CORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 660-iv

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

public administration select committee

 

 

Politics and administration: ministers and civil servants

 

 

Thursday 9 March 2006

SIR MICHAEL QUINLAN GCB, SIR DAVID OMAND GCB, SIR NICHOLAS MONTAGU KCB and SIR ROBIN YOUNG KCB

Evidence heard in Public Questions 224 - 290

 

 

USE OF THE TRANSCRIPT

1.

This is a corrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee, and copies have been made available by the Vote Office for the use of Members and others.

 

2.

The transcript is an approved formal record of these proceedings. It will be printed in due course.

 

 


Oral Evidence

Taken before the Public Administration Select Committee

on Thursday 9 March 2006

Members present

Dr Tony Wright, in the Chair

Paul Flynn

Julia Goldsworthy

David Heyes

Kelvin Hopkins

Mr Ian Liddell-Grainger

Julie Morgan

Mr Gordon Prentice

Jenny Willott

________________

Examination of Witnesses

 

Witnesses: Sir Michael Quinlan GCB, Sir David Omand GCB, Sir Nicholas Montagu KCB and Sir Robin Young KCB

Q224 Chairman: Can I call the Committee to order and welcome our witnesses this morning. We are very pleased to have you; it is very kind of you to come along. You are a very distinguished quartet; let me say, one of the most distinguished quartets we have had in front of us, of former senior civil servants. If I could think of the collective noun for distinguished former mandarins, this is the moment I would use it, but, as I cannot, I will simply welcome you. We hope that now that you are rather freer you may be able to talk rather more freely about all these issues that we are concerned with, particularly the relationship between ministers and civil servants. I do not know if any or all of you would like to say something, just quickly, by way of introduction?

Sir Michael Quinlan: No.

Sir Robin Young: No.

Sir David Omand: I have no opening statement, Chairman.

Sir Nicholas Montagu: Let us get on with the questioning.

Q225 Chairman: I can see who is taking over here. We will do our very best. Then let me retaliate. Sir Nicholas Montagu, who told me to get on with it just now, you have got a quotation here, one of the things that you have written, which says, and this could be our text to start with: "The dangers of a political Civil Service are too easily exaggerated by those who want to maintain the status quo." What do you mean by that?

Sir Nicholas Montagu: What I mean is that I think there has been a certain amount written and said about the changes that have taken place in the way that ministers take decisions and in the way they organise their advisers which suggest that there has been a real move towards politicising the Civil Service. I do not think, for example, that the greater use of special advisers is the politicisation of the Civil Service. I do not think that turning jobs which were done previously by civil servants into political appointments is, in itself, the politicisation of the Civil Service. I think that they are indicative of a government wanting to do business in a different way from what has been traditional. Where I see politicisation of the Civil Service coming in is where you get essentially a covert process, whereby, for example, an appointment which is made ostensibly on the basis of fair and open competition is made on the basis of political considerations.

Q226 Chairman: That has got one text defended. Let me move now to Michael Quinlan, who has a contrary view of these things, as I understand it, from what you have been writing, because you talk about a move towards presidential government without the openness, checks and balances of that. Then you say that people are being displaced from the Service in favour of less professional and less accountable actors chosen neither by the electorate nor by an impartially-run process. Who are these people who are taking over?

Sir Michael Quinlan: I did not say it is taking place. I think there is disadvantage if it is taking place. I should remind the Committee that it is now 14 years since Her Majesty employed me directly. I am going essentially on what I read in the Hutton and Butler Reports and how business was done there. It seemed there the way business was done, the system and the openness and the involvement of the professional civil servants I had been used to in the past, I am not in the least arguing against the involvement of other sources of advice, I think it is highly salutary there should be other sources, but the impression I get from those reports, and from what I hear from such contacts as I have now in retirement, is that there is less weight given to the Civil Service side than there used to be in the past. No more than that.

Q227 Chairman: These people that you refer to, these less professional, less accountable people, chosen neither by the electorate nor by an impartially-run process, that is special advisers, is it?

Sir Michael Quinlan: I have worked with special advisers and I think they are an essential lubricant in the system, provided, I think, that they do not become gate-keepers who exclude advice from the more traditional sources, and provided also that their advice is transparent, it is open to inspection and to contestation, if you like, and I am not clear that those things are happening.

Q228 Chairman: Let us see if we can get a consensus on this; first of all, whether we think there has been broadly a process of politicisation going on, which is that the political element is encroaching on areas where it should not encroach, presumably? Do we all have the same view on this?

Sir David Omand: I said I would not make an opening statement but perhaps I could step back just slightly from the question and make a plea, first of all, for a sense of proportion about the risks of politicisation. In this period that we are talking about, and one distinguished ex-Cabinet Secretary was led by you into talking about it as a period in which government was less good than it might have been, this is also a period in which, since records began, the country has had an unparalleled period of economic success. That has not been achieved by corporate governance codes or by cabinet secretariat committees, so you just have to pause, I think, and think about the context. A second remark is that there have been - and this is using Michael's words - some significant errors, that is inevitable, governments do make errors, but also there has been very significant underperformance. What I hope your Committee will do is get to the roots of what lies behind that underperformance. I do not think the Civil Service has been politicised. I do not think really there is very much risk that it will be politicised, but there is a very considerable risk, in my view, that we will continue to have significant underperformance in administration. Michael has identified some of the factors which may lie behind that, there may well be others which we can explore, but I would not join a consensus to say that there is a great risk of politicisation, if you mean by that that the structures in the public service, which are there to preserve the neutrality of that service, are seriously at risk. I do not think they are.

Q229 Chairman: I think the argument, as heard from Sir Michael and from Lord Butler, to whom you referred, is that there is a connection - they did not put it quite like this but I am giving you my version of it - between politicisation and underperformance, insofar as politicisation leads to short cuts on the process side, which in turn then leads to poor decisions. Was not that what Butler told us, in his report?

Sir David Omand: What really I am inviting you to do though is put the label 'politicisation' to one side and look at what is underneath, which is not just about the part that special advisers play, it is about the proper relationships between the different parts of government, including the permanent part and the elected part, and about the role that secretaries of state play vis--vis the centre of government, the role that junior ministers play vis--vis special advisers, there are many different parts to this. Talking about politicisation raises old issues, about selection on merit, and so on; those are not the key issues, in my view.

Sir Robin Young: I think I agree with that. If that disagrees with your consensus, I agree with David. I think it would be true to say that we are the least politicised Civil Service probably in the whole world and we are well known for our integrity and political neutrality, rightly, and I think other countries would be amazed to hear anyone suggest that there is a real danger of politicisation of the British Civil Service. If it was being said that it is politicisation which has led to underperformance then I would disagree strongly.

Q230 Chairman: Why do we have queues of former senior civil servants hanging around saying that had been being squeezed out of the policy process, that the traditional relationships are being disturbed in an unbalanced way, short cuts are being taken in policy-making and that special advisers are creating a source of disturbance inside the system? All this is in the atmosphere, is it not?

Sir Robin Young: It is, and I think it is a wrong impression and so I am quite glad you have invited some more recent ex-permanent secretaries. Maybe summers were perfect in those days too and MPs skated down the Thames to the House of Commons. I will argue that lots of things are changing for the better in the Civil Service. I would argue I left a Civil Service that was far better than the one I joined. We have managed to adapt successfully, I think, to the various things that are changing in the real world. It would be astonishing, in my view, if the sorts of Cabinet committee structures and processes, which some of our colleagues are urging on you, which were fitting 30 years ago, were still suitable now, when we have got e‑mail, the internet and 24-hour news. I am delighted to have had the opportunity at least to put a slightly more recent view to this and to try to put it in the perspective of the changing pace of life, the changing circumstances in which we are all working, the way in which all other organisations of similar size have had to change, to adapt to things like e‑mail, the internet and 24‑hour news. In my view, it would be absurd if the Civil Service had not had to adapt as well.

Sir Nicholas Montagu: I think there is a strong element of the supplanted spouse in this. You do not expect turkeys to say, after Christmas, that everything was wonderful. There is an element of that. Certainly, when Michael, Robin, David and I came into the Civil Service, a permanent secretary had this tremendously pivotal position vis--vis his, and unfortunately almost always it was his, secretary of state. There had been a tradition where all advice, not that long ago, had gone through the permanent secretary. The Civil Service that the four of us left had rightly been transformed. The permanent secretary was expected to do far more in the way of managing his, and unfortunately it was still mainly his, department, and governments had come in indicating that they wanted to do business in a different sort of way. And certainly the special adviser, there is no question of that, usurped some of the role of principal policy adviser to the secretary of state which traditionally used to be that of the permanent secretary. There is nothing wrong intrinsically in that, provided that it is supported by proper and minimally bureaucratic processes; in other words, it is desirable that the ministerial head of a department should have access to impartial, non-political, or apolitical, advice before taking a decision, as well as to political advice. It seems to me that if ministers want to bring people of like political opinion into the decision-making process, that is fine, that is something which should be regarded as time moving on, rather than as intrinsically bad and resulting in people looking back from nostalgia to a golden age of the permanent secretary as principal policy adviser.

Sir David Omand: Just to bring us back down to earth for a moment, there are 24 special advisers, at the last count, that I was aware of, working in 10 Downing Street, out of the 81‑odd. Downing Street is a mixed economy; there are civil servants and there are special advisers. If you replaced those 24 special advisers with 24 bright, young, civil servants, you would still have a lot of the issues that I have about the way government is run. It is not about the fact that they are special advisers. If you look at the team which was around the Prime Minister in the events to which Lords Hutton and Butler were referring, this was not a team which was dominated by special advisers, this was a team which had the best professionals in the military and diplomatic fields around it. It is not about politicisation, it is about the concept of how good policy is made, without the separation between policy and delivery, which is the main besetting sin, or the unreality of regarding local government simply as a vehicle for efficient delivery of central objectives. There are deep systemic issues about how performance in government could be improved; some of those are about simple processes. I rather agree with what Michael and Robin Butler have said about the need for a bit more process, but that is not really at the heart of the problem.

Q231 Chairman: No. The Committee intends to turn its attention shortly to some of these performance issues but we want to clear the ground about some of the relationship issues which have dogged this discussion for a long time, to start with, if we can.

Sir David Omand: I am sorry to interrupt, Chairman. I ought to have declared perhaps a past interest, in that I sat on the Special Advisers Pay Committee and was therefore privy to all the job appraisals of what special advisers actually do. One thing that left me with was that it is quite dangerous to use the label 'special adviser' to cover what are entirely different kinds of people. The existence of those people does give rise to some difficult changes which are necessary in the relationships with civil servants, and they are doing rather different jobs. Very, very briefly, you have experts, and the public service is very lucky to have the services of a number of experts recruited through that special adviser route, who are acknowledged experts but they have political affiliations; that is the route to get them in. That has never caused a problem, as far as I am aware. You have another group, media minders and media assistants, and in the old days parliamentary private secretaries would have done that, because in the old days it was the tea room of your House that mattered; now it is not Westminster, it is Wapping. Ministers have to have somebody who can go and pad the corridors of the newspapers and put their side of the story in a political sense. There is nothing wrong with that, and it is enormously helpful to the Government Information Service because it does not lead to pressure on them to become political. There is no pressure then on the official machine to get involved in that kind of work. The third group is the Number 10 special advisers, 24-odd, another nine in the Treasury, who are bright, young, policy-makers, and there are issues there about how those groups interrelate. Then finally you have a smaller number, who their ministers hope will act as chefs de cabinet and progress-chasers, general chiefs of staff. I am not talking about Jonathan Powell's role, which is sui generis, but actually in Whitehall. There, there are very significant risks of upsetting proper relationships with the official machine and relationships between junior ministers and the secretary of state, if a special adviser actually is being used as a chef de cabinet. There are thus a number of issues which come out of looking at special advisers and from trying to clear the ground.

Q232 Chairman: Just on that, as you have raised it, there are two issues, in particular, which have arisen around special advisers, which need to be resolved, I think. One is that there is something unsatisfactory, it is said to us, at the moment, about who can manage and who can discipline them, what are the lines of responsibility, and, although being temporary civil servants, they fall outside the normal Civil Service line management. Could that be corrected, is one question? The second one is, would it not be better if we did not pretend that really they were civil servants and actually we paid them, for example, through the short money, so that they came from a different source, they were demonstrably different kinds of people? Would that be helpful?

Sir David Omand: To answer the second question first, I would need to think quite hard about the balance of advantage. If you make them temporary civil servants, you are drawing them into a machine with an expectation that they will get training, which they will not otherwise do or receive, in the values of the Service of which they are temporary members, and about the informal relationships, informal rather than formal ones, with the permanent secretary and senior officials, it puts them within a framework. If you had them entirely outside a framework, as entirely political animals, then I think it would be harder for a permanent secretary to deal with the very occasional problem that might arise. When I left the Service, it was still the responsibility of the employing secretary of state to look after the discipline of the special advisers that they had recruited. I think that is still the case; certainly that was the case. I think that is right. In the end, it was the secretary of state who chose the individual; if something has gone wrong or there has been some bad behaviour, so very rarely but if it happens, I think you should look to that minister, in the first instance, to sort it. If it cannot be sorted then it is going to escalate and the Cabinet Secretary and the Prime Minister are going to have to look at it, and in the end the Prime Minister could withdraw the consent he gave to the appointment and the appointment would end.

Q233 Mr Liddell-Grainger: I am intrigued by what happened yesterday. Have we seen the first removal of a permanent secretary for failure, in the form of Nigel Crisp? Has he been shifted, has he been got rid of because he could not deliver?

Sir David Omand: I am not in a position to say. I have no idea what the whole background is and it would be quite wrong to comment.

Q234 Mr Liddell-Grainger: What is your feeling about it; you are not in the Civil Service now, any of you?

Sir David Omand: I will give you just one feeling. What is at issue, as I understand it, from the media, and I have no other source of knowledge on this, is the responsibilities that the permanent head of a department holds, as the principal accounting officer, for ensuring the good value for money from the resources you vote and that the budget is controlled and that your authority to spend is not overspent. If that goes seriously awry then the civil servant is personally accountable. Had it been a debate not about money but over some aspect of policy then it would be a very much more complicated case. Really I do not want to be interpreted as confirming that I think that he was removed, because I just do not know the circumstances.

Q235 Mr Liddell-Grainger: Are we seeing a fundamental shift, where he has gone, he has gone early, and that does not normally happen, there was a slight deficit in the NHS, just a tad, so Ian Carruthers, God help us, because I know him quite well, is being promoted? He has been got rid of?

Sir David Omand: I am sure you will be able to find other examples where people go early. It does not tend to get quite the same publicity.

Q236 Mr Liddell-Grainger: A permanent secretary? Come on. Think back?

Sir Nicholas Montagu: I will give you an example, because it was public knowledge and he said so himself: Sir Peter Kemp, sacked from the Cabinet Office under Margaret Thatcher.

Q237 Mr Liddell-Grainger: So it does happen?

Sir Nicholas Montagu: Yes.

Q238 Mr Liddell-Grainger: Sir Gus O'Donnell is saying there should be more corporate responsibility amongst senior civil servants. Are we not going to have other examples; is this now going to be the norm, where ministers think "Crikey, there's a deficit," and actually what they will do is say, "Let's get rid of the perm. sec., let's send him down the road to the Inland Revenue," or whatever? Is this going to start happening?

Sir Nicholas Montagu: I think probably I should confront that last bit. I can think of only one example of somebody who was sent to run the Inland Revenue as a punishment. He made a joke about a Prime Minister in her hearing and I think she regarded it as Siberia; in fact, it was Paradise Island, but she did not realise that.

Sir David Omand: You used the word collective there and, as I interpret what Gus is trying to do, it is to get the senior leadership of the Service to recognise that together they have to make a difference and they have to support each other. It is not saying that, formally, there is any change in the responsibilities that those individuals have to their secretaries of state.

Q239 Mr Liddell-Grainger: One of the reasons I am going to ask this is that we have seen a vast explosion within Number 10 of policy groups: blue-sky thinking, direct risk groups. We worked out, I think, that there were 78 members of the policy group, I cannot remember, it is an enormous amount; it is under 100. That is a fundamental shift in central control of the organisation. You say that you do not see politicisation. I beg to disagree, because I think Number 10, the executive, now has a massive machine.

Sir David Omand: That is not politicisation. That is a real threat to the way government works, but it is not politicisation.

Q240 Mr Liddell-Grainger: Alright, but it is using it for politics, political ends?

Sir David Omand: It is taking it away from one group of politicians, the secretaries of state, and putting it in another place.

Q241 Mr Liddell-Grainger: Also we have seen Lord Birt, who did a job within government, nobody quite understood what but yet he crossed all lines, he went in and out of every department, looking at something. Surely, you are seeing interference from the highest level within all departments of the Civil Service?

Sir Nicholas Montagu: Do not confuse centralisation with politicisation. Yes, it is certainly true that in recent years we have seen the kind of shift of power that David mentioned from departments towards the centre, but that does not result in the politicisation of the Civil Service, it is something quite different. On your wider point, I think you have seen increasingly, over the last nine years or so, an emphasis on the role of permanent secretaries as managers and as deliverers. The rhetoric of delivery is used, in my view sometimes inappropriately, all over government. In a way, it seems to me that has resulted in a polarisation of what, in some sense, was already a traditional role, that ministers set the parameters of policy and permanent secretaries manage and lead departments to implement that policy in the widest sense. Accompanying that polarisation has been a much sharper focus on the accountability of individual permanent secretaries, and this has been manifested in all sorts of ways, not just by the Government but, for example, the ways in which departmental select committees operate. What you are describing is, if you like, the evolution of that process of a sharper accountability of the permanent secretaries, a determination to make it actually mean something, coupled with the emphasis on delivery.

Q242 Mr Liddell-Grainger: Can I take one example: targets. We have had target upon target upon target. The moment it changed the blame was shifted. That is one example. Surely the politicians now are going to blame the non-delivery, or the non-ability to deliver, on the senior civil servants and then use that as an excuse to say, "Right; it's their problem, not ours"?

Sir David Omand: A preliminary remark, if I may, which is to say that I take my share of responsibility for not having done everything you told us, and to say that there has to be mea culpa, because we were not in very good shape, in the late 1990s, as a Service, in terms of skills for actually project-managing and delivering. That said, there has been a gigantic category error of thinking that you can put policy and delivery in separate boxes and then assuming that the policy is a political world and the delivery is just people you hire in to do the delivery. Policy goes all the way down, there are policies in Her Majesty's Prisons for what time breakfast is served, and a policy is not something which is confined to a little box in the centre. Good policies are deliverable policies. The question, which I would put in any code which might be drawn up, is then who was in the room when the decision was taken, and if there was not a key representative of the deliverer in the room when the decision was taken the chances are it was not a very good decision.

Q243 Chairman: Sir Michael was shaking his head in dissent then?

Sir Michael Quinlan: I was going to disagree slightly with Nick Montagu, but may I say that I do not believe that permanent secretaries should be regarded as unsackable, and they have not been regarded as unsackable. It has happened rarely and I hope that is something to be welcomed rather than deplored. The point I wanted to recalibrate, as compared with what Nick said, is this, that I do not believe you can, or should attempt to, differentiate, and here I am with David, between policy and administration or organisation, in the sense that one is the minister's business and the other is the permanent secretary's. It may be that a particular minister, and, if I may say so, they come in all sorts of shapes and sizes, with different interests, different capabilities, wants to leave administration to the permanent secretary; it is still the minister's responsibility. For example, when I was away from the Ministry of Defence, Mr Heseltine did very extensive things, and they were Mr Heseltine's, as David will know, to the organisation and the administration of the department. It would have been wholly inappropriate for a permanent secretary at the time to say, "Sorry, Secretary of State, that's not your business, it's mine." All of it is the minister's business, and if it were the case, and I have no idea whether it is, that a particular short-touring of a permanent secretary were the result of a Minister trying to put distance between himself and the way a department was run, I would think that was inappropriate.

Sir David Omand: Interestingly, Mr Heseltine, in deciding that major change was needed, with the Permanent Secretary appointed a small team of civil servants and military officers, and that worked, on reorganisation, so those who had to carry out the tasks of the Ministry were deeply engaged in the work of actually putting it all together.

Q244 Chairman: When Nick Montagu says that this corporate governance code is wrong, because it flags up ministers as being involved too centrally in the running of departments, given that fact, that you do not disagree with each other but you simply recalibrate each other's remarks, you do not agree with that, do you?

Sir David Omand: I think the idea of drawing corporate governance and codes into all of this is a huge muddle and I would strongly advise caution before going down that route, for reasons that we could expand. Michael is right, right in law and right in practice, and this is the Carltona principle[1], which is the legal principle on which all our administration is founded, that the minister is responsible for the acts of officials done with the authority which actually only the minister has and gives to officials to act on his behalf, so you cannot separate them out in that sense, but a wise minister does not interfere beyond their competence.

Q245 Julia Goldsworthy: On that basis, I am not really sure why Nigel Crisp resigned, if the deficits were not his responsibility, or would they be the responsibility of the Minister, for the structural changes?

Sir David Omand: In a sense, this is precisely the point that I am making. Because it was a financial matter, it was a matter in which, as accounting officer, he had, from your House specifically, through the Exchequer and Audit Act, a specific personal responsibility. Had it been a policy disagreement then the case, in a sense, would have been more interesting.

Q246 Julia Goldsworthy: Was that in his role as Chief Executive of the NHS or Permanent Secretary?

Sir David Omand: It is his role as accounting officer. He was both head of the department and Chief Executive, but he was the accounting officer for all the expenditure of the National Health Service, which of course is an enormous responsibility.

Q247 Chairman: The NHS has had financial problems for as long as any of us can remember, but it has not produced resignations of people at the top, has it, certainly not permanent secretaries?

Sir David Omand: No, and indeed I can think of other ministries, including some I have been in, where financial control at times has been difficult to maintain. I cannot speak for why he has resigned because, as I say, I have not talked to him about it and really I do not know the background and cannot speculate.

Q248 Chairman: Is there some confusion about having someone both as Permanent Secretary and Chief Executive?

Sir David Omand: I do not think it is confusion but I think it must be an impossible job.

Q249 Julia Goldsworthy: Is there a conflict there?

Sir David Omand: No, I do not think there is a conflict necessarily, and you could structure the organisation underneath you in such a way as to support you properly, but just the sheer weight of work in trying to both jobs, I would have said, was well nigh impossible.

Q250 Julia Goldsworthy: Changing the subject slightly, the other area which struck me as quite interesting is the parts of government that have been depoliticised more recently. If you look at the National Institute for Clinical Excellence and the transfer of interest rate setting to the Monetary Policy Committee, in these areas of depoliticisation, I wonder if you think that has changed the role and the relationship between ministers and civil servants, because what is apolitical has been siphoned off?

Sir David Omand: It is a fascinating phenomenon. It has been extremely successful; if you look at the Food Standards Agency or the Bank of England Monetary Committee, you cannot say that these moves have not been actually really very successful. The underlying reason for them, I suspect, is because of the lack of trust in the political system and in politicians. Therefore, to get credibility with the markets or get credibility with the public in food safety, you put the problem offshore and you put it in the hands of people who are thought not to be politicians. Of course, this distances the decision-making from the very people who are supposed to be the tribunes of the people, so in a democratic sense I worry about putting all of this offshore. It is about trust, I think.

Q251 Julia Goldsworthy: How has that changed the relationship then, do you think, between ministers and civil servants? It leaves the majority of the political decisions back with ministers, and if the Civil Service has to be apolitical and if the apolitical stuff is being siphoned off then what is left to do, how does the relationship change, do you think?

Sir Michael Quinlan: Chairman, we are stumbling constantly over this word 'political' and politicisation; are we talking about party politicisation? The Civil Service is highly political in many important respects, in that we have to be alert to political realities, realities imposed, for example, by your House and the other House, and we have to be political in the sense that, once the people have put in power a particular administration, we are trying to do the very best we can to carry out what they wish to do. That is a political activity, if you like. The worry, which I think is now overdone, as has been said earlier, is that the Civil Service is getting party political. I do not think that is happening.

Sir David Omand: The test of that is, which the Civil Service Code brings out, were there to be a change to a government of a different complexion, would that incoming government feel it necessary to replace the senior civil servants and would the senior civil servants feel it necessary to resign because they would not be able to carry out, in conscience, the policies of the incoming government. We are a very long way away from that position. I just do not think that is a real problem.

Sir Michael Quinlan: To come back to Ms Goldsworthy's point, it seems to me that, on some of these outfits, like NICE[2], a judgment has been made that the advantages of removing them from party political pressures, or the pressures of Parliament, outweigh those of losing a certain kind of accountability. There are different models of that. The Health and Safety Executive, with which I used to have some involvement, is another model which is at least distanced if not entirely removed from the day-to-day involvement of ministers.

Q252 Mr Prentice: Should Sir Michael Jay be sacked?

Sir David Omand: No.

Q253 Mr Prentice: Do you want to tell me why not? You saw the piece in The Times today, which referred the reader to the Report of the Foreign Affairs Select Committee, and apparently the Foreign Office brought in Collinson Grant in 2004 to examine its, that is the Department, efficiency, effectiveness and control of costs. The Foreign Affairs Committee concluded that Sir Michael Jay is part of the problem. Under his stewardship the Collinson Grant report was originally suppressed, they criticised the management that he was supposed to lead, he acquiesced in a situation where some senior managers failed to collaborate with Collinson Grant's proper inquiries, his senior managers did not contest or seek to correct, prior to publication, errors which they now allege are contained in the report. This is damning stuff, and it goes to the heart of his role as accounting officer, something that David Omand spoke about earlier in relation to Nigel Crisp. I put the question again: should Michael Jay be sacked?

Sir David Omand: That is not a proper question to ask me because I have not read that report and I have no idea of the facts behind it. Just to comment that there are two routes by which Parliament, it seems to me, very properly, can look at this. One is the Public Accounts Committee, because we are talking about the administration of a department, and to call in the Accounting Officer and find out really what lies behind these reports. The other is for the select committee to call in the Secretary of State, who is, as it were, the employer of that Permanent Secretary, and that is where the main thrust of this questioning should go: is the Secretary of State satisfied with the state of the Foreign Office and its administration and the service that it delivers to British citizens overseas and to the construction of policy, and if not why not.

Q254 Mr Prentice: So the Foreign Secretary should be held responsible, or accountable, for the actions of his Permanent Secretary in this respect?

Sir David Omand: If we are talking about the delivery of the services, if we are talking about some specific problems with the management of the budget then that is probably a matter that the Public Accounts Committee could legitimately look directly to the Permanent Secretary for.

Sir Michael Quinlan: The Secretary of State is always accountable, in the sense that it is his responsibility to give an account of what is going on within his department. He has the power to give direction on any matter within the department, with one or two small, conventional exceptions. A permanent secretary should not be totally exempt from sacking but, if I may say also, respectfully, they should not be sacked by select committees.

Q255 Mr Prentice: Select committees did not sack Nigel Crisp, did they?

Sir Michael Quinlan: No.

Q256 Mr Prentice: I am interested in why Sir Nigel Crisp went. Was it because of the financial overspend in the NHS, or was it because of a series of policy blunders? You all read the newspapers and I am not springing this question on you, but in June last year Sir Nigel sent out a letter to the NHS across the land, and I raised this at the last meeting of this Committee, saying that a quarter of a million employees of the NHS - chiropodists, physiotherapists, midwives, people like that - were going to move out of the NHS as an employer and into the private sector, 'not for profit' or voluntary sectors. That letter went out from Sir Nigel Crisp and the Government decided to change the policy in November. Where does responsibility lie for that? Does the Secretary of State bear any responsibility at all for that colossal policy blunder? That is question one. Question two: how are these policies tested within the Civil Service; is it really just the old silos, that the Department of Health decides what the policy is and everyone else goes along with it, or is there some collective examination of these policies, testing them to destruction almost, before they enter into the public domain?

Sir Michael Quinlan: Two separate questions, I think. I come back again, the secretary of state is accountable to Parliament, and the permanent secretary, apart from the special case of the Accounting Officer and propriety of expenditure, is accountable to the Secretary of State. On the matter of Sir Nigel Crisp's situation, I do not think we can possibly comment, or certainly I would not dream of commenting.

Q257 Mr Prentice: You can comment on the general point that I am making, that when you get hugely controversial policies - - -

Sir Michael Quinlan: That is the process. I have no idea what process was or was not gone through, but I do believe, and indeed I have said this, that process matters greatly and some of what was disclosed in the Hutton and Butler Reports suggests that process has not been working as well as it ought to.

Sir David Omand: Again, just looking at process, because I do not know the facts of that case, you would expect the permanent secretary, the permanent head of a department or organisation, to be the one communicating managerial decisions to the people who are employed in that department. I have had to do that on many occasions, and sometimes it is good news for them and sometimes it is bad news for them, but if you are the leader of that organisation it is your responsibility to stand up and be counted. I would expect him, in his leadership role, particularly in relation to the NHS, to do that. The policies that he is enumerating are the policies of the Government, they are the policies that he will have agreed with his Secretary of State. If the Government then changes its mind and decides that the policy is to be reversed, and this does happen sometimes, that is the responsibility again of Government and the Secretary of State.

Q258 Mr Prentice: Are you satisfied with the mechanisms within central government to test the robustness of policies?

Sir David Omand: No, I am not.

Q259 Mr Prentice: You are not? That is what I am trying to get at.

Sir David Omand: That is the answer to that. It comes back to what I was saying about whether you can construct sound policies that are going to impact on society without a great deal of work on the deliverability of those policies, bringing into the fold those who have to deliver them. Having been brought up, as Michael was, in the Ministry of Defence, it is inconceivable that Her Majesty's Forces would be sent off on an overseas deployment without the Chiefs of Staff sitting down with the senior civilian advisers, working out what it was going to cost, how long it would take, what the casualties may be, what were the risks and discussing those parameters with the government. Then, when everyone was satisfied it was doable, you would get 110 per cent performance out of the military and they would do it. I think that is a very good model.

Q260 Mr Prentice: Legislation these days, on the face of a bill it says, "This legislation is complying with the Human Rights Act," or something like that, signed off by the Secretary of State. I would like to see the same thing happen with major policy proposals, signed off by secretaries of state; this Education Bill.

Sir David Omand: Before I retired, we spent two years working on a major risk management exercise, it was reported to the House and in fact made public. An important part of that was setting up process, mechanisms, whereby secretaries of state who wanted to come forward with major proposals would actually have to demonstrate deliverability and would actually have to assess risk, in a very methodical way, as major companies do. We devised methodologies for this, with the Office of Government Commerce and the gateway process. I am more confident than I would have been a couple of years ago that this lesson has been learned. There are some processes being put in place, but it is still the case that you can wake up and discover that policy has suddenly been made and announced with timescales before those who really know how to do it have been called into the loop.

Q261 Julia Goldsworthy: Do you think those gateway reviews should be published, because they are not at present?

Sir David Omand: I think that is a real balance of advantage to be considered here. I was gatewayed myself on several occasions, on projects that I had a responsibility for, which were difficult. The process was hugely advantageous because it was private, and I knew, for example, that Downing Street would not be seeing the results of this, and certainly it would not get published. What that did was encourage people to tell the truth, and one of the besetting problems of modern government is that people do not tell the truth to each other about how hard things are, how difficult they are and how long they are going to take. You have the gateway team coming in and they are outside experts, they have done all this before, they know what they are talking about and they go through and they talk and the team talk and they tell the truth, "Well, actually we're rather worried, because we're not sure about this particular policy, what we're trying to do," or they might say, "We don't have the skills." Rather than finding, as so often happens when you have these reviews, people put up a defensive front and say, "Of course it's all alright; it's my project and it's going marvellously," they unpack the real problems. What I have found, going through this process, at the end, is hugely greater confidence that we have actually achieved the objective, because we knew where the problems with the project were likely to be. You go and publish those reviews and I can guarantee - guarantee - that defensiveness will creep in and that people will say, "Well, there is this problem, but the last thing we want to do is air that." There is a trade‑off here; it is really worth thinking about.

Q262 Julia Goldsworthy: A red light on a gateway review does not mean then that policy process stops, does it?

Sir David Omand: If you get a red, you are not going to get through the next gateway, which means your project effectively is on hold until you can show that you have put right the problems, which may be skills shortages, it may be the organisation of the programme, it may be the relationship with the customers who are going to use it eventually. All sorts of things could cause a red light.

Q263 Julia Goldsworthy: With something like identity cards, where there may have been an amber light, it is very difficult for parliamentarians to scrutinise the legislation if they are not fully aware of what the pitfalls may be which may have been expressed privately?

Sir David Omand: Yes, but you can get at that without saying formally that the private advice to the owner of that project, the senior official running that project, should be published. You have every opportunity to call for evidence and to explore in evidence-taking what is meant by an amber, but I think you just ought to leave enough room for truth-telling between experts, so that you encourage that culture.

Sir Michael Quinlan: Like the Attorney General's advice, Chairman, if I may say so.

Chairman: Do not take us there.

Q264 Jenny Willott: I want to ask questions in a couple of areas about the role of permanent secretaries and power and responsibility, and so on. Given that we have been hearing quite a lot from other witnesses about the fact that power and influence increasingly are being centralised in Downing Street, either in Number 10 or 11, depending on different people's views, and the fact that policy advice is being given increasingly by special advisers rather than by permanent secretaries and some people seem to think there is a bit more of a barrier between permanent secretaries and secretaries of state, do you feel that permanent secretaries still have the power and the control that they need to be able to run their departments?

Sir David Omand: Can I add just one thought, before others comment. I would not personalise this just to permanent secretaries. If you take a very large department, like Defence, for example, there is a senior, director-general level official whose full-time job is defence policy, and that individual works very directly with the secretary of state and always has done. The permanent secretary, who would have to spend a great deal of time on this enormous machine and its management, would come in when the issues were big enough on policy. If I may, I would broaden it to ask is there the right kind of interaction between the senior officials of the department, and indeed some of the more junior officials who are experts in the area, in the policy-making process? I think I would like to see a little more readiness to bring in officials at very early stages of policy creation. You are right, by the way, I think, to mention Number 11 as well as Number 10. This is not just a prime ministerial phenomenon.

Sir Robin Young: It is difficult to generalise, is it not, but in departments I have been in, in DCMS and DTI, there was absolutely no issue between special advisers in the department and between ministers getting the advice from officials, at all levels, permanent secretary included, absolutely no issue, so it is quite dangerous to generalise from a few well-known cases and then say the whole thing is bad.

Jenny Willott: I was not suggesting that.

Sir Robin Young: No, but others have. I am not talking of people in this room. In my view, in most departments, the relationship is absolutely excellent between special advisers and officials. If you ask most ministers, I think they are pretty happy with the advice they are getting from officials and the availability of officials to give them advice at all stages, not just secretary of state, I mean ministers of state and parliamentary secretaries as well, who are sometimes left out of this equation, it seems to me. You could test this, if you wanted to, because my last special advisers included Kitty Usher and Andy Burnham, so you can ask them what it was like to be a special adviser in the departments where I was Permanent Secretary. It would be interesting to hear what they say, actually. On centralisation, personally I think whichever government was in power now would want a stronger centre within Whitehall, because there was a danger in the past of the Civil Service being baronial silos in government departments. Most analysts now surely would say that most topics need cross-departmental working and it can no longer be delegated down the line in the old way, as they used to, down to baronial satrapies in departments, who came to the centre only when they wanted to clear a White Paper, or something. I think it is a very old‑fashioned way of looking at government. Most issues now are subject much more to inter-agency approaches, cross-departmental approaches, breaking down old-fashioned barriers. If you accept that analysis, you have to have some centre, or somewhere and not in a department, drawing things together. In my view, most organisations, from Tesco to Birmingham City Council, are having exactly that discussion currently, about where the power, the centre, lies and what can be delegated in the old way down to more local delivery vehicles. There is nothing wrong with that, it seems to me. For some reason or other, within this Government, there is no open discussion about it, either it happens or does not happen and then is complained about behind the scenes. Actually, there is nothing wrong with having a discussion about what should be done in the centre and in a cross-departmental, inter-agency way and what should be delegated to departments. It is a perfectly reasonable debate to have, which is being had in every other organisation of a large size. We should be proud that we are having one and it should be opened up, rather than snide remarks about a strong centre, though not from you personally. A strong centre is necessary, in my view, to drive through a cross-departmental approach.

Sir Michael Quinlan: Though, as I said, I am speaking from experience a long time ago, I venture to think that we should not be too breast-beating about this. In my observation of other countries, and I have had some experience of that, the British system is better than most at getting and keeping its act together across departments, partly because of the existence of a single, and in some ways quite self-confident, Civil Service, with the ability to move people around the system so that there is trust and a feeling of collegiality across the Service. The problem arises, I think, because modern government, in a state like ours, is an immensely complicated business. You have got to slice it up in some way, if you are going to define responsibility at all; the trouble is, wherever you slice it you will find there is an awkward interface and the question then is how do you get machinery to ensure that it is not just a set of silos. I am all in favour of having a strong centre, as long as it does not mean that responsibility is leached out from all the particular secretaries of state. The impression I get, and I do not claim it is more than an impression, is that there has been a certain removal of effective responsibility and independence from departments and secretaries of state through the way the centre has operated.

Sir David Omand: I think that is my perspective.

Sir Nicholas Montagu: I think the essential point here is that there is no single, ideal form of government or ideal pattern. A lot of the problem stems, I believe, from people who have enjoyed a previous style or form of government thinking that any change from it must be for the worse. From the Civil Service's point of view, the Civil Service is there to serve the government of the day, and that, to me, does not mean simply in terms of its policies but also in terms of how it wishes to do business. The effective civil servant, whether it is a permanent secretary or a senior official, or whoever, will understand, given the government's preferences, to whom they need to talk, where the influences are, whom they need to bring together, whom they need to make sure understands the particular departmental constraints. Let me give you a concrete example, because I hope this is supportive of what Robin was saying, it also goes from experience that he and I had. I headed the Economic and Domestic Secretariat of the Cabinet Office, very briefly, immediately after the 1997 election and Robin was my successor. It is undoubtedly true that when the new Labour government came in there was a shift from what had been traditionally the Cabinet Office's role towards Number 10. That is fine, that is entirely within the Prime Minister's prerogative to decide how he wants to do business. As a result of that, I think it is fair to say that both Robin and I saw it as our job to keep in much closer contact with the Head of the Prime Minister's Policy Unit than perhaps our predecessors would have chosen to do. I much prefer to think in terms not of patterns of government but almost of, if you like, conditions that need to be satisfied, in order for decisions, and therefore government, to be, in very heavy quotes, "good".

Q265 Jenny Willott: Given that there are elements of responsibility and power being centralised, particularly with regard to things like communications and media control, and so on, are there any issues around still having clear lines of responsibility for civil servants through the secretary of state, or does the fact that elements of the role are being pulled over into Downing Street have an impact on the lines of responsibility for civil servants?

Sir Robin Young: We work quite carefully to get it right. When the recent change to the Information Service took place, there is now a Head of Profession in the centre, who is, as it were, professional head of the Information Service's folk, but the actual people in your department work for you, so the Head of the DTI Press Office worked for me but the Head of Profession was in the centre. Of course, you are right, that there always have been efforts from the centre to co‑ordinate announcements, some successful, some not, and that has been around for as long as I can remember, so I think it is okay. You are right, it has to be testable, and there has always been a slight delicacy as to who is going to announce what, when, under governments of all colours, for as long as I can remember. I think the arrangements we have got for them are workable, head of profession and then a direct reporting line to the permanent secretary and secretary of state within the department; as always, they work better in some cases than in others.

Sir Michael Quinlan: That operates across the Civil Service as a whole. The Head of the Civil Service is not the line manager of permanent secretaries, he is responsible for competence and standards and the disposition of resources, but the permanent secretary answers not to him or to Number 10, he answers to his secretary of state.

Q266 Jenny Willott: Is that still clear enough?

Sir Michael Quinlan: Occasionally I have heard suggestions that it is not quite as clear as it used to be, but that is just gossip.

Q267 Jenny Willott: Just a final area, which is the increasing tendency to bring in people from outside, particularly in some of the more senior appointments. I think it is something like only 40 per cent of the senior level posts in the last year have gone to internal candidates. Two questions. Do you think, in the long term, that is likely to have an impact on recruitment and making the Civil Service an attractive proposition for people coming in lower down, if they feel that they are not going to be as likely to be able to progress to the top; do you think it will have an impact on the standard of recruitment of civil servants? The second area is do you think it has a noticeable impact on the ability of the Civil Service to deliver, either for good or for ill, because of bringing in new skills, different perspectives, and so on? There has been some suggestion by others that actually one of the good things about having internal candidates being promoted throughout is that by the time they are at the top they understand how the system works, they know the vagaries, they know what you can and cannot achieve. Do you feel that there are issues for the ability of elements of the Civil Service actually to be able to deliver what is expected of them, if you have people coming in from outside who do not quite understand the system and do not know what is realistic and what is not?

Sir Nicholas Montagu: That is a really difficult one. In particular, on the first issue that you raise, actually it has been - and David will forgive my saying this - a worry of mine, ever since the group that he chaired in the wake of the 1999 White Paper looking at bringing in talent as well as bringing it on. I think that the Civil Service, in many ways, is no different from other big organisations, which tend, on the whole, as you are implying, to want to develop their own talent, to provide people coming in with the prospect of a career, with an implicit promise that if they are good enough they can get to the top. I am not saying that we should not bring in outsiders. What I am saying is that I think over the years there has been an unfortunate tendency to behave as though bringing in outsiders is intrinsically virtuous, and if there is, if you like, that implicit preference for outsiders, then I have always been worried that it would have the effect that you fear on recruiting people. If they know that they will get so far but that, other things being equal, at such and such a level, somebody will come in from outside, then I think that could well influence their decision. There have been similar decisions taken within the Civil Service over recent years, about which I have had similar misgivings. That is not to say that there are not a number of posts where I think it makes sense to have an open competition, particularly, again as many organisations would do, if there is a skills shortage in the Civil Service. Very obvious examples are finance directors with proper accountancy and finance qualifications, people with strong project management experience and chief information officers. I do worry about the 'outside is good' philosophy insidiously getting embedded.

Sir David Omand: Can I declare an interest, since I chaired the 'bringing in and bringing on talent' group, where it was part of a Civil Service reform programme. I could not disagree more with Nick, I am afraid.

Chairman: This is not just recalibration, this is rephrasing.

Sir David Omand: I have spent the last two days at the National School of Government, coaching a group of the brightest; they are every bit as good as previous generations. The Civil Service is still number two, at the moment, in terms of graduate choice. There is no evidence at all that people are not wanting to - - -

Q268 Jenny Willott: What is at number one?

Sir David Omand: I think it was the Diplomatic Service, or maybe it is private sector now; but the Civil Service is number two. There is no evidence that this is having an effect. The interesting thing about talking to these young people, these are the bright people coming through in their mid-career, is that they do not think they will spend all their time in the Senior Civil Service necessarily, but they all went to get to the top of the Service. They are deeply committed to the values of the Service and its ethos and to public service, but they can see themselves being chief executive of a local authority, they can see themselves working in the NHS, depending on their backgrounds, so their career patterns are going to be more varied. With the influx of talent, I think the nation should be very grateful that a lot of very talented people have chosen to come into the public service. Where I would agree with Nick though is that we have to be careful about what the impact of this is, if we are bringing in, as we have been, fairly large numbers of people into significant positions of responsibility who have not grown up with the ethos of public service. I think there is recognition now that more effort should be made, and more attention being given, to how you induct them and how you make it very clear that there are values to which they have to subscribe if they are going to be members of the public service; so I am an optimist. Another point which might be worth registering is that, at the most senior levels, so we are talking about directors-general or permanent secretaries, where there have been open competitions and very good people have come in, there is a distinction to be made between those posts where a background in commerce may well be a very significant attribute and those posts where actually the professional skill that is being sought is knowledge of how government works, and that is the case with most departments. I would say that, if there are worries in the career planning and management of senior civil servants about whether there are going to be enough people of the right type to fill certain kinds of jobs, the time to act is a little earlier to bring people in, try them out in the Service, make sure they really understand how government works. The professional skill that I and my colleagues have is being able to operate on the interface between the political and the executive, knowing how government works and therefore enabling it to work more effectively. With Nick, I would be a little careful about which posts I competed outside, unless there were specific needs to bring in skills which I knew did not exist sufficiently inside. There are some posts, for example, in defence procurement, and so on, where traditionally in the past we have had very successful outside appointments.

Sir Michael Quinlan: I agree essentially with what David has said. It seems to me it is a matter of proportion. The Civil Service is well used to having folk coming from outside, particularly, for example, during the war and its aftermath, a very large number of people came in and stayed in at the top level, so this is not an entirely new experience. I think we are enriched and refreshed by having people come in to appropriate posts from the outside. I would be worried if the proportion became very high, for example, if you had 80 per cent of grade one posts, or permanent secretary posts, going outside and we began to get near to the US system; 20 per cent, or something like that, absolutely fine. I do not see any ground for worry about the condition we are in now, either in terms of the numbers or in terms of the effect upon people's hopes and expectations, and therefore on quality.

Chairman: Thank you for that.

Q269 David Heyes: You could say perhaps that the Civil Service itself was to blame for this influx, or the need to search for talent outside. I want to explore your views on what the Civil Service is doing from within to renew itself and make sure it has got the skills in place for the future, and I would like to hear your views on that?

Sir Robin Young: Perhaps I can take that one, as it relates to the last one, not least because I chaired a group with Gus O'Donnell on it, about improving Civil Service leadership capacity. I think you are absolutely right with that question. What was happening when we put out posts to open competition was that the civil servants lost on merit. It was not because there was a decision taken in advance to have somebody from outside, it was just that we seemed to be not bringing forward people with the right mix of skills and the right self-confidence to win on merit in a competed interview process. Something was going wrong with the mix of skills and the self-confidence of our future leaders, which meant that whenever we did open up a competition we lost on merit. That was why I think we were right, since we always need to have the best people, to accelerate, in the short term, the number of people coming in from outside on merit. What we should be doing meanwhile though, in response to that, is making every effort to review our future leadership model so that we get and train up future civil servants who will beat outside candidates on merit in open competition. That was the way in which we tried to sell within the Civil Service something called the Civil Service Leadership Model, which is available out there, if people want to see it. Basically, it said "Let's try to keep the historic strengths of integrity, neutrality, intellectual excellence, keeping the show on the road, but add to it some new skills which Civil Service candidates have shown they lacked when they failed to get these jobs in open competitions." These included self-confidence, presentational skills, working in teams, taking risks, putting your head above the parapet and generally the things which outside candidates seemed to be beating us on in interview. Now we have a completely re-sorted training and development model for the young, senior civil servants and new fast-stream entrants, which was designed to make our existing population more likely to win in open competitions, and I hope it is going to work.

Q270 David Heyes: You did not mention the 'professional skills in government' programme, which came in about 18 months ago; you would see that as part of it?

Sir Robin Young: Indeed it was; it came in after it. I chaired something called the Improving Capacity Group and that was followed straightaway by the Professionalism group, so there were two strands begun under the last Cabinet Secretary and I imagine Gus is continuing them. These two strands are going to transform, I hope, the training and development of future leaders of the Civil Service.

Sir David Omand: The roots of this go back a very long way. There were lean years in the 1980s, when the Civil Service should have been taking in 300 fast-streamers from the graduates and they were taking in a dozen, or fewer, so there were lean years, and those are the people, who now, 20 years later, ought to be getting to the top. There was a deficit there. There was a big deficit in terms of giving civil servants the experience of managing programmes of change. In specialist skills, project managers we were very short of, and IT competence in dealing at a strategic level with major IT issues. There were very few people around who really had experience in those areas; that was a national shortage. Nonetheless, there were very good reasons for thinking, by the time of the late nineties, that the Service needed quite a lot of refreshing.

Q271 David Heyes: Sir Nicholas, do you feel that the Civil Service is doing enough to ensure it has got the right skills for the future, because you have all talked about the need to maintain a balance, a proportion, here between the injection of whatever benefits you get from private sector skills and the traditional Civil Service approach and ethic, and so on? Is enough happening? Can the lost ground be retrieved?

Sir Nicholas Montagu: I would be very worried about saying enough was happening, of any organisation, because there is always more that can be done. Certainly I think a lot more is being done. The Civil Service that I joined over 30 years ago tended to think in terms of development as ticking the boxes for how many days a year you spent on training courses; we tell this Committee that development ain't that. I do think that a lot more is being done now, particularly with groups identified as having particularly high potential, to ensure that their wider development needs are met, in terms of filling the experience and skills gap, giving them, for example, experience of management jobs and rounding them more for future, very high-level jobs. That is where I agree very much with David. I coach people on the 'high potential development' scheme, where, interestingly, there is a very good core of career civil servants and of people who have come in slightly later and who now therefore are being groomed up for very top posts. My only worry is, as always with these schemes, that there is a risk of neglecting what I might call the routine needs of people who at this stage are not in the very top cadre, who may be late developers, but in any case who will have very real development needs, to ensure that they too have a proper, individualised programme, and this ought to be the responsibility of their managers, which will equip them, in terms of skills and experience, for anything that may come along in the future.

Q272 David Heyes: Do any of you feel that we have gone too far in bringing in this private sector element to the Civil Service, with the risks of that distorting the public service ethos, the tradition?

Sir David Omand: A lot of the people coming in are not coming from the private sector, they are coming from local government, the Health Service, and so on.

Sir Nicholas Montagu: What exactly are you thinking of?

Q273 David Heyes: Bringing, if you like, a more businesslike ethic to bear, and you can acquire a businesslike ethic in other parts of the public sector and the voluntary sector, or wherever, that has a distorting effect on the policy direction and a view of the world that influences the advice that ministers are given. I would suggest, for instance, that some of the problems that we have talked about earlier, in the Health Service, could be traced to having reliance on looking to the private sector for service delivery at the expense of the traditional way of doing things, that the source of that is in the advice which has come from this new influx of people and this new view of the world?

Sir Nicholas Montagu: I do not think that. Certainly there are times when I have felt that the Civil Service Management Board, the group of permanent secretaries, which David, Robin and I were on, was assuming analogies with the private sector that were false, or on occasion believed that it was copying private sector practice when actually it was not doing so. I do not think that there has been an influx of what you described as private sector ethos at the expense of the public sector ethos. Public sector ethos is to do with a lot of the values and the institutions that we have been talking about today. What I think has been healthy under successive governments - and after all this is nothing new, remember that the so‑called "Next Steps" report was actually called Improving Management in Government: the Next Steps - has been an increased emphasis on conducting government business in the kind of orderly way that would be natural for a private sector company concerned with a very different sort of business. So that you do expect coherent planning systems, you do expect aligned management processes, you expect to see proper risk management processes in place and again, obviously, a sensible use of non-executive directors on departmental boards. You could say that all of these were examples of importing what you describe as the private sector ethos. Actually, I would describe them as looking to other sectors and applying relevant experience from them in a way that genuinely improved Civil Service management.

Chairman: Thank you for that.

Q274 Kelvin Hopkins: I have detected varying degrees of concern about the increasing centralisation of power and decision-making in Downing Street, rather than in Cabinet and with a more pluralist approach to these things, but understandably you all deny that the Civil Service has become politicised. I just wonder whether this is because perhaps now everyone is signed up to a consensus on a world view and that there is not any real division of view about the direction of travel of government any more: the end of politics?

Sir Nicholas Montagu: I do not think so, myself, and again others will have their views. Even allowing for the sometimes artificially-generated heat among you lot in this House, one can see, I think, very real differences of emphasis and underlying differences of ideology. I do not feel that we have got the kind of sometimes bland consensus that I have seen in countries with different political systems, particularly those where a coalition is endemic. I think that probably the reason why we may seem perhaps a bit complacent about non‑politicisation is because we believe genuinely that a shift in power from one part of government to another, or a shift of power from the permanent officials to political appointees, does not constitute politicisation. I think all of us interpret politicisation as more of an overt or covert process, in which permanent officials colour their advice on the assumption that if they do not show, implicitly or explicitly, party bias for the party in power they will suffer, or in which their progress is impeded if they are not seen as government supporters, or in which ministers interfere in an appointments system so as to give preference, in an ostensibly open process, to people who share their political views. Those are symptoms; it is not a definition. I think what we are saying is that they are symptoms we do not see occurring and that the shifts in power that were agreed on do not alter the truth of that.

Sir David Omand: I think I would put a little rider on that. I agree entirely with what Nick says about politicisation. It is not about the Civil Service being pressured to take a partisan view. I do not think there is any evidence of that. If, however, the style of government is one in which there is a prevailing view about a particular issue which is very strongly held then it is possible to fall into group-think. It is possible to find that actually it is difficult to be the dissident voice saying, "Actually, this will take twice as long as you think it will," or "It can't be done within the budget," or "This is actually going to have a serious knock-on effect on another area of policy altogether and, before you decide to do it, you had better consult that secretary of state and get it worked out." This group cohesion at times can influence how decisions get taken. Smart secretaries of state, and I have worked for some very smart secretaries of state and I am very well aware of it, talk to their permanent secretaries and avoid getting into these problems. It is one of the risks of having a smaller number of people involved in higher policy-making.

Q275 Kelvin Hopkins: Your careers blossomed under the long period of office of the Thatcher/Major Conservative governments. During that time Mrs Thatcher was known to prefer people whom she described as 'one of us' and people who were 'not one of us', in various spheres, I understand, were marginalised, or were not preferred. Radical changes took place in the approach to politics - in particular, privatisation, moving towards economic liberalism - a very dramatic shift from the kind of social democratic consensus that there had been before. In that era, if one wanted to progress as a civil servant, would one not, effectively, have had to sign up to that emerging new view of the world and would people perhaps who took a social democratic view and did not like privatisation select themselves out and do something different? Was that how it worked?

Sir Michael Quinlan: I worked through the whole of this period in fairly senior posts. I do not think that did happen at all. The story that Mrs Thatcher appointed people according to whether or not they were 'one of us' I think is media fantasy, very largely. Clearly she had some influence on who got appointed to a few permanent secretary posts, but that is something which any Prime Minister is in a position to do. It is clearly the case that civil servants who serve ministers - that is what they are there for - are going to be influenced by what ministers want. It is no good, if you do not believe in a particular policy to which the government is wholly committed, saying that constantly every time it comes up; to that extent you have to conform. That does not mean that you do not criticise, you do not point out difficulties, and I think that remained so right through the Thatcher years, as I remember them.

Q276 Kelvin Hopkins: There is a model described in our committee papers which some seem to think is the way we live now, the model that there is always a right answer to every policy and therefore that there is no need for political choice any more. Indeed if one looks, indeed, at leading members of all the political parties, the differences between them in many cases are negligible. Do you think that we have now got to a point now where government is saying "There is a right answer; it's only delivery. The direction is decided, the policy is agreed by everybody; it's just a question of getting to the delivery"?

Sir David Omand: I think there are many problems for which there are no solutions and the political choice comes in taking the least worst, and deciding, as it were, which bits you compromise on is the essence of political choice. It is very hard and I think there are still many disagreements about how that could be done.

Q277 Chairman: It is not much of an election slogan, is it?

Sir David Omand: Yes.

Q278 Kelvin Hopkins: In a healthy democracy, and I put this point to Sir Christopher Foster last week, pluralism, different centres of power and a bit of tension between them is a good thing. Do you not think that the Civil Service would do well to encourage people who take different views from that prevailing at the moment, who might even be old-fashioned, middle of the road social democrats, like me, who would be completely out of favour with our present leader. Might it actually be a healthy thing inside the Civil Service to promote, more of a debate about policy in a real sense?

Sir Robin Young: I think you would find, if you came through a government department, that you would be really struck by the different types of people and different views actually that are there. Far be it from ex-mandarins to tell MPs whether there is now a new political consensus; you know that better than I do. When you are in a government department, say, DTI, looking at nuclear energy or Rover, it is not obvious there is consensus on those issues, whatever the leaders of the parties might be saying. When you get down from the general to the particular there is plenty of room for disagreement, both amongst officials and amongst politicians, in ways which are not always predictable either by party or by manifesto. There is plenty of room for interesting discussion in departments and I think you would be struck by the variety of people we do promote and actually, if they were able to tell you, the different views they hold too.

Kelvin Hopkins: You must introduce me to some of your Socialist colleagues, Sir Robin.

Sir Robin Young: I could. I would not dare, but I could.

Sir Michael Quinlan: Could I say, Chairman, that there is very clearly a wide range of attitudes to be found in the departments; on the whole, they do not come with a political label. I would not have the faintest idea whether my colleagues in the Ministry of Defence were Social Democrats or Conservative, any more than, I hope, they would know whether I was. There are just different temperaments and different judgments.

Chairman: I think the point behind Kelvin's question, and he puts it sometimes well, is the worry that the grit is removed from the machine and the traditional 'truth-telling to power' role of civil servants can be eroded, in conditions particularly where there is group-think of a kind that you describe. I do not think it is the question of ideology, as you say, Michael, that people bring to it, it is whether we can retain those independent, critical voices that will improve the policy process, and I suspect we all agree about that.

Q279 Mr Prentice: On that very point, in what circumstances should civil servants blow the whistle on their secretary of state? Let me cite a current example, it was in yesterday's FT, the Chancellor of the Exchequer's decision to remove the requirement for an operating and financial review, which would apply to all listed companies; business felt this was a burden, the DTI had consulted on this for months and months and months, and the Chancellor, a kind of ex cathedra pronouncement, just set it aside. We see from the story in the FT that officials in the Treasury were urging the Chancellor to consult other departments but it did not happen, and it came into the public domain only because Friends of the Earth decided to make an issue of it. In what circumstances should civil servants, let us take the case of the Treasury here, say to themselves, "If the Chancellor isn't going to speak to the Secretary of State for Trade and Industry, well, we're going to do the consulting for him"?

Sir David Omand: This is a very good question, and you have to say blow the whistle to whom? The Secretary of the Cabinet exists in order to fulfil the role of someone to whom a permanent secretary or senior official can take a problem like that. Actually, I think it occurs remarkably rarely, because permanent secretaries actually do spend a lot of time talking to each other and they act as a short-circuiting network. It is not uncommon that you can find in any government, and I can go back many, many years, with different kinds of governments, strong personalities which clash, and therefore ministers do not want particularly to consult colleague X or colleague Y, and part of the value of having a permanent Civil Service is that, in the end, the business still gets done. If your question was when would they blow the whistle outside then the answer is never.

Sir Michael Quinlan: Never.

Q280 Mr Prentice: Coming back to what I said earlier, I would like to see some kind of a British standard, a kite-mark, attached to policy as it comes out of the machine, and we do not have a kite-mark, in the way you talk about, Sir Michael, in articles you have had published in the Guardian and in others, where you talk about the shambles of some policies, the decision to abolish the office of Lord Chancellor. For people like myself, on the outside, trying to get some kind of understanding of what happens inside the machine, it is profoundly dispiriting that we get half-baked policies coming out and not a peep - not a peep - from people inside to express their reservations. Maybe the channels are not there; that was your comment.

Sir David Omand: The channels are there, and, in a sense, the germ of what I suspect you are looking for is already in the Ministerial Code, which says, ministers have a duty to give fair consideration and due weight to informed and impartial advice from the civil servants. If those ministers are disregarding due advice that actually it is unsound to proceed, for various reasons, including the fact that you will destroy a colleague's programme with your proposal, or whatever, then the minister is in breach of the Ministerial Code. That is where the Cabinet Secretary and the Prime Minister have a duty to intervene.

Sir Michael Quinlan: Arguably, only the Prime Minister can enforce this within government, and outside it only you can police it.

Q281 Chairman: You have seen that this is coming out of what Gordon was asking you. Last week we had a very interesting discussion with Sir Christopher Foster and Lord Butler about this business as to whether there has been a decline in simply the quality of government, and they both assented to the proposition that there had been, and indeed Lord Butler said, yes, he shares culpability for this process. Collectively, you all seem to be saying you are not declinists; in fact you are telling us that things have got better?

Sir Robin Young: I am, certainly. I am not sure that everybody else is and I do not buy the Foster thesis that things were perfect when he was around and are worse since then.

Sir Michael Quinlan: He does not say that.

Sir Robin Young: I do not buy that thesis and some of the examples he uses, the poll tax, and things like that, he was involved with personally, so I think, if I were you, I would investigate that thesis more carefully.

Q282 Mr Prentice: We are striving after perfection, are we not; we just need some pointers from people like you about how policy-making can be improved, and there is just so much stuff coming out now which is kind of mutually contradictory?

Sir Robin Young: In my opinion, government is hugely more complicated than it was before. Things are moving quicker than ever before, there is more of it than before; if you want less of it then you are in Parliament and you can stop it. I would say the Civil Service machine is coping fantastically well with the challenges it is getting and is improving in the way it is doing its business; that is my position, and it is not the position maybe I read from Lord Butler, which was why I was quite pleased to come along today.

Sir David Omand: It is consistent with Robin Butler's position, because the world we are working in now is not the world of ten years ago and certainly not that of 20 years ago, so to say that things are getting worse is, I think, a very misleading way of looking at it. It is a different world, and the question is are we actually as good as we might be in today's world, and my answer to that is, no, we are not and there are things we can do to improve. That is the way round to look at it, I think.

Q283 Chairman: We have not really talked about appointments at all, in relation to ministers and civil servants. What I want just to test on you is, if it is being said that ministers are accountable for the running of their departments, that is what the constitutional relationship is, clearly they will want a role in choosing the kinds of people who are going to do the actual running for which they are going to be held accountable, would it be dreadful if ministers had rather more of a role than they have now, in appointing people inside departments?

Sir David Omand: Are you referring to the permanent secretary or generally to the appointments within a department; because there is a clear distinction, which I think sometimes does get forgotten, between the process of appointing somebody from within the Civil Service to a key appointment, such as a permanent secretary or a director-general, in which there is no bar whatever to a secretary of state being fully consulted in that process and his, or her, views being taken into account. However, if it is being run by an open competition, in order potentially to bring somebody new into the Civil Service, then that process has to be seen to be objective and impartial, and if we are to maintain the standards I think we should maintain you cannot compromise on that.

Q284 Chairman: This seems a rather artificial distinction, does it not?

Sir David Omand: No; it is not artificial at all. I think it is a very real one.

Q285 Chairman: If we are saying that it is perfectly normal, and indeed proper, for politicians to get involved in internal promotions, internal movements, inside the Service, which is what we are being told and were told last week by Lord Butler, but that if we run an open competition then these great rules kick in, with the Civil Service Commission, I am putting it to you, that rather gives the game away, in terms of politicians not being involved in Civil Service appointments when in fact they are routinely involved in Civil Service appointments, except when we run open competitions?

Sir Nicholas Montagu: I think I will dissent probably from some of the things my colleagues said about running departments. I have a very clear and rather traditionalist view that ministers should not get involved in the actual running of departments, in terms of appointments, management processes, allocation of budgets, and so on. So far as appointments are concerned, I think that a sensible permanent secretary will talk informally to a minister before making a senior appointment to an important job where productive contact with the minister is going to be critical to success. What worries me, and this was the reason I wrote that memorandum which I did about the code of conduct, is the thought of a blurring of lines of responsibility between ministers' and the permanent secretaries' accountabilities, which I would argue are accounting officer responsibilities for the running of the department. I would see appointments as coming squarely within that.

Sir David Omand: There is not a lot, in fact, between Nick and myself, because the process I am talking about is that informal consultation with the secretary of state about which individual would work best with the secretary of state as a private secretary or a director-general, or whatever. Provided the individual was coming from within the Service and therefore had been accredited already by the Civil Service Commission as at an acceptable standard, in terms of merit and in terms of their values, and being confident that the individual will live the values of the Service then, perfectly properly, the secretary of state can be consulted about it. In the end, it is not the secretary of state's decision, if it is a Civil Service posting, but nonetheless the secretary of state, almost invariably, indeed would be consulted over senior departmental appointments. If you extend the proposition and say then, "Well why don't we do the same for external appointments?" what you are doing then is you are beginning to breach, I think, an important part of the structure that Robin Mountfield set out in his really excellent paper on this. I think you have to allow the Civil Service Commission to be the judges of whether an individual meets the standard for a senior position in the Service; therefore, if you have chosen to run an external competition, you have not got an alternative. This comes back partly to my point about when it is advisable to run open competitions for the permanent secretaryship of a major line department, and I suspect probably it is not often.

Q286 Chairman: I am sorry to go on about this, but this tests some of the rather general things that we say. It is not just a question of meeting the standard, because indeed that is what I think ministers, and I believe the previous Cabinet Secretary, were asking for in wanting to get some revision to the rules on open competitions. They wanted to move over, I think, to something like the public body model with the Commission of Public Appointments, where they are allowed to choose from a number of candidates who meet the standard, so there is no question of not meeting the standard. The question is, if two or three candidates meet the standard, as found by the open competition procedure, monitored by the Civil Service Commission, what would be constitutionally outrageous about ministers then, as with public bodies, having a choice, given the fact that they are involved routinely in internal competitions anyway?

Sir David Omand: You are suggesting effectively a two-stage process. You could build such a process in which the Civil Service Commissioners were the first gateway and then you had a ticket saying, as it were, "You are appointable to this position." Then you would have to go to the minister and say, "Of the available appointable people, some of whom come from outside with tickets, some of whom come from inside, which would you prefer?" You could make such a system work; the danger would be, in terms of the perceptions from outside, and that actually you would have to construct this system really rather carefully. An alternative way of doing it, which would be informal, is just simply, at the stage of the long list, that you consult the secretary of state and ask whether "any of these people are people you would not be able to work with?" I have found, in running these competitions, that an informal consultation at long list stage, which you can do with public bodies, you get the information you need from the secretary of state yet you preserve the impartiality of the objective selection, which of these people then is the best; so that is another way of approaching it.

Sir Michael Quinlan: On the matter of internal appointments, this has to be a matter of convention, not of formal rule or law. Certainly I would consult the secretary of state about who I was going to propose as Policy Director in the Ministry of Defence. Secretaries of state, in my experience, will accept that and will disagree with me only on very strong grounds and will not expect all senior promotions to be referred to them. There is no formal reason why they could not insist, and I can remember one case, in one department, when I had a battle with the secretary of state about insisting on a particular appointment. It rests on convention; it is a very healthy convention, it is a very well-established convention. I do not think it can be better than that.

Q287 Chairman: Let me go back, just finally, to one question which came up earlier on, which is the difference between politicisation and centralisation, and this takes us into territory that we may get into as a Committee later, not immediately, but because we have got you I would like just to ask you about it. There is an argument around which says that we have got the worst of both worlds at the moment. That is, we have lost, as it were, the integrity of departments, they have been weakened, but, at the same time, we have not built the kind of strong, strategic centre that other organisations would have, that we live in this limbo state where departments feel that they are being endlessly interfered with but the centre has not equipped itself with the kinds of skills and powers and resources to make it a genuine centre. Sir Michael, you have argued about the presidentialisation that is going on and the lack of checks and balances; is this the state that we are in and, if so, in which direction should it be resolved?

Sir David Omand: I raised this in my earlier remarks. In a sense, I think it is the state we are in, but the choices open are not straightforward. The centre does not have, and the Prime Minister does not have, the statutory authority. The statutory authority comes from this House to the secretaries of state through the various pieces of legislation. The permanent secretaries report to their secretary of state; that is the constitutional position. To change that is a very big decision and one that Parliament would want to oversee. I do not myself advocate such a change, nor do I not think it is necessary to make such a change; what is needed is a rebalancing of the processes of government so that you can produce a genuinely strategic centre. Colleagues have pointed out the need to join up government policies. You cannot run government in departmental silos and therefore you need to have a centre that is capable of ensuring that government joins up, and you need to have a centre that can produce a strategic view about these major policy issues. What perhaps you do not need is a centre that is trying to do the individual secretaries' of state job for them, in constructing the detailed policies that will give effect to the government's strategic direction, but this is a matter of personal choice for the ministers and prime minister of the day. It is convention again; you cannot really legislate for it.

Sir Michael Quinlan: There have been mechanisms; you will remember, Chairman, the Central Policy Review Staff, which sadly, in my view, Mrs Thatcher abolished. Essentially, that was something set up to look across departments; so it is not an innovation, what is happening.

Sir David Omand: Just to add this thought, because we have not had time to discuss it, to consider the influence of the media. That runs through all of this and drives a lot of what happens under the label of 'centralisation', because of the need to ensure a coherent, consistent approach, and in some cases that is really distorting the way policy gets made.

Sir Robin Young: I think it is roughly the way you said it. I do not think we have lost the integrity or strength of departments. I do not think you should take that as read. I think departments are strong and are better than you believe, or that the critics believe, and some of the generalisations just do not apply to work in departments, actually they are all about Number 10 or Number 11. A lot of things said about the Civil Service, really, in my view, are talking about Alastair Campbell, or something of that nature, whereas actually what goes on in departments, if you speak to ministers or civil servants in departments, is very, very, very different from the generalisations about Numbers 10 and 11. I think you are right, we have not got the strategic centre that we need, and, as I said earlier, we do want a strategic centre, nor do we have clarity about what the centre does, and thinks it does, and what we mean by the centre, whether we mean it is Number 10 or Number 11. In my opinion, the government should set that out for itself; it should not be laid down by you or by Christopher Foster, or even Nick Monck. The government should say, "This is what we want at the centre and this is what we're going to get. Here is the job description of the Lord Birt figure, here is his willingness to appear before Mr Wright and explain what he does." There should be transparency and confidence about the strategic centre which we are setting up, but the government should decide what to do.

Q288 Chairman: This is a foretaste for another inquiry; it is a tantalising foretaste.

Sir Robin Young: You have a solution now.

Chairman: Some people say that Gordon Brown is going to resolve this, in practice, by putting Number 10 and the Treasury and the Cabinet Office all together and we shall not have to worry about these things because they will be gone and we shall look back on a golden age of pluralism under the present Prime Minister. Anyway, that is for another day. I think we have had a really interesting session; in fact, I think we will have to call on you as a sort of standing panel and bring you back for all these inquiries. Thank you very much. We have covered a lot of ground. I am sorry we have not been able to do justice to everything. I am sorry, I have got one sort of 'sting in the tail' question from David Heyes.

Q289 David Heyes: Clearly, you have got a huge wealth of experience between you and I just wondered if any of you had thought about sharing that with the wider world. Have any of you written your memoirs, or do you intend to write your memoirs?

Sir Nicholas Montagu: I satisfy my ego trip by writing monthly for the Guardian's new 'Public' magazine, which, of course, is compulsory reading for all Members of this House.

Sir David Omand: No memoir.

Sir Robin Young: No.

Sir Michael Quinlan: No memoirs.

Q290 David Heyes: What do you think about top civil servants retiring and cashing in with memoirs?

Sir David Omand: We deplore it utterly.

Sir Nicholas Montagu: All of us could tell John Major y-front stories; most of us choose not to do so.

Chairman: That is a tantalising thing to say at the end. As you know, we are doing a little inquiry on memoirs as well. Thank you very much indeed for this morning.

 



[1] Note by witness: See Carltona Ltd v Commissioners of Works [1948] 2 All ER 560.

[2] National Institute for Clinical Excellence