The Role of the FCO in UK Government

Written evidence from Catarina Tully

Response to request for responses to the FASC inquiry 'The role of the FCO'

1. I have structured my responses to your questions around the following headings: the challenge facing foreign ministries globally; choices about the FCO's role; and implications for capabilities and resources. In summary:

· The changing nature of our world means many Foreign Ministries are wrestling with the issues and questions raised in the FASC inquiry. The widely-claimed weakness of the FCO's position within HMG in the past few years is mainly a result of this changing environment.

· Despite efforts over previous years, the FCO's strategic purpose has become blurred and requires some refocus. More importantly, it needs the structures, capabilities and resources to fulfill a refocused role.

· The FCO successfully acts as the international implementation arm of HMG through its network of embassies. The key choice on the role of the FCO is the extent to which the FCO takes the cross-Whitehall lead on setting the strategic context for HMG's international policy and on new international policy challenges, like global resource constraints. A maximalist interpretation of its role is necessary for the FCO to be at the centre of government.

· In order to fulfill its role effectively, there needs to be more specialisation in the FCO, higher levels of programmatic funding, strengthened analytical skills and greater cross-Whitehall clarity on what FCO strategic leadership looks like.

2. Biography: Cat Tully is an independent consultant working on foreign and development policy issues. She was formerly Strategy Project Director at the Foreign and Commonwealth Office until August 2010. She has worked on strategy development across the private, government and civil society sectors, including for HMG Prime Minister's Strategy Unit, Procter and Gamble, Christian Aid, World Bank and the UN. Cat's research areas include: horizon scanning and strategic risk management; machinery of government in national strategy-making; technology, public engagement and governance; and global public goods and resources.

Context: the challenges facing Foreign Ministries across the world

3. As highlighted by the Foreign Affairs Select Committee, the changing nature of our world means many Foreign Ministries are wrestling with the issues and questions raised in the FASC inquiry. The US's QDDR, released last month, looks at the capabilities needed by 21st century diplomatic and development services. The German government has conducted various conferences on what a 21st century foreign service should look like. The French 2008 White Papers on Foreign Affairs and Defence and National Security examine the division of labour between Departments, and the structures and capabilities needed in a Foreign Ministry. Together with innovations introduced by Canada, Australia and Singapore, among others, these experiences provide an evidence-base that is worthwhile mining more systematically. [1]

4. The impact of technological, economic and demographic drivers, and the resulting blurring of lines between foreign and domestic policy are well documented elsewhere. I will nevertheless briefly explicitly summarise here the challenges and opportunities that commentators agree that the 21st century multipolar world will bring. HMG and the FCO have made strong progress in addressing all of these areas and are considered to be ahead of the curve by other governments in some areas like public diplomacy and thought-leadership on new complex global challenges. However, we need to run just to keep still in this situation - continual change requires continual adaptation by HMG.

a) New sets of policy challenges, often uncertain, diffuse and interlinked: these include complex, non-linear systems of global and regional public goods (e.g. water, labour, food, energy and carbon security), new security challenges (in particular around radicalisation, early intervention and conflict prevention), and the interlinkages between economic and national security.

b) A growth in the impact of different actors and evolving means of engagement and influence: not just the growth of BRIC and other countries, but also regional and local actors (e.g. cities), high-net worth individuals, diaspora groups, state-owned and multinational businesses, civil society, etc.

c) Changing and multiplying forms of governance within which to promote the UK's national interest: including the different 'G' groupings, ad hoc alliances, UN, revitalised regional bodies and the European Union, counting the External Action Service.

5. This changing environment poses three challenges to the process of conducting HMG international policy:

a) greater need for coherence and joining-up as increasing numbers of Departmental and non-government actors become involved in the international sphere;

b) the functions and structure of the diplomatic service need some recalibration to the new strategic context; and

c) the nature of running operations abroad is different, with the changing nature and cost of security, use of different technologies, etc.

6. The FCO is an excellent organisation, with enviable assets including staff, analytical power, and the network. Its strategic context however, as for other Foreign Ministries, is increasingly challenging. The widely-claimed weakness of the FCO's position within HMG in the past few years is mainly a result of this changing environment. The purpose of the FCO has become less clear as its traditional role and key asset - as gatekeeper and conduit of international interactions - has disappeared. The increased complexity of the environment, the increase in the number of its partners, the participation of domestic Departments in international networks, the different potential entry points or ways it can make a difference, combined with a sharp reduction in resources, has meant that the FCO has had many focal points and spread its skills thinly. As a result, and despite various attempts to strategically sharpen it, the FCO's strategic purpose has become blurred and requires a gentle refocus. The FASC's inquiry is an excellent opportunity to address what the FCO is for, namely refine the purpose it fulfills for HMG and for the UK, describe clearly the problems it can help address, and ensure that it has the structures, resources and capabilities to support its purpose.

Key choices about the FCO's role: maximalist or minimalist vision

7. For the purpose of this paper, I have distinguished two functions that the FCO owns in HMG. One is about acting on behalf of HMG internationally - effectively being the international implementation arm of HMG. These roles include running the network of embassies internationally, including at international organisations, providing consular support and crisis response, being a platform for UK policy delivery in-country, and sending expertise and knowledge about the country back to HMG.

8. This role is conducted well. These roles need logistical support and guidance from the centre (like the central crisis response team or UKTI) but more of the decisions should be decentralised so that strategy-making at the country level can be made by front line staff. There is also a need to continue to stay abreast of technological developments that provide the potential to drive value for money, like laptop diplomats.

9. Recommendation: decentralise more decision-making powers to embassies so they have a stronger lead on developing cross-HMG country strategies. Continue to develop innovative solutions to provide network coverage that drives value for money.

10. The other function is leading policy. Some narrow policy areas are squarely within the FCO's remit, e.g. non-proliferation. But to fulfill the Foreign Secretary's vision of the FCO being at the centre of government, the FCO also needs to take the lead on setting the strategic vision for HMG's international policy. This means two things. First, to hold the overview and collaboratively set the framework within which all of Whitehall Departments' international policy interventions can sit coherently (this overview needs to be strategically aligned with the SDSR and DFID's plans and agreed by the National Security Council). Second, the response to the challenges and opportunities identified in paragraph 4 need to be led somewhere within government - and they should be led by the FCO. I have highlighted the gaps that remain in addressing these new issues:

· New complex policy issues: The gap here is around upping analytical (and economic) skills on complex systems, enhancing creativity and innovation in policy responses and initiatives, leading horizon-scanning and identifying discontinuities. There is excellent work done across different government Departments, but there is not one place where it is fully pulled together.

· Growth in different actors: The gap here is around thinking innovatively on engaging with new actors; enhancing the UK's influencing strategy, especially on the sub-multilateral forms of governance (regions and cities) and the use of soft power; and coordinating a joined-up and innovative government approach to engaging with international non-traditional actors e.g. private-public partnerships with businesses to achieve common goals.

· Changing governance: The gap here is around promoting greater creative thinking on promoting UK's national interest within different forms of international governance and fora.

11. Recommendation: that the FCO takes the strategic lead for setting the context for UK international policy (with the SDSR and reporting to/agreed by the NSC); takes the policy lead on global public goods issues; takes the overview on international horizon-scanning across government; and leads coordination on engaging with different international actors.

Implications for capabilities and resources

12. None of my commentary is new analysis: indeed the FCO is engaging already with many of these issues and has embarked on various initiatives to improve its capability. Notable examples include excellent analysis and innovative policy/approaches led by Research Analysts, Communications Directorate, the Global Economy Group, Middle East and North Africa Directorate, among many. The question remains therefore why there is a certain fuzziness to the traction of the FCO centre. And how to address it without committing significantly more resources. There are five areas that can be addressed:

· FCO staff are currently required to have a very broad set of skills. The FCO's two distinct functions (running the international implementation arm of HMG and leading policy) arguably increasingly require two different skill sets, with a lot of overlap in between. Skills required in Posts include managing the post, detailed analysis and reporting, influencing skills, consensual negotiations, crisis response, and a practical ability to respond to the plethora of different challenges thrown up daily in often difficult environments. Skills at the policy centre require deep knowledge and networks in Whitehall, systems thinking, horizon scanning, and analytical skills around prioritising options, exposing policy tradeoffs, identifying synergies and developing innovative responses. Recommendation: There is a case to be made for FCO staff to specialise within two separate career streams. A diplomatic embassy staff run the embassies, possibly with longer posting duration, themselves led by ambassadors from across different Whitehall Departments where appropriate. And policy staff at the centre would focus on policy expertise and analysis, developing the skills to lead strategic thinking across government, and horizon scanning. There would be secondments between these two cadres, but in particular the policy staff should be open to cross-Whitehall and external secondments. This would permit staff to focus on specialising their skills and expertise, where at the moment they are asked to be generalists.

· The FCO faces financial resource constraints that limit its ability to promote its policy agenda both with other government departments and international partners. Relatively small amounts of additional programmatic funding could get value for money in terms of traction. Recommendation: that FCO programmatic funding is increased.

· The FCO's analytical capability has been reduced in recent years in various economic and geographic policy areas, thankfully now being addressed. Recommendation: to maintain and develop the FCO's analytical, policy and language expertise; create an external think tank with DFID and MOD that can introduce innovative ideas; use both government and external intellectual resources (e.g. the Royal College of Defence Studies, National School of Government, Institute of Government, Chatham House and RUSI); and systematically engage with senior international foreign policy thinkers and leaders via high-profile conferences.

· Other government Departments can be resistant for the FCO to take the role in setting the strategic context because they feel that the FCO does not always reflect their interests, perspective and analysis. Recommendation: At a macro-level, an agreed regular FCO-led process for setting the strategic vision should occur, similar to the US' new QDDR process. This could be arranged to coincide with a new government term and the Defence Review. On a micro-level, the FCO and other Departments should develop a clearly defined process and methodology for developing thematic and country strategies and coordinating Departmental business planning processes. Organisational innovations (like bringing together the Strategy Units or Policy Units across MOD, DFID, FCO and Cabinet Office NSS) could also be explored. Joint training and secondments would also be valuable as would a forum for FDNS Department senior leaders/policy DGs to meet and discuss common issues and align strategic vision.

23 January 2011