Tag Archives: Civil Service

Civil Service too risk averse at a micro level

 Faced with big challenges, the Civil Service thought small thoughts.  [Tony Blair, memoirs]

A report by the House of Commons Public Administration Committee has warned that the Coalition Government needs a more transparent and flexible Civil Service when it comes to commissioning public services from charities, social enterprises, mutuals and private companies.

The Committee’s report says the Civil Service needs to transfer power out of Whitehall and into communities and as a result fundamentally change the way it works.

It says the challenge of this new role will be compounded by the need to meet sizeable reductions in administrative budgets set out in the 2010 Spending Review.

Its conclusions are that while the Government seeks to embrace change, it has failed to recognise the scale of reform required or to set out the change programme required to achieve this reform. It says there is a reluctance to produce what they see as the latest in a long line of reform initiatives in Whitehall. This antipathy to a plan for reform fails to take note of the critical factors for success in Civil Service reform initiatives and wider corporate change programmes: coordination from the centre and strong political leadership. As a result, it warns, key policies like the ‘Big Society’ agenda and decentralisation will fail.

The Committee says: “We have recommended that the Government should produce a comprehensive change programme articulating clearly what it believes the Civil Service is for, how it must change and with a timetable of clear milestones. Such a change programme would enable real change in Whitehall and avoid the fate of previous unsuccessful reform initiatives.

“Such a change programme must also include proposals for the Civil Service to retain and to develop the new skill sets required to meet the demands of the Big Society policy agenda, and to address long-running concerns about the decline in specialist expertise in Whitehall, the failure to innovate and to take risks, and the failure to work across departmental silos. Such a plan is required to combat inertia and deliver government policies where Ministers and departments may otherwise be unwilling or unable to drive change.

“To reflect the changing role of the Civil Service, we have also recommended that the Government should consider the development of a new Haldane model of accountability which can sustain localism and decentralisation; or they must explain how the existing model remains relevant. The new realities of devolving power out of Whitehall to local government and elsewhere should be codified in the Civil Service governance structures.

“Ministers seem to believe that change will just happen. It is essential that the Cabinet Office take leadership of the reforms and coordinate the efforts in individual departments and across Whitehall as a whole. The scale of the challenges faced by the Civil Service calls for the establishment of a world class centre of Government, headed by someone with the authority to insist on delivery across Whitehall.”

In particular, the report says the main change of task, which will affect many but not all departments, will be an increase in commissioning and contracting. More onerous and time-consuming, however, will be monitoring the contracting process and dealing with problems and complaints arising.

The report says Whitehall has traditionally performed three core roles: policy advice, the management of public services, and the supervision of public bodies. If the Civil Service is to connect with Ministers’ ambitions for public service reform a fourth capability will need to be added to this trio: the ability to engage with groups from the voluntary and private sectors through the contracting and commissioning process. Every government department must focus on developing this fourth capability, and the Cabinet Office must ensure that this is embedded in the Civil Service change programme across government.

The report explains why SMEs have made so few inroads into government work. 

It goes so far as to depict ministers as not understanding Civil Service inertia, which means they cannot come up with a plan to do anything about it. Cabinet Office Minister, Francis Maude, described a paradoxical situation where Government took huge risks at a macro level, but at a micro level tended to be very risk averse and hostile to innovation.

He added, “You do not often hear of someone’s career suffering because they preside over an inefficient status quo, but try something new that does not work and that can blot your copybook bigtime.”

 An example of one SME’s innovative ideas

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Mutuals: white paper offers public services choice as Cameron tells Civil Service to take more risks

It was unfortunate that yesterday’s press conference to launch the Open Public Services White Paper by David Cameron was hijacked by journalists quizzing him on the ongoing News International story.

The event, organised by Reform in Canary Wharf, also featured speakers from big business i.e. the CBI, the consumer organisation Which, and the voluntary sector – “a Coalition in support of the White Paper,” suggested Cameron.

Detailing the public services landscape, Cameron scarcely mentioned mutuals by name, though they do feature significantly in the White Paper itself.

Modernisation of public services, he said, will give people choice and control over the services they use, and end the ‘get what you’re given’ culture.

People will be given more choice to shape the public services they use, putting control in the hands of individuals and neighbourhoods so everyone can benefit from the best public services available.

“I know what our public services can do and how they are the backbone of this country. But I know too that the way they have been run for decades – old-fashioned, top-down, take-what-you’re-given – is just not working for a lot of people.“Ours is a vision of open public services – there will be more freedom, more choice and more local control. Wherever possible we are increasing choice by giving people direct control over the services they use,” said Cameron, who detailed five core principles for modernising public services: choice, decentralisation, diversity, fairness and accountability.

He also made some key points about change and also about risk-taking for those now in the public sector:

“This is the case for change. If we want to compete in the world; if we want to get value for money; and above all if we want the decent, reliable public services that make life better for people, there will be no progress if we stick with the status quo.  What does change look like? It’s about ending the top-down, big government way of running public services,  and bringing in a Big Society approach, releasing the grip of state control and putting power into people’s hands. The old dogma that says ‘Whitehall knows best’ – that is going.”

“We really need to ensure that civil servants and arms length bodies see that there is a clear set of principles to apply: about choice, about diversity, about payment by results, about the role of private and voluntary sectors.

“The biggest challenge for the Civil Service is to try and adapt to this new culture and also a very difficult thing to do, and an easy thing to say, is that actually civil servants will have to take some risks. We all know that in business it is very easy to award the contract to Price Waterhouse. They’ve done it before, they’re an enormous organisation, they won’t fail. I think there’s a similar tendency within the Civil Service. It’s safe to keep it in house and deal with one of the big providers.

“If we really want to see diversity, choice and competition, we have to take some risks and recognise that sometimes there will be a new dynamic social enterprise that has a great way of tackling poverty or drug abuse or helping prisoners go straight, and we do need to take some risks with those organisations and understand that rather like in business, when you have a failure, that that doesn’t mean that the Civil Service has done a disastrous job.

“In business, we try new things in order to do better, and when they don’t work, we sit back and think, ‘How do we do that better next time?’ We do need a sense of creativity and enterprise in our Civil Service which is clearly there….a change of culture, perhaps a different attitude towards innovation and risk and a sense that that will be a good way of driving performance.”

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This what the White Paper says about public service mutuals:

6.14 We are doing much more than just sweeping away regulations. We are giving public sector staff new rights to form new mutuals and bid to take over the services they deliver, empowering millions of public sector staff to become their own bosses. This will free up the often untapped entrepreneurial and innovative drive of public sector professionals.

6.15 Ownership and control, through mutualisation, empower employees to innovate and redesign services around service users and communities, driving up quality. We will not dictate the precise form of these mutuals; rather, this should be driven by what is best for the users of services and by employees as co-owners of the business. Options include wholly employee-led, multi-stakeholder and mutual joint venture models.

6.16 The Government will take steps to identify and overcome the barriers placed in the way of public sector workers who want to exercise these rights.

6.17 Public sector employee ownership: the key policies we are already implementing include:

  • Right to Provide – we are giving public sector workers who want to form mutuals or co-operatives to deliver public services a Right to Provide. This will enable public sector workers to form independent, or joint venture based, mutual and co-operative social enterprises. Progress is already being made with a new Right to Provide for NHS staff and opportunities for local authorities to invoke the Right to Challenge;
  • mutual pathfinders – the first wave of employee-led mutual pathfinders was launched in August 2010 with a second wave announced in February 2011. These pathfinders are being mentored by expert organisations as well as leading figures in social enterprise and public service to support their growth and share best practice; the pathfinders will provide critical learning as more employees look to exercise these rights;
  • Mutuals Task Force – Professor Julian Le Grand, one of theUK’s leading thinkers on public service reform, has been appointed to lead a Task Force to push employee ownership across the public sector;
  • Mutuals Support Programme – we will invest at least £10 million in the Mutuals Support Programme, to support some of the most promising and innovative mutuals so that they reach the point of investment readiness. This support will be available from autumn 2011;
  • Enterprise Incubator Unit – this has been set up within the Cabinet Office to provide advice, challenge and resources for public service providers from central government departments and their agencies who want to move from the public sector to the independent sector. The unit will help management teams to restructure themselves and their teams into independent businesses, which may include partners providing finance or expertise, for example through a joint venture;
  • Post Office mutualisation – In May, Co-operativesUK published a report commissioned by the Government on options to transfer Post Office Ltd from government ownership to a mutual run for the public benefit. The Government will carefully consider this report before launching a public consultation later this year; and
  • My Civil Service Pension (MyCSP) – plans have been announced for MyCSP to become the first mutual enterprise to spin out of a central government service. MyCSP administers Civil Service pension schemes for 1.5 million public sector workers. MyCSP’s plans to mutualise, which have the full backing of the Government, will give employees a stake in the new business, alongside government and a private sector partner. The innovative ownership model will be matched by a participative management approach: there has already been a strong turnout in elections for the Employee Partnership Council, through which employees will have a meaningful say in the running of the business.
Enabling new provision

7.7  Creating open public services will require new types of investment in public services: investment of money, inspiration and entrepreneurial effort. The Government will promote the opportunities being created by open public services, tailored to individual sectors. This promotion will aim to support:

  • accessing new forms of external finance – there is an exciting set of opportunities to bring new forms of finance into public services. This includes social investment (e.g. social impact bonds); payment for results on capital improvements (e.g. energy efficiency) and the financing of modernisation programmes (e.g. joint ventures to introduce new technology). Work is under way to develop effective measures of the social impact of investment and to launch the Big Society Bank, which will catalyse the growth of a sustainable social investment market;
  • empowering public sector staff to take control of their own services in new enterprises like mutuals – the creation of mutuals is a critical step in achieving more diversity in public services. However, we recognise that this is a big step to take for both staff and the public body that employs them. We will set out a full range of support available to those who are considering setting up a mutual, in the same way that we seek to stimulate both voluntary and private sector development. This will include a £10 million Mutuals Support Programme to provide support to fledgling mutuals that are being set up to deliver public services by employees leaving the public sector; and
  • actively encouraging new providers, of all sizes and from all sectors, to deliver public services– when we say we want diversity in public services, that is exactly what we mean. We will take active steps to avoid simply switching from one type of monopoly to another. We will launch a positive action programme to improve the awareness of public service opportunities to new providers, especially small and medium-sized enterprises. Many of our policy changes have already opened up attractive new opportunities, for example in the Work Programme and through personal budgets in social care. In addition, we will take positive action on procurement and through regulators to ensure that other opportunities (e.g. in central government procurement) are opened up to new types of provider, be they from the public, private or voluntary sector.

If you want more details, you can access the White Paper here – and the Government has unveiled an Open Public Services website