Examination of Witnesses (Question Numbers
80-99)
RT HON
FRANCIS MAUDE
MP AND RT
HON OLIVER
LETWIN MP
27 JULY 2010
Q80 Chair: Henry VIII's Star Chamber
Court was a sort of pet court. It had no legal standing and was
designed to do his hatchet work!
Mr Letwin: It does not sit in
Star Chamber Court and it is not called the `Star Chamber', it
is called the `Public Expenditure Committee'.
Mr Maude: It is far less exciting
though!
Mr Letwin: It has none of the
tools that were available to the original Star Chamber available
to it. In the end, the Government as a whole very fully recognises
that we all share responsibility for achieving the deficit reduction
and this is simply a method for trying to make difficult judgments
where departments have not been able to reach an accommodation
with the Treasury.
Q81 Michael Dugher: You mentioned
in your previous evidence to us the importance of protecting front-line
services, and that is something that ministers also stated repeatedly
during the election campaign. Now, notwithstanding the fact that,
I think, politicians of all parties tend to be afflicted with
a bout of optimism prior to polling day, you must understand that
the sheer scale and timing of the cuts that you are introducing
will have a massive impact on front-line public services. What
impact assessment and other mechanisms are you putting in place
to actually try and assess that prior to these cuts going ahead?
Mr Letwin: Well, a huge amount
of work is being done in many dimensions to try to end up getting
more for less. It is not our ambition simply to maintain the quality
of public services, but to improve them.
Q82 Michael Dugher: But, if you are
making—excuse me for interrupting—25 per cent or maybe
30 per cent when people are looking at 40 per cent cuts, again,
notwithstanding your admirable optimism, you must surely appreciate
that you do not get more for less. Do you not get less for less?
Mr Letwin: No. I understand that
that is a view that some people take, but it is not one we share.
The ability to improve the outcomes depends on having a sufficiently
imaginative and radical view about how we accommodate having less
input in such a way as to deliver a better output, and I really
believe we can do that. Let us take, for example, because it is
entirely in the public domain, the question of how we improve
policing, a classic front-line service in Britain. I think all
our parliamentary colleagues would agree that it is not perfect
at present and many people feel that they are not adequately policed
at the moment, and the Home Secretary has made it perfectly clear
that the effect of the public spending round will be to put some
pressure on police numbers.
Q83 Michael Dugher: You mean having
less police? That is what `putting pressure on police numbers'
means, does it not? That is what is planned.
Mr Letwin: That is exactly what
it means, as she has said, but we are taking a series of steps
which we believe will mean that the outcome is not the same level
of policing, but better policing, even given those constraints,
and that is by removing a huge pile of bureaucracy and paperwork,
which is occupying police time which, therefore, does not end
up by delivering service to people, and by changing completely
the relationship between the police and those they are policing
through crime maps, through `beat' meetings and through the election
of police commissioners. We think we can completely change the
relationships there in such a way that the police actually deliver
what it is that local populations wish to have delivered because,
instead of occupying their time looking upwards towards the Home
Office and dealing with the bureaucracy deluging them from above,
they are focused remorselessly on delivering what the locals want.
Now, that is just one example among many. Whether we are right
or not, time will tell, but we really passionately believe that
we will end up with the best of policing in this country, notwithstanding
spending less on it.
Mr Maude: Can I just add a point
on Mr Dugher's question about more for less or whether it is just
less for less. The whole area of the online delivery of public
services is one in whose progress we are in the infancy still,
but I would just quote an example from your own Party's time in
office when the DVLA produced a system for renewing your car tax
online. This massively improved the quality of the public service
in terms of convenience to the citizen and the transaction now
gets done for literally a tenth of the cost. The transaction costs
£1 and the unit cost was about £1 before when it was
paper-based and online it is 10p; much more for hugely less.
Q84 Michael Dugher: So are you going
to have online police officers or virtual policing? I take your
point, but that line of argument does not actually work with all
public services.
Mr Letwin: I think it is very
important that you are listening to both what Francis is saying
and what I am saying and that they are actually two parts of the
same story. In part, we hope to get more for less by being more
efficient in the way we deliver things that are delivered, in
many cases, by old-fashioned systems and, in part, by making structural
reforms that alter incentives and relationships: and we are not
in any way confusing those, neither am I trying to get Francis
to share a vision of online policing which we do not believe,
nor is he trying to get me to believe that we do not need structural
reforms, which we do need. What we are saying is that you need
both efficiency of the back office massively and structural reform
to get the services' structure right. If you do those two things
together, you really can deliver more for less.
Mr Maude: And the two meet and
overlap. In exactly what Oliver has been talking about, police
reform and the whole thing about crime-mapping, it absolutely
depends on the effective use of new technology, not massive, grand,
new IT schemes, but relatively accessible technology to which
people have ready access.
Chair: Moving on, the big society.
Q85 Robert Halfon: How would you
explain the basic idea of the big society because, whilst many
of us know what it is, if you still ask people outside, they are
confused? Also, would you agree with what the adviser said, that
there is some kind of coral reef?
Mr Maude: Yes, Lord Wei has this
very engaging analogy of the ecosystem. What is the big society?
Well, we are at the end of the era of big Government. Big Government
has been unsuccessful in addressing many of the acute social problems
our country faces and, in any event, as the outgoing Chief Secretary
said, there is no money. The thinking behind the big society is
that you cannot simply allow the State to retrench and just assume
that spontaneously and organically the social capital, the myriad
organisations on which a successful, strong, cohesive society
depends, will automatically spring into effect, so the State has
to play a proactive, interventionist role in stimulating the creation
of that social capital. This is not by having a grand, national
plan, but this is by a whole lot of different approaches. We see
the big society as being the other side of the coin of decentralisation
and localism, if you like, in terms of taking power away from
the centre and giving it to communities as it should all be the
other way round and it should be about communities, families,
neighbourhoods, people taking power, not being graciously given
it by the centre. That is the demand side of the equation, the
big society groups who both are able, and want, to take power,
take more control over their lives and the lives of their communities.
Decentralisation is the supply side, that is the push, and the
big society is the pull. In every part of our country, is there
enough social capital to make this happen automatically? No, which
is why the State has to have some kind of interventionist role
which is why we have laid stress on the desirability of training
up a cadre of community organisers whose job it is to stimulate
and support the neighbourhood groups, the rich network of neighbourhood
groups, which is essentially what much of what social capital
is, and a small-scale scheme of grants and endowments to support
them.
Q86 Chair: Is there not an oxymoron
at the heart of this programme? I believe in Burke's platoons,
which we might call the same as the big society, and the Government
is going to do something to try and repair the broken society,
but it is rather like in The Life of Brian, Brian saying
to the crowd, "Be individual" and they are all saying,
"Yes, be individual"! If you are going to put 5,000
community activists into society, is that not Government doing
something which is itself going to displace what initiative might
have been there before that government action was taken?
Mr Maude: Well, if it did do that,
then it would be wrong and it is not what our intention is, and
we will be at pains to ensure that that is not what happens. One
of the criticisms that gets made of our approach to the big society
is that it is fine in the leafy suburbs where there are residents'
associations and lots of stuff going on, but what about the really
deprived areas where there is not so much going on, there is not
so much social capital? Well, there are two points to make. One
is that there is always more than you think, there is always some
kind of often completely informal and not remotely formally organised
activity, some kind of social capital often operating without
any public money support at all, so it is very rarely that there
is a complete desert in terms of social capital. Secondly, where
there is not enough to allow that part of our society to be fully
engaged with society, then some help is needed to support it,
and that is our intention.
Mr Letwin: Can I just offer a
general observation in response to your question which comes back
to Mr Halfon's question as well. Government has not been neutral
in creating the circumstances we currently face. In many cases,
it is government action that has suffocated what would otherwise
be natural activity, not intentionally mostly, but by mistake.
What Francis rightly describes as the `supply side', the structural
reforms we are putting in place so that there is much more opportunity
for people to run things at the local level, schools, community
groups, whatever it may be, opens up an opportunity. If there
had not been previous government action that had suffocated natural
activity, we would not then need to stimulate the demand side
of the equation, but in fact there has been, so all we are trying
to do is to counteract what has been done unwittingly by previous
administrations over very many decades. Ten years ago Mr Halfon
will very much remember his own part in this when I set out a
vision for enabling societies to do essentially the same sort
of thing that we are talking about now. I do not think I then
sufficiently recognised, and we have come gradually to recognise,
that it is not enough just to open up the opportunity, but we
actually have to take practical steps. Once they are working,
we will no longer need to take them, there will be the social
capital and, on the basis of that, the dividends will be continuous
action at the local level. The last thing I would like to say
is that I am fantastically encouraged and really quite surprised
by the extent to which, as Francis says, despite the suffocation
over many decades, there is so much there. When Greg Clark, whom
you may want to interview about this as Minister for Decentralisation,
just put up in lights the opportunity to come forward and be vanguard
areas, we little expected that we would receive a deluge of people
around the country, saying, "We'd like to do this. We want
to get on with this". I think there is a huge will across
the country to take power into people's hands and to achieve things
locally now, we are allowing it, so yes, we will encourage it,
stimulate it and facilitate it where it does not exist, but actually
a lot of it is going to happen naturally.
Q87 Robert Halfon: Iain Duncan Smith
has talked about the tessellation of the bigger charities. How
will you make sure that the big society really does go down—and
I am not talking about the schools or the police which are all
part of that, I understand that, but literally goes down—to
the neighbourhood level where the residents' group wants to transform
their neighbourhood and so on and not just to be hijacked by some
of the bigger charities that are very astute at political lobbying?
Mr Letwin: Well, Francis may want
to talk about the charity end of that, but can I just dwell on
the community group end, in many cases not even charities. I think
it is little-recognised that one of the most important and radical
steps we are proposing to take is to give back to neighbourhoods
the ability to plan physically the neighbourhood, which is fantastically
important to people. What happens when neighbourhoods start all
over Britain down the road, as they will under our plans, of getting
together and trying to work out what the neighbourhood should
feel like and look like with the power to determine that? What
will happen is that people will forge new relationships, nothing
to do with organised charity, but just people getting together.
Similarly, we have an immensely radical set of proposals about
enabling community groups to take over failing both public sector
and, under some circumstances, private sector assets locally,
pubs and community centres. Again, it is not a question of the
big battalions, but the Chairman's little platoons. These open
up the possibility of people getting together in housing estates
and villages alike, and indeed the suburban areas between the
two, and working together to change their communities which will
interact of course with charities small and large and organised
voluntary groups nationally and regionally, but actually it is
at the local level that it will be built.
Q88 Robert Halfon: Philip Johnston's
critique that you are not doing enough for the big society to
involve local Government, what is your view about that?
Mr Letwin: He really needs to
have a prolonged tutorial with Eric Pickles. Eric has an absolutely
marvellous presentation in which he explains his three crucial
and complex priorities for local Government and the relationship
between local Government and central Government, and he then shows
a slide: one, localism; two, localism; three, localism. Eric is
taking steps to recreate the ability of traditional local Government
alongside this double devolution to communities to give them universal
powers of competence, to enable them to take charge of their own
lives and the lives of their communities properly, for example,
through not having ring-fenced grants, but being able to decide
how to spend their own money. It is actually something which the
Chairman, in another guise many years back, argued for and we
are now making progress in this direction at last.
Q89 Chair: Would you be attempting
this with such urgency if it were not for the constraints on public
spending?
Mr Letwin: The answer to that,
Chairman, is yes. Even if we had all the money in the world, this
is the most centralised country in Western Europe that needs to
be one of the most decentralised.
Mr Maude: Oliver and I have been
making speeches about this for ten years, at the very least.
Q90 Chair: I have made one or two
myself.
Mr Maude: Indeed, very good ones,
if I may say.
Q91 Chair: I think you have answered
this question really, but in the modern world people are very
busy and we have all been brought up to feel, "Oh, other
people do that. The Government does that". Are these people
available to take on these roles, typically, some would say, to
run parks and schools and things that Government has been doing
for a long time?
Mr Maude: Well, (a) there is the
old rule that, if you want something done, find a busy person
to do it, and (b) I would just talk about something which is related,
which is our plan to allow groups of public sector workers to
form mutuals and co-ops and then bid to take over, run and deliver
public services. On that front, we are finding a lot of enthusiasm
among frustrated public servants who see ways of their services
being delivered better and want to do it. One of the things we
did at the very early stage of the Comprehensive Spending Review
was to issue the spending challenge to public sector workers.
It was slightly kind of ridiculed when we announced it and cynical
people, there are some, believed this was some kind of gimmick
just to enable us to say that we consulted. To our surprise, delight
and slight consternation because it had given us a big logistical
issue in dealing with them, there were well over 60,000 responses
of mostly really serious, hard-edged ideas of how to deliver public
services better while cutting the cost. What that told me is that
there is in our public services huge pent-up frustration of people
at the front end of delivering public services who see how it
can be done better, but who do not have the power to do it. The
first stage is that they have submitted their ideas to us, which
we will deal with in the best way that we can and hope to action
as many of them as possible, but the second thing is that out
there is a huge number of people, among whom will be some people
who are public sector entrepreneurs, people who are deeply imbued
with the public service ethos and want to devote their career
to delivering public services, but who are nonetheless entrepreneurs
who, if we can find the means of enabling them to take charge
of the delivery of those public services, leading a mutual or
a co-op to do that, then I think, to go back to Mr Dugher's point,
there is a lot more that can be done and for less.
Q92 Chair: Shall we move on finally
to the work of the Cabinet Office. You have brought a lot of private
sector people into Government in the short time you have been
going, such as Lord Browne and Lucy Neville-Rolfe. Is running
a government department really like running Tesco or BP?
Mr Maude: Government is not like
a business. I sometimes reflect that business is difficult, but
simple in that there is a very simple imperative which is to make
a profit, which you can only do by efficiently serving your customers
and giving your customers what they want. Government is difficult,
but complex because you are attempting all the time to achieve
different, and often conflicting, objectives which often have
tension between them. The fact that Government is different from
business does not mean that it does not have a huge amount to
learn from business, and some of the things that we are doing
at the moment, trying to centralise procurement, the way Government
procures, massive disparities in how different bits of Government
buy kind of basic, boring stuff, like photocopier paper, huge
disparities in the price, we are not using the scale of Government
to drive down those costs and we should be. We have not up until
now been attempting to manage the relationships with the major
suppliers to Government on a cross-Government basis, so actually
it is the big suppliers who may be earning, in some cases, billions
from Government across the piece who have been able to pick off
different bits of Government, and we are saying that you need
to do that differently. I am leading that process and I am very,
very glad indeed to have the support and advice of very serious
people from the business world, who have done this themselves.
In a big, complex business, there are some things you expect to
run from the centre and they are strategy, strategic communications,
cash, you want to control cash from the centre, headcount, broad
HR operating standards, property, big projects that carry reputational,
financial and operational risk, you must control those from the
centre. Commodity procurement, commodity goods and services, you
would expect to use the scale to procure those from the centre,
but everything else actually you should push as far away from
the centre as you can. If I can venture a mildly partisan comment,
under the last Government it sometimes seemed to me that those
things were the wrong way round. There was not control over those
few things that should be tightly controlled from the centre and
yet, on the other side of it, there seemed a constant attempt
to micromanage delivery from the centre, so on exactly that which
should be loose and pushed away from the centre, there was a completely
vain and doomed attempt to control and micromanage from the centre,
but the things which the centre must have a mandate to control
they were not, which is one of the reasons why spending has been
out of control.
Q93 Nick de Bois: Just turning back
to the welcome idea of non-executive directors, can you clarify
their reporting line? Do they report to the Minister or will they
actually report to Lord Browne?
Mr Maude: Well, they will be appointed
by the Minister, these are ministerial appointments, and there
is a general view that you feel accountable to whomever appoints
you, in my view, and they will not be accountable to Lord Browne.
He will, as it were, lead the community of non-executive board
members and I would expect him to convene them periodically as
a group to share experience, to learn from each other what works,
what has not worked, are there common patterns, all of those kinds
of things, but they will not be accountable to him.
Q94 Nick de Bois: Just pursuing the
same line, if we want to take advantage of the skill set of the
non-executive director, they may end up in a position where they
disagree, for example, with the Minister about the performance
of a permanent secretary. Is it clear that, given that non-execs
will have, if you like, the power to suggest a permanent secretary's
removal, if I understand it right—
Mr Maude: Yes.
Q95 Nick de Bois:— will there
be a conflict there, and are they simply making a recommendation
or will it be, "No, this must happen, Minister"?
Mr Maude: This is a kind of nuclear
last resort—
Q96 Nick de Bois: Sure, I understand
that.
Mr Maude:— and the judgment
we made was that, for very serious people from the outside world
to feel that this role is not window-dressing, then you have to
have a last resort power to recommend, and it is no more than
recommend, to the Prime Minister and the Head of the Civil Service
that a permanent secretary, whom they judge to be an obstacle
to effective delivery, should be removed. You have to have a way
of—
Q97 Nick de Bois: It is a pretty
strong recommendation, as I understand it.
Mr Maude: Yes, it would be very
extreme, but the concern that gets raised about these sorts of
roles is that they are fine, but how are you going to get purchase
and how are you going to capture the attention of the official
system? Well, this seemed to us to be a way of capturing the attention.
Q98 Greg Mulholland: You will be
aware that there has been some concern, particularly from the
FDA, about the politicisation of departmental boards and that
ministers do chair them. How do you respond to that, and can I
also ask why you actually are proposing that ministers be able
to chair them rather than necessarily permanent secretaries, but
how do you respond to the charge of this being politicisation
and how will you guard against that?
Mr Maude: Well, the first point
to make is that it is not a universal pattern that permanent secretaries
have chaired these boards. In the last Government, there were
several departments where ministers themselves chaired the boards.
The second point is that ministers are, at the end of it, responsible
for what their departments do and I do not think it is enough
for ministers simply to remove themselves from any involvement
with the operational implementation of policy. They should be
involved with it, not to micromanage it, but to be in a position
where they can be held to account. Ministers should be held to
account obviously to Parliament, but also by the Prime Minister,
for the way in which they discharge their responsibilities, and
I do not see how you can do that unless you are chairing the board.
Mr Letwin: If I can just amplify
that, what we have been negotiating with each Secretary of State
and Permanent Secretary jointly is the Structural Reform Plan
for the Department in question. Coming out of the Public Spending
Review, they will have been negotiating with the Treasury, and
ultimately with the Public Expenditure Committee and Cabinet,
a plan for getting more from reduced inputs. Those together will
form a business plan for the Department. In each case, the Secretary
of State and ministerial colleagues are bound in to deliver what
it is that they have participated in negotiating, and I think
that is an extraordinarily important part of the architecture
of this Government. We are not saying, "Here are ministers
and we will make some generalised statements about what we want
in the coalition Programme for Government or otherwise, and there
is some set of officials to implement it". We recognise that,
in order to achieve the goals we have set out in the Programme
for Government through the medium of the structural reform plans
and the Spending Review, ministers, including secretaries of state,
need to be absolutely bound into the delivery, as Francis said,
and the continuous monthly and weekly monitoring of the delivery
of those plans is not aimed at officials, but aimed at ministers.
It is for them to work out the ways in which, through their officials,
they make these things happen.
Q99 Greg Mulholland: That was a very
helpful explanation, but it did not really deal with the politicisation
point, so how would you take that head-on?
Mr Maude: Well, I genuinely do
not understand it. Ministers are political, but the idea that
somehow, because you are a minister and, therefore, political
and you should not chair the board of a department for which you
take responsibility seems bizarre. No one pays greater obeisance
than I do to the idea of political impartiality of the Civil Service.
I take this really seriously and I strongly supported the Civil
Service provisions in the Constitutional Reform and Governance,
now, Act which we were at pains to ensure got on to the statute
book before the election in the wash-up period, which gave a statutory
basis to the Civil Service Code which entrenches the Civil Service.
I take this really seriously, and I worship at the shrine of Northcote
Trevelyan in my more unguarded moments, but the idea that somehow
it is politicising for ministers to, in a very clear way, take
responsibility for what their departments do just seems bizarre
and I genuinely do not understand it.
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