Select Committee on Environmental Audit First Report


Changes in the Structure of Government and Sustainable Development

1.  In October 2000, the Prime Minister said that it was time to "reawaken the environmental challenge as part of the core of British and International politics".[1] Our particular purpose in examining the impact of changes to the machinery of Government in the post-election period is twofold: to identify the strengths and weaknesses in the new Whitehall structure as far as it relates to sustainable development and environmental protection and to ensure that clear lines of responsibility exist. Does Whitehall now provide a better foundation for delivery on the Prime Minister's commitment?

2.  Following the General Election in June 2001, a number of changes were made to the structure of Whitehall and departmental responsibilities—changes which impacted significantly on the ways in which policy areas critical to progress in sustainable development and environmental protection are organised. In the boldest move, the vast Department for the Environment, Transport and the Regions (DETR), which had been created in 1997 to bring together the functions and responsibilities of the Departments of Transport and the Environment, was stripped of the environmental aspects of its three-pronged remit. The Minister for the Environment, Rt Hon. Michael Meacher MP, whose retention of his Ministerial portfolio from one Parliament to the next is a deserved recognition of his efforts, now works from the newly created Department for the Environment, Food and Rural Affairs (DEFRA), under the leadership of the Secretary of State, the Rt Hon. Mrs Beckett. DETR's Environmental Protection Group and Wildlife and Countryside Directorate were also transferred to DEFRA where they joined with the much larger Ministry of Agriculture, Fisheries and Food (MAFF).[2]

3.  The majority of the remainder of DETR's functions and responsibilities, including responsibility for planning, are now with the Department for Transport, Local Government and the Regions, itself also established in the post-election period. Sponsorship of the Regional Development Agencies (RDAs), passed from DETR the Department of Trade and Industry (DTI).

The Positive Case

4.  Tampering with the machinery of Government is a tempting possibility in the wake of an election campaign. It offers an apparent potential for more efficient, more logical and more productive practices and procedures and creates an instant impression of radical reform. But Ministers have to ensure that any new departmental boundaries are drawn up against a considered rationale which observe the principles of good management. Much was made in 1997 of the benefits of bringing together within a single Government department policy responsibility for environmental, transport and regional matters. In 1998, for instance, Sir Andrew Turnbull, told the Select Committee on Environment, Transport and the Regions, that the creation of DETR had not been done as a piece of administrative tidying up or as a money saving exercise but with real purpose: he said that there had been "many issues which the old DoE [Department of the Environment] and the old DoT [Department of Transport] needed to collaborate on and could not handle themselves and a belief that they could do it better bringing a lot of these issues of transport and the environment together".[3]

5.  We asked both Mrs Beckett and the Rt Hon. Stephen Byers MP, Secretary of State for Transport, Local Government and the Regions, whether the break up of the DETR was an indication that Ministers believed that the mega-department had not, after all, met its potential. Mrs Beckett and Mr Byers argued that environmental policy areas had increasingly gained importance since 1997, consuming an ever larger proportion of Ministerial time, especially in terms of the international framework for sustainable development, and that this had led to a recognition that "there was much to be said for having a department that has sustainable development as its prime focus".[4]

6.  Sustainable development is a superficially simple phrase. It encompasses a range of ideas ranging from "don't eat tomorrow's potatoes today" to meeting "the needs of the present without compromising the ability of future generations to meet their own needs".[5] The Government's interpretation is that sustainable development involves meeting four objectives simultaneously:

    i.   Social progress which recognises the needs of everyone;
    ii.   Effective protection of the environment;
    iii. Prudent use of natural resources; and
    iv. Maintenance of high and stable levels of economic growth and employment.[6]

7.  Sustainable development has to be a central aim for every Government department. It is more than an environmental issue. Although the merit in bringing together many of the key policy areas behind sustainable development—environmental protection, transport, planning and regional development—was obvious, there is no single ideal model for the structure of Government, nor is any model free from disadvantages. Splitting environmental protection and sustainable development from the rest of DETR's policy areas has inevitably introduced a series of risks. The real imperative is to identify those risks and to ensure that Ministers work hard to minimise them.

Transitional Issues

8.  There has been a Department of the Environment, or at least a Department with "Environment" in its title, since October 1970 but the range of associated functions and responsibilities and been in almost constant flux. For years the title was associated with local Government, housing, and public building and works. Only more recently has environmental protection gained the political importance, and public significance, that it has today. The merger four years ago of environment with the rest of DETR was viewed at the time with some scepticism. It was nevertheless a merger of more or less equal partners who, furthermore, knew each other well, having maintained common services and similar working methods up until the early 1990s.

9.  The creation of the Department of the Environment, Food and Rural Affairs brings none of these advantages. The Environment Protection Group and the Wildlife and Countryside Directorate came from a Department which had developed a reputation for innovation and progressiveness with strong links across Whitehall. Conversely, MAFF, widely seen as resistant to change, was a department deeply involved in the crises that have hit farming and rural economies in recent years, particularly BSE and Foot and Mouth. This has led some to argue that putting the environmental aspects of DETR together with MAFF was not the result of any environmental or sustainable development policy delivery logic, but more an effort to promote a cultural change within MAFF.[7]

10.  An additional complication came to the fore upon merger: significant differences between the pay and conditions of former DETR staff and former MAFF personnel. Pay for civil servants below the Senior Civil Service was delegated to individual departments a decade or so ago. DETR staff had been in the top quartile of the civil service in terms of pay, while MAFF staff had been in the bottom quartile. These differences raised a series of issues around equal pay in DEFRA. In August 2001 the Public and Communications Services Union started a programme of selective industrial action, targeting specific offices for one or two days a week. In late August, DEFRA made some interim payments to staff which addressed the immediate problem. When Mrs Beckett appeared before us at the end of November, she was not able to predict when a permanent solution to the dispute might be reached.[8]

11.  The Select Committee on the Environment, Food and Rural Affairs have questioned the Minister and the Permanent Secretary over the industrial dispute.[9] It is more properly a matter for that Committee to comment on than for us. What concerns us here is the impact of transition, with the additional complexity of an industrial dispute, on the delivery of policy. DETR, with its three-pronged remit, existed for four years. Large-scale re-organisation risks diverting both senior and junior personnel from their main task of policy development and delivery. It has been estimated that significant changes to departmental structures can take up to two years to bed down.[10] Mrs Beckett acknowledged that the industrial dispute in particular "has had an impact on the department's overall work...there have been some concerns that our service to stakeholders might be affected".[11] Working on the basis that it takes two years to complete the merger process, which may be optimistic in the case of DEFRA with all the problems of civil service transfers, pay and structures, four out of six years between 1997 and 2003 will have been spent in transition.

Creating the Right Signals

12.  In other countries environmental protection and sustainable development are linked with a range of different policy areas. In Denmark it is homed with energy, in South Africa with tourism, in Holland with planning and energy (much like the pre-1997 UK Department of the Environment), in Germany with nuclear safety and in Austria with agriculture and forestry. The new logic in UK policy organisation has caused disquiet in some quarters, not least because some issues excluded from DEFRA's portfolio—transport, industry, planning and urban regeneration—are those where integration with environmental protection is not only fundamental to making progress on sustainable development but also most difficult to achieve.

13.  Some have argued that the new departmental arrangements are "in a sense, a step backwards to the perception of environmental protection as being about saving hedgerows and protecting the countryside".[12] Charles Secrett, Director of Friends of the Earth, told us that "Essentially, the political signal that has been sent out by DEFRA, we fear, is that environment and sustainability issues are about bunnies and bloody farmers; and we think that that is a very, very dangerous political message".[13] In contrast Mrs Beckett told us that there had been no loss of focus on environmental issues as a result of the creation of DEFRA and that she would be "extremely unhappy" if any one thought that there had.[14] The perception that DEFRA is a department concerned principally with rural issues may result in a lack of engagement over sustainability issues between DEFRA on the one hand and NGOs, international partners and the public on the other.

14.  The apparent downgrading in the level of priority accorded to environmental and sustainability issues appeared to be confirmed by the consultation document issued by DEFRA in summer 2001 on the new department's aims and objectives. One specialist journal argued that it represented a "significant shift in the Government's environmental priorities...the weight given to rural, agricultural and farming polices is unexpected. It is clear from the body of the document, that the focus of the former Department for the Environment, Transport and the Regions on environmental protection, and building on the polluter pays principle, is now matched, if not exceeded, by the objectives of developing sustainable food and farming policies and reversing the decline in the countryside".[15] The aims and objectives subsequently agreed by DEFRA put sustainable development as an overall aim; but five of its seven objectives are specifically tied to rural and agricultural matters, seeming to confirm initial fears that environmental protection would lose out to the more politically urgent issues of farming and CAP reform.

15.  There is also a risk that other Government departments will not, as a matter of course, consult with DEFRA colleagues when developing and implementing policy which may impact on the environment or sustainability and that even the good working practices and relationships developed within DETR will erode over time. As Tony Hawkhead, the Chief Executive of Groundwork said, there is a need to ensure "sustainable development doesn't become an 'also ran', shoehorned into DEFRA under the guise of environmental protection and rural renewal".[16] The Government does not seem to view this as a significant risk; three Secretaries of State told us that working relationships between civil servants who used to all work in the same department but who are now split around Whitehall are still close. Both Mrs Beckett and Mr Byers drew our attention to a concordat signed between the permanent secretaries of their departments covering a range of practical approaches to making sure that the good communications established under DETR continue.[17]

16.  Mr Byers added that the increased priority attached to environmental matters would act as a safeguard.[18] Rt Hon. Patricia Hewitt MP, Secretary of State for Trade and Industry, told us that her department "had a number of joint projects [with DETR] and those have moved quite seamlessly to DEFRA, with whom we have the same good working relationship...the fact that in some cases it is a different Department that is housing those officials does not seem to have disturbed the official-level relationship".[19]

Working Across Whitehall

17.  The good communications developed between DETR officials working in different policy areas provide a firm foundation to go forward. We are not, however, satisfied that the new arrangements provide adequate protection to prevent a deterioration in communications. The new arrangements regarding regional policy illustrate this point well. The current structure for regional policy in England has developed incrementally since the late 1980s. New Government Offices were created in 1994, followed by the establishment of Regional Development Agencies (RDAs), with their statutory duty to take account of sustainable development, and the encouragement of Regional Chambers and Assemblies in 1999. In 2000 RDAs were issued with policy guidance on Regional Sustainable Development Frameworks. These arrangements have resulted in some tension between regional the bodies (Assemblies, Chambers and the RDAs) and between the regional strategies the each develop which were not resolved under the guidance of DETR despite its inclusive remit.

18.  Under the new arrangements, responsibility for regional policy has been split between the Regional Co-ordination Unit in the Cabinet Office, the Department of Trade and Industry through its sponsorship of the RDAs, DTLR with its responsibilities for regional planning and DEFRA which has oversight of Regional Sustainable Development Frameworks. This represents a fragmentation of regional policy and separates the majority of regional policy responsibility from the environment policy. As the RSPB told us, there is a concern that "this fragmentation will exacerbate the lack of emphasis on sustainable development within regional policy (a problem evident even before the new department arrangements came into existence).".[20] There are also concerns that the move to DTI could result in RDAs becoming almost exclusively concerned with economic development with overwhelmingly economic priorities although we note that Lord Falconer, Minister for Housing, Planning and Regeneration, told the Select Committee on Transport, Local Government and the Regions that he did not believe that the change would have a significant impact on the RDAs priorities.[21]

19.  Similarly, divorcing environment from transport, dividing responsibilities for climate change, and positioning environmental protection so that it has it has to compete against the demands of the old MAFF agenda risks hindering rather than accelerate progress. The counter to these risks is for DEFRA, like the Treasury, to be involved in the work of each Department, making sustainability issues as central to policy development as finance and expenditure already is. Mr Meacher, at the launch of the third annual Greening Government Report in November 2001, acknowledged that there was a need to demonstrate that DEFRA can work in this way, stating that "Integrating sustainable development into decision making is the single biggest challenge facing Green Ministers".[22]

20.  DEFRA's commitment to sustainable development has not been adequately communicated beyond the confines of Whitehall. When Mr Hewett, Senior Research Fellow at the Institute of Public Policy Research, appeared before us only two weeks before the Secretary of State for the Environment, Food and Rural Affairs, he questioned whether DEFRA had the capacity to achieve the integration between rural and environmental policy which is required if sustainable development is to become central to the work of the department.[23] At the same time, Mr Charles Secrett, Director of Friends of the Earth stated that "we do not yet see the political will being demonstrated".[24]

21.  The Government as a whole, and not just the Secretary of State for the Environment, Food and Rural Affairs and DEFRA, needs to underline a belief in a new consensus, one which puts sustainable development at the top of the political agenda both nationally and regionally, and to counter the impression that DEFRA was unplanned. As part of this we recommend the Government produces and disseminates a statement of clarification on the responsibilities for the promotion of sustainable development at a regional level.

Ministerial Responsibilities: the role of the Deputy Prime Minister

22.  We have sought to establish a clear understanding of where responsibility for specific aspects of environmental and sustainable development policy and decision-making now rests within Government. Sustainable development is an issue which affects all aspects of policy. As the Rt Hon. Michael Meacher MP, Minister for the Environment, has previously stated all "Ministers, officials and key representatives of the governing process have got to take account of the sustainability process".[25] The 10 Downing Street statement of 11 June 2001 which stated that the Deputy Prime Minister would retain a leading role in international negotiations on climate change: unsurprising, particularly when viewed in the context of the Cabinet Office's work on other cross-cutting issues such as social exclusion and e-government.

23.  We invited the Deputy Prime Minister to give evidence to us as part of our inquiry. The Deputy Prime Minister declined to do so, stating that policy responsibility in this area rested with Mrs Beckett, as the Secretary of State for the Environment, Food and the Regions. She made it clear that it was for her and her Department to take the lead in such international negotiations, describing the Deputy Prime Minister's role as one where he "continues to take an interest in these issues".[26] We were therefore surprised to note the Chancellor of the Exchequer saying, during his statement on the Pre-Budget Report, the day before Mrs Beckett gave evidence to us, that "to stem the tide of global warming the Deputy Prime Minister is leading the pressure for new international agreements".[27]

24.  Those Ministers whom we questioned each provided the same uniform response. It has taken considerable effort to establish precisely the role of the Deputy Prime Minister vis a vis the Secretary of State for the Environment, Food and Rural Affairs. If it was difficult for us to do, with our close links with Government and the powers bestowed by the House of Commons, it must have been an almost impossible task for others. We are therefore grateful to the Deputy Prime Minister for providing us with a memorandum of clarification.[28] Mrs Beckett and her department have the lead responsibly for sustainable development with the Deputy Prime Minister playing a significant role in international negotiations on climate change. The memorandum is published with this Report. We were only partially reassured to find that Ministers did not share the confusion we and others sensed over lines of responsibility.

25.  We recommend that significant changes to the machinery of government are in future accompanied by a memorandum to the relevant select committee(s) providing a robust reasoning for the changes and detailed information on their nature. It is particularly important that policy imperatives which cut across departmental boundaries are not downgraded in departmental reorganisations.

Sustainable Development

26.  The Sustainable Development Unit (SDU) was established within DETR following the 1997 general election, although the Labour Party, when it first proposed the idea of an SDU, originally planned to locate it in the Cabinet Office. It too was transferred to DEFRA in June 2001.

27.  In practice, the SDU made a significant contribution in DETR under the leadership of the Deputy Prime Minister. The Sustainable Development Strategy published by DETR in 1999 provides an innovative and ambitious framework for the future.[29] The differences would appear to have more to do with Ministerial, and indeed Prime Ministerial, engagement than with location. Had the Deputy Prime Minister chosen to use the SDU as his own personal policy unit, in a manner similar to the way in which the Prime Minister uses the PIU, the SDU may well have achieved a comparable status in Whitehall. This analysis suggests that Ministerial support is the key factor for the SDU and that decisive leadership remains one of the most important factors in delivery.

28.  When we examined Mrs Beckett, she convinced us of her personal commitment to sustainable development and we were reassured to be told that "it is the intention of the Government to make sure that sustainable development is a vision for the whole Government".[30] DEFRA has already achieved some notable successes influencing other Government Departments. For example, the Treasury has been persuaded to make sustainable development an "underpinning theme" in the spending review process and to incorporate sustainable development as one of the key aims of the Office of Government Procurement (no small achievement given the Treasury's earlier intransigence on this point).[31]

29.  These concessions towards a sustainability agenda on the part of the Treasury are significant, but the real test will be to see what advances, what changes in practice and culture, they engender. Initial indications are not entirely positive. Moreover, the separation of those policy areas critical to progress in sustainable development puts a greater responsibility on all Ministers, regardless of their portfolio, to take sustainable development seriously. That responsibility should be clearly articulated in public service agreements (PSAs) so that performance can be reviewed against agreed targets. We welcome the requirement set in the Treasury's SR2002 guidance on sustainable development that each department should prepare and submit a Sustainable Development Report, but we are disconcerted by the bald statement, despite the reassurances on joint working and effective communications we received from DEFRA, DTLR and DTI, that "Departments are not expected to add new 'sustainable development' targets" to their Public Service Agreements.[32] To the contrary, we expect to see DEFRA working with other Departments to ensure that sustainable development becomes an operational priority across Government and for this to be reflected in Public Service Agreements.

30.  There have been regular calls for the SDU to be moved to the Cabinet Office ever since it was established. Comparisons have been made between the influence wielded by other cross-cutting units which are located in the Cabinet Office, like the Social Exclusion Unit and the Performance and Innovation Unit (PIU) and the high profile way in which they were launched, and the performance of the Sustainable Development Unit.[33] These units have become influential in policy making precisely because they are in the Cabinet Office, nestled at the heart of the Government machine. The SDU was originally part of the Deputy Prime Minister's domain—and he too is now working from the Cabinet Office, taking a leading role in climate change and chairing the Cabinet Committee on the Environment (ENV(G)). There would have been arguments of logic and consistency in favour of moving the Sustainable Development Unit to the Cabinet Office in the post-election re-organisation. Combined with Mrs Beckett's and Mr Meacher's support, it would have redoubled the chances of sustainable development being taken seriously by other Ministers and Government departments. That opportunity has been missed. To compensate for this we recommend that central units such as the Performance and Innovation Unit and the Social Exclusion Unit should be obliged to take account of sustainable development in all their activities.

31.  The Sustainable Development Unit needs to have committed, consistent and overt support from all Ministers. Under whichever Government Department it is placed, it can only function effectively if it is treated as a critical component of the very centre of Government.

32.  We have argued before for the greater use environmental appraisals of policy to ensure that environmental issues are taken into consideration. The Modernising Government White Paper in March 1999 and the UK Sustainable Development Strategy, A Better Quality of Life in May 1999 both committed the Government to developing a more integrated approach to policy-making. The first step was the development of a Policy-Makers Checklist. All Departments are required to maintain records of the outcome of environmental policy screenings and to publish any free-standing environmental appraisals that result from the screening process. Departments are obliged to notify the Sustainable Development Unit (SDU) when an environmental appraisals are published. To date the SDU has been notified of only 55 such appraisals, of which 45 had been undertaken by the DETR itself, suggesting that other departments have been idle or have not taken the requirement seriously.[34] As the most recent Greening Government report makes clear, "it is somewhat disappointing that, despite promotion of environmental appraisal, inclusion in the Policy Makers Checklist and screening systems put in place by departments, relatively few departments beyond DETR have produced published environmental appraisals".[35] Progress to date on implementing a thorough programme of environmental appraisal of policy has been disappointingly slow. One of DEFRA's key challenges is to ensure that it becomes routine.

33.  To make progress on sustainable development, all departments have to look beyond their immediate policy aims to the wider social, economic and environmental impacts. The Greening Government report commits the Government to investigating the lack of progress on the implementation of environmental policy appraisals. We will continue to monitor the Government's progress on policy screening and environmental appraisals in the near future as we review the whole of the Government's Greening Government Initiative.

34.  If DEFRA is to position itself as the champion of sustainable development it will need to work effectively across departmental boundaries, to demonstrate strong leadership with a visible commitment to sustainable development, and to work tirelessly to ensure that sustainability issues are integrated into every aspect of Government policy and that all Ministers recognise the responsibility they have to take sustainable development into account, in much the same way that finance and expenditure already are. DEFRA also has to operate in a transparent manner, making itself open to audit and scrutiny. That is the challenge that faces DEFRA.

1   Prime Minister's Speech to the CBI/Green Alliance, 24 October 2000 (published on the internet at http://www.number­ Back

2   MAFF had some 10,000 staff working in the departmental headquarters compared to a combined total around 600 in the Environmental Protection Group and the Wildlife and Countryside Directorate. Associated public bodies, such as English Nature and the Environment Agency, also transferred from DETR to DEFRA. Back

3   Minutes of Evidence taken before the Environment Sub Committee, Session 1997-98, The Departmental Annual Report 1998 and Expenditure Plans 1998-99, HC 844, Q. 3. Back

4   Q. 218; See also QQ.106-9. Back

5   Report of the World Commission on Environment and Development (the 'Brundtland Report'), OUP, 1987. Back

6   First Report from the Environmental Audit Committee, Session 2000-01, Environmental Audit: The First Parliament, HC 67-I, para 12. Back

7   Dear Prime Minister: open letters on green goals for the second term, Green Alliance, July 2001, p. 6. Back

8   Q. 234. Back

9   Minutes of Evidence taken before the Select Committee on the Environment, Food and Rural Affairs, on The Establishment of DEFRA and other Matters, Wednesday 14th November 2001, HC 366-i, QQ. 20-21. Back

10   See Minutes of Evidence taken before the Environment Sub-committee, Session 1997-98, Departmental Annual Report 1998 and Expenditure Plans 1998-99, HC 844, Q.3. Back

11   Q. 231. Back

12   Public Service Magazine, Papering Over the Cracks?, Aug-Sept 01, p. 20. Back

13   Minutes of Evidence, Environmental Audit Committee, Session 2001-02, The Pre-Budget Report, HC 363-ii, Q. 103. Back

14   Q. 219. Back

15   United Kingdom Environment News, October 2001, DEFRA signals shift in policy emphasis towards countryside and food safety, p. 1. Back

16   Dear Prime Minister: open letters on green goals for the second terms, p. 4. Back

17   QQ. 104 and 120. Back

18   Q. 108. Back

19   QQ. 1 and 3. Back

20   Briefing from the RSPB to the EAC: RDAs and Sustainable Development, p. 1.  Back

21   Minutes of Evidence taken before the Select Committee on Transport, Local Government and the Regions, Departmental Estimates and Annual Report 2001 and Recent Policy Developments, 22nd November 2001, HC 373-i, Q. 161. Back

22 Back

23   Minutes of Evidence taken before the Environmental Audit Committee, Pre-Budget Report 2001, HC 363-i, Q. 78. Back

24   Minutes of Evidence taken before the Environmental Audit Committee, Pre-Budget Report 2001, HC 363-i, Q. 107. Back

25   Seventh Report from the Environmental Audit Committee, Session 1999-2000, on Water Prices and the Environment, HC 597-I, para. 214. Back

26   Minutes of Evidence taken before the Environmental Audit Committee, 28 November 2001, Departmental Responsibilities for Sustainable Development, HC 326-iii, Q.249; See also QQ. 244-248. Back

27   Hansard Debates, 27 November 2001, col 835. Back

28   See Appendix 1, pp.17-20 Back

29   Department of the Environment, Transport and the Regions, A Better Quality of Life: A Strategy for sustainable development for the United Kingdom, Cm 4345, May 1999. Back

30   Q. 242. Back

31   Q. 222. Back

32   Treasury Guidance on Sustainable Development in SR2002, Published November 2001, para 12. Back

33   Most recently by the Performance and Innovation Unit in its Report on Resource Productivity, November 2001. Back

34   Greening Government: Third Annual Report (Part 1-Summary), November 2001, p. 16, table 3.2. Back

35   Greening Government: Third Annual Report, (Part I Summary), November 2001, p. 16, para 3.7. Back

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