Public Administration CommitteeWritten evidence submitted by Prospect (CSR 3)

Introduction

1. Prospect is an independent union of 120,000 members including 34,000 professionals, managers and specialists employed in the Civil Service across departments, agencies and non-departmental public bodies. Many of our members are expert practitioners in areas as diverse as animal and tree diseases, engineering systems, life sciences, accident investigation and insolvency. Others are employed in functions ranging from health and safety regulation, support for vulnerable adults, environmental stewardship and policy advice. It is our genuine belief that while civil service specialists rarely have a high profile, except in times of national crisis, they are indispensable to modern government. Given the very real challenges, for example relating to energy policy, global warming and eco-security, they should play a much bigger role in a reformed civil service.

2. We therefore strongly welcome the Select Committee’s timely inquiry. It resonates strongly with the themes of a report Prospect published earlier in the year titled “Government that can needs people who know how: a professional vision for the UK civil service”—http://bitly.com/SyVbaS We would therefore be pleased to have an opportunity to expand on our summary responses below.

Is the Civil Service in need of radical reform?

3. The short answer to this question is that radical reform is needed. The idea of civil service reform is not new. In fact it has been around since the 1968 Fulton Report and ever since governments of all hues have dabbled with new initiatives, usually cloaked in the language of efficiency. Yet although there has been an almost continuous process of change, it has not always been informed by the evidence or the consequences thought through. Moreover, no government has overcome the entrenched civil service culture that still regards policy-making as the most prestigious function and the route to career advancement. None has successfully joined up the rigid departmental silos, often jealously guarded by senior civil servants. As the Select Committee concluded in 2010 “The need for frequent civil service reform programmes over the years can be attributed to failure to consider what the civil service is for, what it should do, and what it can be reasonably expected to deliver”.

4. Prospect agrees. We do not take an ideological approach to public service delivery. Nor do we oppose change for the sake of opposition, but the reality is that there has been too much change for the sake of change whilst the need for fundamental reform has simply not been addressed. New professional approaches are needed to deliver better quality services, set standards for ethical behaviour and ensure fair employment practices.

5. Prospect recognises that the UK civil service operates in 2012 in a very different environment to that of Fulton, but it is our view that a similar wide-ranging, high-calibre strategic review is needed which can look beyond the short-term electoral cycle. This review needs to look at how to:

Break the bonds of departmental decision-making and allow specialist expertise to be deployed across government.

Improve labour market information in order to provide timely and accurate data on skills and expertise.

Enhance the professionalism of the civil service by re-establishing specialist career paths and opening up access for specialists to the senior civil service. A competency-based approach to progression that genuinely recognised the achievement of professional or development milestones would help in this regard.

Clarifying the roles of different parts of government (departments, executive agencies, non-departmental public bodies, trading funds) and between ministers, civil servants and other advisers.

Require accountability and ethical behaviour at all levels of the service. It is essential to have a clear understanding of what political neutrality means in modern government.

Use good employment relations and equal career opportunities to underpin the quality of services provided by public servants.

Require Heads of Profession and designated lead departments to work jointly with unions to develop cohesive sets of terms and conditions for their specialisms and to negotiate pay, career pathways and continuing professional development (CPD).

Promote a positive framework for employee engagement through sustained political and management commitment, realistic objectives and appropriate decision-making structures.

Use a transparent process to assess proposals for the provision of public services by the voluntary/community or private sectors.

Use international experience to learn the scope and limitations of citizen influence over policy-making and innovation by public servants.

Promote understanding of the regulations and practices that govern public service.

Are the Government’s plans for reform, as outlined in the Civil Service Reform Plan and related documents, likely to lead to beneficial changes?

6. In our view the Reform Plan is a lost opportunity for constructive change to provide the basis for a more professional civil service. It is a highly political document, but sorely lacking both a robust evidence base and credible implementation plan.

7. For example, it promotes expansion of a shared services model that to date has proved to be ineffective and, although identifying a silo mentality across Whitehall, says very little about what actions will be taken to break down those silos. It appears that the target of 380,000 civil servants is to be achieved by a human resources policy that emulates worst practice in some parts of the private sector, using a discredited relative assessment system that will penalise people who don’t get on with their manager. This is despite evidence from the Chartered Institute of Personnel and Development (CIPD) that the key—and growing—challenge facing public sector employers is actually to recruit and retain skilled managers and professional staff. The Plan’s support for policy-making by “nudge” economics and crowd-sourcing over expert advice lacks all credibility.

8. The current obsession with shrinking the state quite simply misses the point. As the aftermath of the Quango cull has shown, the work still needs to be done and changes to its organisation, location and resourcing impact critically and directly on outcomes. Official data on changes in civil service employment from 2011–12 shows that although the cuts have hit administrative budgets, key operational areas have also been badly affected—with an inevitable reduction in service delivery. For example MOD has lost 14% of staff. Core DEFRA, the DCLG, Insolvency Service and Department of Health have all cut one in five of their staff. Further the National Audit Office’s report on “Managing budgeting in government” confirmed that the prime focus on cutting spending misses the mark as far as value to the taxpayer is concerned. NAO noted, for instance, that “The system is less effective at addressing objectives for prioritisation of public spending and delivery of value for money across government”. It also found that departments only weakly integrate budgets with corporate operational plans and that the budgetary system encourages departments to bid for funds based on their specific needs, but does not promote cross-government working.

9. This lack of strategic vision is coupled with a failure to listen to the people who know how to deliver. Far from valuing staff as its key resource, in October in the name of civil service reform and without any consultation, the Government unilaterally instructed departments to review their terms and conditions. This is clearly a centrally driven approach emanating directly from those at the Cabinet Office that are also responsible for ensuring that the civil service complies with its legal responsibilities—also set out in the Civil Service Management Code—to inform, consult and negotiate with recognised trade unions. Civil Service management must recognise that the proposed changes to terms and conditions will rupture industrial relations in the civil service and certainly do not provide the basis for constructive reform.

10. More positively unions have been consulted on the development of the Civil Service Capabilities Plan, though it has become increasingly vacuous as it has evolved. For example although commercial and project management skills have been identified as priorities for improvement, it is acknowledged that hard evidence to support these assertions is lacking. At the time of writing the final version of the Capabilities Plan had not been published, and the draft made available to unions does not address the challenges that have arisen from the civil service denuding itself of “intelligent customer” capability. In reality meeting the identified priorities of improving commercial and project management skills will also depend on thorough understanding of the market in which work is being commissioned or procured. Expert professional skills, for example in engineering or science, are integral to this process yet are not recognised as such. Prospect is extremely concerned about future resourcing requirements for scarce skills. This is based on our own research into current skills gaps and shortages showing, among others, shortages of specialist, cost and project engineers, marine surveyors, IT, psychologists and other scientific disciplines. There is nothing we have seen in the Plan to that will address these urgent challenges.

11. Although the current heavy focus on headcount reductions makes it expedient to simply buy in scarce skills and/or capabilities, this is not a cost effective strategy and will soon lead to further diminution in the quality of advice and services. One way to maintain critical mass that has been depleted in many areas could be to manage scarce skills in a more co-ordinated way across government. We therefore welcome proposals to strengthen the role of Heads of Profession to include influencing the resourcing and deployment of specialist expertise, though we lack confidence that there will be sufficient or sustained commitment from the top that will be necessary to recalibrate the balance of power between departments and professions.

What is the best approach for achieving consensus on the future size, shape and functions of the civil service?

12. A more strategic approach is needed, building from evidence and consultation with stakeholders. Size and shape should be derived from a new consensus on the functions of the civil service and not determinants of it. It is worth recalling that the Fulton report described the range of activities that are the role of government as analysis of policy issues, formulation and implementation of policy, delivery of services to the public, and management of resources.

13. Fulton’s prescription stands the test of time, though it is of increasing importance that information about these activities is available in formats and media that are readily accessible and understood by citizens. Good government should be expected to engage in dialogue at all levels, to explain difficult decisions, and to maintain dialogue even when its position differs from stakeholders and counterparts. There is no doubt that the process of engagement is done well by some parts of government. For example, the Government Office for Science review of the science and engineering profession has involved evidence gathering from all levels of government, the external science and engineering community and with Prospect. It stands in stark contrast to some of the superficial proposals in the Reform Plan and to the leadership of some ministers.

14. We are of course very concerned that although the Plan refers to a modern employment package, it actually doesn’t offer anything new or in the least innovative. Nor, regrettably, does it deal with the key challenge of providing an attractive, sustainable reward strategy to ensure that the civil service can attract and retain the skills it needs. Prospect would be keen to contribute and engage with a pay strategy that is evidence-based, transparent and fair. To this end we have called for the establishment of a Pay Review Body or similar independent mechanism to consider evidence relating to civil servants by function or professional group. Our case for a civil service Pay Review Body is set out in the Annex. In this context we would have no difficulty in holding individual civil servants to account for their contribution.

15. Whilst Prospect understands that political time horizons are bounded by electoral cycles, experience in the current Parliament has demonstrated the financial and opportunity costs of enacting change without a proper understanding of what already exists. For example our members observe that the system of locating analysts within policy teams results in greater confidence in the evidence, appropriate use and agility of response. It is easy but misleading for ministers to counter pose this system with one based on commissioning policy and advice from third parties. The facility to do this already exists, and has value, but cannot replace the need for integrated day-to-day policy advice provided by civil servants with knowledge of the issues and institutional memory. Again clarity over the functions and purpose of the civil service would help to guard against counter-productive change but should also be used to promote good practice.

16. The Government in Westminster has much to learn from the devolved administrations in Scotland and Wales which, away from the headlines, are both quietly making progress in joining up public sector policy and delivery. They are not afraid to do things differently, but are doing so in consultation with staff and unions. The Welsh Government consultation “Working together for Wales: The Public Service Workforce” seeks continual improvement in services and puts at the heart of this process a workforce partnership council that brings together devolved public sector employers and trade unions. Admittedly this initiative is still at an early stage, but our feedback is that there is genuine commitment to making it work. Even closer to home, one of DEFRA’s Agencies has a local partnership agreement with Prospect based on an overarching shared aim of helping to build the organisation as a thriving business and leading employer of choice. This local agreement reflects Prospect’s national priorities. Despite all the current difficulties, the union does still have a positive vision for change. Current policies will not deliver that vision, but Prospect would be willing to work with any government genuinely committed to fair change.

November 2012

Annex 1

THE CASE FOR A CIVIL SERVICE PAY REVIEW BODY

1. The civil service is the only major part of the public sector without a service-wide pay review body arrangement. It is also the only major part of the public sector not to have experienced fundamental reform of its pay and grading structures in the last 20 years. Whereas the NHS introduced Agenda for Change and the Department for Education negotiated the National Agreement for Raising Standards and Tackling Workload, civil service departments and agencies were simply left to decide their own pay arrangements. This led to:

A diminution in the quality of evidence available for decision-making. Previously the Office of Manpower Economics had worked with the parties to produce a detailed survey of comparable pay levels which informed negotiations over pay for the civil service as a whole and for professional groups within it.

A significant increase in resources needed to determine and maintain pay and conditions in around 200 separate bargaining units.

Barriers to movement due to divergence of terms and conditions across the civil service—inhibiting both career development opportunities for individuals and, from management’s perspective, flexible deployment of resources service-wide.

2. By contrast, the School Teachers’ PRB has a remit to consider the professional duties of school teachers as well as their pay and conditions and the NHS PRB also takes a proactive approach to improving its understanding of the roles of all staff within the remit groups. Yet it is evident from recent experience—including at the Department of Transport, MOD and DEFRA—that Ministers have not understood the role of specialists in their departments and have only appreciated the loss of capacity when it visibly impacts on the quality of operational decision-making.

3. The Cabinet Office has attempted to plug the data gap by commissioning commercial consultants, mainly Hay, to provide pay data. However, it has become increasingly obvious that this data is not fit for purpose—it does not adequately address the range of functions undertaken by civil servants and it simply does not recognise that not all civil servants have readily identifiable private sector comparators. Although Hay has one of the largest databases, no single organisation can provide comprehensive coverage and we are aware that the exclusion of significant employers in some areas has skewed their results.

4. Although there is a PRB for senior salaries and one for the Prison Service, both of which operate with union support, their remit groups are not sufficiently broad for recommendations to be confidently applied to the wider civil service. Although there is a strong case to be made that employers should apply exactly the same approach to pay at all levels of an organisation, the reality is that strategies to recruit, retain and motivate suitably able and qualified people to exercise their different responsibilities need to be appropriate to the circumstances in which they operate. Past attempts to transfer SCS practices to other parts of the civil service have proved to be ill-judged.

5. What is needed are regular surveys of relevant external data, co-ordinated by an independent expert body, to provide a sustainable basis for managing civil service pay as well as ensuring that skill needs can be met.

Prepared 5th September 2013