Embedding sustainable development across Government, after the Secretary of State’s announcement on the future of the Sustainable Development Commission

Written evidence submitted by the new economics foundation (ESD 02)

Summary

· Sustainable development objectives are universally supported in principle, but are often not acted on when they conflict with more immediately pressing objectives. It is this conflict that has to be managed.

· The traditional approach is to institutionalise the conflict into different departmental points of view. The alternative, which we recommend, is to make the conflict the business of a central unit.

· This is because the traditional approach:-

- Is at times wasteful and inefficient

- Makes it difficult for the government to respond in an agile way when things don’t go according to plan

- Cannot mobilise society for the major changes that will be needed in the 2020s

- Cannot provide the kind of strategic perspective which the scale of the challenge demands

- Cannot give enough air time to non-climate change threats to sustainability.

· Hence we recommend:-

- The Cabinet Office Minister of State should have responsibility for ensuring that the prosperity and well-being of citizens today is not bought at the expense of their prosperity and well-being in the future

- There should be a dedicated unit serving the Minister of State, to develop a long term strategy, to monitor performance against this, and to co-ordinate and engage with all those whose support will be needed for implementation

- The unit should hold a significant budget which it would then allocate to departments – this would be instead of not in addition to existing budgets

- The Climate Change Committee (CCC) and the Environmental Audit Committee (EAC) should each report regularly on the adequacy of the evolving strategy, the success with which it is being implemented and on potential improvements.

Main submission

How can mechanisms to ensure the sustainability of Government operations, procurement and policy-making be improved and further embedded and mainstreamed across Government departments?

1. Our response covers policy only and is based on a single, simple observation. Sustainable development objectives are universally supported in principle, but are often not acted on when they conflict with more immediately pressing objectives. It is this conflict between the long and the short term that makes the issue difficult and it is this conflict that has to be managed. This requires both effective policy making and effective and independent policy auditing: there are biases in government towards the short term and against action and we need external pressures to counter them.

2. As far as policy making is concerned we believe there are two possible approaches to managing the conflict:-

· The conflict can be institutionalised into different departmental points of view, and resolved through cabinet committees, cross cutting targets and the associated machinery. This was the approach of the last government.

· The conflict can become the business of a central unit, either permanently or at least for a while, and resolved through a combination of strategic analysis and the widest possible engagement with the private and public sectors and the public at large. This is the approach we recommend.

3. There are good arguments for preserving the previous approach: playing out the conflict in this way helps ensure that different points of view are represented, with the political equivalent of the invisible hand resolving differences. However we also believe it has real shortcomings (the examples are all from before May of this year):-

· It is at times wasteful and inefficient, with work being duplicated in different places to support different departmental agendas (for example on occasion this happened on supply chains, low carbon skills and consumption patterns), and poor alignment of policy development and implementation (for example on employment subsidies, fuel poverty, behaviour change and regional policy)

· It makes it difficult for the government to respond in an agile way when things don’t go according to plan – institutional bias and associated entrenched positions are designed into the system. One senior official has said that this slowness is actually a merit of the system, preventing politicians from constantly shooting off in new directions, but anyone who has worked in the private sector will know that responding to events slowly is hardly a pre-condition of good strategic decision making.

· It cannot mobilise society for the fundamental changes all parties agree will be needed in the 2020s and beyond, and indeed sends out very mixed signals: business, citizens and indeed the public sector need a very clear sense of where government thinks we are going if they are to play their role

· It cannot provide the kind of strategic perspective demanded by the scale of the challenges involved; these are simply too large for the negotiation of trade offs, micro-economic analysis and direction (or nudging) from the centre that the current structures are designed to deliver. As a result, no-one is dealing with them (as one senior official in a position to know has put it). A much broader strategic approach is needed, integrating economics (ie how to mobilise the private sector), organisational strategy (ie how to mobilise and co-ordinate government and the wider public sector) and political strategy (ie how to mobilise the public). The Secretary of State for the Environment told the House of Commons on 22 July that "We will put processes in place to join up activity across Government much more effectively." Governments have been trying to do that unsuccessfully since the middle ages; it is strategy not simply process that makes effective joining up of major policy development possible.

· It does not effectively integrate responses to non-climate change threats to sustainability into long term economic policy – the process is structured as a negotiation (between say DECC and BIS) which means the third player (in practice often DEFRA, representing biodiversity for example) does not get the air time it deserves.

4. Hence we recommend a structure along the following lines:-

· The Cabinet Office Minister of State should have responsibility for ensuring that the prosperity and well-being of citizens today is not bought at the expense of their prosperity and well-being in the future; he should also be the Prime Minister’s representative in negotiations between departments on this agenda

· There should be a dedicated unit serving the Minister of State, to develop a long term strategy, to monitor performance against this, and to co-ordinate and engage with all those whose support will be needed for implementation; the Director of the unit could also be a member of the No 10 Staff

· The unit should hold a significant budget which it would then allocate to departments – this would be instead of not in addition to existing budgets

· The Minister of State should chair a quarterly meeting of junior ministers across Whitehall with sustainable development responsibilities, with a view to spotting and nurturing opportunities for co-ordination and co-operation and for generating new ideas

· The remit of Cabinet sub-committee ED(EE) should be expanded to include policies designed to ensure sustainability and the successful transition to a low carbon, sustainable economy (it should also be rebadged).

5. The role of the central unit in more detail would be:-

· To identify risks and ways of mitigating these

· To caretake and communicate an evolving framework for the policies designed to deliver the transformation to a low carbon, sustainable economy

· To monitor performance against the metrics in this framework, building on existing systems such as carbon budgets

· To co-ordinate and ideally reduce the number of Whitehall initiatives that fit within this framework, and where there are policy conflicts, create areas of agreement that can be acted on, when necessary negotiating changes

· To build capability by providing analytical tools for policy makers (eg inputs to the Green Book), advice, training and commissioned research

· To stimulate and respond to the networks beyond Whitehall that encourage creative, joined up policy

· To engage with the public, business and the public and third sectors.

6. This would make much of the role of the Sustainable Development Programme Office in DEFRA redundant.

7. We believe this unit, if it stuck to this brief, would win the necessary Whitehall support. The Institute for Government reported recently in ‘Shaping Up’ (2010) that while senior officials would strongly resist ‘micro-management’, they would generally welcome ‘stronger leadership’ from the centre. We also believe that a small but strategic centre is more compatible with devolution of powers to local government than is traditional departmentalism.

8. As to the policy audit process, we recommend that the Climate Change Committee (CCC) and the Environmental Audit Committee (EAC) each report regularly on the adequacy of the evolving strategy, the success with which it is being implemented and on potential improvements. The CCC would, of course, be concerned purely with climate change; the EAC, ideally reporting after the CCC and incorporating its findings, would take a broader view of sustainability. We recommend that the EAC is supported by the National Audit Office in this work.

How can governance arrangements for sustainable development in Government be improved, and how can sustainability reporting by Government departments be made more transparent and accountable?

9. Our response covers policy only. The existing sustainability reporting as it applies to policy making is largely post hoc justification and as such a complete waste of time and money. The various official structures that have from time to time sprung up (such as the Sustainable Development Programme Board) have been equally pointless.

10. The governance and reporting have to be conducted by a unit with the confidence of the Prime Minister. What it says will then count – but, conscious of the need to retain that confidence, it will also remain sensitive to the conflicting pressures that departments face. Hence our recommendation above that the unit reporting to the Cabinet Office Minister of State is also responsible for monitoring policy across government: it would develop the strategy, monitor progress across government against that strategy, and then report on that progress to the Cabinet, as well as the EAC and the CCC. The latter, as noted, would then supply an independent audit.

Was the SDC successful in fulfilling its remit? Which aspects of its work have reached a natural end, or are otherwise of less importance, and which remain of particular continuing importance?

11. Promoting awareness of the concept of sustainable development

The SDC established greater awareness of the concept amongst a number of officials, largely but not exclusively those dealing with operations and procurement. It also had some successes in its work with DCFS on the curriculum. However it was not successful at promoting the concept to the wider world. The concept – basically not depriving our children and their children of a decent life – is very simple and intuitively appealing. The SDC, and DEFRA under the last government, made it rather complex and difficult to understand. Promoting wider awareness of the need for sustainable development – and of how this means more than dealing with climate change – remains of vital importance.

12. Establishing good working practices within Government

The SDC made a significant contribution to establishing good operations and procurement working practices within Government (it did not influence policy working practices). This was largely through its successful SOGE and SDIG reports and associated capability building processes. Much of this work is done and the baton can easily be passed on to the Centre of Expertise in Sustainable Procurement.

13. Advising key Ministers and others across Government

The SDC partly fulfilled its remit in this respect: it was successful in DH and in DCSF/ DfE but less successful in other departments. This was probably because it failed to win the trust of key Ministers, and was unable (and to some extent unwilling) to use its inside track to identify how it could help Ministers solve the problems they faced.

14. Monitoring performance against sustainable development targets and reporting on these.

As just noted, the SDC fulfilled its remit in this respect effectively, in so far as the targets related to central government operations and procurement.

In formulating a future architecture for sustainable development in Government, how can it take on board wider developments and initiatives (eg to develop 'sustainability reporting' in departments' accounts) and the contributions that other bodies might make (eg Centre of Expertise in Sustainable Procurement)?

15. We do not have any additional comments to make under this heading.

How, without the assistance of the SDC, will the Government be able to demonstrate that it is 'the greenest government ever'?

16. The extension of the Cabinet Office Minister of State’s remit as proposed above, together with the formation of a supporting unit and the development of ED(EE)’s remit, would begin to demonstrate the Government’s commitment. The kind of public engagement that we are calling on the new unit to perform would continue to demonstrate this.

11 October 2010