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Mr. Freeman: That is a novel idea, on which I should like to reflect. I suspect that my hon. Friend is suggesting an extension of the commissioners' role in relation to those who are not technically civil servants but who serve in the public sector. Perhaps my hon. Friend will be able to develop that argument during the debate. It is an interesting idea, but the commissioners' role is, as their name implies, currently restricted to the civil service.
Mr. A. J. Beith (Berwick-upon-Tweed): I hope that the Minister responds sympathetically to the hon. Member for Castle Point (Dr. Spink), because there is a wide area of the public service to which the experience of the Office of the Civil Service Commissioners could be extended if it had wider public service responsibilities--quangos, and the inspectorate of education, whose staff are Crown servants but not civil servants, to name only two examples.
Mr. Freeman: I understand that one of our main daily newspapers describes contributions to debates by the right hon. Member for Bishop Auckland (Mr. Foster) and myself as sleep-inducing and boring. [Hon. Members: "Never."] The right hon. Gentleman and I are perhaps in a minority of two in believing that not to be the case.
The suggestion by my hon. Friend the Member for Castle Point (Dr. Spink) and the right hon. Member for Berwick-upon-Tweed (Mr. Beith) is a constructive idea, which I would not want to dismiss. We should return to that. I look forward to the right hon. Gentleman's contribution to the debate. Certainly, in relation to quangos and non-departmental public bodies--that is, bodies without a Minister in charge--there is a very strong case for looking afresh at some of the principles that we apply, especially on recruitment and promotion, so I take the idea seriously.
In addition, the First Commissioner now has a role in relation to senior internal appointments, and attends the senior appointments selection committee. He is able to comment on the choice between open competition and internal appointment in relation to selection on merit, and on the development of senior selection processes.
The new regime introduced in 1995 clarified the roles of Departments and agencies and of Recruitment and Assessment Services. It has now been made clear that it is for the head of each Department or agency to ensure that the key recruitment principles are followed in practice. Departments and agencies are required to publish information about their recruitment systems.
RAS has had no formal role in regulating civil service recruitment, although of course it adheres to the commissioners' requirements in the services that it provides. RAS now focuses entirely on its role as a provider of high-quality recruitment and related services. That is in line with the principle recommended by the 1994 review, that the roles of service provider, that is, RAS, and the regulator, that is, the Departments and the civil service commissioners, should be separate.
Mr. Garrett:
What is the justification for the retention of the administrative fast-stream entry in an organisation that is now supposed to be increasingly technocratic and managerial?
Mr. Freeman:
The fast stream is designed primarily to recruit graduates into the civil service. It does not guarantee--
Mr. Garrett:
They are not all graduates.
Mr. Freeman:
No. I said "primarily". They are primarily graduates. It is a very competitive market. There is not a fast track to promotion, to permanent secretary level. At the early stages of the introduction of individuals--indeed, I suspect that my hon. Friend the Parliamentary Secretary, Office of Public Service, would be able to answer in a far more personal capacity because he was probably a product of that system--
Mr. Garrett:
Without justification.
Mr. Freeman:
I was not seeking to dodge the question. I am merely pointing out that we have some personal experience on the Treasury Bench. I believe that there is justification for the fast stream, simply because it attracts, from memory, about 7,000 to 8,000 applications a year for perhaps 200 jobs, in a very competitive graduate pool. It does so because it provides a tailor-made system of recruitment and pays special attention to those highly qualified individuals.
Mr. Garrett
indicated dissent.
Mr. Freeman:
Of course they are. They are for the most part graduates, who, if they did not join the civil service, would be competed for in the private sector.
I now refer to the privatisation of Recruitment and Assessment Services. RAS was established as a next steps agency to provide services to Departments and agencies on a repayment basis. It is widely regarded for its recruitment and assessment capabilities, and is perhaps best known for its role in the recruitment of high-calibre graduates to the civil service fast stream, the future "high fliers" in the civil service, but without any guarantee of promotion.
The agency has done well. With no tied business, it has to compete in a dynamic marketplace against Departments' in-house teams as well as against private sector recruitment companies. With the continuing development of a range of services designed to meet the changing needs of customers, it has established a reputation as a centre of excellence and it has been able to increase its overall market share of civil service recruitment, from 7 per cent. at the start to 12 per cent. in 1995-96--RAS accounts for only 12 per cent. of recruitment into the civil service.
The opportunity for RAS to compete in wider public and private sector markets will come at a time when companies are beginning to place their graduate recruitment in the hands of outside specialist recruitment firms. RAS will be especially well placed to exploit that trend. Freedom to develop fully the potential of the business will enhance the range of services and the value for money that it can offer to customers, including existing customers and Departments. Therefore, we are confident that privatisation will also give best value for money for the taxpayer.
Mr. John Gunnell (Morley and Leeds, South):
The Minister is well aware that that proposal was heavily defeated in the House of Lords--I think by 120 votes to 64. In response to the defeat, the Lord Privy Seal said that
Mr. Freeman:
I had planned to deal with that issue later in my speech, but I shall deal with it now. I have been called to appear before the relevant Committee of another place, which is looking at the public sector and its services, including Recruitment and Assessment Services. I look forward to doing that after the Whitsun recess. The hon. Gentleman must concede that neither this House nor the other place has had as comprehensive an opportunity as today to consider the reasons for our suggestion of transferring ownership of RAS to the private sector. We are now doing that. When I attend the Committee of another place, I shall expand on that in even greater detail.
I look forward to seeing the conclusions of the report of that Committee, which I understand will be available before the summer recess--and before we complete any arrangements for the transfer of ownership of RAS. I give my assurance to this place and to the other place that the observations of the Committee will be taken into account and carefully considered. If the hon. Gentleman listened to the Lords debate, or read the report of it, he will have come to the conclusion that the arguments in it did not bear a tremendous relationship to the realities of the new situation, post-1995, when the principles governing recruitment into the civil service and the regulation of that process have been removed from RAS.
Mr. Giles Radice (North Durham):
Is the Minister saying that the noble Lord who led for the Government--who made two lengthy speeches--was incompetent and did not put forward the proper arguments? As I understand it, he put forward the arguments and a distinguished collection of Lords--if I may so boldly call them that--comprehensively undermined them and, as a result, the Government were defeated by a vast majority. If the Committee comes forward with proposals, the Government ought to take them very seriously and delay their project.
Mr. Freeman:
I am the Minister responsible, and this is the first opportunity that I have had to account to the House--this is ministerial accountability. I am explaining the policy and the reasons for it in detail. I look forward to giving evidence to the Committee and to its deliberations. Any conclusions of the Committee that are relevant to the privatisation of RAS will be carefully considered. I give the House and the Committee an assurance that I shall treat the deliberations seriously. I cannot believe that the hon. Gentleman is suggesting that a Committee of this place or another place should control the policies of Government. It is this House and the other place that must pass specific conclusions on specific legislative proposals.
Mr. Derek Foster (Bishop Auckland):
Would it not be sensible to defer any progress on the privatisation until the Select Committee has given the Chancellor the benefit of its full deliberations?
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