Examination of Witnesses (Questions 420-439)|
THURSDAY 29 NOVEMBER 2001
420. I understood that, yes.
(Sir Steven Robson) I know. Which is a completely
different kettle of fish from being a non-executive director in
DTI. I would define the role of these non-executives at DTI as
useful but limited; and you could have Gerald Corbett if you wanted
to, in that, I would not have Gerald in the role in my Office
of the Chief Executive of Government.
421. Who would you have in there?
(Sir Steven Robson) Someone like John Brown of BP.
Chairman: Make a note of that, would you, Clerk?
422. Just returning to Jack, for the first point,
on this public service ethos. You mentioned some of your members
are actually employed by the private sector but work within the
public sector itself; is it possible, in your opinion, to have
a public service ethos working for the private sector?
(Mr Dromey) There are some contracts that our members
work in that are well-managed contracts, and the individuals are,
as a consequence, well-motivated. It would be wrong to pretend
that there have not been some contracts of that kind; they are
the exception, not the rule. There is no question but that the
ethos changes, and, interestingly, if you talk to the private
sector, they acknowledge that; they acknowledge that not just
in employment terms, but they acknowledge that in terms of the
wider issues, including that issue of accountability. It was once
put to me by a leading figure in the private sector that, essentially,
their relationships are contractual relationships with the client,
and that they have difficulties seeing the community as being
more than just recipients of service, and acknowledging that the
community is a community and that they are dealing with citizens.
So there are real difficulties to reproduce what is that valuable,
crucial, intangible that we have been talking about earlier on
today, in contractual relationships, real difficulties.
423. Jonathan, you mentioned the fact that some
of your members have left the Civil Service to go into the private
sector and doubled, and in some instances quadrupled, the salaries.
Is that not the bed of the problem, on the basis that you are
not paying enough money for the people to carry out the public
service? Indeed, Steve Robson has mentioned that while Bob Kiley
is on £500,000 a year, the candidate that would shake up
Whitehall must be worth £2 million; it is either the fact
that Kiley is paid too much or we are not paying people enough
at the top?
(Mr Baume) I do not think senior salaries are high
enough, frankly. We put in evidence to the review body, and I
think the Senior Salaries Review Body is due to report very shortly
about that. People do not do the job for money; of course, money
motivates everybody, everybody wants to earn a decent standard
of living, so do not misunderstand what I am saying, but many
of the people we represent could go off and earn a lot more money
doing other jobs outside the public sector, but they do not, for
a variety of reasons which we have touched on. But I do think
we have underpaid senior public servants in Britain, I think there
has been a culture that says that somehow it is not acceptable
to pay senior public servants decent salaries. I do not think
anybody is expecting to be paid the same as senior jobs in the
private sector; on the other hand, you can question whether some
of the salaries paid in the private sector are warranted by any
criteria whatsoever, a point that has been raised by many MPs
and other outside commentators. I think the balance has got far
too skewed to be helpful, and particularly when you compare the
differential between senior managers in the private sector and
the majority of private sector workers. In the public services
there is a concept that there needs to be a balance struck, that
inevitably there will be differentials, as you take on more responsible
and senior jobs, but those need to be kept within a reasonable
framework, and I think that is a concept of fairness that people
are happy to accept.
424. So what you would say then is that just
the fact of offering a larger salary would not necessarily attract
the right people into the job?
(Mr Baume) No, it would not. If you offer too low
a salary, you may turn away potentially very good applicants.
But people do not do these jobs predominantly for the money.
425. I have got this conspiracy theory that
during the eighties and nineties there was this plan to diminish
the role of the public servant, either within local government,
which is the background I came from originally, in the early eighties,
when there was constant pressure on local authorities and the
public sector to cut back, whether it was through capping or other
means, I perceived that to be an area which was pushing us further
and further to rely on the private sector, and hence the position
that we are in at the present time. That was perceived, in your
words, in some instances, as throwing money into the public sector
that was not having the desired effect. Surely, that is where
the problem actually lies, is in the eighties and nineties, where
there was this desire, probably private was perceived to be best
by the Government of the day?
(Sir Steven Robson) Certainly, the Government of the
1980s had an ambition, in its own words, to roll back the frontiers
of the state, that was quite clear and it did do so. I think,
actually, we are on a rather different point here, which is, wherever
the frontier happens to be at the moment, can we make the public
services work better. Now, it seems to me, everybody around this
table agrees that it ought to be possible to make them work better
and the question is how do we do it. The easy answer is to throw
more money at them. I suspect that, if one could actually look
at it in some depth, one would conclude that at the moment the
taxpayer probably gets 75 pence of value for every pound that
is spent in the public services, and that that is some measure
of the gains we could make if we could get the system to work
426. Where have you produced this figure from?
(Sir Steven Robson) I have produced it just from my
experience over the years of looking at what happens when changes
are made, what kinds of changes in value for money tend to get
thrown up; obviously, it is a very wide spectrum, but actually
quite a lot seems to narrow down into the area of 20 to 30 per
cent, sometimes it is a lot more, sometimes it is less, but it
seems to be around there. And that is the sort of conclusion I
came to, that this may be a measure of the potential for improvement,
but it is not just an improvement in cost, it is also an improvement
in the service that is delivered through the mechanisms as well.
And, as I say, I think the issues there are ones about objectives,
incentives and management, and getting improvements in those areas
could help us harvest that 25p, or whatever it happens to be.
427. Could I just ask you on that, is it the
case then, if we follow that analysis, is it that we need a once
and for all shake-up that would reclaim that 25 per cent, and
then we can settle down and just do it in the normal way, or is
it a continuing
(Sir Steven Robson) I think, whenever one looks at
a situation, I will take the Treasury, for example, back in the
mid 1990s, we made an attempt to improve the efficiency of the
Treasury, which, frankly, had not been an issue which had interested
the management of the Treasury ever since I had been in it, so
there was, if you like, a backlog to catch up; but once you tried
to catch up the backlog there was then a constant process of improvement
from the new base, whatever it was. So I think there was a combination
of both catching up on the deficit, as it were, but that is not
the end of the game, all around us in the economy productivity
is rising, and productivity needs to carry on rising in the public
(Mr Baume) Can I just make one additional point. I
do not disagree with that, about the need to be working constantly
to improve the quality of the services.
428. You do not disagree with the 25 per cent?
(Mr Baume) I assumed that was a rather off-the-cuff
figure, and I do not want to comment on that, in particular. But
I would say that change, certainly in the Civil Service, is generated
predominantly from the role that Ministers want the Civil Service
to play; particular priorities are set, for example, there has
been a lot of work going on behind the scenes about improving
the quality of how policy advice is drawn together, work from
the Performance and Innovation Unit, and I think this Committee
has looked at some of this in the past. It was not that people
did not feel there was a problem but it was not seen as politically
an area that Ministers wanted Civil Servants to spend time analysing;
now you can ask why, and all the rest of it. But do not forget
that, particularly at the heart of public services, the decisions
that are taken are based on the priorities that politicians set
for those services, and, in services that are often underresourced
and people working in very pressured jobs, you devote your attention
to where the politicians want you to devote those attentions,
and things inevitably get missed. But I think attempts to reform
the Civil Service are welcome, and something that we are very
(Sir Steven Robson) Can I say, I just do think that
is a rather extreme view. The best politician in the world is
going to have a fairly limited horizon, the horizon is going to
be fairly near to him, just because the public sector is a huge
organisation and the amount they see cannot, in its nature, be
very great, they have a close horizon; and, yes, within that horizon,
they set their priorities. But, in my view, there is a huge responsibility
on those of us, as I used to, who work permanently in the public
sector to improve the way that it works beyond that horizon, and
the bulk of the public sector is beyond that horizon, and that
is a heavy responsibility.
(Mr Dromey) Yes, but not by pretending that the private
sector has all the answers.
(Sir Steven Robson) No-one has pretended that.
(Mr Dromey) But take that extreme view, Steve; it
sounds to me that what you are arguing is, in essence, this, that
privatisation is the greatest miracle since the virgin birth,
pain-free, heaven on earth. And the problem about that focus is
that it is diverting the debate away from how you renew the public
services, key issues, in terms of the quality of management. If
I can just draw in an additional point, what our General Secretary,
Bill Morris, called for in the summer, the notion of the academy
of public service excellence, because there are real problems
about the quality of public service management, even if we reject
the rather bleak picture that is being painted by too many politicians.
Secondly, what a serious public service excellence agenda looks
like, as to how you run things well. Thirdly, there is the crucial
issue of the involvement of employees and their trade unions;
and, I have to say, one of the weaknesses in areas of the public
sector is on precisely this point, that notion of day in, day
out involvement of employees in a culture of continuous improvement,
what that looks like, and also the proper role of trade unions,
in terms of debate, particularly, on strategic issues. And, fourthly,
on the people agenda, for what is in excess of five million public
servants. I sometimes think that that key debate gets obscured
as a consequence of the kind of ideology that we have heard here
(Sir Steven Robson) First of all, I have not said
anything today to suggest that privatisation is a wonderful thing.
I have said constantly today that the key issues are ones about
clarity of objectives, incentives and management, and if those
are not people issues, Jack, I am not too sure what is.
429. If that is the point though, I think you
are not being entirely honest, because I think your supplementary
point is that those cannot be delivered within the public sector
as it is now though, because you did say how averse to change
(Sir Steven Robson) I do not think it can be, as it
is now, but that does not mean that therefore the only answer
is to privatise it. What I have been talking about is introducing
diversity and choice. Just to take one of those things, the incentives,
the incentives in the public sector are, as Jonathan has said,
fundamentally, of a blame culture, of creating an aversion to
risk and change, and all the sort of effort in the world is going
to find it incredibly hard to change that directly, which is one
reason why taking some activity out of that environment and putting
it in another environment may be a sensible way to promote diversity.
Chairman: Okay; we are enjoying this so much,
but we have got to just get towards the end of it, I am afraid.
430. It is for Sir Steve. I am fascinated by
his motivation. Going back to the opening comments, I think you
said that you were embarrassed, even ashamed, to admit that you
had worked for 30 years in the public sector.
(Sir Steven Robson) It was a joke.
431. I realise it was a light-hearted comment,
but what you have said since tends to confirm the reality of it.
If the public service ethos is just a sentimental concept that
you personally do not subscribe to, I do not understand why you
went to work in the public service in the first place, and why
you stayed with it for 30 years; can you help us to understand
an alternative view?
(Sir Steven Robson) It is extremely straightforward.
It does not mean that I have to subscribe to the public sector
ethos. I believe that what the public sector does is extremely
important for the well-being of our economy and the well-being
of our community, and I was honoured and privileged to work in
that for 30 years, I enjoyed every moment, I enjoyed the job tremendously,
I got a lot of satisfaction out of it. The fact that I believe
that, if we are going to fulfil our obligation to our community
and our nation to provide the public services that they deserve,
there needs to be a considerable amount of change in no way suggests
that I did not think it was the right place to work and where
I wanted to make a contribution.
432. If the three key elements of making the
public sector work better are incentives, clear objectives, good
management, you have really driven those points home today, just
to pick one of those, how were you incentivised when you worked
in the public sector?
(Sir Steven Robson) I was not incentivised very well,
433. You stayed in it for 30 years?
(Sir Steven Robson) I thought I had just made clear
that I did not stay in it for 30 years because I thought it was
a perfect place, I stayed in it for 30 years because I thought
it was a very important place, what it did was very important,
and I was privileged to have the opportunity to contribute to
it. I do not think one has to work somewhere solely or simply
because you think it is perfect. The fact that there was a need
to improve things and the scope and opportunity to do something
to try to improve things was a reward and satisfaction in its
own right, and the fact that the incentives that I and my colleagues
faced were poor and imprecise simply emphasised the need to try
to make those changes.
434. But are you not describing a public service
ethos which drove you for 30 years, which you have now come and
told us is a fantasy?
(Sir Steven Robson) I am not describing a public service
ethos. If it is any of those things that I described at the beginning,
a readiness to work harder and better, of selflessness and objectivity,
what I had was the opportunity to do a job which I thought was
important and which I enjoyed. That is the opportunity which is
presented to a lot of people, happily, in a lot of other parts
of the economy. Quite a lot of people do not get that opportunity,
and that is a great sadness, both in the public and the private
sector; but the fact that there are jobs which people can derive
a lot of satisfaction from and feel they are making a worthwhile
contribution in doing is not unique to the public sector.
435. Can I just ask, is there a different public
sector ethos between the great and the good and the ordinary worker
in a care home, so somebody, a senior civil servant or in a care
(Mr Baume) I cannot speak about somebody working in
a care home. All I can say is, in the past I worked for a different
union, representing very junior staff in the Civil Service; initially
I represented staff working in job centres and benefit offices,
that is very much at the sharp end. No, I do not think there was.
I think individuals clearly differ in motivation. Inevitably,
particularly in a large organisation of about half a million civil
servants, I think that concept of serving the community and serving
the public was there amongst very junior staff in the Civil Service,
with whom I worked some years ago, as it is there in the very
senior staff in the Civil Service, whom I tend to represent now.
(Mr Dromey) Just very briefly. I welcome what Jonathan
has said, because we have argued that, all too often, there is
a forgotten army. That when the debate takes place on education,
education, education, people forget that education is more than
just teachers, it is also everyone from the school dinner-lady,
or man, to the classroom assistants. That when we talk about the
National Health Service, the National Health Service is more than
just about doctors and nurses, it is about the porters, ancillaries,
all those who are members of that caring team. When we talk about
world standards in universities, universities are more than just
about professors, they are also about porters. So it is welcome,
the point that you make. And I absolutely agree with Jonathan,
what you see is a top to bottom ethos, it varies in its nature
but there is a top to bottom ethos.
436. One of the things that has changed over
the recent years is the concept of working in partnerships, whether
it is a strategic board, or with the voluntary sector; how do
you get the public sector accountabilities that you have been
talking about, which is more than just the electorate, on a four-yearly,
or whatever, basis, within those partnerships?
(Mr Baume) In the memorandum from the FDA, I think
if we look at partnerships in the round, because some of those
partnerships are with the private sector, some of them with the
voluntary sector, we listed a number of criteria that we would
like to see in place if we are bringing in particularly people
from the private sector to deliver public services. The FDA is
not saying there is no role for private sector delivery, we have
never suggested that; so those seven criteria we saw as ways of
setting in place those wider accountabilities. Now some of them
relate to treatment of staff, and I think Jack touched upon that
earlier; others of them though do relate to transparency and openness,
and it is partly about the way that contracts are designed, about
the public accountabilities in that sense. If you are looking
at the political accountabilities, and most of those are ones
with four- or five-year cycles, local government, central government,
etc., I think that is a more complex issue to address, and I do
not think there is a simple answer to that, but I think underpinning
it, nevertheless, has to be openness. For example, I see no reason
whatsoever why any contract, signed with any provider, for the
delivery of public services, should not, at a successful stage,
be a public document; why are we signing contracts that are retained
in secret, which makes it very hard then for anybody to assess
whether or not the contracts have been delivered. Targets should
be open and monitored and publicly available. All of those are
mechanisms in play, so that, wherever the level of accountability
that you are trying to demonstrate, at least people understand
and know what is happening. And I think far too much of this at
the moment is shrouded in this all-purpose, commercial in confidence
tag, which is used to cover almost any dealings whatsoever, particularly
with the private sector but it does happen on occasions, I understand,
anyway, with the voluntary sector as well.
(Mr Dromey) Can I add just very briefly to that, Brian,
two points. The first is that there are difficult issues of accountability
that arise; and, incidentally, that will be a next-stage debate,
when we are talking, as we will be more and more, about public/public
partnerships as well. But, secondly, there is a very interesting
development now increasingly underway of creative partnerships;
so Birmingham's car parks are managed on a joint venture basis
between NCP and Birmingham City Council. The employees remain
employed by the City Council but good management has been brought
in to run those car parks well, and accountability remains with
Birmingham City Council. And in the Ministry of Defence, you would
not have thought the Ministry of Defence would be characterised
by entrepreneurship, but I chaired a conference on 6 September
of 200 representatives of the trade unions, Ministry of Defence
managers at all levels and the private sector, talking about how
we make sensible use, taking advantage of selling into wider markets
policy, of irreducible spare capacity to trade commercially. There
are hundreds of interesting arrangements that have been concluded,
with employees remaining MoD employees, ranging from, on the one
hand, the servicing of torpedoes by MoD employees produced by
BAe Systems, to, on the other hand, for those of us who have got
kids and therefore have to watch Pop Stars, the inaugural video
of Hearsay, for their first Number One hit, being made in a wind-tunnel
at Shoeburyness, a DERA establishment. Our members were delighted
because they were getting their autographs and looking after them
whilst they were making the video.
Brian White: As somebody who used to live in
Shoeburyness and was not allowed to know what went on in that
establishment, that is novel.
437. Can I ask Steve Robson, I am sorry but
we have got to be very brief at this point, but, in principle,
do you sign up to the idea that there are problems of accountability
and transparency in using private sector operators, and that the
only way to correct that is by having the kind of openness that
is being described here?
(Sir Steven Robson) I certainly think there needs
to be openness about what the private sector has been retained
to do, whatever it is that one is asking it to do, the objectives
it has been set and the criteria for deliverables on which it
is being rewarded ought to be known to everybody; whether the
intricacies of the terms of the contract, is another matter. I
am not quite sure whether Jonathan is saying, for example, that
whatever the contract is that MoD has with Rolls-Royce to deliver
tanks, I think it is Rolls-Royce, it is whoever makes tanks, should
all tank contracts be kind of an open document, I kind of rather
doubt it, because I suspect that it screws up our tank manufacturers'
attempts to sell into other countries. But I think being clear,
when someone is delivering a public service, what they have been
asked to deliver and the structure on which they are being rewarded,
I think that should be open.
438. One of the things that has become clear
over the last few years is the role of the Treasury in determining
the whole PFI/PPP; how would you see the role of the Treasury
in defining what should be in the public sector, can you just
explain to me, given your experience, how the Treasury works,
in that sense, in this field?
(Sir Steven Robson) The Treasury could, I suppose,
give guidance on such matters as to what parts of contracts should
or should not be in the public domain; I do not think it does,
and I suspect that some Departments, carrying on this example
that Jack has raised of the Ministry of Defence, would feel very
jealous of their own rights to determine the confidentiality of
their own contracts.
439. So the Public Service Agreements, that
are now seeming to predominate,
(Sir Steven Robson) I am sorry, I thought we were
talking about contracts between the public sector and the private
sector. The public sector agreements are simply contracts, well,
they are not even contracts, are they, they are documents setting
out what Departments think they are going to achieve in the coming
years, in various areas of their activity. I think those are in
the public record in their departmental reports.