Examination of Witnesses (Questions 1-19)
MAVIS MCDONALD CB, PROFESSOR RON AMANN, DR DAVID SALISBURY CB AND MR STEPHEN CROWNE
MONDAY 21 JANUARY 2002
1. Welcome to the Committee of Public Accounts in the House of Commons. This afternoon we are very happy to welcome Mrs Mavis McDonald, who is Permanent Secretary at the Cabinet Office. We are going to be discussing a very full Report by the NAO on Modern Policy-Making. Mrs McDonald, could you introduce your colleagues seated around you please.
(Mavis McDonald) I hope you do not mind if I ask them to speak for themselves, starting with Professor Amann.
(Professor Amann) I am Ron Amann, Head of the Centre for Management and Policy Studies in the Cabinet Office.
(Mr Crowne) Stephen Crowne, Acting Director of the Standards and Effectiveness Unit in the Department for Education and Skills.
(Dr Salisbury) Dr David Salisbury, I head the Immunisation Group at the Department of Health.
2. Thank you very much. Perhaps, Mrs McDonald, I could ask you to open the NAO Report on pages 2 and 3 to start our deliberations. You will see there put in very graphic form some of the disasters that have happened in recent years. When we look at the Millennium Dome, the Cancellation of the Benefits Payment Card, the Implementation of the National Probation Service Information System, the Passport Delays for Summer 1999, the Progress in Completing the New British Library, can we have any confidence that the fine words we read in this Report will actually be translated into practice?
(Mavis McDonald) Thank you, Mr Chairman. If I may, I will refer to the NAO's own Report in opening my reply to you because there are a number of case studies in that Report which do demonstrate the principles of better policy-making that we have been trying to promote from the Cabinet Office, and which have led to good results. Two of them, the National Literacy Strategy and the Meningitis Campaign are the reasons why I invited my colleagues on my right to join us this afternoon. We have had two sessions with you on joint policy-making and regulatory impact relatively recently, which again had examples of good practice in various aspects of policy-making. As I hope I keep consistently saying, we do not view ourselves as at any point reaching a stop; this is a process of continuous improvement. We have done some work to survey experience and practice in departments which has been led by the Centre for Management and Policy Studies and resulted in the Report which we circulated with a previous Memorandum to the Committee on Better Policy-Making, which gives us some flavour of the snapshot position at the moment of what we think the state of play is on improved policy-making across Whitehall. I would like, with your agreement, to ask Professor Amann to say one or two things about the findings of that survey.
(Professor Amann) I hope that members of the Committee found it helpful to have this report on Better Policy-Making, which came out at the same time as the NAO Report. It is the largest survey of policy making that has taken place in government. It draws out 130 case studies of best practice and we publish 40 of them in the Report. You will see from the Report that there is quite a wide range between, on the one hand, for example, use of emotional intelligence in improving people skills in Customs & Excise and, at the very rigorous end, the use of research on game theory, to design auctions for the auctioning of the radio spectrum. Very briefly, the main picture that comes through there is of a fairly rich seam of activity so far as the inclusiveness of the policy is concerned, that is consulting and informing stakeholders, and a relative weakness in the use of international evidence in evaluation and in forward thinking. When we come to the barriers to better policy-making, rather familiar factors were picked upsilos between departments, hierarchies within departmentsand all of these features of policy-making have been picked up in the NAO Report. If we look at the two Reports and try to reconcile them, although the approach is different, the conclusions are very similar. In short, there are areas of concern, and areas where we need to improve, but also I think quite an encouraging picture in some aspects as well.
3. Mrs McDonald, if my colleague Nick Gibb could be with us this afternoon I am sure that he would say this Report is "motherhood and apple pie". Has the apple pie been digested?
(Mavis McDonald) You really have to decide what a measure of success would be to assess just how effective we are being. If you take a measure of success as cost-effectiveness in achieving Government priorities and look at some of the frameworks which are now in place, in particular the basic framework provided by the spending reviews and Public Service Agreements and the Public Expenditure Committee's monitoring of those agreements, which involves both the Treasury and the Cabinet Office working together, supplemented by the kind of survey work that Ron Amann has just described with various kinds of evaluations, then I think you could say we have got a better framework for knowing whether we are doing better, whether we are on track, whether we are measuring the risks of achieving objectives, and whether we have plans in place to cope with those risks, unexpected or not. I would like to go back to what I said earlier. We do not view ourselves as being at some kind of static point where we stop. What we are looking for is continuous improvement in the service that we give to Ministers. Since the Election and since the NAO Report, there have been further developments, which are briefly referred to in the memorandum we gave you. We have a clear priority of improved public service reform and delivery, and we have two new Units based within the Cabinet Office. There is the Prime Minister's Delivery Unit, which working on the key areas of health, education, crime reduction, asylum and transport with the departments concerned to plan and monitor programmes and projects designed to achieve objectives in both a supportive and challenging way. That is one new development. The other is the Office of Public Services Reform which is developing programmes to work with departments to help them assess whether they have the capacity to achieve those end results in terms of the people, skills and knowledge they have got within departments, and working with both of those is the Centre for Management and Policy Studies whose role is both to design the training programmes that achieve that capacity but also enable us to promote better practice and from there disseminate knowledge across Whitehall.
4. Let us try and get into the detail. What you say is fine but let us turn to page 37 and let us look at paragraph 2.8. This is about the need for experts. "The report was also concerned at the distribution of specialists across departments and highlighted that relatively small numbers of economists and statistical experts were devoted to some high expenditure areas. We found that the number of specialists in the departments that we examined had changed little since the publication of the report". So here we have an example in Whitehall of a lot of good intention but actually, when it comes to it, very little changing from the traditional way that Whitehall is run.
(Mavis McDonald) If I may make two separate points. One, we do have figures beginning to come through showing that we are being more successful now in recruiting specialists like economists and statisticians. I think there was a piece in The Guardian focusing on the Treasury success in putting applications in for economists and policy analysts. We, also, I think, would continue to say that is not the only source of expert advice that we can make use of in departments, we can of course buy in extra advice for particular purposes where we do not feel that we have got particular skills in-house to deal with particular projects. Also, as a general administrator myself, I would not want to under-estimate the capacity of the basic administrative Civil Service to be an intelligent customer in relation to the policies they are working on in terms of knowing what other kinds of teams of skills might be put together to achieve particular policy objectives.
5. Can you afford the experts and will they be listened to?
(Mavis McDonald) I think we can afford the experts within our budget, as the Treasury would tell us, I think we are, like everybody else, always subject to what the market price is at any one time. We have found, for example, on occasions that we were competing in a very expensive market for IT project management skills but markets go up and down and we have to set our priorities to make sure we do achieve what we need to do properly by buying in the right skills at the right time if we have not got them in-house.
6. Let us just look at another similar area where sentiments, it seems to me, have not necessarily been translated to action. If you turn back now to page six, paragraph ten, you will see towards the end of that paragraph the report reads in terms of interconnections with departments: "We found no examples in the departments included in this study of the interconnection between policies being regularly reviewed". What is your answer to that?
(Mavis McDonald) I am quite sure that is what the NAO found but I think I would say we found that slightly surprising in that we have got examples of interconnectivity being reviewed in a variety of ways through both our basic processes, such as policy clearance through Cabinet Committee, the traditional style of inter-departmental policy clearance, by some of the things that we talked about before when we looked at regulatory impact and the way in which legislation impacts on different points through that process. The last spending review broke new ground with a number of cross-cutting spending reviews and the follow through on those has been consistently monitored by the Treasury and the Cabinet Office. The current spending review has also got a number of cross-cutting spending reviews in different areas. Last time we met we talked about joined up approaches to Government and the different kind of ways in which we have been seeking to address the issues of particular client groups, for example, by bringing departments together and setting up new kinds of programmes in different kinds of ways. Although I am quite sure that comment came back to the NAO, I think in practice we can produce lots of examples of where that is not, indeed, the case.
7. Equally, my colleagues were frustrated in terms of bed blocking in the NHS for instance, that in their own area there was a shortage but in the neighbouring area there were plenty but their constituents could not have access to them. So I am sure you will appreciate and agree there is a lot of work to be done?
(Mavis McDonald) Yes. I would not dispute that at all. I think I would want to say, though, that by and large the principle is well established as one of the critical aspects of better policy making.
8. All right. Let us just pursue this idea of whether this is just rhetoric or not by asking you really if you look at paragraph 1.11 and figure 13 on page 28, which are a key part of the report in terms of what you are trying to achieve, I am sure you will agree with that, what key improvements in policy making have the Cabinet Office initiatives actually produced?
(Mavis McDonald) I think, if I may I will split the answer to this with Ron, if you do not mind us doing this boxing and coxing, I am sure you will tell us if you do. We have had some significant successes with the development of work following the Social Exclusion Units addressing particular issues such as Rough Sleepers, Neighbourhood Renewal and a variety of other particularly difficult challenging issues on the social exclusion side which have led to new approaches to new programmes where we are beginning to see real results on the ground. Even though it is quite early days we are beginning to see different approaches. We have got our examples through DLTR of better joined up working on the ground through earlier engagement, through greater discussion and engagement with stakeholders, through proposals to develop local public service agreements to supplement national service agreements to bring together national standards with local input on what are the priorities within their areas. Ron, I think you have found several examples.
9. Before you pass on. We have Rough Sleepers so far, a pretty small area, we have got DLTR, local service agreements, what else have we got?
(Mavis McDonald) I was going to ask Ron.
10. I would like to hear from you.
(Mavis McDonald) Okay. We have got the example following the PIU Report on the regions, both a well established regional co-ordination unit and Government Offices for the Regions, which now have a very considerably greater number of Central Government Departments engaged round the table to try and ensure greater joining up and understanding of the interaction at local level of different Government policies. We have in there now DEFRA operating. We have Crime Reduction in the Home Office operating. The Department of Health have just announced that they are going to sit alongside the Government Offices and run the Regional Public Health arm and their assessment of the improvement from the regions. All of those are following analysis of what might help improve policy delivery and development on the ground.
11. I want to press on now because time is getting on. Can I just refer you to page 28 now. You have figure 12 there summarising the four main areas on which you are focusing to promote improvements in policy making. Can you just tell us how you are measuring their success?
(Mavis McDonald) I really would like to ask Ron to answer this.
(Professor Amann) Thank you, Chairman. Really it falls into two parts. How we are measuring success in policy making, how we are measuring success in the related area of improving the skills which feed in to policy making. In the case of policy making, the report that the Committee has before it which we prepared is really establishing some base line data of what best practice in policy making looks like across all departments. We will be wanting to use that to form networks, indeed we are doing that with networks of policy makers, and we will be able to take a view on how practice is improving in the months and years to come. We will be evaluating particular examples of policy making. We have completed an evaluation of Policy Action Teams in the Social Exclusion Unit, for example, which we will be publishing very shortly. In terms of skills, we are involved in training in policy making from the heart of the Civil Service right up to events that we organise for ministers and senior civil servants and, indeed, the joint training of ministers and senior civil servants. The kinds of figures that we are looking for there are on take up 75 per cent of UK ministers attended CMPS events last year and they did so on average three times. There is, if I can put it that way, repeat business. The feedback has been very positive. When it comes to the new programmes on policy making that we are developing for civil servants at the more operational level, we are seeking to evaluate that in future not just in terms of the marks that course members give at the moment when they have completed their course at Sunningdale, for example, but to do lagged evaluations a year or so down the track to see what difference that training has actually made on the ground in departments.
13. Thank you. When my colleagues ask questions can we have slightly shorter replies because they are time limited? Has the Cabinet Office been subject to peer review?
(Mavis McDonald) Yes, we had a peer view completed in the summer of 2000.
14. What impact did it have?
(Mavis McDonald) It had two impacts. Firstly, it made us think very hard about the way we work together across the Cabinet Office to make sure that a) we were not duplicating but b) we were getting more coherence out of the work we were doing and the messages we were giving to it. Secondly, it made us re-think the extent to which we were sufficiently engaged with departments in the development of our thinking in order to improve the lead we were giving to policy development in other areas.
15. Could I ask you about implementing policies. We have this system by which executive agencies are not involved in policy-making and where departments actually make the policy. Do you think that across Whitehall those responsible for implementing policies are consulted early enough to influence the policy design and improve the chances of the policies being successful? This is dealt with particularly in paragraph 2.13, page 40.
(Mavis McDonald) My own experience of agencies is that their engagement in policy development varies quite a lot. Some are quite heavily engaged, others are not, and the range of agencies and the type of business they do varies, of course, significantly. We have got an agency review under way at the moment to look at the range and scale of their activities in relation to the central requirements made of them and that, inter alia, will be looking at this issue of the extent to which they are sufficiently engaged in policy development, and that is due to report to Ministers in March.
16. Is there still sufficient focus on risk management? I have been told that some of the focus may have gone off risk management within the Cabinet Office. Is there someone in the Cabinet Office spearheading risk management?
(Mavis McDonald) This is an area in which we have always worked closely with the Treasury, who of course have the main responsibility for risk and value for money, and we are continuing to work with them on that. We do also work with a body called ILGRA, which looks at risk to the public, and we have, in that context, been continuing to work on a statement about the approach to risk across government. That work is being taken forward by the Performance and Innovation Unit at the moment, which is doing a study on how to promote improvement of risk management. We are now, too, entering the new resource accounting budgeting regime where all of us are required, as part of the statement of internal control, to assess and set out our views as Permanent Secretaries as to the adequacy of the risk management arrangements in our departments.
Chairman: I had a couple more questions but in view of the lengthy answers I will stop there and ask George Osborne to continue.
17. Could I ask you, Mrs McDonald, about this plethora of new units that has been set up in the Cabinet Office in recent months. You say in your memorandum that there is a Delivery Unit and an Office of Public Services Reform Unit and then the Report also talks about a Forward Strategy Unitthose are the main threeand there is also the Performance and Innovation Unit and the Downing Street Policy Unit. Is there not a danger with five different units all looking at government policy on public services that there is an enormous amount of scope for confusion?
(Mavis McDonald) The answer to that is yes, you are right, but they are not doing the same work, they are doing complementary work, and it is our responsibility to explain how the various approaches that they are taking fit together.
18. What is the difference between the Delivery Unit and the Office of Public Services Reform Unit?
(Mavis McDonald) The Delivery Unit is working with departments on the way in which they are actually going to deliver specified objectives. They are working on some of the more challenging aspects of the public service agreements with those departments, and that is their primary focus. The Office of Public Services Reform complements that work because it is focused on the capacity of departments to actually achieve that delivery. So it is looking at skills and know-how on project management for example, and the capacity of the training we provide to back up those skills or develop those skills. One of the things they are trying to do is develop a model of a high standard, good, working department through something called a `Departmental Change Programme' where they will work alongside departments in an extension of the peer review process to assess the skills and systems that departments have to manage themselves.
19. I cannot say it has given me great confidence that my trains are going to run on time. What about the Forward Strategy Unit; how does that fit in with the Delivery Unit and the of Public Services Reform Unit?
(Mavis McDonald) The Forward Strategy Unit is a small group of advisers who advise the Prime Minister on further out work, so they are looking ten to 15 years ahead.