UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 307-iii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

Public Administration SELECT COMMITTEE

 

 

Civil service effectiveness

 

 

Thursday 3 March 2005

PROFESSOR CHRISTOPHER HOOD, DR MARTIN LODGE

and PROFESSOR COLIN TALBOT

Evidence heard in Public Questions 125 - 191

 

 

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Oral Evidence

Taken before the Public Administration Select Committee

on Thursday 3 March 2005

Members present

Tony Wright, in the Chair

Mrs Anne Campbell

Mr David Heyes

Mr Ian Liddell-Grainger

Mr Gordon Prentice

________________

Memorandum submitted by Professor Christopher Hood and Dr Martin Lodge

Examination of Witnesses

 

Witnesses: Professor Christopher Hood, All Souls College, Oxford, Dr Martin Lodge, London School of Economics and Professor Colin Talbot, University of Nottingham, examined.

Q125 Chairman: Let me call the Committee to order and welcome our witnesses this afternoon, Professor Christopher Hood, Dr Martin Lodge and Professor Colin Talbot, who have come to help us with our inquiry into the effectiveness of the Civil Service. Thank you for sending us various pieces of paper beforehand. Would any or all of you like to say a brief word by way of introduction?

Professor Hood: Insofar as I have any competency to speak on this subject it as a result of a study that I conducted with Dr Lodge a couple of years ago looking at the policy making skills and abilities of civil servants in relation to the competency framework set out for the Civil Service. It is on that basis that I think I can speak to you today.

Professor Talbot: I have been looking at issues particularly in relation to management and organisation issues in the Civil Service for a good many years and doing a lot of international comparative work on that. I can certainly address some of the interesting management issues that are coming up at the moment.

Q126 Chairman: Professor, you know all about this because you have been working on it for years and years and years. Let us just get our heads round some of this. What is the British Civil Service good at?

Professor Talbot: Telling us they are good.

Q127 Chairman: They are good at telling us they are good, are they?

Professor Talbot: Yes, they are very good at telling us they are good. They are very good at maintaining - I was going to say mythology but I think that is probably a bit too strong - the idea that we have a Rolls Royce Civil Service (that is the phrase most often used).

Q128 Chairman: Do we not have a Rolls Royce Civil Service?

Professor Talbot: I think we do but not necessarily in the way in which they mean it. Rolls Royce I think is a very apt metaphor because Rolls Royces carry people round in splendid isolation from the rest of the world with great status and power and elegance, but they do not necessarily achieve a lot.

Q129 Chairman: So what we want is a Ford Focus Civil Service is it?

Professor Talbot: I think so.

Q130 Chairman: How do we get one of those?

Professor Talbot: I think there are some major issues about the relationship of the Civil Service to the service delivery element of what it does itself, the relationship with the service delivery element of the rest of the public service and also - I think Christopher and Martin have probably got more to say on this - on the way in which they make policy, which I think is a rather closed process at the moment despite all promises about reformed policy making processes which the new government made in 1998. I do not see a lot of evidence of that having happened.

Professor Hood: May I say that a couple of years ago when I was interviewing German civil servants with Dr Lodge one of the things that those German civil servants thought that the British Civil Service was very good at was co-ordinating their policy in Europe. That was the view from Germany. They admired the British for that.

Q131 Chairman: You sent us a very interesting paper on these British German comparisons on policy making competency. I did not quite understand all of it, I must say. That is the way with academics, is it not? I just want you to translate a bit for me. This is under "Boundary-Spanning Competencies". Because I thought you were trying to say something important here I quite wanted to know what it was. It says, "Policy-making occurs in many different political climates, modes and circumstances. But where it amounts to anything more than political signalling, presentation or judicious 'parking' of difficult problems, a crucial skill for civil servants is to make effective links between standard-setting, information-gathering and behaviour-modification or implementation. That link - or the absence of it - is central to the problem of policy effectiveness in modern government." I am interested because it says it is "central" but I could not understand what you were talking about. What are you really trying to say there?

Professor Hood: The point I am making is that in the inter-governmental world we are in today we tend to work in a world where standards are set in one place - typically in Brussels - the enforcement is often done in another place by another set of authorities, often local authorities; information about whether what is happening is good or bad is collected by another set of organisations. In that kind of world the key skill is how you bring those different bits together and what I am saying - perhaps in too circuitous prose - is that the key thing that makes Civil Service activity effective or not is their ability to do that and that is why I use the phrase "boundary-spanning", moving across these different jurisdictions and these different bits of machinery at different levels that do these different activities.

Q132 Chairman: Let us think in practical ways about how some of these activities might be done better. Given what we know about the environment in which the Civil Service now operates - which is different than the one in which it operated 50 years ago or even 30 years ago - if you are put in charge of a unit to improve the effectiveness of the British Civil Service what do you start doing?

Professor Talbot: First of all you have to ask the question: what do you mean by effectiveness? and there are a number of different roles for the Civil Service. The basic division usually used is the one between operations and policy making which partly relates to what Christopher was just saying. If we start off with policy making I think there are some interesting issues there. The tradition in the UK has been very much that as far as possible the Civil Service attempts to monopolise policy advice to ministers. One of the reasons why there has always been such friction between introducing political advisors or special advisors to ministers in the Civil Service is that the Civil Service see that as usurping their job of giving policy advice to ministers. They see their role as being very much having sifted all the evidence, weighed all the pros and cons and coming up with proposals to ministers which satisfy the political objectives of ministers. It seems to me that that is very different from a role of, for example hypothetically, the Civil Service seeing itself much more as policy brokers or policy facilitators where they were drawing on a much wider range of evidence, allowing ministers access to that evidence and not simply monopolising it to themselves. That has been supposedly embedded in a lot of the messages that have come since 1997 about improving the policy making process. I personally do not see very much evidence of that having happened yet. The Civil Service is very fond of words like "contestability" and "choice" at the moment (and the Government as well) but I do not see much contestability in policy advice, for example. There is still an attempt to monopolise.

Q133 Chairman: If we were to develop a contestable model of policy advice, what would that look like?

Professor Talbot: I think it would involve both the Civil Service having a more open approach to that which means that we would have, for example, a lot more green papers before policy was decided upon, hopefully involving Parliament in that process so that select committees like yourselves and specialist select committees would have much more opportunity to be involved in hearings pre policy being implemented, so you would have a much more open process in advance of these things happening rather than the way that things tend to happen at the moment which is that policy emerges fully-fledged from government and then everybody argues over it.

Q134 Mr Prentice: My experience is that we are all consulted to death on issues that do not really matter, but where it does matter the prime minister just makes an ex cathedra announcement.

Professor Talbot: I think that is probably true. I think you are right that there has been a lot of relatively superficial consultation around minor issues but on a lot of the very big policy issues about how we deal with education, health and criminal justice it has tended to be that policy appears fully fledged and we all argue about it.

Q135 Mr Prentice: Is that kind of dereliction of duty by the Civil Service that the Civil Service should not allow half-baked policy proposals to solidify into concrete policy intentions?

Professor Talbot: I am tempted to say "it was ever thus", that the model in the UK has always been that the Civil Service is the sole owner of policy advice to ministers and sometimes it has worked well and sometimes it has worked excruciatingly badly.

Q136 Chairman: Are you really saying that the Government should simply contract out of policy advice? That is one argument that is sometimes put, that the Government should say that it simply wants policy in a certain area and it asks people to submit them as we do in all kinds of other things. That would be a model, would it not?

Professor Hood: I think that one of the things that I have been trying to say in the paper I submitted to you and the longer documents it is drawn from, is that it is actually not possible for civil servants in most cases in most cases - certainly in any technical aspects of policy - to monopolise the sources of technical expertise. Definitely in the examples we looked at that was not the case but they do fulfil a very important role in brokerage in deciding what experts are asked to contribute and I think that is a very difficult skill for civil servants to exercise effectively. Often these consultation processes - as you hinted yourself - are very political and difficult to manage. However, if I can go back to your earlier question of what do we need to advance Civil Service effectiveness, one point that I did make in my paper is that if we look at the current competency frameworks that the Civil Service itself sets out for what it thinks are the qualities that make civil servants effective, they are cast almost wholly in terms of individualised qualities and our argument - or my argument with Dr Lodge - is that this is perhaps over-individualised and that much of the criticisms of the Civil Service and how it works are not about the individual brilliance or otherwise of particular individuals but their ability to work together effectively; the system, in short, that does that. If I had this very difficult job that you are asking me to take on, it would be that part of it that I would be trying to deal with, how you can get the working relationships better rather than necessarily changing the individual qualities of particular people.

Q137 Chairman: If we start off by saying that there is a distinction between things that we can do in terms of skilling the Service in a variety of ways or developing team competencies in the way you are describing, but there is also the issue of whether the structural frameworks are right. I think I what I would quite like to have you say something about - initially so that we can just clear the territory - whether you think there are some structural issues about how the Civil Service at all levels is presently organised which bears on the effectiveness question. Can we perhaps just get our heads round that issue to start with?

Professor Hood: There are large scale issues about the structural divisions between the different parts of the public service, whether that be local, central or what have you. If you accept my argument that the key problem in modern government is to bring the different bits of the public service together, obviously those structural divisions may not always be that helpful. If what you want to do to create maximum effectiveness is to be able to bring in the right kind of expertise when you need it for particular purposes, then I think that obviously there are some structural barriers but in our German/British comparison we found that the British Civil Service is doing much better than the German one in that respect, in that it was able to get in different kinds of expertise on different kinds of contracts in a way that was not available in the German structure.

Q138 Chairman: Was there a structural change contained in what you just said?

Professor Hood: What I was referring to was the ability to bring in individuals on different kinds of tenure to contribute expertise as and when needed.

Q139 Chairman: Are you suggesting that we might dissolve the Civil Service into a unified public service?

Professor Hood: If I were re-designing the structure from new I think I might well consider doing so.

Q140 Chairman: That is the kind of thing I am asking you about; that is the big structural thought that we would like you to have.

Professor Talbot: If we take a step back and look at what the whole of the public sector do and where the Civil Service fits into that, the Civil Service is roughly ten per cent of the entire public sector and of that ten per cent probably less than ten per cent of the Civil Service do the policy making and about 90 per cent of it is actually involved in delivering services very much like other parts of the public sector. It seems to me that that raises some fundamental issues about structures; that is an historical accident that evolved in that way. Most of those services have now been organised into executive agencies which is a very weak form of re-organisation into semi-autonomous bodies. That could easily be reconsidered to see whether or not they could be put on a statutory basis; I think there is a strong case for that, as are non-departmental public bodies and particularly some of the bigger agencies like the prison service so they are actually moved away from direct political management. That does then raise issues about their status and whether or not they are still part of the Civil Service because again we have this historical accident where we have large executive non-departmental public bodies which are not Civil Service but which do more or less the same things as large executive agencies which are part of the Civil Service. It is an accident of history that they happen to be in those positions. I think there is a good case for that, thinking about moving it out. I think there are also issues about the structural relationship between the Civil Service and the rest of the public sector. There is a very strong presumption from Whitehall that the rest of the public sector has nothing or very little to tell Whitehall about how to organise things and one of the most obvious ways in which that manifests itself is the very small amount of interchange that takes place between the rest of the public sector in the UK and Whitehall as opposed to other jurisdictions where it is not at all unusual for people to move from central government level to local government and back again. It is actually very unusual in the UK; it has become a bit better in recent years but not tremendously so. By and large insofar as Whitehall does want to move people in and out it is always from the private sector rather than the rest of the public sector. I think there are some issues around that. I think there are some fundamental issues about boundaries as well in relation to delivery of some services. Why do we have some benefits operations in local government - like housing benefit - and others in central government? Why can some of those things not be devolved more? There are certainly a lot of models around where those sorts of things do happen. In Denmark, for example, tax collection and benefit are at local government level; although policy is set nationally, the tax rates are set nationally and the benefits are set nationally, local government does the delivery. There are all those sorts of issues that we have had debates over in the past - the favourite has always been the health service about whether that should be devolved down to local level - but we have never really had a thorough look at the whole of the public sector, started with a blank sheet of paper and asked what would actually be a more sensible way of organising these things.

Professor Hood: One other point that is also mentioned in the paper that I submitted with Dr Lodge is the issue of how far you need to think about recruiting internationally to a greater extent than in the past. If you want a Civil Service that is the best in the world perhaps you should really be thinking about a more international pattern of recruitment than we currently see.

Q141 Mrs Campbell: If you were to do that, to bring in people on an international level or even from local government what sort of skills do you think that would bring into the Civil Service which they do not have at the moment?

Professor Hood: I think that one of the arguments for a more international pattern of recruitment is simply that you would increase the competitive pool from which you could draw talent. More specifically I think it might bring in perspectives, particularly about European government, that British civil servants are not terribly well-informed about. On the whole they tend to be pretty well up in my experience on the commonwealth structures but not usually so well informed about continental European structures of government.

Q142 Mrs Campbell: Does that apply to local government as well?

Professor Talbot: I think there are obvious advantages in bringing people in from other parts of the public service. This does not just relate to other parts of public service; there has been a long time problem with the senior ranks of the Civil Service essentially being people who have always worked in policy jobs and have never got their hands dirty actually running anything. There have bee attempts in recent years to try to improve that, but it is not actually terribly good. You still have a situation where the vast majority of senior jobs are in parent departments whereas 70 or 80 per cent of civil servants work in agencies with probably only about 20 per cent of the senior posts in agencies. I think that speaks volumes if you are a civil servant about where you want to be in terms of your career structure. So even within the Civil Service there is a prejudice still against actually being involved in operations management. To some extent the new professional structures that they are putting in place with the separate operations and policy professions actually codifies that and says there are two different roles. Obviously we have people in local government and the health service and various other local services that have tremendous experience about how to organise public services which could be brought into central government more effectively than it is at the moment. At the moment they tend to be drafted into specialist units. We have only had one example of somebody coming from local government into central government and ending up as a permanent secretary and he has now left. (I think we all know who that is.) That is a real problem I think and, as I say, there is a lot of interchange. I would just add to what Christopher was saying about international recruitment. I have not looked at the figures recently but certainly a few years ago the UK was extremely bad at taking up our allocation of places in the European Union bureaucracy whereas other countries like Ireland were extremely adept at making sure they had a lot of people in there.

Q143 Mr Prentice: I am a member of the UK delegation to the Council of Europe and I think the British Civil Service runs the show over there, which brings me to the point that Professor Hood made. You told us that the Civil Service ought to recruit internationally because there is an international talent pool, but just a few moments before you told us that the Germans paid tribute to the British Civil Service and their knowledge of European structures. How do you reconcile these two points?

Professor Hood: I do not think those comments are entirely incompatible. I quite take the point that you are making and I was trying to show you ways in which the Civil Service was admired when we interviewed people from Germany. However, I do not think that one should necessarily conclude from that that it is impossible for the Civil Service not to be able to recruit people from overseas. I think that is compatible with what I have said.

Q144 Mr Prentice: There are people out there who would say, "If it ain't broke, don't fix it", but we spend millions constantly reorganising, taking structures apart, putting them together again but it does not bring any substantial outcomes that are different from what went before.

Professor Hood: Yes, I am very sympathetic with that view myself. I think what you need is sustained policies pursued over time. I do agree with that and I do agree with you, if this is what you are implying, that one of the real problems with Civil Service reform is that particular ideas get taken up, run with for a while, not really followed through and then dropped before the next thing comes along. Again, if you are putting me in the position of trying to direct this show, I would want to try to do something that was sustained over time and was not just a short term initiative.

Q145 Mr Prentice: Can I just go back a stage because you were talking about the perils of closed policy making in the Civil Service - those are my words, not yours - but can you tell us of some major policy blunders that were the result of the Civil Service playing its policy cards too close to its chest?

Professor Talbot: The most recent one and probably the most controversial is in the Butler inquiry. The evidence there is quite clear that there was a degree of group-think going on between not just civil servants - by which I include the intelligence agencies - but politicians as well. That is a very clear example. I can think of others: in the setting up of the CSA (Child Support Agency) there was some scrutiny of the policy but there was never any serious look at the thinking behind setting it up as a separate agency, yet it was obviously a disaster from the start. I can point to the reason why it was a disaster and if anybody had bothered to ask anybody outside the Civil Service about whether this particular model would have worked as a way of organising that function, I would have said no at the time and I suspect a lot of other people would have said that this was likely to fall flat on its face.

Q146 Mr Prentice: So if you ask the right questions then there will never be any policy disasters.

Professor Talbot: I am not saying that at all. I am saying that I think if you open the process up to greater scrutiny there is a better chance that you can avoid disaster. It does not mean it is not going to happen; there are always going to be mistakes made. We are very bad at opening up those sorts of processes.

Q147 Mr Prentice: What about foot and mouth or BSE that cost the nation billions of pounds?

Professor Talbot: I was talking to somebody who was involved in one of the foot and mouth inquiries who said that when they finally got hold of a copy of the 196-whenever it was report they read through the list of recommendations and concluded that if those recommendations had ever been implemented we would not have had the problems we had with the second outbreak. I think that is a pretty good example of where Whitehall is not always terribly good at following through all these things.

Q148 Mr Prentice: You have it in for the Civil Service and you would like to see a unified public service.

Professor Talbot: No, I do not have it in for the Civil Service; I have great respect for the Civil Service and for a lot of people who work in it. I think the system as an institution is to some extent broke in the sense that it is a very hermetically sealed system. I think there are fundamental constitutional issues about the role, the Service and its attachment to government. It is not open, for example, in the way public servants in local government are open to scrutiny by other people. I think some of those things need addressing quite fundamentally. I do not think at the moment, for example, that the draft Civil Service Act actually deals with some of those fundamental issues.

Q149 Mr Prentice: But neither you nor your two colleagues are calling for a unified public service.

Professor Hood: I would like to say that as a long term goal there is a lot to be said for that. I am not saying that it should be done overnight but I do see potential advantages in that.

Q150 Mr Prentice: We had a memorandum from the Civil Service Commissioners and they tell us that bringing everyone together - that is welding together the Civil Service, local government and the rest of it - could lead to confusion about role, purpose and loyalty and they question whether the creation of a single service would be possible. However, you are telling us that it would be possible and in the longer term it is desirable; it is something that you would argue for.

Professor Hood: It is possible in the sense that in the German state you do have a single public service which works for different elective authorities and different parts of the state so somehow or other they do resolve the loyalty problems.

Q151 Mr Prentice: Are people better governed in Germany as a result?

Professor Hood: I would say that in some respects they probably are, but I do not want to argue that in all respects they are.

Dr Lodge: It has been a long-standing tradition in a couple of government departments to only recruit from other administrations so in that sense you do not recruit straight from university some large scale of your population of ministries, but you take the best talents who have already been on the receiving end of federal legislation, know how to transpose it and have seen implementation of that on the ground. In that sense you have the result of that kind of system.

Q152 Mrs Campbell: Turning to the skills agenda and coming back to what sort of skills you need to be a civil servant, many civil servants were probably recruited some years ago and in this hermetically sealed environment they maybe have not had the time or the opportunity to develop their skills. Would you like to comment on that?

Professor Talbot: First of all we have to be clear about what we are talking about by civil servants. What we are talking about here I suspect are not the civil servants as a whole, we are talking about people who work in the Whitehall Village, the senior civil servants and those involved in the policy making side of things; we are not talking about prison officers and so on. The salient characteristic of the British Civil Service is that most senior civil servants have been historically recruited with a first degree and have no further degree qualifications. They receive a certain amount of in-house training. That has by and large been fairly weak for senior people and they have acquired their skills by the traditional "sitting next to Nellie" approach of acquiring skills as senior civil servants. As a consequence, because of the whole generalist tradition and that way of recruiting and training people up, we have people who are often very, very intelligent, extremely good analysts, but their educational qualifications and their qualifications in things like formal policy analysis and formal evaluation techniques and understanding those sorts of issues tends to be very weak. That is still the case compared to other jurisdictions where we have relatively highly qualified people in those sorts of senior Civil Service jobs.

Q153 Mrs Campbell: Moving on to service delivery, these are the areas that affect us most as members of Parliament because we have constituents who suffer the consequences of policies that are not well delivered, like the CSA for instance. Certainly there is still a substantial proportion of people who come to my advice surgeries who are victims of the failure of the CSA. We do often fail to deliver these important services. Are you saying that because something like the CSA was faulty from the start and was not set up properly, one cannot blame civil servants for that kind of failure? If so, what about other things like, for instance, tax credits? There was a time when the Inland Revenue took over the issue of tax credits and it was a complete disaster.

Professor Talbot: The answer to the question of who do you blame I think is we do not know because we very rarely know in our system who is actually responsible for the decision or the police advice that was given because we have such a non-transparent system. A report was published this morning on the e-university fiasco. It is very unclear in that as to who actually was responsible. It was clearly driven by the suppliers but whether or not it was the civil servants or the politicians who were responsible for accepting that position I have no idea. The problem about scrutiny I think in our system is that because there is this almost indissoluble link between politicians and civil servants, civil servants very rarely get scrutinised properly in the way in which they are in some other jurisdictions.

Professor Hood: I do not have that much to say about the service delivery aspects as such because my study was on policy making skills, but I would only venture to say that many of these failures - certainly the two to which you have referred - as I understand it are failures that go back to the information systems that were selected for these organisations and the problems that were associated with that, so that the front line civil servants that your constituents deal with may well have been doing their best with information systems that were not easy for them to use or perhaps properly fitted for the job. Therefore I think you need to look at the process by which those kinds of systems get selected and developed, which is indeed a policy making role and where indeed you do have issues about how you select effective information systems that are fit for purpose.

Q154 Mrs Campbell: You have digressed onto another of my favourite subjects, but before we move onto information systems could I just clarify what you were saying, Colin, about not knowing whose responsibility it is when things go wrong. Do you think there is a strong case for having a much better analysis of failures so that we can learn from those failures because that does not seem to be happening at the moment?

Professor Talbot: There are several issues on that, the first is the constitutional point that our Civil Service, in Lord Armstrong's famous phrase, has no constitutional personality separate and apart from that of the government of the day. That is very unusual in most democracies and it makes them into what I jokingly call "serial monogamists"; they are not neutral in the sense that they are neutral and independent of the government, they are very much wedded to whoever is in government at a particular time. Because accountability goes through ministers to Parliament without any direct scrutiny of civil servants themselves and because they only give evidence at least formally to Parliament on behalf of ministers, it makes it extremely difficult to scrutinise where the decision points were where things actually went wrong. How do you get at that? I think one is that you could change the rules - the motherly rules - which mean that civil servants only speak on behalf of ministers so that they could actually be interrogated by Parliament directly in a way in which they could actually answer for themselves. In practice that has happened with a lot of the agency chief executives who have spoken out quite clearly on issues which have not followed the ministerial line. Secondly, you could change the role of the National Audit Office so that it could investigate in a way in which the General Accounting Office does, for example, in the United States, in a lot more detail. You could then start to prise that open a little bit and start to understand where these mistakes are actually being made. One of the things that is quite clear about the British system is that we are appallingly bad at analysing when there have been disasters and teasing out what actually went wrong. There are certain examples elsewhere where other jurisdictions are much better at doing that than we are.

Q155 Mrs Campbell: A good example seems to be the CSA because when it was first put together in 1993 it never worked, it was a complete disaster so we redesigned it and lo and behold we have another complete disaster so we certainly have not learned from that example. Can I just move onto IT systems? It seems to me that one of the problems with IT systems is that we do not properly evaluate what the requirements are before companies ask to develop them. Whose fault is this? Is this because we have not adequately defined policy? Or is it because we have a Civil Service which does not know how to analyse the requirements? Or is it that the commercial contractors actually have an incentive for it to go wrong because then they get paid to put it right? Is it all those or just some of them?

Professor Talbot: Having dealt with a large IT project in local government when I was there many years ago, I have to say that your last point about the IT contractors, I remember being told by a large IT contractor that they love detailed specifications from government - the more detailed the better - because they could guarantee that they would make a lot of money on all the variations to the contract and they were quite happy to bid for next to nothing for the initial contract on the grounds that they would make all of their money on the contract variations. That is a hazard in the public sector because of the way in which we do competitive tendering. I cannot see an easy way round that; it does seem to be a fairly common problem and it is not just a problem in the UK. I think there are some problems which are generic and certainly Peter Gershon's evidence to you pointed that out, that there is quite a dismal record across quite a lot of OECD countries of failures in IT projects in government and in some large private sector organisations as well. However, I do think there is specifically in the UK a weakness in terms of understanding, certainly understanding IT at senior civil servant levels and also project management skills and procurement skills; I think there is clearly a weakness there which needs to be addressed. There are not enough people who are properly trained in those things. I know individuals who have gone from being a head of personnel in one Civil Service department to be head of procurement in another with absolutely no background whatsoever in procurement before they went there, then they are suddenly in charge of millions and millions of pounds' worth of procurement projects with no training at all.

Professor Hood: I would add to that that IT systems of this kind, as complex projects, take a good deal of time to develop and during that time all kinds of things happen: governments change, the personnel within departments and agencies change as well. The lead time of the project is a very long time in politics and the bureaucracy and it would not be surprising if specifications start to alter.

Q156 Mrs Campbell: One of the problems that we do seem to have on projects like Airwave, for example (the communication system to bring together the police, the fire services, et cetera) is that the project is so massive and has been on-going for such a long time that the initial solution to the problem has actually changed and yet we are only half way through implementing it. Is there an answer to that? All government projects are likely to be big and take years to develop and in that time not only has the technology changed and there may be a different solution, but the requirements have probably changed as well. What is the answer to that?

Professor Hood: I am not sure that I think there is a single one shot answer to that. I started my career studying tax administration over 30 years ago, well before the age of modern computers, and exactly the same kind of thing tended to happen. I do not want to portray myself as an expert in IT systems - I have colleagues who are and would be better equipped to take you through these particular issues - but let me only say that some of those claim that these problems are exacerbated by the lack of open source software in IT systems which makes it extremely hard for other contractors or indeed any outside party to understand the operating code that is involved. Certainly there are professors, for instance, at the Kennedy School of Government at Harvard University who argue that governments ought to move more generally towards open source software as a means of at least ameliorating this problem. I quite take your point that it probably cannot be completely removed.

Q157 Mrs Campbell: We are doing completely the reverse. Through Europe we are trying to slap patents on all the software.

Professor Talbot: It is not my field of expertise but I do think there is an issue because there always seems to be a presumption that big is beautiful when it comes to IT systems and it seems to me that is not necessarily always the case. If you are talking about long term development to end up with something that is unified there may well be a case for piloting several different types of systems and seeing which one actually works and different areas and then spreading that eventually with less of a risk than these huge projects which cause problems because of the cycle times of these things. You can end up designing something for a war that has gone away.

Dr Lodge: May I just add a German example of what may politically be regarded as a fiasco but it works perfectly fine now. It is the Toll Collect system, a road haulage charging system where government got some very sophisticated technical system developed by two large scale German companies - strangely enough - but required this system to come up very early in order to fill budgetary deficits. It was too ambitious and therefore caused a political fiasco. However, one year later the system works perfectly well. In that sense you have a technical system which works and politically is regarded as extremely desirable as such.

Q158 Mr Heyes: We have got this far without mentioning Gershon so this is an opportunity for you to share your thoughts about him. Is it appropriate? Does it go far enough? Can it deliver?

Professor Hood: Can I say that I thought it was very interesting that we are re-introducing specific job cut targets for the Civil Service almost exactly ten years after the last conservative government abandoned them. My understanding is that that government abandoned them because they were getting in the way of effective management and, as I understand it, the problem was that Civil Service managements struggling to meet job cut targets were doing that in a way that did not necessarily lead to more effective management. For example, they might hire more consultants, more expensively than the civil servants they were firing to meet the targets. I think that kind of problem is always going to be with you if you have a specific job cut type target. The other comment I would make is that I spent some time analysing the job cut targets that existed under the Thatcher and Major governments and a large part of those job cuts were achieved by outsourcing the so-called industrial Civil Service, the blue collar Civil Service and the scope for that has almost gone because that bit of it hardly exists. I think again this time it would have to be different for these job cuts to succeed.

Professor Talbot: First of all I have an interesting historical I was going to say parallel, but it is the wrong word, paradox is probably better. In 1979 when Margaret Thatcher came to power the first thing she did was to appoint an efficiency scrutiniser and they tried efficiency scrutinies for about five or six years and discovered that of roughly £600 million pounds' worth a year of savings that they had identified only about £300 million were being delivered. They did a review of all of this which was eventually published as something called the Next Steps Report Improving Management in Government so they switched from doing efficiency scrutinies to doing a systemic change of creating executive agencies and putting all the technology and agencies in place. What is interesting under the Labour Government is that we have done almost the reverse of that process. We started off with the systemic change of introducing the comprehensive reviews and public services agreements and a whole series of planning mechanisms to try to make the system work better and six or seven years later we seem to have decided that it is not working terribly well and we now need Lyons and Gershon to come along and find out why all these planning mechanisms did not produce savings. I am very sceptical about what Gershon has actually said about all that, but I do think that is an interesting switch around in terms of priorities. In terms of Gershon itself I read his evidence to you with great interest and at the end of it I was totally confused as to whether the purpose of the Gershon review was about delivering efficiency savings or identifying efficiency savings. Certainly the way in which it has been portrayed, the way in which the report is written is all about identification of efficiency savings. I think it is absolutely astonishing that it was months after the report was published that he finally admitted in the Economist that the base line for this two and a half per cent saving per year that he had identified was zero. In other words, they were assuming no efficiency savings. Given that if you look through most of the departmental plans they have built in usually about two per cent efficiency saving targets somewhere lurking around, this two and a half per cent does not sound quite so impressive once you do that. I think that is quite astonishing, first of all. He seemed to admit that in the first half of his evidence to you when he said that this was really all about delivering efficiency savings that the departments have been very good about identifying in the past but they have never actually delivered them. If it is about delivering then I have grave doubts about it. I agree with Christopher's comments about the head count issue but again if you go back to the parallel with the Next Steps programme, the Next Steps programme was implemented by putting a second permanent secretary in the Cabinet Office reporting directly to the Prime Minister to make all of this work. With great respect to John Outon and the Office of Government Commerce the same impetus is not there behind these Gershon savings. If I were being really cynical -as I was accused of being at the Treasury Select Committee last year - then I would say that I would be surprised if we heard much about Gershon after 6 May.

Q159 Mr Heyes: That is the price of operating in a democratic system where electoral considerations have an impact; that is the reality of the world we live in.

Professor Talbot: I think that is true. I am disappointed at the detrimental affect that that may have on public servants because there are an awful lot of people out there scared about their jobs, it has a demoralising effect on people who are not going to lose their jobs. It re-creates this message that the public sector is inveterately bad at organising things, which I do not believe for a moment. I think there are always problems as there are in any big organisations and you have to find ways of dealing with them. I do agree with Peter Gershon that it is always a mixture of systemic ways of dealing with it and episodic attempts and campaigns to try to identify savings and make them. I would say that one of the things that I do not think he has done at all and nobody seems to have addressed is that if the whole comprehensive spending review process and PSAs have failed so badly that there are these huge savings to be made, what is wrong with them and what do we do to put them right?

Dr Lodge: As a German case we do not have these kinds of issues because of federal government. Since German unification we have a smaller federal bureaucracy than we had and every year there is a cut back of about two per cent total staff in each ministry which is regarded as pretty tough and pretty disillusioning on junior staff.

Q160 Mr Liddell-Grainger: Can I ask some specifics on one or two people? Harold Wilson, just before he retired, called the Civil Service together and asked if there was a case to split the job down the middle so that the cabinet secretary and the Civil Service were split. Is that good or bad?

Professor Talbot: I think that actually raises the issue about whether you split the Civil Service down the middle. It is about this difference between policy advice and running the Civil Service in terms of it being a service delivery organisation with slightly more than 500,000 employees in it. In terms of the centre of government I am not sure whether splitting the role of the head of the Civil Service and the cabinet secretary is that important. I think there is a much bigger issue about the whole organisation at the centre in terms of the Treasury and Cabinet Office and Number 10 and the way in which policy is made within that nexus. I think there are real problems there.

Professor Hood: This has been done, of course, in the past and the reason why the case was made for bringing these two roles together was that by locating these two roles in different individuals you had things that fell through the cracks between them. That, I think, was the argument for bringing these two positions together. We have been around this track before and there is a historical experience of it.

Q161 Mr Liddell-Grainger: Moving on a little bit further, Sir Andrew Turnbull said that he was, and I quote, "fed up with outsiders attacking the generalist culture"; he was talking about generalists and specialists and he wants that blurred. This is all part of it; it is the bigger picture. You rightly pointed out that it is the policy making, the Treasury, et cetera which at the moment does not seem to work because you have the gifted amateur and the professional. Sir Andrew then goes on to say that it is all part of the 1988 Next Steps programme as a sort of extension - which I do not actually think it is - but is that an idea which is actually Civil Service speak for actually having to do nothing.

Professor Talbot: I suspect it is to some extent. I think the recognition of the two main professional groups that they are now describing as the operational managers professional group and policy makers professional group is obviously a continuation of the ideas behind the Next Steps programme, although it was never as simple as that and there were always policy making people in the agencies (or at least in some of them). However, the reverse was not necessarily true and there has been a very bad experience I think of transferring people who have been good at operational management and delivering services into policy jobs in the centre. That is still extremely weak. In that sense the centre has not changed that much I do not think; it is still very much the Whitehall Village that was described 30 years ago by academic colleagues and investigators then.

Q162 Mr Liddell-Grainger: Is Sir Andrew Turnbull crying wolf: "I want this to happen, I'm fed up"? Are they crocodile tears?

Professor Talbot: I am not privy to the sorts of discussions that go on in Whitehall but my guess would be that the Prime Minister is extremely unhappy with "delivery" (in inverted commas); it is not happening as well as he would like and I would expect a third term labour government will want to change that. I have seen that the Civil Service is to some extent getting the blame for that and I think there will be an attempt to change things. I suspect some of what is going on is a pre-emptive move by the Civil Service. I cannot believe it is a coincidence that you get that sort of initiative at the same time as three previous heads of the Civil Service make statements attacking policy making in government, the role of politicians in government and defending the Civil Service.

Q163 Mr Liddell-Grainger: I think Nick Montagu made it quite clear. Do you want to add anything to that?

Professor Hood: Only to say that I think this particular role of Cabinet Secretary and head of the Civil Service Professor Talbot's argument that civil servants are only there in a delivery role starts to become limited because there are constitutional duties, as it were, associated with this position. If, for instance, the election that is expected later this year produces a hung Parliament then it will be the person in this position together with one or two other individuals who will advise the monarch on what to do in those circumstances. That is not just a servant agency; it is a constitutional role of obviously key importance. Similarly the issue of the rules about what counts as party political activity and the activity of the Government, ultimately these are very perplexing issues but that is what the cabinet secretary has to cope with. This is a position which combines, as it were, some constitutional features along with being a chief executive type of role. It is difficult to hold these things together.

Professor Talbot: I am not saying those roles do not exist; I think they do. I think I am beginning to be persuaded - I am not entirely convinced about this yet - that actually what Next Steps originally intended to so (which was actually to separate the Civil Service into two completely different chunks, one which deals with policy advice and the constitutional issues and all of that and another bit dealing with service delivery). The arguments against that have always been about policy makers losing contact with the delivery aim. I do not think they have very good contact with the delivery end and I do not think it necessarily puts a barrier in the way. If you opened up the Civil Service policy making processes and also the exchange of staff in the way in which I was suggesting earlier, then I think those sorts of things could easily be overcome. We have tried all sorts of things over the last 25 years to try to change the culture of Whitehall and I really do not think it has changed that much for all of these attempts that have been going on. I think that is really something that needs shaking up quite dramatically.

Q164 Mr Liddell-Grainger: Following down that line, the head of the new policy unit is going to be Sir Brian Bender of Defra, the man responsible for BSE, CJD, TB, ESA payments which have gone wrong; the list goes on. It is the second worst performing department I think after Pensions; an interesting choice to head policy. Do you think that is a fair synopsis?

Professor Talbot: I do not think you can personally blame him for BSE.

Q165 Mr Liddell-Grainger: No, but he was responsible for trying to sort it out. Certainly foot and mouth you can. Gordon brought it up very eloquently that the Northumberland report ended up being leaked which I thought would be fairly open policy. Is that the right man, do you think, to head policy?

Professor Talbot: I could not comment.

Q166 Mr Liddell-Grainger: Moving onto special advisors, there has been an enormous increase in special advisors. We have done a report on it in this Committee. Do you think the role of the special advisor within policy making is the right mechanism or is it a system which really needs to be completely overhauled?

Professor Hood: I think that you find a role of this kind in most parliamentary democracies and this is rather a small number of politically appointed civil servants compared to what we see in other comparable countries. Indeed, I think there are people who have questioned whether we even have enough of these people rather than too many. I have met and talked to a number of career departmental civil servants who have no problem with the notion of special advisors and recognise that they bring particular backgrounds skills and a particular role to the job which they value. I do not think there is an in principle problem with having a political Civil Service of that kind. I think that obviously there are issues about how well the roles are defined, but I am not sure that it is obvious that Britain has too many of these, certainly there are far fewer than there are, for instance, in Germany. I do not think also that it is necessarily the case that despite these well-publicised examples you have given, that they always lead to major friction with civil servants.

Q167 Mr Liddell-Grainger: Is the reason in Germany that you have more political parties making up the government? Secondly, are they constitutionally enshrined? As you know, we also brought forward a draft Civil Service Bill to try to bring a lot of this up to fruition. The third point about Germany, who is responsible for looking after them? Is it the Civil Service or is it the government of the day?

Dr Lodge: The minister is responsible for the advisor but not only the minister; if you are a junior minister you are responsible for your personal advisor. That basically means you bring in someone from your party with a party background. The second trend in Germany is that you have increased the role of young party background people coming into ministries to monitor a democratic administration. These people who later become civil servants there is a well-established role of reward where if you were a personal advisor and you rewarded the minister or the parliamentary secretary of state or the state secretaries of the junior minister, then you are often rewarded by a permanent civil service post afterwards which however is not constitutional. The role of these people is also not constitutional so official traffic has to go to the civil servant permanent state secretary. These people only have informal powers of calling on civil servants.

Professor Talbot: The point I was trying to make earlier is that the role of the civil servant in the UK in relation to the Government is so much closer to government and so much less either legally or constitutionally separate and independent from government than it is in a lot of other countries. I think that is actually what produces some of the conflict and friction when you bring in policy advisors. If you listened to the programme last week, the revival of Yes, Minister, the whole point about that little episode where Hacker comes into office and brings his political advisor with him and the first thing the Civil Service do is say, "No, the Minister has lots of people to advise him now; you can just wait out here in an antechamber". I think that actually symbolises the real problem which is that there is such a close symbiosis between the senior Civil Service and the government of the day in the UK system that the space for political advisors is actually relatively small within that. In other countries it is much clearer where there is a clearer division between civil service and the politicians part of the government and the role of political advisors is much clearer in those circumstances. I think that is partly what generates the friction in the UK.

Q168 Mr Liddell-Grainger: How high up do you think somebody could be brought in from industry? Could they come in at permanent secretary level? Or would it be a junior role? Do you think somebody from industry could be a permanent secretary?

Professor Talbot: From the private sector probably not, but the way you pose the question is interesting because that is the way the question always gets posed in the UK. In Whitehall we have this thing called The Whitehall and Industry Group which is responsible for doing interchange between Whitehall and the private sector. They do not even think about the interchange between Whitehall and local government, for example. There are plenty of people in local government who could be brought in at a permanent secretary level.

Q169 Mr Liddell-Grainger: Would you advocate that?

Professor Talbot: I would certainly advocate a much greater level of exchange in both directions between Whitehall and local government and now the devolved assemblies as well.

Q170 Mr Heyes: My reservation with that idea is that local government officers are pariahs. The government policy seems designed to emasculate and dismember local government. Are you seriously saying we should be trying to find ways of pursuing this?

Professor Talbot: Absolutely. We have had one good example - but only one - where somebody who was a local authority chief executive, Mike Bichard, came in first of all as an agency chief executive and then as a permanent secretary. Most people think he did an extremely good job so it obviously can be done. What is interesting is that he is the only case that I can think of of somebody coming from local government into that sort of role. He is even, I think, the only person who has come from an agency chief executive role into being a permanent secretary, so even with the Civil Service there is a serious problem.

Q171 Mr Prentice: Can we just stick with this because I was rather taken with what you said earlier about the relationship between senior civil servants and the government of the day and serial monogamy. Does that mean that the senior people just cannot say "no"?

Professor Talbot: I think like any marriage there is probably a certain amount of negotiation going on over specific roles. The point I am trying to make is that it is a very tightly organised arrangement whereas in many other jurisdictions senior civil servants are also accountable to the legislature, for example, and can be scrutinised by the legislature in a way in which we do not do in our system.

Q172 Mr Prentice: You have been giving me the impression that the problem is that the senior civil servants just roll over.

Professor Talbot: No.

Q173 Mr Prentice: Is that not the case?

Professor Talbot: We do not know for certain; there is not enough evidence about exactly what does go on. I suspect there are cases where that does happen and I expect there are cases - and I know of individual cases - where permanent secretaries have stood up to ministers and said, "No, Minister".

Q174 Mr Prentice: Can you tell us about those?

Professor Talbot: No. I have been told in confidence about some of these instances.

Q175 Mr Prentice: You need not name names.

Professor Talbot: I can think of an example of a ministry which had just been through a big internal planning exercise, had a set of plans about what it was going to do which had been approved by the previous minister; a new minister comes in and says that he wants to have a ministerial action plan of his priorities and the permanent secretary has said, "No, Minister. Go back and re-do the plans for the ministry as a whole in order to incorporate them, but we are not having two different sets of plans for the ministry". To the politician's credit that advice was accepted. I do not know how much that happens; there is not enough evidence about that sort of thing.

Professor Hood: One of the realms in which this can happen - and we know sometimes does happen - is in the role of permanent secretaries or their equivalents as accounting officers in which they are independently accountable to Parliament for the legal spending of public money and we do know that there are instances in which permanent secretaries and accounting officers have declined to spend public money according to ministerial instructions.

Q176 Mr Prentice: It does not happen very often.

Professor Hood: No, it does not happen very often but we know that it happens sometimes. Again, you will excuse me if I do not name names, but civil servants to whom I have spoken have indicated that they have raised that issue from time to time in their careers.

Q177 Mr Prentice: We will have Sir Andrew Turnbull in front of us a week today. Is it the case that permanent secretaries are part of the problem?

Professor Talbot: I think the culture at the top of the Civil Service is part of the problem, about the whole way in which the whole senior Civil Service is recruited, trained and inducted into the culture of Whitehall, and the lack of training and lack of going out into the rest of the public sector. I would be very interested to see a senior civil servant sent out and asked to run a local authority for six months as a chief executive or a deputy chief executive and see the experience that that would give them. I do think there is still a problem. It has got better over the last 15 years; there are more people coming in from outside; there is slightly better training. There is certainly more diversity in recruitment to the senior Civil Service but I still think we have an awfully long way to go to get away from the predominant model of Oxbridge, fast stream, straight into the top.

Q178 Mr Prentice: And it lets the country down, that is the impact of what you are saying. When I asked you to identify policy blunders at the very beginning you mentioned Butler and Iraq. Do you think that was a very serious dereliction of duty by the senior Civil Service?

Professor Talbot: I am not saying one way or the other; I am saying what Butler said. Butler's conclusions seem to be that there was a group-think creeping in and that is one of the problems about the closeness of this relationship. Butler was on that Yes, Minister programme last week which William Hague did and one of the things that I thought was rather neat was his description of sitting with the minister waiting for the outcome from the Arms to Iraq Inquiry, the Scott Inquiry, and the civil servant and the minister were sitting there together waiting to write the reply to the Scott Inquiry. In a sense that is a picture of the relationship between the senior Civil Service and ministers in the UK. Yes, there is always a tension and in certain circumstances senior civil servants will say no to ministers, but generally speaking they have a very close relationship.

Professor Talbot: First of all, I am not sure that it is true that there is a single type of permanent secretary, certainly in interviews I have done in Whitehall. It has been put to me that permanent secretaries can operate very different styles; some are obsessed with policy and would really like to be ministers; others are more concerned with shepherding their sheep, as was once described to me. That is one point I would like to make. The other point that I would want to make would be structural or constitutional and this might come back to your point in that if a senior business executive were to come into the role of permanent secretary he or she might be surprised by the fact that they are not really able to sign off on policy in a way that can sometimes happen in other comparable systems, so this is a role that in some ways seems very powerful but in other ways is limited.

Q179 Mr Prentice: They can sign off in some kinds of policies, can they not? Internal management of the departments and so on, but we cannot have civil servants deciding whether the country goes to war or not.

Professor Hood: No, I would agree with that.

Q180 Mr Prentice: We have had a memorandum from the Civil Service Commissioners and they tell us that there is a need for a greater clarity about the respect of rules and responsibilities of ministers and permanent secretaries in the management of departments. Are you surprised by that statement?

Professor Hood: I think that it may well be that, certainly according to interviewees I have spoken to, there has been a tendency - so those interviewees have told me - over the past couple of decades or so for ministers to demand more in the way of management ability from permanent secretaries.

Q181 Mr Prentice: Then why do the permanent secretaries not say no, that is not their job?

Professor Hood: Should they do that?

Q182 Mr Prentice: Well why do they not?

Professor Hood: The permanent secretary might well do so but I think that it may not be quite so well understood in the past, that is my point. There is a demarcation of roles and that may be what is behind that memorandum that you have.

Professor Talbot: There is a lot of variability in that and most of the evidence is that you get some ministers who are extremely laissez-faire towards the internal micro-management issues and some who are extremely hands-on and want to get involved in the detail. Derek Lewis's account of the differences between Ken Clarke and Michael Howard as Home Secretary is extremely illuminating, where one was very much hands-off and allowing the director general of the prison service to get on with it with a broad framework and the other was extremely hands-on and involved in a lot of micro-management issues. I think there is plenty of evidence that that is the case. In general there is always this tension between ministers wanting not just to set broad policy and broad resources and targets and allow civil servants and public service organisations to get on with it, but actually wanting to get involved in the details of implementation.

Q183 Mr Prentice: When Sir Andrew Turnbull comes before us next Thursday, should I tell him to get a grip and make sure that permanent secretaries say no to ministers when ministers are trying to encroach on their territory?

Professor Talbot: It depends. I interviewed Sir Robin Butler about the arrangements for the Next Steps agencies about ten years ago and I asked him about the fact that despite the fact that agencies had framework documents which laid down the government's arrangements for the agencies and what ministers should and should not be involved in and so on, there was plenty of evidence of ministers intervening in all sorts of operational decisions which they really should not have been involved with. Robin Butler's position at that point was that that is the constitution of the UK. Ministers are accountable to Parliament for everything that goes on within their ministry and therefore they have a right to intervene in every issue. I do not know whether that doctrine has changed at the top, but I suspect that it has not.

Mr Prentice: You have just reminded me of Norman Fowler's book Ministers Decide. Has anyone read that?

Q184 Chairman: I am not even sure that Mrs Fowler has. Colin, you are arguing very much that we should get more access to what civil servants get up to. They should be scrutinised far more openly and directly and that bears on this last point about political responsibility. Surely we want it both ways, do we not? We want ministers to be accountable for what goes on in their departments and we see the dangers, do we not, that if we simply had civil servants being trotted out so that ministers could say, "It wasn't me, it was the chap in my department who screwed up" that would let ministers off the hook. What would be the gains that we would get from opening up civil servants in that way?

Professor Talbot: I do not think that you would get rid of problems about who is directly accountable entirely; that is always going to be a problem. To some extent the creation of the Next Steps agencies has opened it up a little bit and there are obviously gains to be made with that. The Derek Lewis affair is a very good example; the CSA is another example actually where we have gone through several chief executives who have carried the can for what I think are policy failures which are the responsibility of senior civil servants and ministers. You will change the game; you will change the way in which these things are dealt with. One of the big differences is that it will be much more publicly accountable and we will be able to see what is going on, you will be able to see what is going on and you will be able to investigate a bit more. That will not stop people trying to hide behind, shift the blame and all the rest of it. That goes on now anyway, but at least we will be able to see a bit better what actually does happen.

Q185 Chairman: And you were not worried about the loss of political accountability?

Professor Talbot: I do not think there is necessarily a loss of political accountability. You might actually be able to pin people down more. In the Derek Lewis affair if Parliament had actually carried out its role then Michael Howard would have gone as well because if you go through the documentation it is absolutely clear that everything that Derek Lewis got the blame for Michael Howard had signed off.

Q186 Chairman: At the moment ministers get into deep trouble if they try to say, "I am not responsible for what happened; actually it was the responsibility of this civil servant".

Professor Talbot: That is exactly what Michael Howard did say. He said, "I am responsible for policy, Derek Lewis is responsible for operations". This was an operational failure; Derek Lewis got sacked.

Q187 Chairman: That was in the context of the agency issue. You are wanting to extend this more generally so that there is visibility and accountability for policy of particular civil servants and I am asking if there are going to be great dangers in that too?

Professor Talbot: Not necessarily. If civil servants give policy advice to ministers it is up to the ministers to decide whether or not they accept that policy advice. You cannot blame the civil servants for the policy advice being wrong at policy advice level. You cannot blame civil servants for giving faulty policy advice. At the end of the day it is up to ministers to decide and I think you can blame ministers if they have not taken other sources of policy advice. I think part of the problem in our system is that we do have this hermetically sealed policy system where it is actually very difficult for other policy sources to get into the system.

Q188 Chairman: So far as the Civil Service is taking steps now to identify policy responsibilities far more clearly so that people take responsibility for particular programmes and are held to account in a managerial sense, surely that meets the objective that you do not have the diffusion of responsibility; you have very clear management responsibility put in. That is what we surely need to achieve. We do not need it in the way you describe it where there is the loss of political accountability.

Professor Talbot: I do not agree that there is necessarily a loss of political accountability.

Q189 Chairman: You mentioned in passing, Colin, that you thought the real issues were to deal with the nexus between the Cabinet Office, the Treasury and Number 10. I would like to know what you mean that the real issues are to be found there. What are the issues and what do we need to do about it?

Professor Talbot: I think it is essentially an issue about coordination of policy between those and who drives policy. My colleague, Sue - who is sitting behind me somewhere - made this point to the Treasury Select Committee some years ago: you do not put the finance department in charge of policy; the finance department is there to help facilitate policy, it is not there to run it. I think part of the problem we have always had in the UK is that the Treasury has had an extraordinary role in the policy making process and I think that has got much stronger in the last eight years, and certainly that is a view within Treasury and within Downing Street and the Cabinet Office as well. The policy making capacity of both Downing Street and the Cabinet Office is not - as some people have suggested - too strong; I actually think it is too weak. I think the capacity to actually shape policy and drive it from the centre is actually fairly weak in our system.

Q190 Chairman: Would this be remedied by a fully-fledged prime minister's department?

Professor Talbot: I do not know whether we need a prime minister's department; we certainly need something stronger than we have at the moment. I suspect some people think it might be remedied by the current chancellor moving into Number 10 and taking some of those powers with him.

Q191 Chairman: We had the question earlier about special advisors and all that, but do you think if we increased the amount of politically appointed people for central government - as we have heard is the case in other systems - that is liable to increase the overall effectiveness of what the Civil Service does?

Dr Lodge: That was part of a Germanist question, may I say. As a political civil servant I spoke earlier about personal advisors. In Germany they are 99.9 per cent people who have an administrative career behind them so they combine the political rationality of a party but loyalty towards a particular faction of the particular party plus an understanding of what an administration is about. In that sense you do not get an in and out system of people who have never seen a bureaucracy and do not know how to lead it. They have considerable experience and bringing in people who have no idea would not occur in that sense.

Professor Talbot: If you kept the existing system of policy making and you brought in a lot more special advisors you would be setting up a situation for a great deal of conflict and friction. If you changed the system to a more pluralistic one which was more open to various forms of policy advice coming into the system and the process was seen as much more one of collecting different views and bringing them together in a more open way, then I do not think that would be a problem, but I do think under the current system if you brought in a lot more special advisors you would be setting up a system of conflict between them and the permanent Civil Service.

Professor Hood: In the memorandum that I put in with my colleague I suggested that there is a need for evaluation of the quality of policy advice that comes from the Civil Service by civil servants and I am not sure that it would always be beneficial to do that in an open way because if you really want a learning process you may need some space, as it were, for civil servants as professionals to reflect on their successes and failures and if you did want to benchmark the quality of policy that civil servants come up with then there may be an argument for having an element of discretion in that process just for the same reason as you have an anonymous reporting of near misses in air traffic systems or medical systems. I might want to shade a little what my colleague says. If you really want to have learning and you want sharing of experience et cetera, not just a process that will always accentuate the negative, then you may want to have space for a process that is not completely open in that sense.

Professor Talbot: The other part of this is the scrutiny role of Parliament and if you want more special advisors I suggest you get them in Parliament enhancing the role of Parliament to scrutinise the executive in the way it is done in a number of other countries. In the United States they have a Congressional Budget Office and the GAO working in a much more activist way than we have here and most of the committees have quite large staffs. I know it is a different constitutional system but I do think there is still scope for enhancing that here. We are very weak at that sort of thing.

Chairman: On the note of giving us more resources I think we will end. We are very grateful for your time this afternoon. I know we have covered a lot of ground fairly thinly but we are very grateful to you for coming and helping us with our inquiry. Thank you very much indeed.