Select Committee on Public Administration Minutes of Evidence


Memorandum by Vernon Bogdanor, Professor of Government, Oxford University

  1.  The central leitmotif in current proposals for reform of the civil service is the need to improve its managerial effectiveness. "Effective performance management", we are told "is the key";[1] and this is to be achieved by creating "a well-functioning business planning system".[2] In a modern civil service, performance management systems should both "link individuals' objectives to business objectives"; and "incentivise (sic) people to seek more challenging responsibilities, develop their competences and demonstrate leadership".[3] Performance related pay is one way through which these objectives can be achieved.

  2.  The intellectual climate in which this approach has been adopted is not one that has been set by the present government. It can perhaps be traced back as far as the Fulton Report of 1968 and the 1970 White Paper on the reform of central government. Since that time, it became a commonplace to argue that many of Britain's problems arose because her professional elite was steeped in an anti-industrial culture, which had proved a hindrance to the country's efficiency and economic progress. Thus, the very professionalism of the civil service, which has been so widely admired in foreign countries, was seen as a handicap and not an advantage. This critique of professionalism was fuelled by the work of commentators such as Martin Wiener in his book, English Culture and the Decline of the Industrial Spirit (1981), and Correlli Barnett in his books The Audit of War (1986) and The Lost Victory (1995), although their conclusions have been vigorously attacked by many scholars. There is indeed a paradox involved in the Wiener/Barnett critique. For, while the British civil service has been the subject of much emulation and admiration, it is doubtful if the same is true of British management. The suggestion, therefore, that the civil service would become more efficient if it adopted the practices of British management seems somewhat bizarre, and requires, perhaps, more powerful advocacy than it has yet received.

  3.  It is, moreover, not wholly clear that the practices of private industry have been fully understood by those seeking to make the case for civil service reform. It is all too easy to visualise managers in the private sector as buccaneering entrepreneurs, subject continuously to the stern rigours of competition, and "incentivised" by means of performance pay. In fact, however, many large companies operate very much like the traditional civil service. Indeed, in 1993, the Oughton Report, the "Career Management and Succession Planning Study", argued that Whitehall already adopted many of the best practices of private industry and that the case for further change had not been made out.

  The Oughton Report discovered that the practices of private industry were not as many ministers imagined them to be. Many large private companies, such as Unilever, BP and Shell, followed civil service practice, and favoured "appointment to the top jobs from within". They went outside only when there was a particular skills shortage or a need for a radical change of direction; and they would then revert as soon as possible to filling top posts internally. The companies investigated by Oughton, which included Unilever, BP and Shell, cited as a main reason for this policy the "adverse effect on staff morale as an argument against complete open competition".[4]

  In Britain, Chief Executives of agencies are generally appointed on fixed-term contracts. But large companies tended to use such contracts at executive levels "only in exceptional circumstances", the most common form of employment contract in the private sector being the rolling contract. In general,

    "private sector contracts are more often used at senior levels to increase rather than to decrease security of tenure and to protect the organisation from unethical or predatory behaviour. Fixed-term contracts are hardly used except for specific short-term appointments, and are much disliked both by employers and those employed in this way."

  Therefore, the Oughton Report concluded, "The policy of fixed-term contracts for Agency Chief Executives should be re-examined against the background of this evidence".[5]

  The Head of the Chief Executive branch of the State Services Commission in New Zealand, where short-term contracts had been adopted, suggested that they had "undermined the broader framework of management development which emphasises the nurturing of talent against a long-term view of career management". For, "however confident individuals might be about the renewal of their contracts, they would inevitably start casting around toward the end of their term, if only to increase their bargaining strength".[6] There was a danger of short-term contracts undermining the independence of the public service in that they might inhibit officials from giving free and frank advice to ministers toward the end of their term in order not to jeopardise the renewal of their contract.

  4.  The Oughton Report concluded, then, that the case for further change in the civil service had not yet been made out. Has the case been made out in the various documents on civil service reform, summarised in Sir Richard Wilson's report to the Prime Minister, "Civil Service Reform"? It is difficult to see anywhere in these documents any empirical argument or evidence-based analysis which serve to make such a case. The verdict then must be, at the very least, one of "not proven".

  5.  One of the measures designed to improve the effectiveness of the civil service is to increase the number of outsiders. At present, the existing proportion of senior civil service posts advertised to attract people from outside is 20-25 per cent. "This proportion would be expected to rise to 35 per cent." [7]

  Anyone who objects to the infusion of outsiders into the civil service is liable to be met with the rhetorical question, "Do you want a closed civil service?" It would not, however, be very sensible to suggest to someone who objected to unqualified doctors or lawyers, that he or she favoured a "closed" medical or legal profession. For professions are, by definition, closed. The question is whether the civil service is still to be seen as a profession, based on its own particular expertise of public administration, or as a form of management.

  It is worth noting also that in practice the two cultures of public service and private business have not meshed very well, but have remained distinct. It is difficult to think of many successful businessmen or women who have made successful careers in the civil service, and difficult to think of many senior civil servants who have proved themselves to be equally successful in the business world. The same is true, of course, at political level. It is difficult to think of many top businessmen or women who have made a success of a political career; and difficult to think of many top politicians who have been very successful in the business world. Probably the cultures of local government and perhaps even of academic life are more similar to the culture of the civil service than is the culture of private industry. Yet, while current proposals for reform emphasise reciprocal exchanges with business and the voluntary sector, hardly anything is said about exchanges with local government or the universities. [8]

  6.  Two problems in particular arise with the infusion of outsiders into the civil service. The first is the need to ensure that public service standards are maintained; the second is the need to ensure that the civil service does not become politicised.

  7.  The British civil service has been widely admired, and rightly so, for its very high standards of integrity, professionalism, political neutrality and incorruptibility. These standards have been secured by continuity of experience which served to yield a common ethical basis. Until recently, this ethical basis seemed so deeply embedded in the culture of the civil service that there appeared no need for it to be codified.

  With greater interchange, however, between the civil service and the private sector, great care needs to be taken that public service standards are maintained. Indeed, Sir John Bourn, the Comptroller and Auditor-General, and Robert Sheldon, MP, formerly Chairman of the Public Accounts Committee, have frequently expressed their belief that newcomers into the public sector need to be initiated into public sector standards. It is clearly vital that civil servants should not think of those with whom they do business outside Whitehall as potential employers.

  Recently, a new appointment as head of Customs and Excise was announced, following public advertisement. The person appointed had been a Treasury civil servant for 11 years and had then moved to a city firm. If appointments of this kind come to predominate, it will be important to monitor the effect on morale upon existing staff who see good jobs being given to those who return to the civil service after undertaking better paid jobs outside. Otherwise, the whole notion of a career civil service, of a professional commitment, will come under threat.

  8.  The political neutrality of the British civil service flows fundamentally from its career basis, since if one joins the service for life, one will inevitably be called upon to serve successive administrations of different political colours. One is not likely to succeed, therefore, as a civil servant, unless one succeeds in displaying political impartiality. New recruits coming in from outside will generally lack the traditional patterns of experience, such as that of being private secretary to a minister, which help to socialise civil servants as neutral advisers. Moreover, someone recruited from outside in virtue of relevant knowledge is very likely to arrive with political baggage, policy commitments derived from their previous experience. It is not clear how far recruitment to senior policy positions in the civil service can avoid the dangers of politicisation or at least a degree of prior policy commitment, incompatible with our traditional notions of political neutrality.

  At some point, indeed, when the percentage of outsiders has exceeded a certain figure, it may be that the civil service has become fundamentally altered since the policy commitments of its senior figures will have made it unacceptable to the main alternative government of the day. For civil service reform is different perhaps from reform in other areas in that the civil service belongs not only to the government of the day, but also to any alternative government which might take office. Thus the introduction into the civil service of too many people with prior policy commitments sympathetic to those of the government of the day could serve to alter the civil service beyond recognition by politicising it. There can, of course, be no similar objection to outsiders being brought in as special advisers.

  9.  There is a fundamental contradiction, so it seems to me, between current proposals for civil service reform, and the idea of joined-up, or holistic government, which has been much championed by the current administration. That is because holistic government implies shared responsibility, while the civil service reform proposals imply individual responsibility.

  Civil servants are bound to have to consult more with their colleagues and with those outside Whitehall, than members of other professions such as, for example, doctors, accountants or schoolteachers. In the words of Sir Edward Bridges's classic Rede lecture, "Portrait of a Profession", published in 1950, "Few of them [civil servants] are ever completely responsible for the work they are doing—Through the nature of his work, therefore, he [the civil servant] has much less consciousness than other professional men that the work he does is his own individual achievement, and is inevitably far more conscious than others that the work he does is part of something greater than himself".[9] There is a danger that current proposals will undermine this consciousness.

  10.  Holistic, or joined-up government, has two crucial features. The first is that it is designed to deal with highly intractable and difficult social problems, such as social exclusion, drugs, community health, and so on. The aim is to re-create social capital and restore community ties. Success in this endeavour is likely to be very much a long-term affair, and not such as can be made subject to any regime of "incentivising" or performance pay. Such a regime might well encourage those subject to it to treat means as ends, to treat, for example, educational deprivation as a matter solely of test scores and attendance records, rather than the involvement of families in the educational process; or to judge the police solely in terms of law enforcement rather than on the wider basis of community safety; or to judge the National Health Service by how successful it is in curing illness rather than in preventing it. A regime of incentives provides too many incentives to cut corners, to dispose of difficult problems by dumping them on some other department. Schools, for example, can improve their position in the league tables by expelling difficult pupils. These pupils, however, then contribute to the statistics on youth crime, so that the criminal justice system is seen to perform less well. That is precisely the kind of juggling which holistic government has been designed to prevent.

  11.  Second, holistic government implies an end to defensive compartmentalisation and turf wars. It implies co-operation between different parts of the governmental machine, between the departments of central government, and between central and local government and local agencies. How, under such a dispensation, will it prove possible to distinguish and disentangle various contributions so as to estimate how much each element contributes to the whole?

  12.  There is, then, a deep-seated conflict between the ethos of the new public management, which lies behind the proposals for civil service reform, by which government is broken down into discrete or separate units of accountability, and the idea of holistic government whose central theme is that there is a social context of interdependence to many of our most intractable problems.

  13.  There can, in the last resort, be no real analogy between the civil service and private management. For there is no real analogy in the private sector to the central constitutional principle of ministerial accountability to Parliament. The business of a government department must, inevitably, be scrutinised in a different way from that in which shareholders of a public company judge the operations of their firm. In the latter case, the net financial outcome of all of the firm's operations over a period of time will be evaluated at the annual meeting of shareholders. Parliament, however, may scrutinise any single operation carried out by government at any time, and may do so some considerable time after the operation in question has occurred. This has obvious implications for record-taking and for the avoidance of risk, and it makes the conduct of public affairs by civil servants a profession and not a business. It also forms the basis for the traditional contract by means of which civil servants are offered job security in exchange for levels of pay generally lower than many of them could command elsewhere. That contract, and the basic principles which have undermined the British civil service, have remained unchallenged until recently. Some might suggest that they have come under challenge today, not so much because the civil service has been shown to be inefficient, but because, since the time of Sir Edward Bridges, there has been a precipitous decline of national self-confidence, and the civil service has become its latest victim. Yet an institution which has on the whole served this country well should not be undermined by default, but only after it has been shown, through the most rigorous analysis and scrutiny that its performance is in fact inadequate. That analysis and scrutiny has not yet been forthcoming.

Vernon Bogdanor

February 2000

1  Cabinet Office: Performance Management: Civil Service Reform, HMSO, 1999, paragraph, 3. Back
2  Ibid, paragraph, 4, i. Back
3  Ibid, paragraph, 12, i, ii. Back
4  Cabinet Office: Efficiency Unit: Career Management and Succession Planning Study, HMSO, 1993, pp. 40, 41. Back
5  Ibid, p 5. Back
6  Ibid, p 134. Back
7  Cabinet office: Bringing in and Bringing on Talent, p 30. Back
8  Ibid, p 37. Back
9  Sir Edward Bridges: Portrait of a Profession: The Civil Service Tradition, (The Rede Lecture 1950), Cambridge University Press, 1950, pp 26-7. Back

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