Tackling Wales’ Sir Humphreys

Andrew Davies calls for radical reform of the way the Welsh civil service operates

Our views of the civil service are indelibly influenced by programmes such as Yes Minister and, more recently, The Thick of It. The caricature of civil service mandarins like Sir Humphrey Appleby and special advisers like Malcolm Tucker running rings around hapless Ministers is now lodged in the public’s memory. Like all good caricatures, amongst the gags and stereotypes, there is a large grain of truth.

However, many people are not aware that Welsh Government civil servants work for an institution that originated in mid-19th Century Victorian Britain, which is the only part of the pre-devolution constitutional settlement that remains unexamined and unreformed. Many people are surprised to be told that senior Welsh Government civil servants are appointed by and are accountable to the head of the UK Civil Service and not Welsh Ministers. I believe the time has now come for radical reform.

The Home civil service owes its origins to the Northcote-Trevelyan report of 1854 that recommended a permanent, unified and politically neutral civil service. However, by the mid-20th Century there were growing concerns about the ability of the civil service to respond to the changing demands of Britain. As a result Prime Minister Harold Wilson set up the Fulton Committee, which reported in 1968.

Lord Fulton, former Principal of Swansea University, found the civil service to be inadequate to meet the tasks facing the UK. The Civil Service was based on the cult of the amateur generalist, while those with specialist and technical skills were not valued or given the authority they deserved. The Civil Service was also very hierarchical with a classification system that made it rigid and unresponsive. The Civil Service lacked skilled managers especially in terms of personnel management. In addition it was a very closed and inward looking institution which had little contact with the wider community.

It has been widely acknowledged that Fulton failed and the period since has seen successive reviews that have repeated the criticisms that Fulton made. For example, in 1997 Cabinet Secretary Sir Richard Wilson, then Head of the Civil Service, identified civil service reform as his major priority, and his proposals bore an uncanny resemblance to the Fulton recommendations.

So the urgent need for reform has been consistently recognised by senior civil servants and politicians but one is entitled to ask what progress was made? A decade after Wilson the Whitehall Civil Service itself undertook a series of Departmental Capability Reviews, which again showed the same defects:

  • Weak executive capacity, with poor leadership and management.
  • Weak reflective capacity and poor long-term thinking.
  • Poor co-ordination and disjointed government, with little evidence of joint working between Civil Service departments.
  • Poor management of knowledge and organisational memory, which undermined learning and innovation.
  • An obsession with process and compliance, not outcomes and delivery.

Bearing in mind that these were internal and not external reviews this was a pretty damning indictment by the Civil Service itself. My own experience over ten years as a Minister confirmed this. This is not a criticism of individual civil servants but of the Civil Service system and culture, which will be very familiar to many who encounter it on a regular basis. The Civil Service is not good at long-term planning and is rarely strategic in its thinking, policy making and its financial planning. The promotion of senior officials is largely on the basis of intellectual and policy-making ability not on their leadership and management capability. Because of the preoccupation with policy, the management of relationships, whether internal or external, is not seen as a priority. Many years ago, a consultant working for Welsh Government said to us as Ministers, “Don’t forget, senior officials spend most of their time managing you and not their departments.” Sir Humphrey is alive and well!

Welsh Ministers have recognised that the current system will be challenged to deliver the policy making or the management of services that 21st Century Wales requires. For example, the proposed establishment of a Welsh institute of public policy is a recognition of the lack of sufficient capacity of the Welsh Civil Service to make policy. As the 2011 Welsh Labour Manifesto also stated, it is “anomalous that the Assembly Government senior civil service is not accountable to Welsh Ministers and that after the first decade of devolution it is appropriate that the current civil service system be reviewed.” There followed a commitment to “review and seek realignment of the governance and performance of the Assembly Government civil service, better to reflect the developing requirements of devolution whilst remaining part of the Home Civil Service.”

What might come out of such a review? Radical change is certainly needed. First of all, the anomaly of accountability must be addressed. After devolution the Civil Service Code was amended to provide that “civil servants owe their loyalty to the Administrations in which they serve”. However, the Welsh Government Permanent Secretary and the Senior Civil Service are still formally accountable to the Cabinet Secretary/Head of the Civil Service, not Welsh Ministers.

For example, when Dame Gillian Morgan, the current Permanent Secretary, was appointed, former First Minister Rhodri Morgan was consulted but not formally involved in her selection. In my view, there should be a clear line of accountability, including responsibility for appointments, of the Permanent Secretary to the First Minister and Welsh Ministers. I also believe it is anomalous in the 21st Century that there are effectively two classes of civil servants. It is elitist, smacks of “officers and other ranks” and should be abolished.

I also believe there should be a clearer distinction between Ministerial and Civil Service accountability and responsibility. The existing convention that Ministers are accountable for everything that happens on their watch is dysfunctional and damaging. How can a Minister be responsible for the actions of every civil servant who works in their department? I think Ministers should be politically accountable for the development and delivery of policy and senior civil servants responsible for financial and operational management of their departments.

Poor performance management by senior civil servants has been identified as a major weakness. The current system of performance-related pay where, like much of the private sector, decisions are made by senior civil servants themselves, should be abolished. I believe that Senior Civil Servants should be appointed on fixed-term contracts with key strategic criteria based on Welsh Government objectives. If these criteria are not achieved then the contracts should not be renewed.

Management is not taken sufficiently seriously in the Civil Service, whichparadoxically is both poorly managed and over managed. It is also a very hierarchical and status conscious organisation. Civil servants will often be described by their grade rather than their job title! In addition and perversely financial management is not related to performance management, so while there is control, indeed micro-management of expenditure, this is unrelated to the effective management of policy outcomes. As in any business, financial management should be closely related to performance management and the effective value-for-money use of that expenditure.

Presently senior civil service management is inwardly rather than externally focused, with the bulk of their time taken up with internal organisational matters. In a post-devolution Wales we need civil servants who are facilitators working closely with social partners in civil society, rather than gatekeepers of information and access to Ministers. This requires a very different skill set. My long-standing proposal is for the creation of a ‘Welsh Public Service’, with its own distinct ethos and ‘permeable’ boundaries, in which staff could move seamlessly between the civil service, local government, the health service, or indeed the third and private sectors.

There has been some debate in recent years about the creation of a separate Welsh Civil Service. At present I do not believe that to be desirable. With the current constitutional settlement, the ability to be part of the wider UK civil service is crucial for effective policy-making between Welsh and UK Governments, as is the secondment of staff between Wales and Whitehall. There is a danger of a purely Welsh Civil Service being parochial and not aware of developments outside Wales, and it not being able to recruit a critical mass of staff with sufficient ability. However, a ‘Yes’ vote in a Scottish referendum will force this as well as other issues onto the agenda.

While the separation of the Welsh from the Home Civil Service may not currently be feasible, a great deal of work has been done in Wales over the last ten years to develop partnership arrangements across public bodies especially around employment and human resource issues. The manifesto commitment to establish a national secondment scheme is an extension of this process. All this work will need to be sustained and accelerated to bring a de facto Welsh Public Service into existence.

The training of civil service and public service management in Wales needs addressing seriously. At a UK level the Civil Service College must be more attuned to the needs of devolved government. To tackle the priorities of public service management in Wales, the 2011 Welsh Labour Manifesto committed to the establishment of a Leadership Academy. The intention is to improve management training and facilitate the creation of a Welsh Public Service. Working with universities and other providers, management training would be based on the needs of public services in Wales.

An attempt was made in the Welsh Labour manifesto to address the existing bias in the civil service towards policy making rather than service delivery, through the commitment to set up the First Minister’s Delivery Unit in Government.  This is intended to improve the ability of the First Minister Carwyn Jones to co-ordinate and implement delivery of Government objectives over this Assembly term.

A complaint often made of the Civil Service is that it is risk-averse. However, I don’t think this is necessarily accurate. In my view it is more a case that the Civil Service, like the public sectior generally,is often poor in assessing and managing risk.  As we have seen in Wales and elsewhere civil servants have frequently taken enormous and very expensive risks, for example in the procurement of major ICT projects. Here I believe the problem has been the lack of the right expertise resulting in private sector providers negotiating deals that provide large profits for the companies involved but do not serve the needs of government and the taxpayer. This is an area where there is a great need to strengthen the role of skilled specialists rather than generalists.

I would also argue the problem is less risk aversion than an over emphasis on compliance and process. As various reviews of the civil service have found, innovation is not incentivised or encouraged. The dominant culture is one of ‘not invented here’ and ‘not the way we do business’. To create the required innovative outward-looking culture, and to tackle the problems of micro-management and the culture of compliance, whole levels of unnecessary management should be eliminated. A flatter management structure should be created with a greater delegation of responsibility and financial management.

There must be a clearer focus on the delivery of fewer but more strategic policy outcomes and a reduction in the requirement for the mechanical following of administrative process, much of which is unnecessary, repetitive and self-serving. As gatekeepers, the concentration on process is of course one of the ways in which civil servants control outside or partner bodies, and one of the ways senior civil servants ‘manage’ Ministers.  Old habits would seem to die hard.

Professor Andrew Davies, a former Finance Minister in the Welsh Government, is now a strategic adviser to the Vice Chancellor of Swansea University. This article appears in the Spring 2012 issue of the IWA’s journal Agenda which is published this week.

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