Examination of Witnesses (Question Numbers
60-79)
DAME HELEN
GHOSH DCB, MR
MIKE ANDERSON
AND MS
ANNE MARIE
MILLAR
11 NOVEMBER 2009
Q60 Paddy Tipping: So what signals
are you getting? There are reports that you will be asked to make
further savings.
Dame Helen Ghosh: Well, under
one of our most talented young colleagues, we have launched a
programme within the Department both for the Public Value Programme,
which is essentially looking at our spending programmes, the Operational
Efficiency Programme, which is broadly described as `back office',
but it is everything from procurement to shared services and so
on, and the Arm's-Length Body Programme, which is what does our
delivery landscape look like, are there too many people, too few
people. In fact, with a department like ours, all those things
line up very closely together, so, if you take how you deal with
flood defence, that is a spending programme, but it is also an
efficiency issue in terms of the Environment Agency and ourselves,
and it is also something about the relationship with an arm's-length
body. We were one of the first departments to get into action
on that, and I imagine it is the case that the Chancellor will
want to give sort of preliminary indications about what kinds
of findings are coming out of that and some of the first kinds
of savings that might be found. Again not to blow our own trumpet,
but I think that is what I am here to do, I think we were probably
the very first Department to send our return into the Treasury
in response to an early exercise because we knew where we were
and we had set it up. Clearly, in terms of our programmes, a lot
of our big spending is what you would call `licence to operate',
so flood defences, animal health, in particular, and our science
programmes and so on, so we have constantly to hit that balance
between getting more efficiency out of the money that we spend
and to what extent you can reduce the budgets further. I think
on the Operational Efficiency Programme there is a published target,
which is what we are working to, that all departments should find
between 20 and 25 per cent of their so-called `back office' based
on 2007-08 by 2013-14, so that is what we are working to there,
and again I imagine the Chancellor will want to say a bit about
how people might do that.
Q61 Paddy Tipping: But you can only
make efficiency savings for so long. Ultimately, it gets harder
and harder and you have got to look at spending programmes. What
reassurance can you give to us about spending programmes, that
they will be cut?
Dame Helen Ghosh: I do not think
I can give you any more assurance than the Government has given,
which is that, clearly, the first thing to do is to look at how
you can get more for the money you have got, but the Prime Minister
himself, in his well-covered speech about cuts, made the point
that you might have to stop doing lower-value programmes, which
ultimately of course is a question of judgment and support both
publicly and politically, so clearly, as part of our work, we
will be looking at whether we can identify those things that are
lower-value programmes. Again, as I think I have discussed with
the Committee before, we have difficulty doing that in the sense
that, sadly, we do not have programmes which spend a lot of money
which do not relate very closely to our strategic outcomes or
have `licence to operate' implications, so there are not easy
pickings, which is why efficiency and getting more for our money
is where we need to look to first.
Mr Anderson: It is also the value
question, with all these acronyms that are going around, but actually
the real issue is the value of the programmes that we produce.
We do have a real understanding of how our programmes and our
money track together now, and that has happened in the last period
since the Permanent Secretary has reorganised, and what we really
want to merge in the next few months is that full list of prioritisation
and understanding of the value, that, if you put more money in
here, you will get more result out here and, if you take it away,
you are going to damage to a degree so that, when we go to ministers,
we have that full list of options, depending on whatever the Treasury
say to us at the time they say to us, "Right guys, this is
what we have. This is what you're going to get", and that,
I think, will ultimately answer your question. There will come
a moment though when we will have to stop something and we need
to be in a clear position to explain why we are saying that that
is the least value.
Q62 Chairman: Just to be absolutely
clear, on page 138 of the Report you have identified towards the
£75 million about £35½ million worth of savings
already, but is the next stage of finding the other £35 million
the process you have just described, in other words, some programmes
are going to go, or are they focused on better value for money
in other aspects of the way that your Department is run?
Dame Helen Ghosh: The narrative
on this is extremely complicated because things come out sequentially.
Q63 Chairman: Well, make it simple
for our readers please.
Dame Helen Ghosh: The £75
million that you are quoting was an amount quoted by the Chancellor
in the Budget this year where he said—
Q64 Chairman: Well, I am only quoting
from page 137 of your Report. You have written it down. It says
here, "Looking ahead, Defra and its delivery bodies will
be working together to identify and deliver the additional £75
million of efficiencies required by 2010-11, confirmed in the
Budget".
Dame Helen Ghosh: Sorry, the narrative
is what I am trying to tell you. That is money we have simply
taken out of our budget for 2010-11, it is done, we have taken
it out of the budget. The process I have just described, and we
know something across the Department and the agencies of what
the impact of that is, but we do not yet know, because actually
we are however many months we are away from 2010-11, exactly how—
Q65 Chairman: Not long.
Dame Helen Ghosh: Not long, but
all of our bodies, back to the list we gave in the additional
information, are working out how to deliver as many of their outcomes
for that money. The exercise that Mike describes, the Public Value
Programme, is looking at programmes to 2013-14. It is not a CSR,
but effectively it is saying, "If you look beyond at 2011-12,
2012-13 and 2013-14, how can you reduce your spending?" All
departments have been asked to look at the 50 per cent by value
of their programmes for that period and to show how they can reduce
or make more efficient, or whatever the outcome is, their spending
for those three years, not 2010-11, so £75 million is 2010-11
and PVP is beyond 2010-11.
Q66 Chairman: Let me ask a question
about how you monitor it because at the end of the day you are
a service department and you deliver services to a broad range
of customers.
Dame Helen Ghosh: Yes.
Q67 Chairman: When you reduce the
expenditure, for example, you talk here about £17 million
being saved on TSE[23]
surveillance, okay, fine, but who is tasked to monitor that you
are not actually underachieving in terms of appropriate practices
to provide the protection at the same level as it is today, but
costing less to deliver? Who is tasked with the quality control
of the reduced expenditure, but holding delivery quality constant?
Dame Helen Ghosh: Well, in that
case, there is a demand-side issue as well as an affordability
issue. It has been clear, as with TSE and all the research we
have paid for at VLA[24]
and elsewhere and the incidence in livestock, that, if the incidence
of TSE is declining, then you need to do less surveillance. We
will take those judgments on the basis of the best possible scientific
advice that we get and, as you will know, I think, from your previous
lives, we have very distinguished scientific groups on things
like spongiform encephalopathy to tell us what surveillance they
think we should do, so we reduce the surveillance in line with
the best scientific evidence that we can get and that is how we
test that.
Q68 Chairman: Did it not occur to you, when
you see that you can make savings of this order, how, relatively
speaking, inefficiently the Department was run before?
Dame Helen Ghosh: That is not
a saving that is anything to do with efficiency or inefficiency,
it is what we choose to do.
Q69 Chairman: But there are other
things where you are doing things in a different way. How radically
are you starting to limber up? For example, over the debacle of
the RPA, I heard somebody irreverently suggest that, for example,
Natural England paid money out of environmental schemes, so, if
they do it, why can they not take over the RPA? Why do you not
bang it all together? How revolutionary are you going to be? You
have got lots of outposts doing similar things.
Dame Helen Ghosh: The exercise
that I described, the arm's-length body exercise, will look at
precisely those sorts of issues. We do constantly look at our
delivery landscape, and Hampton made us do that in terms of where
our inspectorates are. It is easy to be quite simplistic though,
that X pays money out, so it is obvious that they should pay money
out. Actually, if you look at the staff in Natural England and
the expertise in Natural England, it is predominantly people who
understand biodiversity, can give farmers face-to-face and excellent
advice on environmental stewardship schemes, but actually a lot
of what the RPA does is a payment operation, having done complex
calculations within a complex scheme, so, in that sense, it is
probably closer to complex social security benefit administration
than it is to Natural England, but we will be looking at precisely
those sorts of issues. If I can come back, the fundamental issue,
I suspect, that all departments need to face if times are tough
is what are the things that only Government can do, and that is
the criterion, what are the things that only Government can do,
and should we think about doing only those things; I think that
is the criterion.
Q70 Mr Williams: One of the targets
that you were set was the Lyons relocation target and I think
you hit that fairly early on?
Dame Helen Ghosh: We have exceeded
it.
Q71 Mr Williams: You were going to
exceed it because of the relocation of the MMO[25]
to Tyneside, but, when the review of the shortlisted locations
was done, the staff were not very keen on either Tyneside or Newcastle,
which I think was the other one, but you said that the relocation
and transition was going to take place without redundancies.
Dame Helen Ghosh: Indeed.
Q72 Mr Williams: But, if the staff
are not very keen on it, what procedures are you putting in place
to make sure that you can achieve your target of no redundancies?
Dame Helen Ghosh: The Marine Fisheries
Agency is an executive agency which is of course part of the Department,
so all the current staff in MFA are civil servants, so what we
have done, which is what we would do if we were reducing the work
in any area of the Department, is say to the staff in the MFA
who do not wish to go to Tyneside, "You will, therefore,
be able to apply for roles and you become, as it were, moved back
into the heart of the Department, or indeed you can apply for
jobs in other executive agencies", and that is the commitment
we have made to them, so they will now, but I think we are phasing
it in such a way so that we make sure that we maintain the skills
that we have in the places that we need them. That is the process
that the staff who do not want to go are following, so they are
just like any other civil servant in the Department.
Q73 Mr Williams: How successful has
that process been? Have you some idea of the outcome?
Dame Helen Ghosh: Of course, as
I say, we are not doing it as a big bang, because we need to make
sure we can maintain the service until the April vesting date.
I am very happy to establish how many people have already moved
out and back into the normal department, but they are, I know,
already exploring, applying for jobs, as it were, back in the
Department, though they are in the Department already, in fact.
I should also say that I think we are being very successful in
recruiting very highly qualified staff to work up in Tyneside.
I was recently looking at a list, I think in response to a parliamentary
question about the qualifications of people we were recruiting,
and they were dazzlingly well-qualified. Existing staff are well-qualified,
but we do not seem at the moment to be having trouble in recruiting
good people.
Q74 Mr Williams: I understand that
Tyneside were very late in showing an interest to view the location
for the MMO. Could you tell us a little bit, very briefly, about
how the process of selection took place and who, in the end, was
responsible for the decision?
Dame Helen Ghosh: It was a ministerial
decision. Again, I would be happy to give you details of the process,
but we clearly wanted to go through a fact-based, an evidence-based
analysis, and so we looked at a variety of issues: whether it
was staff preferences, whether it was the local labour market,
whether it was the issue about access to clusters of scientific
excellence. Of course, any choice was bound to be controversial.
I know the staff very much hoped that we would remain in London,
but the then Minister, Jonathan Shaw, and Hilary, took the view
that to have a Marine Management Organisation that was not more
obviously near a coast would not send the right kind of signals.
Q75 Mr Williams: I think some interested
parties thought it was going to go to the South West. I understand
there were ten locations on the shortlist. How many of those locations
were put to the Minister?
Dame Helen Ghosh: I do not know.
Q76 Mr Williams: Could you let us
know?
Dame Helen Ghosh: I could let
you know. I should say, it is a management decision rather than
a statutory decision, and, therefore, although I think we went
through a very open and transparent process, it is not the same
as making a statutory decision under a piece of legislation; it
is actually a choice which would be based on a number of factors.
Q77 Chairman: Just help me to understand.
One of your relocations has seen 223 agriculture and horticulture
development board posts relocated to Stoneleigh in Warwickshire
from what are described as "various locations in the South
East". If those people transferred to their new place of
work and they are earning the same level as they were, which I
presume they are, it is quite hard to understand where the cost
savings are going to come. There is no real detail about what
the pre and post property costs were, which must, by definition,
be the only other place you are going to save the money. Are these
real savings? If you could write to me (because you may not know
the answer) I would be interested in a break-down to know where
the savings come.
Dame Helen Ghosh: Yes, I would
be happy to do that. There was a business case and, as you say,
the business case will have analysed the opportunity costs and,
indeed, the actual savings you could make moving out of place
A and moving to Stoneleigh, and, indeed, there will have been
some, I suspect, voluntary redundancy payments made to staff,
so that would have been factored into the business case. The argument
for moving to Stoneleigh, which I imagine you are familiar with
from your previous roles, is that it is very much a cluster now
of agricultural and food-based business and science. The NFU[26]
is there, we have now brought together the old levy boards into
a single place, and so you will get the synergy advantages of
all being in the same place but I am sure that we have got financial
savings, and I am happy to send you details of the business case.
Q78 Chairman: I would just like to be
convinced that the savings really are real. Let us move on then
to the subject of the Customer Focus and Insight Project, a matter
that is dealt with on page 131 of your report. In practical terms,
what real differences will this exercise make to the quality of
the services which you provide? Give me an example.
Dame Helen Ghosh: I will give
you an example. I will give you the example of fishermen. I will
just go back a stage. Customer insight is useful for a number
of reasons in a department like ours. It is useful in order to
give customers the service they want and, therefore, serve the
public, which is one of the key things we are there to do, and
make them feel happy with our service. It is also about getting
them to do the things we want them to do and feel happy about
that thing. In persuading citizens, for example, to recycle, persuading
businesses to be more resourceful, actually you need to understand
how they think about things. You might do customer insight for
a variety of reasons. A good example is the work we have done
with fishermen, where there are, as you will know, a range of
issues about delivery, about change, about government strategy.
What we did there was we did research about what their attitudes
were to the relationship with government and, indeed, to their
business, to how they would like to interrelate to government
and, particularly, the Marine and Fisheries Agency staff, who
were the people they meet most of the time. We did that analysis.
We met groups of fishermen in their places of work around the
country and, for example, they said, "Actually, we do not
want to look at the Internet all the time. We do not read stuff.
What we like is information and guidance direct from people who
we know and trust." So what we are now doing is training
our marine fisheries officers to be able to give a wide range
of advice and information to fishermen on the quayside, and that
is a much better way of communicating.
Q79 Chairman: Why the heck could
you not put that in so that we have got some idea, instead of
having to read this kind of gobble-speak: "Improved service,
better defined systems and nurturing of a cultural shift which
is based on understanding and responding to behaviours and motivators
will ensure Defra better delivers policies and services that meet
customers' needs and achieve our strategic objective"? It
sounds like something from a travel book!
Dame Helen Ghosh: I think we have
a tendency to feel that telling stories is a bit infra dig.
I have to say, if you listen to any Management Board member or,
indeed, to Hilary, we say, "So, what is it we actually do?
Tell me a story." We will have more stories in next year,
I promise.
23 Transmissible Spongiform Encephalopathy Back
24
Veterinary Laboratories Agency Back
25
Marine Management Organisation Back
26
National Farmers' Union Back
|
