By Vivienne Russell
12 June 2009
Gordon Brown’s wide-ranging changes have produced a beefed-up business department, shared ministerial responsibilities and a potentially big-hitting role for the DCLG
The French have a saying: the more things change, the more they stay the same. So, it could be argued, it is in Whitehall.
Cast your mind back to 1997 and you might remember the Department for Environment, Transport and the Regions – the ‘super-ministry’ created for the then new deputy prime minister John Prescott. It lasted only a few years before its constituent elements were hived off to separate ministries.
One of the most striking features of the latest ministerial and government changes is the creation of the Department for Business, Innovation and Skills by merging Business & Regulatory Reform and Innovation, Universities & Skills. Under the leadership of former Berr secretary Lord Mandelson, now the first secretary of state and de facto deputy prime minister, the new department takes on the responsibilities for further education, higher education, skills and science policy from Dius.
Another remarkable feature is the extent of the new department’s ministerial footprint. While most common or garden ministries can boast just three or four junior ministers working under their secretary of state, Mandelson has ten, many of whom have a foot in other departments – Defence; Culture, Media & Sport; and Children, Schools & Families to name just three.
Few will mourn the passing of Dius – it struggled to make a success of its disparate responsibilities – but concerns have been raised about the wisdom of making the changes in the midst of an economic downturn.
Martin Doel, chief executive of the Association of Colleges, says: ‘In the middle of a recession and with less than a year to run to an election, it is unhelpful to introduce this degree of change in terms of ministerial responsibility. When changes like this are made, departments are sometimes forced to concentrate on their reorganisation at the expense of a focus on delivery.’
Liberal Democrat MP Phil Willis, who chaired the Dius select committee in the Commons, tells Public Finance that the decision to scrap the department was not surprising. It was ‘not functional’, he says, and failed to get its different policy agendas to gel together.
But he criticises the size of the new department and the timing of its creation so late in the electoral cycle, all of which add up to a lack of coherence in the government’s thinking.
‘Super-departments in the past have never worked and they’ve usually been pulled apart very quickly,’ he says.
‘You’ve now compounded the problem which you had with Dius… [The government is giving] the impression that universities, innovation and science are part and parcel of a business agenda. Actually, trying to accommodate all that within one portfolio is very demanding, to say the least, and is prone to quick disbandment whenever there’s a change of government.’
Willis adds that there is logic to coupling skills with business, as skills can be seen as a means of bringing the country out of recession.
‘I’ve not heard [Mandelson] express that logic, by the way. I do suspect that [the creation of the DBIS] is more to do with a dysfunctional Dius and Mandelson seeing his empire grow ever larger.’
Senior civil servants have also expressed unease at the move. Jonathan Baume, leader of the FDA union, highlights the costs involved in such major departmental changes.
‘Ministers don’t seem to grasp how much time and money is spent in setting up a new government department, or in merging work into a new department,’ he says. ‘More than £7m of taxpayers’ money has been wasted so far in setting up Dius and then abolishing it 20 months later. Merging it back into Berr can only be assumed to be for party political expediency rather than for better government.’
Among Mandelson’s new team of ministers is Doncaster Central MP Rosie Winterton, who also takes over as minister of state at the Department for Communities and Local Government following John Healey’s promotion to the housing minister post.
The New Local Government Network think-tank maintains that splitting the role across the two departments is a sensible move. ‘Regional policy has always been kept at Berr. It makes sense to bring it into [the communities and local government department],’ says NLGN communications head James Hulme.
‘It’s quite often the norm now for ministers to have joint departments. In reality ministers spend most of their time in one place, but it can help in terms of driving joined-up policy.’
Hulme observes that the reshuffle, particularly the far-reaching policy tentacles given to the DBIS, reflects the fact that Mandelson is now placed at the heart of government. ‘But that’s not necessarily a bad thing. Mandelson has always been a very positive advocate for the regions. He will look to give regional development agencies a bigger role in tackling the downturn. We may well see an enhanced role for regional structures.’
As to the likely tack to be taken by Winterton’s other boss – new Communities and Local Government Secretary John Denham – the jury is out.
Denham is a former Southampton and Hampshire councillor and Hulme says that it is good to see someone coming into the DCLG who has a local government background and knows the sector.
‘We are a bit more in the dark as to what he wants to do, but he is a big hitter in the Cabinet and will be listened to quite closely by the prime minister.’
Andy Sawford, chief executive of the Local Government Information Unit think-tank, is similarly upbeat about Denham’s appointment. A political heavyweight, Denham will help bring the DCLG from the periphery of Whitehall into the mainstream, he says.
‘He came from a very significant spending department right at the heart of the government’s work on the economy and has a huge amount of political credibility. To have someone like that at the DCLG is good news. Denham will be quite a strong secretary of state although I think we’ll have to persuade him of the localist case because he has a mixed record with regard to local government,’ Sawford tells PF.
Winterton’s dual role with the DBIS is also to be welcomed and Sawford predicts she will be highly visible. He says that by having a direct link to what is ‘clearly going to be a really powerful new Whitehall department’, and ‘by taking forward the sub-national review agenda to urgent implementation, Rosie Winterton will help councils to make maximum impact on their communities’. Maybe change is on the cards.
