Select Committee on Public Administration Minutes of Evidence

Examination of Witnesses (Questions 80-99)



80. You are.

  (Mavis McDonald) We have pretty well doubled, largely through the addition of the Government Offices of the Regions, since before the election. So we are approaching 5,000 staff where we were something over 2,000. These are estimates yet because we have not got the final resources agreed for the new structure for the remainder of the year. In total we expect to be spending about £170 million a year more on administration resource costs which is largely staff and capital.

81. Are these administrative costs, the ones that are unique or the main responsibility of the Deputy Prime Minister, allocated to you and others allocated to No10? I think there is a suspicion in some people's minds that there is increasing confusion between what was traditionally No10 staff and traditionally the Cabinet Office staff. Is the budget shared?

  (Mavis McDonald) I am the Accounting Officer for all the units, including the staff at No10.

82. A reverse takeover.

  (Mavis McDonald) This is for the purposes of the formal accounting and in the Departmental Report we send to the Committee we give quite detailed break downs of that and I would expect you to see the new attributions as we get them through in supplementaries shortly.
  (Mr Prescott) And the Cabinet Office has been involved in that. I cannot remember the term, I think Mr Heseltine called it the dust can or something.


83. Bran tub?

  (Mr Prescott) Bran tub he said, yes. Then he said that each Cabinet Office comes along and picks up different pieces, it has got drugs and that goes to the Home Secretary, and you must make a judgment as to whether that is right or wrong. It has been a bit of a rolling stone on occasions and I suppose that is a reflection of the importance that the Prime Minister has put to things. Somebody was saying to me the other day "You have got to make sure science is in No10", I said "Why should it be in No10", "It used to be before". It has picked a lot of things up and we all have to be judged on the actions we take and what that balance is and we are presenting to you today our balance.

84. Just as a matter of fact, perhaps to the Accounting Officer, it would be the case, would it not, that No10 has invented these new units, it happens to have located them in the Cabinet Office?

  (Mavis McDonald) Yes.

85. They will not count as an expansion of No10 because they will count as an expansion of the Cabinet Office, is that right?

  (Mavis McDonald) The whole account is published as one account for No10 and the Cabinet Office. If we are negotiating with the Treasury for resourcing in the Spending Review then we are negotiating for the whole lot together.

86. In terms of numbers of staff, numbers of staff will be counted as having expanded in the Cabinet Office despite the fact that these units are working to No10 in fact.

  (Mavis McDonald) I think it will be quite clear where staff are located. They are located in the Cabinet Office, some of the heads of the unit work through the Cabinet Office through Ministers to No10. Some of the units are based in No10, not in the Cabinet Office.

87. It is not a question of whether it is good or bad but we are trying to get an account of it.

  (Mavis McDonald) We have been spending some time bringing units in and sending units out and setting up the new units. We have also redistributed some of the work that was going on before to fit in to the new agenda and the new units. That is why we have taken a little time to produce the organisation chart and update our website. We should have that for you very, very shortly.

88. We look forward to that.

  (Mr Prescott) And it could be easily identified.

Mr Trend

89. Is it possible that before the Secretary of the Cabinet comes to us we could have the order because last time there was a great delay and it was irritating to both of us?

  (Mr Prescott) I am interested to hear there was a delay before. It is just total hell, all of these things, because everyone is concerned about their position on it.

90. Exactly.

  (Lord Macdonald of Tradeston) To help Mr Trend and his definition of the Delivery Unit, as the Deputy Prime Minister said earlier his responsibilities are broad and strategic; mine are very specific with the Delivery Unit with day to day oversight of, as I say, 30 people working to the Prime Minister who holds regular stock takes with the Secretaries of State, at which we are present. We report regularly to the Prime Minister on how his priorities are progressing, whether they have been achieved or not. We also try to offer some solutions to specific problems as they emerge or to identify those problems. In looking to bring those solutions forward of course I work very closely with the Deputy Prime Minister and try to ensure that the other units inside the Cabinet Office, many of whom I have got no formal association with, try to use their efforts to bring us the solutions that are needed in the four priority areas of health, education, transport and crime.

91. But why is it not sufficient for the guy in the Treasury to do this as part of the PSA exercise?

  (Lord Macdonald of Tradeston) We work very closely with the Treasury but they have got 160 PSAs so their public sector teams obviously have a very wide spread of responsibility across Government. What the Prime Minister has said is that there are particularly challenging areas, not necessarily more important but more challenging, on which this Delivery Unit will concentrate. My day to day business is to report as regularly as necessary to the Prime Minister on what is going on there and to ensure that the Treasury also understand what difficulties might be emerging. I think you will find if you have the opportunity to talk to any Treasury officials that they will now see that we are able to dive under the surface of problems in a way that would not be possible for their units with such a broad sweep of responsibility.

Mr Prentice

92. Can I stick with this Delivery Unit business. I think there are two imperatives driving the Labour Government and they may be contradictory. One is to modernise structures, let us take the Health Service, and the other is to deliver outcomes. At the moment there is huge upheaval in the Health Service. If I just look at my own area in Lancashire, we have got a new Primary Care Trust, we have got the merging of two NHS trusts, my own one and the one covering Jack Straw's constituency, we have got the creation of a new Mental Health Trust in Lancashire and we have the abolition of the East Lancashire Health Authority. That is one of the 16 health authorities in the north-west which have been collapsed down to three. And we have got all the changes on patient representations, CHCs and so on. I just wonder if it is possible to deliver the outcome that the Government wants to see at a time of massive organisational change?

  (Lord Macdonald of Tradeston) We are looking at a perspective of four or five years for this Parliament and inevitably at a time of change there will be distractions clearly for the people involved. But by changing the structures, of course, you might judge it much more likely that you will deliver the outcomes that you need for the patients, for the customers there. That is a decision that has clearly been taken in a number of areas, many of them, of course, having gone through as Acts of Parliament. I accept that, of course, there are difficult times in prospect for those in the process of change. I accept too that it is our job to try to reduce the complexity by ensuring that one of the principles of public life is to try and put as much of the responsibility down to the front line as is possible. We can have national frameworks for accountability and performance but the Prime Minister is very insistent in trying to get the responsibilities down to the front line, as we have done quite successfully in schools for instance. Those are the priorities that we are pursuing, not just for the Delivery Unit but, for instance, the Regulatory Impact Unit has been working and trying to strip out red tape from elements of the Health Service as well as the Police as well as the educational establishments. We want to try to focus all of the activities of these various groups on these key concerns which are the four priority areas.

93. You are much more than just progress chasers obviously. I am interested in the relationship between the Delivery Unit and individual Departments.

  (Mr Prescott) Reform.

94. Reform, yes. What we have been talking about is whether the Departments respond to the Delivery Unit initiative or whether you sit down with the Departments and work out what is possible jointly.

  (Mr Prescott) I think this is an extremely important point. If I look at New Deal for Communities I get the similarity of all these Departments' programmes and our job is how can you bring them together to deliver and focus on one area, whether it is health or the New Deal for Communities. This is a real problem for us in delivery, I do not think there is any doubt about it. That is why the Prime Minister often mentions reform is necessary for the delivery. You cannot just provide the money, it is the outcomes we are talking about and not just simply putting money in and then they will deal with it. All the evidence shows that it is not. I must say in some of the evidence we have got returning where we have been measuring the outputs and seeing how we have done on the outcomes we have seen an improvement. I think it was done in teachers, was it not? It was done in teenage pregnancy. It is this cross-cutting how we get to achieve it. We will not achieve all those targets unless we can achieve that interface and the reform. That is what we are very much trying to do. At the end of the day though if we find that you cannot deliver it—Let me perhaps give you an example which always struck me as right for us to do what we are doing without perhaps giving an indication of Ministers involved. We had a particular programme for something and we said that should be done. I will not get into all the controversial areas about it. We set it on our cards, I went round the country and then we found that the Department did not think that was an important priority and we did not discover that until 18 months in and that is the first period of a government. I think the Department probably had the best side of the argument in this. We had made it a commitment and at the end of the day they just were not delivering it. If we do not know that earlier than 18 months before we are going to have real problems about delivery. It may argue that is not the right one you should have been promising, and I am sure there are many arguments, but we learn from experience that perhaps targeting was not done properly to begin with, perhaps we have got to change it if we want to be successful. I have no doubt the question that has been posed by yourself, how we reform delivery, how we actually perhaps lift the burden of too many commitments in too many areas and indeed be focussed on what we really want from people is something that this Committee has always been concerned about and we have got to be as concerned about the delivery and the reform of it if we are to achieve those targets.

Mr Steen

95. This is in relation to one of the points Gus Macdonald just mentioned about the Regulatory Unit. Something which I have majored on for many years is deregulation. You mentioned the Regulatory Unit as trying to tackle red tape. The reality is that the Deregulation Select Committee, of which I am also a Member, has only deregulated in three areas since Labour came to office. That is on dancing, you can dance more in this country, you can drink more at different times and you can gamble more. Those are the three deregulatory areas which the Government has been successful on. I would like to compliment you on that, we have a much happier society.

  (Mr Prescott) As a drinking, dancing Member of Parliament.

96. There is a real problem about deregulation, that it just is not happening—just is not happening. You as an industrialist must realise that what the Tories did was the easy bit. We deregulated and really we repealed by secondary legislation. We repealed things that would take ages to go through the Commons and the Lords and we found a new device. As far as lifting the burden, and I know the Deputy Prime Minister has been interested in this as long as I have, it is not happening because society is getting more and more complicated, there are more rules and regulations coming out of Europe, and I am on the European Select Committee as well. I just think the reality is very different from the window dressing. If you have got 5,000 staff in the Department I say to myself "there is the start of the deregulation, cut that to 50". That would be your start of deregulation. The best way to deregulate is to cut the number of staff because they then cannot enforce.

  (Mr Prescott) That happened in your previous administration and you ended up with more regulations than you started with and less staff.


97. When we had Michael Heseltine in front of us one day in the last Parliament, I may not have the words exactly right, he said something like "I did not believe a word of it anyway".

  (Mr Prescott) I am in that school, I am sorry to disappoint you.
  (Lord Macdonald of Tradeston) In reply to Mr Steen, I was indeed one of those businessmen called before Mr Heseltine and I took what he said very seriously at that time. I had no doubt that his intention was to slash away at red tape and I am sure it is an aspiration of every government. We are perhaps more worldly now in realising just what a difficult job it is.
  (Mr Prescott) It did not help in the food industry.
  (Lord Macdonald of Tradeston) There may be some trends that will help us. Chris Haskins and his Task Force are doing good work. Lord Haskins believes, for instance, that the amount of regulation coming out of Europe will now lessen considerably that we are through a particular phase there. I think too we should not underestimate the commitment that this Government has given to it. As you say, we brought in the reform which offered the Regulatory Reform Orders and I hope that Parliament will be as eager as we are to see those processed efficiently because I think that is an important new route for changing legislation quickly. I have got a panel for regulatory accountability which calls Ministers to account for their Departments' regulatory performance. We have got plans requested from every Department so that we can make an assessment of whether they are trying hard enough on this front and there is a Minister for Regulatory Reform in every Department. I can assure you that the Prime Minister is more passionate about it than even I remember Michael Heseltine being. I think he means every word of it.

Mr Steen

98. The real test is if you want to dance more, if you want to drink more, if you want to gamble more, thank Labour, but anything more has not actually happened. I want to come back to why and that is hygiene, because every time you want to make something cleaner everybody says "let us pass a new regulation and a new rule", so there are hygiene regulations coming out from everywhere, and yet, in spite of that, there have been more incidents of food poisoning everywhere than ever before. Then safety: as a result of the current world security you cannot stop safety regulations coming out, there will be more safety regulations, and security, there is no limit to the amount of regulations on security. What I am saying is we ought to be honest and your unit ought to say "look, we are not going to succeed on this, it is like King Canute, they are coming out from every angle, hygiene, safety, security".

  (Mr Prescott) Europe. Most of it comes from Europe.

  Brian White: The Committee has actually asked for the Minister to come to the Regulatory Reform Committee. You were not there on Monday.

  Chairman: I feel a speech coming on, Anthony.

  Mr Steen: I have finished it.

  Chairman: We have heard it before and it is a very good speech.

Mr Lyons

99. Can I come back to the Delivery Unit and regional government. Who will make the assessment about whether the regional government objectives have been met in some way?

  (Mr Prescott) Our view is that regional government will lead to a much more efficient and effective way of delivering public services through the process of decentralisation. I suppose you can make a judgment if you look at Scotland or Wales whether they have achieved that because that is a matter of devolution. Our judgment would be, therefore, in delivering services as we have at the moment because most of the agencies are local authorities who deliver in most of our processes.

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