is messing about with almost every major spending system – including health, education and local government. Switching the NHS from formula and area-based funding, as now, to patient-based funding via overlapping GP-led consortiums, plus some area-based ingredients, will have unpredictable results. Education funding streams will increasingly be affected by formula alterations, especially because of ‘free schools’ and the pupil premium – again with probably erratic results. The local government funding formula is also being ‘revised’, with winners and losers already emerging.

So there is plenty of potential disaster waiting in the wings, aside from the usual ‘events’ and accidents that so bedevil any government. Will an essentially unreformed core Whitehall, with a confusing leadership structure and increasingly belligerent staff, be able to cope? Probably not. Will the politicians see it as a convenient scapegoat – almost ­certainly. Brodie Clark is just the start.

Colin Talbot is  professor of public policy and management at the University of Manchester Business SchoolTransparent

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