Two challenges and an opportunity

They made their first public appearance together to respond to the open letter sent to them by the Institute for Government. The letter drew on the Institute’s research to spell out the six issues that most need attention as they develop their plan for civil service reform. It argues that without urgent reform there is the risk of a downward spiral of cuts, inadequate services and a demoralised Civil Service. The new Cabinet Secretary observed we are only 25% through the first four years of a savings programme that is going to last at least seven years. Yet already the Civil Service is shrinking fast. The Thatcher government aimed to cut the Civil Service by a little over 10% in four years. Whitehall has already achieved cuts on this scale in just 18 months since the 2010 spending review. Some departments have reduced their headcount by 20% already. Heywood warned that headcount reductions could continue for five to ten years. He questioned whether the Civil Service had really absorbed the implications for future spending of the fact that the economy is 10 to 15% smaller that anyone was planning for. His blunt message to the audience of senior civil servants was that there is no question of simply waiting for a return of business as usual – the Civil Service was going to have to drive continuous improvements for the foreseeable future. And if the fiscal challenge was not enough the range and ambition of the Coalitions agenda is remarkable. Heywood compared the Thatcher Government - which took on one or two big issues each year any of which could consume a large amount of parliamentary energy - with the Coalition: “[they have] thrown pretty much everything up in the air at the same time… it is a Government in a hurry”. Heywood and Kerslake are clear the job of permanent secretaries has to change. They have reshaped the top team leading the Civil Service. They expect permanent secretaries to lead cross civil service efficiency and reform as a core part of their job. Francis Maude stated that he wants to see permanent secretaries being held sharply to account for raising value for money in their departments. He knows that the quality of management information has to improve to make that accountability meaningful: “Our data isn’t good… we really need to know what is going on, especially financial information”. The frivolous reporting of the Prime Ministers’s app misses the point about the power of data for holding ministers and officials to account. There was an intriguing debate on policy making. Heywood welcomed its inclusion as one of the six key issues in the open letter and urged the Civil Service to be more ambitious and innovative. As he dismissed suggestions that there had been a rift between him and the Prime Minister’s soon to depart advisor Steve Hilton – he reflected on the fact that it had taken the energy of outsiders like Hilton to bring ideas like nudge, transparency, wellbeing and behaviour change into Civil Service thinking on policy making. “Why were we lagging behind and not thinking about these new ideas?” he asked. He rebuffed suggestions that policy making was routinely poor – but created a stir amongst Twitter followers with the suggestion that there was merit in looking for areas of policy making that could be contested – and carried out by the private sector or others. Kerslake stressed the crucial implementation test of good policy – “does it get delivered?” Kerslake signalled his desire to get much clearer about what the smaller but stronger Civil Service should look like: why it does what it does, and how functions are best carried out. He said it was time to move away from the model of a civil service that is all about free standing departments. He wants to open up the reform debate and involve others including arms length bodies and local government. So there are already signs that Heywood and Kerslake could prove to be bold and radical reformers of the Civil Service. They and Maude argue the Civil Service must change and needs to be better at some of its core functions. They have begun their leadership in a distinctive way. They clearly recognise that efforts by the Centre to impose major change without wider support will inevitably fail. Instead they want to create strong corporate leadership of the reform plan with the active commitment and involvement of senior leaders, ministers and the best talent in the Civil Service. Lasting civil service reform has always need sustained ministerial backing. Maude rightly argues that the reform plan needs buy-in from Parliament as well as opposition politicians. He said he wants to involve both in the discussion of his emerging plan. So it is a crucial challenge for the civil service reform leadership trinity to secure and hold this backing and engagement across politics, parliament and the Civil Service. They will need it for the inevitably tough decisions and push back that the right reforms will generate. Can they succeed in leading the change needed to handle the huge challenges facing the Civil Service? The publication of this reform plan in the next two or three months will give us our first chance to form a view. Maude is very specific about the sort of plan he requires: “rigorously practical… actions will be put into effect”. But will their plan be another candidate for the dismal back catalogue of unimplemented reform strategies? Or will it satisfy Maude’s desire for an ambitious plan with practical actions that get to the heart of the some of the issues we have identified in our open letter? The Institute will aim to continue our close engagement with politicians and civil service leaders, while continuing to offer constructive, independent assessments of progress and problems. We are revising our research programme to ensure it is tackling the issues that matter most to successful Civil Service reform.