Reforming government: the Cabinet Office

Last week Reform published its 2011 scorecard of the Coalition Government’s public service reform programme. Following the articles on the health, welfare  and education reforms, Andrew Haldenby, Reform’s Director, discusses the Cabinet Office.
 
The Prime Minister has put the Cabinet Office in the vanguard of his efforts to reform public services.  The Cabinet Office Structural Reform Plan gives the Cabinet Office responsibilities to reform the Civil Service, create more competitive public sector markets and reduce inefficiency” (through the operation of the Efficiency and Reform Group).  These are major objectives on which the success of the wider programme depends.  For this reason, the lack of progress should be a real worry for the government.
 
In opposition, Francis Maude argued that reform of Whitehall – in particular, making senior civil servants personally accountable for performance – would underpin the government’s wider efforts.  The experience of ministers such as Alan Milburn, David Blunkett, Caroline Flint and indeed Tony Blair strongly supported his argument.  They came to the conclusion that the lack of accountability of Whitehall made radical change extremely hard to implement.  In 2007, Alan Milburn said: “Whitehall is the one part of the public services that has largely escaped Tony Blair’s reforming zeal. It should do so no longer.”
 
Francis Maude’s idea was to make Permanent Secretaries accountable to departmental boards, chaired by ministers.  In the “last resort”, as Francis Maude put it at the 2010 Conservative Party conference, Ministers could ask the Cabinet Secretary and the Prime Minister that Permanent Secretaries could be moved.  That would at least be a step in the right direction.  But in recent weeks senior civil servants have questioned the force of the boards.  Dame Helen Ghosh, the Permanent Secretary of the Home Office, told the Public Administration Select Committee told the boards would be “advisory” rather than executive.  The Cabinet Office draft structural reform plan does express the idea that Permanent Secretaries should be put fixed term contracts, but progress is only described as “ongoing”.  The impression is that civil service reform has been kicked into the long grass.  This would be consistent with Francis Maude’s speech at a Reform conference in July 2010 where he argued that Whitehall’s position should actually be strengthened, for example by reducing the use of management consultants.
 
A key ambition of the Cabinet Office is to “enhance public sector markets” by “examining opportunities for further private and voluntary sector involvement in service delivery” and “creating a level playing field” in procurement contracts.  In fact the opposite approach is being taken. Following the Department for Business, Innovation and Skills’ pledge that one quarter of government contracts will be awarded to small businesses, the Cabinet Office has set out plans to facilitate this.  Here the ambition is to reduce waste by centralising procurement and commissioning. This again skews the market, in favour of small suppliers and against big ones. It also misses the crucial point that value for money comes from accountability, not central dictat. In a speech on 10 February 2011 Nick Clegg explained that “opening up public services” really means skewing the market, in this case in favour of public sector employee co-ops and charities, and against for-profit providers.
 
The Efficiency and Reform Group is improving the procurement of central government services.  But its remit stops there; it is excluded from the other government departments, responsible for nearly all public spending. Because of its oversight of the civil service, the Cabinet Office is essential for the success of wider reform.  It needs a new start.