Session 2010-11
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CORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 714-ii

House of COMMONS

Oral EVIDENCE

TAKEN BEFORE the

Public Administration Committee

Good Governance AND Civil Service Reform

Tuesday 1 February 2011

Lord Armstrong of Ilminster GCB CVO, Lord Wilson of Dinton GCB and Lord Turnbull KCB CVO

Mr Ian Watmore, Sir Suma Chakrabarti KCB
and Dame Helen Ghosh DCB

Evidence heard in Public Questions 106 - 193

USE OF THE TRANSCRIPT

1.    

This is a corrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee, and copies have been made available by the Vote Office for the use of Members and others.

2.

The transcript is an approved formal record of these proceedings. It will be printed in due course.

Oral Evidence

Taken before the Public Administration Committee

on Tuesday 1 February 2011

Members present:

Mr Bernard Jenkin (Chair)

Nick de Bois

Charlie Elphicke

Paul Flynn

Robert Halfon

Kelvin Hopkins

Greg Mulholland

________________

Examination of Witnesses

Witnesses: Lord Armstrong of Ilminster GCB CVO, Lord Wilson of Dinton GCB, and Lord Turnbull KCB CVO, gave evidence.

Q106 Chair: Thank you for joining our Committee this morning. For the record, would you each kindly just identify who you are?

Lord Armstrong: I am Lord Armstrong of Ilminster. I was Secretary of the Cabinet from 1979 to 1987, and Head of the Home Civil Service from November 1981 to December 1987.

Lord Wilson: I am Lord Wilson of Dinton. I was Secretary of the Cabinet from January 1998 to September 2002. I was both Secretary of the Cabinet and Head of the Home Civil Service in that time.

Lord Turnbull: I am Lord Turnbull. I succeeded Richard Wilson in both roles in September 2002 and I retired in July 2005.

Chair: Thank you. Our principal concern is our inquiry into good governance and Civil Service reform. We are attempting initially to establish some principles of good governance, but our questions will go wider than that. We will start with the Cabinet Manual that has just been produced.

Q107 Robert Halfon: Do you think that the production of the Cabinet Manual is a good thing?

Lord Armstrong: Yes, I do think it is a good thing. It is a comprehensive collection of material about how things are done, both in some constitutional matters but also in administrative matters right across the Government. It is a very useful collection of information. I do not think that one should exaggerate its importance. I do not see it as a written constitution or anything of that kind. It is descriptive rather than prescriptive, descriptive of the way things are now. I think it is very useful. I can see that it will be able to be updated as the system and practices change. That too is going to be very useful.

Q108 Robert Halfon: Is it based on precedent and convention? How has the Manual been drawn up?

Lord Armstrong: You would have to ask somebody closer to the business of it than I am, but I presume there has been a team of people collecting the material. Some of it obviously is not directly from the Cabinet Office-the material about the Attorney-General, the Law Officers and so on. There would have been an editorial team collecting it under the leadership of Sir Gus O’Donnell.

Q109 Robert Halfon: What is the legal backdrop to the document?

Lord Armstrong: The legal backdrop?

Robert Halfon: Yes.

Lord Armstrong: I do not know that there is a legal backdrop as such. I think it is an administrative document.

Q110 Robert Halfon: In essence, is it just guidelines rather than an enforced set of rules?

Lord Armstrong: It is not rules, it is guidelines. It is a description of what happens now, the way it is done now, and it is capable of modification as the way things are done changes.

Lord Wilson: It says on the cover "a guide to laws, conventions and rules on the operation of government". It is a mixture of all those things. Some of it is in the law; some of it most definitely is not in the law and, as Lord Armstrong rightly said, is about describing how things are done.

Lord Turnbull: It brings together two kinds of material, and they have slightly different statuses. There is the bit that relates to how the Civil Service and Cabinet work, which is authoritative, because the Government is in the best position to say what is the best description of those workings. There is also material where they are describing their relations with other people-the Judiciary, both Houses of Parliament and so on. Some people have said, "What right have you got to describe that?" I think the answer they will give is, "We are telling you how we think we interact with those other parts of Government." It is useful for them to know what we think is the way in which we interact, for example, with the conduct of civil servants appearing before Select Committees. Those two parts are of slightly different status, drawn together in one document.

Q111 Robert Halfon: Lord Armstrong, would you have found the Cabinet Manual more useful when you were conducting negotiations in 1974 regarding the potential coalition with the Liberals?

Lord Armstrong: I should have found it useful if there had been such a document, certainly yes. I suppose, in a sense, the experience of that time, as it was funded at the time, became part of the basis of the Manual. As it was, I had to do research from other sources to fill myself in to think about what would happen if we came to that situation.

Lord Turnbull: Another use of this was not simply to get the principal players in, for example, the Cabinet Office and the Palace on to the same page, but to explain to the outside world how this works. There were a lot of misconceptions. People had got used to a Prime Minister losing an election and departing the scene by Friday afternoon. To explain the process whereby negotiations take place, I think, helps calm people. They did not expect there to be a result immediately. The comment written about this process was thereby more informed. Given the tensions around the markets at the time, I think that was a very useful function.

Q112 Robert Halfon: Given what you have said about the Manual really being about guidelines, is your view that this Manual does not represent the start of a written constitution?

Lord Armstrong: No, in my view it does not. I think it is descriptive, rather in the way that academic and learned treatises have been in the past. There is nothing in it that says there is a process for amending this. It is a description of business as it is, work in hand, if you like. That will change; it will modify, as it has in the past. That will be reflected in updates of the Manual. I do not see it as a written constitution, but I do see it as a useful work of reference.

Lord Wilson: I see it as a modest but useful document. It does not attempt to write comprehensively. There is a great deal that lies behind it––behind almost every sentence in some places––but it provides the outlines, a starting point, for someone who wants to have an overall view of what the conventions are in a particular situation.

Q113 Chair: Is it in fact therefore misnamed? It is not a Cabinet Manual; it is questions of procedure for civil servants.

Lord Turnbull: It is not just for civil servants. It is to explain both to Government’s partners elsewhere in the constitution how they think they work, and to the wider world. I think it is misnamed. It is a title they have borrowed from New Zealand. People think this is about the Cabinet, whereas it is about a lot more than the Cabinet. The subtitle "guide to laws, conventions and rules" is actually a more accurate description, because "Manual" has slightly too prescriptive a tone, I think. Maybe they can adjust the title, but I think the foreword is very clear on what the purpose of this document is.

Lord Armstrong: I agree with the comments on the title and I have been trying to think what better title one might give it. I am unable to think of anything crisp and short, except perhaps, "The Way We Live Now".

Q114 Robert Halfon: Lord Turnbull, you are quoted as saying, "Civil servants should support the Government, but shouldn’t try to keep the Coalition together." Do you not think that, in the negotiations for the coalition, the Civil Service overstepped the mark, given that Gus O’Donnell is quoted on the record saying that he advised that a coalition would be better for the markets? Is that not a step too far in terms of the Civil Service?

Lord Turnbull: The Civil Service said two things. One is that they would provide logistical support: people needed rooms, communications or whatever, and that offer was taken up. The other was that they said, "If you want note takers or you get into something like proximity talks and you want someone to carry messages from one place to another, we will do that," which is what has happened in Scotland; or "If you want help drafting this document." In the end, the parties decided they wanted to do that themselves but, if they had wanted to take advantage of that, I think that is a proper function. Advice such as, "It would be a good idea if you went about this briskly, given the uncertainty of markets"-that was advice that was generic; it was not specifically catered to a particular party.

Q115 Robert Halfon: He said specifically that a coalition would be more helpful to the markets. Surely that is a political statement in itself. Who knows whether a minority government would have been beneficial to the markets? We just do not know. Even if it is right, is it really the job of a civil servant to try to push the Government into having a coalition?

Lord Turnbull: I think it is perfectly valid, particularly for someone who had been a permanent secretary at the Treasury, to indicate that there was a danger of market uncertainty. I personally think it is true that a coalition has two things. It has support-in effect it has a majority-and also it has some commitment that this will last through time, which is going to give more assurance than a minority government, where it is all about how long it is going to be before one of them decides to break cover and demand an election.

Q116 Robert Halfon: Does it not give the impression that the Civil Service favour the coalition, as opposed to another scenario?

Lord Turnbull: I think it may be valid to say the Civil Service favoured a coalition; it did not say which form of coalition and whether it was Lib/Lab or Conservative/Liberal Democrat. That would have been overstepping the mark.

Q117 Robert Halfon: Surely the Civil Service should not favour a coalition or not a coalition? It should be up to the elected politicians to decide.

Lord Turnbull: No, what it should favour is a government that is stable, able to carry through its programme and has some prospect of lasting long enough to see it through. It is perfectly right to express a view that that would be a desirable outcome.

Lord Armstrong: I think it is not unreasonable for a civil servant, who was probably asked for his view, to say that, if the Queen’s Government is to aim to be able to be carried on, it would be a good thing to avoid instability in the markets. Given that markets were in a fragile state, a fragile condition, at that time, it is perfectly reasonable for a civil servant, particularly if asked, to say, "You should be thinking about the possible effects of what is going to happen upon the markets," because the consequences of not thinking about it could have been extremely serious.

Q118 Chair: Lord Wilson, would he have been better to keep his advice private?

Lord Wilson: I make it a practice never to comment on what my successors did, but I think the role of the Civil Service is to support the Queen and to help advise the Queen in her function of inviting someone to form a Government. In the process of doing that, I think it is proper for them to draw attention to something that was-I guess; I don’t know the facts of this case-pretty obvious at the time, that there was a real danger of instability in the markets. I think that is part of doing the job well.

Q119 Paul Flynn: Part of the Manual is the role of the Sovereign. Do you think there is a need now to redefine the role of the Sovereign, after having had the present Queen, who has served for a very long period without knowingly or publicly expressing any political opinion? A future change will involve possibly Prince Charles, who frequently expresses political opinions. Unless the role of the Sovereign is redefined and restricted to a largely ornamental role, isn’t there a possibility of problems similar to those that occurred in the 1930s with the Sovereign?

Lord Wilson: I am sure Select Committees or their predecessors over many years have said, "Should we be defining this?" The fact is that, by not defining it over some centuries, we have actually allowed the role of the Sovereign, in a very British way, to evolve without creating crises. I think that is a peculiarly good achievement. We are astonishingly lucky to have a Sovereign who has such a source of political experience of public life-over half a century and more, 60 years-who has met the Prime Minister of the day, weekly, to talk in private about the affairs of state. That is an arrangement that is reasonably clearly set out here and reasonably well understood but, if you tried to put it into the law, you would have great difficulty pinning down the essence of it. The process of slowly cutting back on the royal prerogative in legislation has been going on for a long time. My own view on the whole question of a written constitution is that it is much better to try to move forward incrementally, bit by bit, rather than to attempt a comprehensive rewrite of something that works, on the whole, pretty well and is quite hard to define.

Lord Armstrong: I am quite sure that the present Prince of Wales, who has been around in that capacity for some decades now, knows very well that his freedom of action and speech will be curtailed when he succeeds his mother. I am sure that he is ready to adopt the same constitutional arrangements, as to what he may say or do, as she has followed.

Lord Wilson: I should have said that. I absolutely agree with Lord Armstrong’s comment.

Q120 Paul Flynn: The historian Robert Rhodes James, who was a former member of this House, wrote that, at the time when the Conservative party had decided to get rid of Mrs Thatcher as Prime Minister, there was terror in the party that she would call a general election. The Conservative party couldn’t stop her; Parliament couldn’t stop her; the Cabinet couldn’t stop her. Only the Sovereign could stop any Prime Minister who was acting in her or his own interests from calling an election at that time, which might have been contrary to the public interest. Isn’t it important that the role of the Head of State is defined and strengthened in that particular area?

Lord Turnbull: I was serving in Mrs Thatcher’s private office at the time. I do not recognise that description at all. The idea of an election-this is, quite honestly, the first time I have ever heard of it. I think it is a fantastical idea and has no real relevance to the discussion.

Q121 Chair: Supposing it was the case that a Prime Minister wanted to call a general election rather than just face their own demise as leader of the party, what would happen?

Paul Flynn: This was from a serious historian who was at the heart of the Conservative party.

Lord Turnbull: What is in this Cabinet Manual is a very important principle, which is that the politicians, possibly eventually requiring a vote in the House of Commons, sort this thing out and present her with a solved problem and that she is never faced with having to use discretion that might prove controversial. In two areas, this is related. First of all, the choice of a leader of a party. We will never again get 1963 or whenever it was, when the Sovereign has to choose who should lead the Conservative party. All parties now have proper processes to sort this out. At an election, the political process would have to come to her and then present her with this solution. I think that is a very welcome shift over the last 30 years, and it means that the Sovereign is never put in the position of having to take a decision that might be contested, as most recently, although it is 30 years ago, happened in Australia, when the GovernorGeneral took some action that was controversial. The whole purpose of this Manual is to say we must never put the monarch in that position again.

Q122 Charlie Elphicke: The Manual is very focused on the duties of the Sovereign. I have no doubt that Prince William will make a very fine King in due course. It is focused on the whole issue about Ministers and the Executive. Why is there no mention in this directly about more of an emphasis on the people of the land, public service and the sense of serving the people, which surely is at the heart of everything? It always seems to be looking up to what the top people want, rather than looking at how to ensure that there is a greater engagement and a greater sense of public service, or am I being unfair?

Lord Armstrong: I do not think the Manual aims that high. As I say, I think it is descriptive of what happens now and it is not there to provide guidance about what you might do in other situations or for other purposes. There would be lessons to be learnt from what happens now and the previous development, but it is not the purpose of the Manual to try to prescribe from those lessons. I do not think that that is a fair criticism of the Manual as it is intended to be.

Q123 Nick de Bois: Lord Turnbull, given the statement that you just made saying that never again should we put the Sovereign in a position of having to make a controversial decision, or words to that effect, do you still hold the view that we are not presenting the beginnings of a written constitution here by making such judgments?

Lord Turnbull: I do not think that we get nearer a written constitution. The origin of this piece of work was a time when Gordon Brown went through a phase of being rather interested in the constitution. I think he was testing out the proposition. In my experience, the minute you get to a written constitution, you quickly find that the debate is not between people who want a written constitution and people who do not but with people who want to make some changes to the constitution and then entrench them in a written constitution. I do not think this necessarily takes us that way. The fact that for example, as has been mentioned by colleagues, the role of the Sovereign has evolved, even in her reign, tells you that there are some advantages in the flexibility that we have got.

Lord Armstrong: May I go back to the night in October 1984 when the IRA blew up the Grand Hotel? There was a period of about half an hour in the middle of the night when I thought that the Prime Minister might have been killed. I did do a lot of thinking in that time about what one would do if a Prime Minister was removed from the scene by that sort of thing. As Lord Turnbull said, the ultimate solution is the election of a new leader. The Sovereign would in effect be bound by that, and it would be for the politicians to decide whether there should be an election. There would be questions about the appointment of an interim Prime Minister to carry on the Administration until the election took place, but that process would in effect be resolved by the politicians.

Chair: By the Cabinet.

Lord Armstrong: By the Cabinet. There would be some person within the Cabinet who would be the obvious choice to be the interim Prime Minister. As it happened in October 1984, it would have been probably Lord Whitelaw, I think. What Lord Turnbull says is basically right about that. I think that the Sovereign does retain an ultimate power to respond to the request for a dissolution of Parliament. In 99 cases out of 100, the Sovereign will grant the request. I think the discretion remains in case you get a Prime Minister who has gone off his or her head.

Chair: Which I think was the basis of the original question.

Paul Flynn: I was too nice to say that.

Lord Armstrong: One has to think about it. There could be a Prime Minister who went off his or her head. At that point, the Sovereign would have to exercise his or her discretion and say, "Are you sure that the Government cannot be carried on by somebody other than you?" I hope it will never happen. I have yet to meet a Prime Minister who has gone off his or her head, at any rate while still in office. I think the discretion remains, and could, in these I hope very remote circumstances, be rather useful.

Lord Wilson: This comes back to the nature of this Manual. I think it is modest and useful. In my experience, most of the situations that you have to deal with are not covered ever by the guidance. You always, as it were, have to take it as a starting point and then work out what the practice is and what you should do in a particular situation. I think this discussion has illustrated that.

Q124 Kelvin Hopkins : Isn’t it crucial that the Civil Service plays a role in maintaining and safeguarding the conventions by which we govern ourselves? If that is the case, isn’t it absolutely vital that they are permanent and that they retain their impartial nature? Obviously in this situation it is difficult for you to make any comment that might appear critical of the present Civil Service or its leaders, but you have commented recently on what happened in the past, most interestingly, in the Chilcot inquiry. You cannot say so, but I can say that I thought it was a bit of a break with these conventions that Sir Gus O’Donnell came out publicly urging a coalition. One would expect the head of the Civil Service to say that sort of thing in private, but not in public.

Lord Armstrong: I should think that he was warning about the danger of instability. That was perfectly within his rights. Of course I agree with what you say about the need for the Civil Service to be nonpolitical and impartial. I should think I speak for all three of us in saying we have been constantly conscious of that while we were in office. That is the important point about it.

Lord Turnbull: Two developments in the last two or three years: first, the revised Civil Service Code; secondly, the clauses in the Constitutional Reform and Governance Act that that was passed just before the election.

Lord Armstrong: It got washed up.

Lord Turnbull: It got washed up. There were important clauses enshrining the concept of impartiality, so that has been entrenched. I do not think that is something that is under political threat. I think it actually is in better shape than it has been for some time.

Q125 Kelvin Hopkins: I speak as someone of the left who was deeply critical of the Blair attempts to change the nature of our constitution. I know from your comments last week, and also one could guess, what your feelings were, about the attempt to drive down the power of the Civil Service perhaps to govern with a small coterie of advisers, even marginalising the Cabinet and so on. The Blair revolution did not quite come off in the end and I think we are now stepping back from it. Did it not make you feel uncomfortable? Would that not have made Britain a fundamentally different place, if we had moved towards a presidential style of government, where the president has his small group of advisers and makes decisions without very much reference to anyone else?

Lord Armstrong: I think all three of us would be likely to agree with the last paragraph of the Butler report, some years ago, about sofa government, written in very coded language but none the less very clear in its meaning. Speaking personally at any rate, I think that one of the interesting results of a coalition is the return of a more collective form of Cabinet government. The collective system, with which we are all three familiar, of Cabinet government and the use of Cabinet committees to establish collective responsibility has received a boost, because you can only run the coalition if you are doing that. The coalition increases the need for collective government and collective responsibility, and for the mechanisms by which you achieve that.

Q126 Kelvin Hopkins : Clearly Jonathan Powell was hostile to the Civil Service, from his comments. I personally was seriously concerned that we were losing what I saw as the traditional role of the Civil Service, which I very much supported-the Sir Humphrey model that I personally thought worked very well. I would not suggest that you were quite in the same model as Sir Humphrey, but that was a better way of running things than what we saw later. Do you not agree?

Lord Wilson: When I was doing the job, Peter Riddell had an article headed, "West Wing meets Sir Humphrey". To some extent, that resonated. The position that Lord Turnbull and I were answering questions about last week was quite an unusual one in constitutional terms. It is not in my experience common for a Prime Minister to be in such a very strong position. It only happens if you have a Cabinet that is happy for that to happen, a parliamentary party that is supportive, a trade union movement and political party and public opinion. If you have all of those constitutional checks and balances lying down in the same way, then the Prime Minister is in a very strong position. To extrapolate from that to a general observation about how we run the country I think would be a mistake. Normal conventions will reassert themselves, as I think is happening.

Lord Armstrong: Mrs Thatcher was a very strong Prime Minister, but she understood the importance of Cabinet government, and she took great pains to ensure that decisions went the way she thought they should go, but she did it within the framework of Cabinet government.

Q127 Chair: We must move on. This is all fascinating but we are miles behind. The Cabinet Secretary says in the document that this Cabinet Manual is not intended to have any legal effect. Lord Wilson, in your bitter experience of judicial review after judicial review, do we really have confidence that the Cabinet Manual is not going to be cited as evidence on one side or another that proper procedures have been followed? To that extent, does it not become justiciable?

Lord Wilson: You can never stop people citing things. However, the intention is clearly that it should not be binding, and I think intention matters. It is drafted in a way that is, as you heard earlier, descriptive not prescriptive, and any evidence that a court had about the Manual would have to take account of the fact that the intention is that it should not be binding and not be, in itself, a justiciable document. This is a matter for lawyers, but I would have thought that the fact that it is not written as, and not intended to be, a legally binding document or a rulebook of the kind that is meant to create legal obligations on Ministers would be pretty conclusive proof that it is not itself a legal document of that sort.

Lord Armstrong: I went though the Manual and noted with interest that the words, ‘should’, ‘ought’ and ‘must’ hardly appear at all.

Q128 Chair: Very interesting comment. Would not a senior civil servant, perhaps, trying to advise a Minister to do or not to do something, be likely to refer to this document? Rather like the way legal advice is received by Ministers, would not there be an obligation on a Minister to accept that advice? If they ignored that advice and got into legal difficulties as a result of it, the Cabinet Manual would be cited.

Lord Turnbull: It is important the way this document has been put together. By and large, the civil servants who have drafted it are able to reference some other source for the statements that they are making, which exists already. There’s the Ministerial Code, the special adviser code and various other pieces of hard and soft law. If they have been successful in that, there are very few statements in here that are new. The intention is almost that nothing should be new; you should be able to say, "I have written this because I’ve based it on that principle that is known already and I can tell you where I’ve got it from." The amount of new purchase, you might call it, that it creates for judicial review is small, and that is certainly the intention.

Q129 Nick de Bois: I must confess I am a little confused as to who is actually going to read this book. I will not ask you your opinion on that, but I would like to explore very briefly, Lord Turnbull, if I could start with you, what role you think this Manual could play in terms of the way in which Parliament holds the Executive to account. Is it just simply going to explain to Ministers what to expect from Parliament?

Lord Turnbull: I think it is describing the status quo. It is certainly not commenting or glossing Erskine May, the rules under which the House of Commons operates. It is explaining how they would react in certain circumstances. I doubt it is going to change that to any great extent. When it comes to the House of Lords, it does not for example deal with the interesting question about whether the Salisbury convention is changed or not changed by virtue of there being a coalition. It is careful not to try to change anyone else’s rules.

Lord Armstrong: In the sort of situation you have described, a civil servant might say, "Well, here is what has been done in the past. It doesn’t mean it is what you should do now, but it perhaps does mean that you should think twice or three times before doing it differently. Perhaps you should talk to the Prime Minister before you make such a change."

Lord Wilson: Strong Ministers will still want to act in a strong way, but it just provides a reference point. As to the audience, I am sure this great Committee and its successors will be regularly reading the Manual to see whether they can quote it to witnesses sitting here.

Q130 Chair: This is not the empire striking back against sofa government.

Lord Wilson: I would not want to describe any of this in the language of Star Wars.

Q131 Nick de Bois: Lord Wilson, I read from the evidence to the Chilcot inquiry that you seem to have a lot of faith in the way successful businesses conduct their board meetings, and went so far as to suggest that you would take an element of that and canvass opinion from Cabinet Ministers about the performance of the Prime Minister, which I found intriguing and a good idea. Is that something you would like to see in this Manual, if you think the Manual has any weight, so that it could actually become something the Prime Minister could not overrule or becomes de facto part of being a Cabinet Minister?

Lord Wilson: My comment was that I found it ironic, when I started taking up appointments in the private sector, that the Government that had been imposing increasingly stringent requirements of governance on the running of companies was itself following processes that were less stringent. I took one example from the current code, which was that boards of companies should arrange, either internally or externally, to evaluate the performance of the board-it is not just the chairman-and consider whether they were getting the papers they wanted, whether they were happy with their own performance, each other’s performance and so on. I think that is rather a good discipline, and it was interesting to think of it being applied in the situation of a Cabinet. Either the Cabinet Secretary or someone else-it does not have to be the Cabinet Secretary-should go and ask the members of the Cabinet whether they were happy with the way it was running, whether they would like to see more papers, whether they would like more information or whether they thought the way that discussions took place could be improved.

Q132 Chair: Lord Wilson, you intend this to be empowering.

Lord Wilson: Yes, empowering of Cabinet Ministers. That was the underlying point, thank you.

Q133 Chair: It would seem a little revolutionary if you were Prime Minister, wouldn’t it?

Lord Wilson: We have collective government in this country, in which the Cabinet as a whole takes responsibility for the decisions it takes. Therefore, what is wrong with a process that underpins that by giving Cabinet Ministers an opportunity to say whether they can see ways in which the way they discharge their responsibilities can be improved?

Chair: I think it is an excellent point and very well made, if I may say so.

Lord Armstrong: I sat in on the Cabinet under three Prime Ministers, and each of them ran the Cabinet in his or her own very different, very personal way. It would be very difficult to prescribe permanent rules as to how this is done, because it depends so much on the personality and the strength of the Prime Minister of the day, and his or her relationships with her colleagues and the way they do business. The way that Sir Edward Heath conducted his Cabinet was quite different from the way in which either Mr Wilson or Mrs Thatcher conducted their Cabinets. They were different from each other. It is so different that I think it is quite difficult to make any general rules about it.

Q134 Chair: You do not agree with Lord Wilson that there should be some check to strengthen the hand of individual Cabinet Ministers?

Lord Armstrong: I think it would be interesting to have that, but I do think that the differences between one Cabinet and another, and one Prime Minister and another, set limits to what you can do about that.

Lord Turnbull: Having heard Lord Wilson’s suggestion, I thought it was a good idea, but there was one particular variation from the private sector practice. Directors of a company are elected by the shareholders, not by the chairman. Therefore, it is not in the chairman’s power to deselect a director.

Chair: Something to which Lord Wilson’s comments actually refer.

Lord Turnbull: Therefore, if you are criticising the way Cabinet’s run, you are actually passing those criticisms over to the person who can decide whether you are a member of that body or not, so it makes it more difficult. In a well-run Cabinet, I think the Prime Minister should be having a regular series of bilaterals with his colleagues. One of the things you notice is some people see the Prime Minister every week, several times a week, and there are other Cabinet Ministers who go weeks on end and never have a bilateral. This is the point at which the relationship should develop. You say, "How do you think it is going? Are the ways in which we can improve?" That is the dialogue that I think is missing. We have to find a way of getting some feedback, but recognising it is slightly more difficult to do than in a corporate situation.

Q135 Nick de Bois: I think I’m picking up from what Lord Wilson said, that the onus, Lord Turnbull, on a nonexecutive director in a plc is that, just because there’s a tough chairman, he still has the duty of care and responsibility to ask those tough questions. That emerged from the Maxwell days and so forth. Why is that any different for a Cabinet Minister? In fact, I would have thought a Cabinet Minister should have more spine to be able to stand up and make those recommendations. By the process that Lord Wilson is recommending, would you not agree that it gives them a little bit of an oomph to do that?

Lord Turnbull: The difference I am pointing out is that Cabinet Ministers do not have the same protection as a nonexecutive director has and, therefore, you have to find some other way of getting to this desirable end that there is some feedback.

Q136 Nick de Bois: A nonexecutive director could go to jail, and I am not sure a Cabinet Minister would if he did not ask the right questions.

Lord Armstrong: Their political careers could be ruined.

Q137 Robert Halfon: Going back to the Cabinet Manual, do you think it will have any effect on what was termed the Crichel Down principle, where Ministers are actually responsible for things that go wrong in their Department? That seems to have weakened over the last 1520 years.

Chair: Can we leave that for a moment? We are going to come back to that later.

Q138 Paul Flynn: I come to the argument now that the worst decision in 25 years was the decision to send British soldiers into Iraq for the second time, the result of which was the loss of 179 British lives. We know now that decision was taken without the full knowledge of members of the Cabinet. Parliament supported it on false information supplied to it. Isn’t this a very powerful argument against sofa government? I disagree with the Chairman. I think we have to say that we must press, on the basis of those 179 lives, for more collegiate government in future. Do you agree?

Chair: I am not disagreeing with that.

Lord Armstrong: I strongly support collective government, and I think that undoubtedly on certain occasions, including that, Mr Blair fell short of it.

Lord Wilson: I stand by what I said to the Chilcot inquiry, which is on the public record.

Q139 Chair: Can I move on? Lord Turnbull, you also made some interesting comments at the Chilcot inquiry about the Campbellisation of the information released by government. Comparing it to the disciplines that a plc would have to follow on the release of information, those disciplines just do not apply to government. Government can selectively leak, can selectively announce, can partially withhold information in order to get the right political effect of the information released, in a way that would see directors of a public company prosecuted. Would you like to enlarge on that and do you think there is enough in the Cabinet Manual that addresses that?

Lord Turnbull: I do not think this issue is discussed in the Cabinet Manual. I was struck by reading part of the Campbell diaries, where news emerges that Cherie Blair is expecting another baby, and then there is a row as to, "Do we tell The News of the World or do we tell The Mirror?" This should never have arisen. This should have been a piece of news that just came out of No. 10 to all people, including citizens, at the same time.

Chair: So it is an abuse of patronage really?

Lord Turnbull: It is an abuse of patronage, yes and, as I indicated in my evidence, the corporate world is going rapidly in the other direction, because not only do your results have to appear through the RNS, but other forms of communication, particularly for financial services companies, are being questioned by the FSA. If you hold an investor day, investor briefings and interviews with journalists, there are questions of whether, by the back door, information is being released selectively to various people. That is being clamped down on. At the moment, there is no restraint although, in the area of official statistics, I think we have won some ground back. There is now recognition that the GDP and inflation figures are produced according to a calendar, and go out and are not selectively leaked, but other forms of government announcement are still pretty much a freeforall.

Q140 Chair: Are you ever concerned that our political leaders in government have used nonpolitical people, like members of the armed forces or senior officials, to make the case for something or to announce something in a certain way, which is an attempt to validate, with an impartial person, what is essentially a political decision or a political message? I am thinking particularly, most recently, of the letter in The Times from the Armed Forces Chiefs justifying cutting the Harrier, against very strong opposition from a previous First Sea Lord. Can you think of other occasions that have left you uncomfortable?

Lord Turnbull: I am not particularly uncomfortable with that one, because I think the military leaders went through a review and eventually agreed a settlement with their Minister and in turn with the Treasury. It seems perfectly reasonable, if that is the decision they have reached collectively, publicly to defend it. Whether it is before a Select Committee or a letter to a newspaper, that is what they are doing, so I am not sure that it meets the description of being leant on.

Lord Wilson: There is a very important distinction between explaining the Government’s position and becoming an advocate for it. I think it is perfectly proper and necessary for a public servant or civil servant to explain what the Government’s position is and what the reasons are, and this happens all the time with Select Committees, but there is a very fine line between that and a public servant getting into a position where they are actually arguing for something in a partisan way. That is a constant danger and one has to patrol that boundary.

Q141 Chair: Is it something that should be better reflected in the code or in the Manual?

Lord Wilson: To be honest, I have not read the code to check that point, but it is a very important point.

Lord Armstrong: Some of these points are dealt with in the Ministerial Code, which is a separate document.

Q142 Greg Mulholland: All three of you have clearly had long and distinguished careers in the Civil Service and have seen a number of the reforms that have come forward from political leaders. When you look at the last century particularly but the last 10 years as well, it seems that each generation is trying to reform essentially the same things and each time saying we have to get to grip with the same problems that are being identified. Is the conclusion that we take from that that all Civil Service reform ends in failure?

Lord Wilson: No.

Lord Armstrong: From my point of view, I think the process is one of constant adaptation. Yesterday’s reform does one thing, then you find some other need and you have to modify and go to that, and that is a new form of Civil Service reform. You go through some periods where there is no reform, and that will be followed, particularly under the stimulus of a very active Prime Minister, by periods of quite a lot of reform. It is a process of constant adaptation within the general principles of the Civil Service’s responsibility to Ministers, and Ministers’ accountability to Parliament.

Q143 Greg Mulholland: Is that not really the crux of this: that it is constant adaptation, which is exactly what the Civil Service wants, and yet you have leaders, particularly strong leaders-Margaret Thatcher, Tony Blair and now David Cameron-coming forward with these grand reform schemes that are going to change everything from top to bottom. What happens really is that it is Sir Humphrey who is in charge, making sure that constant adaptation is what actually happens.

Lord Turnbull: I think I would describe it as being that we stand on the shoulders of our predecessors and build on their work. I will give you an example. When Richard Wilson was the head of the Civil Service and I was the permanent secretary in the Treasury, there was a group that produced a report called Bringing in and Bringing on Talent, and it was about opening up senior Civil Service posts to a wider range of applicants. It was started in his time, and continued and accelerated in mine. It was not a case of coming along and simply reversing something that had happened before. Very few things get reversed; they get built on.

Lord Wilson: I agree with that. The Civil Service that I left was very different from the Civil Service I joined. It had moved on immeasurably in important ways. Some of the changes are very big and important changes. I am going to use this as a small visual aid: the Next Steps policy, which was launched in 1988, was a profoundly important step. The financial management initiative was a profoundly important policy and the Citizen’s Charter was a very important idea. Each wave follows the previous wave and moves the service on, and that is how these things are bound to work. Every Government needs something a bit different from the previous Government. The Civil Service that John Major left did not have all the skills and all the people we needed for new Labour. It is bound to be a process of constant adaptation and development, rather than a big onceandforall change that alters it.

Q144 Greg Mulholland: Do we need next steps? Do we need the post-bureaucratic age or is it really the civil servants who will dictate the pace of reform?

Lord Turnbull: Post-bureaucratic age is a new expression of a preexisting idea. In 2001, Tony Blair said something like, "We need a new dynamic in public services-services built around the interests of the user of those services––patients, parents and the lawabiding citizen––rather than being structured around the requirements of those providing the services." That is a central precept of the post-bureaucratic age. There is also the whole idea of choice and what we are seeing in our own lives. I can remember a time when, if you had a telephone at all, you quite likely shared it with the people next door, and you only had one appliance in your house. People have different expectations about the services that they receive, whether they come from the private sector or the public sector, and this phrase, post-bureaucratic age, is capturing that and accelerating that process. Many of the ideas in it giving greater weight to the way people want the services delivered to them, already existed but under different labels.

Q145 Charlie Elphicke: In terms of the Civil Service reform, I am very struck that two thirds of civil servants now work in Government agencies. We have had written evidence from Professor Kakabadse, who came to see us in our previous session. He says there are three key core Civil Service capabilities, namely policy design and development, service delivery excellence and agency relationship management, that is to say sourcing, outsourcing and the management of wholly owned government subsidiaries. Would it be fair to say that a logical extension of the agencies would actually be to raise productivity by contracting them out altogether?

Lord Wilson: It depends on the particular situation. The next steps concept, which Lord Armstrong played a major part in introducing, applies to an enormous variety of different kinds of activities around the Civil Service, and some of them are ones where contracting out has taken place. For instance, the prison service has contracted out to private sector providers the provision of some prisons. There are numerous examples of different agencies performing different kinds of functions and, in some cases, contracting out has taken place. It is very hard to generalise, but in principle that can happen.

Q146 Chair: Professor Kakabadse also points out that to do the post-bureaucratic age and the Big Society, the Civil Service actually needs a fourth skill, which he describes as "the formation of powerful community groups to provide service but also be able to effectively interact with the Civil Service". Would you agree with that? This kind of transformation of the Civil Service would require a great deal of training and reeducation of the Civil Service and its capabilities. Would you agree with that analysis?

Lord Turnbull: Yes, I do. It is coloured by my experience, which I shared with Lord Wilson, of being permanent secretary at the Department of the Environment. There are many areas in local government where you have to bring together in a local area, say with a regeneration project, many players. Civil servants need the ability to influence, to be able to go to a public event, listen and persuade. Increasingly, we are looking for people who have that skill and there is less place, and they thrive less well, for highly cerebral people who operate in Whitehall, write well but do not like speaking or interacting with local people. My experience in the Department of the Environment was that there were lots of them, and a lot of them were in the regional offices, the regional development corporations or whatever, but it is absolutely right that getting people to join you in a common enterprise is a very important skill.

Lord Armstrong: You must always have regard to what Parliament and the public expect Ministers themselves to be responsible for. The Next Steps initiative, which was introduced in 198788, created as the initial Next Steps agents things like the Passport Office and the Driver and Vehicle Licensing Agency, where the great bulk of the work done is purely that of issuing licences or issuing passports. Ministers are not really concerned with that detailed administration; they are concerned with, in the case of the DVLA, the licence rates and with the budget for that organisation. That seems to me a perfectly sensible thing. The difficulties began to emerge with the Prison Service at the time of Mr Derek Lewis, where the Prison Service was taking decisions as a Next Steps executive agency, which eventually came back to haunt the Home Secretary of the day. That is a problem that you constantly have to have in mind. Ministers find themselves held responsible for things that they have not actually been concerned in the creation of.

Lord Wilson: I recognise what Lord Armstrong has described. I can think of specific situations that arose, where somebody within the Prison Service exercised their discretion in a very entrepreneurial way, which is very good but, when Parliament heard about it, it was seen as a scandal. This was about a prison governor who invested an endyear surplus in the provision of an allyearround playing field, which I think was a very good piece of leadership. When Parliament heard about it, they knew that the local village playing field had been sold off, and they thought it was scandalous that the inmates had better treatment than local schools. The boundary between politics and management is quite often really difficult, and it is one of the differences from working in the private sector.

Q147 Charlie Elphicke: Lord Turnbull, this is a followup on my earlier question. During your time there was created, and I quote Lord Wilson, "a dizzying array of units for ‘modernisation’ and ‘delivery’ armed with centralised targets and league tables" that did not foster any engagement with the wider populace. People didn’t like it; it came to be severely criticised. Would it not be a good idea to allow more local empowerment and decentralisation?

Lord Turnbull: There are two and possibly three themes in that. One is: did we create too many units? We are down to the old joke of Bird and Fortune that there are all these units in the Cabinet Office, and there was the Social Exclusion Unit for anyone who couldn’t find a place in any others. When I arrived in 2002, there were too many units and we tried to rationalise that. The Office for Public Service Reform was probably surplus to requirements and gradually it was taken out, and its work was absorbed in other units.

The second theme is really about targets, and there I have some sympathy with this, in the sense that, if you are giving the health service £100 billion a year to spend, do you simply say to the professionals, "Do your best with it. You choose what outputs are going to be delivered."? Some of the improvements that took place in the Health Service, particularly the reduction in waiting times, did respond to the pressure that was put by the setting of targets. On the other hand, targets get gamed against and they do create friction with the professionals. There has been, somebody said, a retreat from them. I do not think we should lose sight of the fact that people are entitled to know, if many billions of pounds are being spent on a particular service, what is being achieved, right down to the level of what any school is doing. If you do not like the league tables in which schools feature, you can either abandon them and retreat, or you can say, "Let us try to work on measures that are more sophisticated, which capture value added, for example." To say we are not going to make any attempt to measure or compare the performance of different parts of the organisation is a dereliction of duty.

Q148 Chair: In the private sector and the armed forces, they do not try to do this. They train the people down the line, so they become more autonomous and more capable. Delegated mission command seems to be something that the public sector is not very good at.

Lord Turnbull: Boards I am on have things called KPIs. There’s a report from the CEO at each board meeting on sales, profits, assets under management or whatever. They use this system. It is easier for them, because these are very often verified and they are not qualitative to the same extent.

Q149 Chair: The entrepreneurs we want in the public sector, the head teachers and hospital managers, are driven out of the public service by the directions and paper raining down at them from on high.

Lord Turnbull: There is a sense in which an idea that had an element of merit went too far and there has been a retreat from it. I do not think you then go to the point where you say, "We will make no use of delivery targets," and the Public Service Agreements will simply say, "Here are the budgetary allocations for departments, for agencies, and you will be told nothing about what is expected to be delivered."

Lord Wilson: It is a big topic this, but I lean in the direction more of setting people clear objectives and giving them discretion within that, with good training, to pursue those objectives. You can get into a situation where people are all pursuing their targets, but they lose sight of what they are trying to do.

Q150 Paul Flynn: I cannot lose this opportunity of having so much experience of the Civil Service-it is a rare event to have you all together here-to ask a question that Oliver Letwin asked, and that is on the policy of prisons. In spite of the efforts of government after government, over a period of 40 or 50 years, recidivism has never changed. It is exactly the same in spite of all those efforts. You could say the same about drug policy, which in fact has got worse, in spite of the huge efforts that have gone into it. It seems to be mainly because government policy has been evidencefree and prejudicerich. Do you feel, looking back on your careers, that you would like to see a measurement of outcomes to see what failures governments have chalked up because they have been following the popular policy, the tabloid policy, rather than going ahead on intelligent, informed evidence?

Lord Wilson: I do think we are not very good at going back and seeing how successful policies were, or indeed at thinking, "What is government good at and what is government less good at?" If you want brief answers, that is where I would stand.

Q151 Kelvin Hopkins: Just a question before you go, which betrays my prejudice, the Civil Service is often portrayed as being negative and acting as a brake on what governments want to do and what radical politicians want to do. In fact, after the Second World War the Civil Service facilitated a social democratic revolution. That was tremendous and immensely successful; for two or three decades we had something that really worked. Since then, we have had a number of radical Prime Ministers, radical politicians with fanciful ideas, and there is a sense in which the Civil Service has been uncomfortable with all of that. I completely sympathise. To what extent have you had to bite your tongue or keep a straight face, while politicians come up with fanciful ideas that are really not going to work?

Lord Turnbull: Radicalism I have no problem with; initiativitis is where I think I part company with it.

Lord Armstrong: What happened after the war is an enormous subject. During the war, there was a singleness of objective and a great deal of working together, of co-operation, between the Government, the civil servants, and the politicians on the one hand and industry on the other. Not only was there a great deal of working together but a great deal of friendship and collegiality developed. The legacy of this lasted us through almost until 1970 really, but the situation since then has of course changed, because those generations have passed on.

Lord Wilson: The Civil Service has shown that it is able to manage large change repeatedly. The size of the Civil Service-from memory-between 1979 and around 1997 shrank from something like 750,000 to less than 500,000. That is a very big change. Some of that was hiving off and some of that was reduction, but we did that very quietly and it was big change. You may not agree with the privatisation programme but actually the carrying out of it was very successful and a pretty big change. The service has shown that it can adapt and do the things that Ministers want, but I go along with the comment that it is initiativitis, if that is the right word, which is more difficult.

Q152 Robert Halfon: I go back to my question I asked earlier: what effect will the Cabinet Manual have on ministerial responsibility for things that go wrong and Ministers resigning, as opposed to blaming it on the Civil Service?

Lord Wilson: Can I just say a word about Crichel Down? I think what Crichel Down illustrates, because it was what you mentioned, is that a Minister’s ability to remain in office depends on whether he or she retains the confidence of the Back Benchers of his Government and of the Prime Minister. That was what happened in Crichel Down. There is a lot of academic study of this. I do not think that the research bears out the statement that Ministers resign when civil servants get it wrong. I think it is about whether Ministers retain the confidence of their Back Benchers and of the Prime Minister.

Q153 Robert Halfon: Does the Cabinet Manual delineate the responsibility of the Minister to resign if things go wrong? Are there any guidelines?

Lord Wilson: The only guideline is whether a Minister retains the confidence of the Prime Minister.

Chair: Or Parliament.

Lord Wilson: And of his Parliamentary party, the party on the benches behind him.

Lord Armstrong: If I may say so, I do not think the Manual is intended to tell you that. As I said, that would be more prescriptive than it intends to be. In that respect, I agree entirely with what Lord Wilson has said. The reasons for resignations very often are a question of whether the Minister concerned still enjoys the support of his Back Benchers. I think back to the resignation of Lord Carrington in April 1982. I do not think he had lost the confidence of his Back Benchers and I am sure he had not lost the confidence of his Prime Minister. I think he came to the conclusion that he was unable to defend himself in the House of Commons because he was a member of the House of Lords, and I suspect he thought that, because of the outbreak of the war in the Falklands and the failures particularly of his Department in the previous time, a head had to roll and his was the head that should roll. It was in that sense a very honourable resignation.

Chair: My Lords, thank you very much indeed for your time with us. We have run over time. We could have run for another hour easily. It is been absolutely fascinating and I can sense my Committee is rather frustrated. They all want to ask more questions. We may follow up in writing one or two issues, if we may. Thank you very much indeed. It has been extremely helpful to us.

Lord Armstrong: Thank you. We’ve enjoyed our time here.

Examination of Witnesses

Witnesses: Mr Ian Watmore, Chief Operating Officer, Efficiency and Reform Group, Cabinet Office, Sir Suma Chakrabarti KCB, Permanent Secretary, Ministry of Justice, and Dame Helen Ghosh DCB, Permanent Secretary, Home Office, gave evidence.

Q154 Chair: Forgive us for keeping you waiting, but perhaps you were more in awe of our previous witnesses than we will ever be. Thank you for joining us. Could I ask you to identify each of yourselves for the record?

Dame Helen Ghosh: I am Helen Ghosh. I am the Permanent Secretary at the Home Office, where I started my role on 1 January. For five years before that, I was the Permanent Secretary at DEFRA.

Ian Watmore: I am Ian Watmore, Permanent Secretary at the Cabinet Office, currently leading on the efficiency and reform agenda across Government.

Sir Suma Chakrabarti: I am Suma Chakrabarti, Permanent Secretary at the Ministry of Justice, where I have been for three years. Before that I was for six years Permanent Secretary at the Department for International Development.

Q155 Robert Halfon: What impact would you say the Big Society has had on the vision of the Government for the Civil Service?

Ian Watmore: The Big Society is one of several things that’s changing the way the Civil Service operates. The Government has set a number of objectives for public service reform and delivery; the Big Society is one. They are currently producing a White Paper to put all that into one document, which will hopefully be published before the Budget, and it does put a profound change on the Civil Service, because it is requiring the Civil Service, as indeed you were alluding to in the last session, to work with communities at a very local level in different ways.

Q156 Robert Halfon: Can you tell us what the Big Society means as far as you understand it, each of you?

Dame Helen Ghosh: From my point of view, and I will use some DEFRA examples in particular, it means that we in government need to focus on doing the things that only government can do, and only do those things. As a Civil Service, what we need to facilitate is that, at the most local, most individual level, people both identify and solve problems in the way that they wish to solve them. For example, in DEFRA we did a great deal of work with, for example, the farming community, not from the centre instructing them in a paternalistic way on how to deal, for example, with animal diseases like bluetongue, but working with them in partnership and asking them to take the decisions. We did the things that only Government could do, in terms of rules and regulations, and they were the people identifying and dealing with the solutions to the problems.

Sir Suma Chakrabarti: Similar examples, I think: in a nutshell for us, it is about devolution of power and accountability, and local empowerment. What I think that leads up to though, with increased transparency as well, is much more local design of solutions to problems on the ground, which will mean quite interesting changes in public service. You will be able to see different performance, for example in Ministry of Justice areas, between different local criminal justice areas. It will be up to the public then to ask questions of why there is a differentiation in performance, whereas, at the moment, it is very much up to the ministry to ask those questions, so that will push power out much more.

Q157 Robert Halfon: I notice that you say it is about the devolution of power, but you do not say it is about renewing civil society, which is a core part of that. Why is that?

Sir Suma Chakrabarti: I think you are right; it is about renewing civil society. One of the things that Lord Turnbull said is absolutely fundamental to this––and it is a new task for the Civil Service, or maybe a renewed task––is to ensure civil society does have the tools to ask the questions that it needs to. That is quite a tricky balance, because the Civil Service obviously wants to help skills being developed at a local level, so they can challenge the way things are done. At the same time, it should not be suggesting the solutions, because then that is a takeover again. Getting that balance right is going to be quite important.

Q158 Robert Halfon: In a previous article, Lord Wilson wrote that part of the problem with the Civil Service was too much centralisation by governments, making it very difficult to run the Civil Service. Do you think that the Big Society will actually help that and that power will be going outwards and downwards, which will make it easier for the Civil Service itself?

Dame Helen Ghosh: Today’s crime maps are an excellent example of how we will transfer power through transparency, as Suma said. Once we have our local police and crime commissioners with an elected local mandate, the power and indeed the accountability will be transferred to them to work with local people to solve those problems. In terms of the challenge to us as civil servants-and I was very interested in what Lord Turnbull said in terms of this being part of a longerterm development-the issue for us is both learning to let go, in terms of the levers of power, moving into those different kinds of world, and learning how to facilitate and, as Suma says, helping support the capacity of local people to make decisions and form their own future.

Q159 Robert Halfon: What limits are there to the Big Society or to how power could be transferred from Whitehall to the grass roots, to communities and neighbourhoods?

Ian Watmore: I think my Minister, Francis Maude, would say that what he would like to see happening, as well as the transfer to the Big Society and localism, is a degree of centralisation of some of the core business aspects of government. I think we may have discussed in the previous session the ideas of bringing more procurement to the centre to get bigger value for the taxpayer pound that is spent. There are two things going on in parallel here: there is a lot of policy devolution to the local front line, through the ways I have just described and that were illustrated by my colleagues here, but there is a degree of getting a grip of some of the business aspects of government, on property, procurement, IT and those sorts of things, which requires a more centralist approach. He refers to that as his tightloose framework, and I think that is probably the best description of what’s going on at the moment.

Q160 Robert Halfon: If local communities do not agree with how you give them localism as such and how you are going to give them more of the powers that they are supposed to be having, what is your response to that?

Ian Watmore: In the generic case, politicians believe that people do want that ability to take control of their own lives, their family’s lives and their communities around them, and that they will have the opportunity so to do. They do not expect it equally across all localities. It will move at different paces and there will be different social issues and local issues that are particularly relevant. Helen talked about the police maps today. I’m sure that’s very topical. We were all Googling this morning putting our postcodes in just to see how many crimes there were round the corner this week. Crime in certain parts of the country has much more relevance than it does in others; poverty in certain parts of the country has more relevance than in others. I think it is about allowing the local communities to take control of the agendas that affect them the most, and fill any vacuums that the Government may have created.

Q161 Robert Halfon: Dame Helen, you made a very important point, I thought, just now about transparency equalling empowerment. Perhaps you are right, but isn’t empowerment more than just having access to information?

Dame Helen Ghosh: Yes.

Robert Halfon: Because having access to information is what websites were doing five years ago. People want to be able to interact and have real ability to deal with that information. Just telling them about crime maps is good, but it is not enough.

Dame Helen Ghosh: It is not enough. I think this comes back to my earlier point that there are some things that government still needs to do and only government can do, which is to set a legislative framework within which that kind of local empowerment can happen. Specifically in that case, in a sense we have now handed out the information about crime mapping but we have not completed the picture. The completed picture is, and it is a Bill currently going through this House, to set up to allow the election of these police and crime commissioners, because that then completes the loop for local accountability to that one person.

Equally, another area where you can use data but then empower is the number of projects on community budgeting that the Department for Communities and Local Government is leading, where we are saying to local people, "Here is a set of, up until now, pretty intractable problems, whether it is reoffending or child protection. We will take away the constraints of siloed budgets and centrally set targets. You can have a budget; you can decide. Local public sector bodies will support you and give you data and then you, as a community group, can use all those tools to solve those problems in an endtoend way." We still need to do things, whether it is positively or negatively, around regulation and legislation, and we still need to offer support, but that is part of the Civil Service role in facilitating this happening at a local level.

Q162 Charlie Elphicke: May I give you an example in terms of the impediments to building a Big Society? Let’s say central Government is going to sell off an asset, be it a port in my constituency, woodland or anything like that-URENCO. The Secretary of State receives two bids: one for £25 million from a local community group; one for £30 million from a private operator, maybe from overseas. As accounting officers, would you have to advise the Secretary of State, under current guidance, to take the higher offer in money terms, or could you value in social and community value?

Ian Watmore: The specific we would have to look at, but generically you can always take a range of criteria into account when you make a recommendation. The price or, in this case, the bid cost is always an important factor, because that is where the real money is, but you take a number of other characteristics into account in making the decision. It is perfectly reasonable for people to take a broaderbased decision than purely on price.

Sir Suma Chakrabarti: Just to give you a reallife example from last year: the whole question of what size of prisons should we build: 2,500 or smaller. The larger the prison, almost certainly the unit cost would be lower. There comes a point where you actually have to ask yourself: is this managerially wise? Could we actually manage the prison well? What are the benefits as well? The benefit side of the equation also matters, not just the cost. Would reoffending rates be lower actually with a smaller prison? That’s what the data shows. You take all that into account, so it is not just a cost thing that you take into account. There is an interesting point you make about the Manual, that is called the green book, which looks at costbenefit analysis and how we do it. Whether it is still too economistic a drive in the main, and whether it should take account of some other factors too, I think is a good question.

Q163 Paul Flynn: Every government comes in with an idea. It is bigideaitis we’re suffering from. We have got the Big Society now. We had the third way under Tony Blair, whatever that was, and the cones hotline under Major. It doesn’t mean anything, does it, any of this? You were saying about DEFRA giving powers to farmers on the question of bluetongue. Wouldn’t it have been far better if farmers were rescued from the dependency culture by taking away their subsidies, as they did in New Zealand, and given full responsibility, so giving a great deal of dynamism to the industry, which it lacks now, where it still expects handouts from national government, local government and Europe, for virtually every problem? Isn’t this very unhealthy? Isn’t this a very productive way of extending devolution?

Dame Helen Ghosh: On the specific issue about the common agricultural policy, the Government’s policy is indeed to withdraw direct subsidies over time, and only pay farmers for producing public goods like skylarks, hedgerows, birds and those sorts of things. In terms of the issue about how one moves away from a position of dependency, in relation to any public group, I think it will change over time. Lord Turnbull was talking earlier about the revolutionary differences in terms of lots of public services, the choice that individuals have and the personal budgets that people have, which are unrecognisable from perhaps 20 years ago. A number of the initiatives that this Government is taking are just driving that same agenda faster.

Q164 Paul Flynn: What changes have you made in order of reducing costs, and what changes do you envisage being made? Do you imagine that you can keep up with the Government’s expectations of cutting costs by very large amounts?

Dame Helen Ghosh: Absolutely, not least because the money has simply disappeared from our budgets. This is not a theoretical exercise, compared with what might otherwise have been; we simply do not have the money in our budgets. For example, we in the Home Office are working very closely with police services on how they can be more efficient, both in how they procure-doing central procurement-and in processes. We have been helping people like West Yorkshire, which has reduced the cost of dealing with small crimes by something like 85%. Again, we have worked to take burdens off police, in terms of reporting requirements, bureaucracy and the targets we set. We are confident, if we do all those things, we will be able to live within our budgets.

Q165 Paul Flynn: One of the ways of reducing costs suggested in the document, is that jobs should be moved out of London, where the work can be done for less. What was the thinking behind making the biggest cut in Passport Office jobs from an area of high unemployment in Newport, which might well swell jobs in London later on? What happened to the Government saying one thing and doing another?

Dame Helen Ghosh: As you will probably be aware, the Passport Service has a very dispersed office network, so we have a number of bases. We currently have too much capacity in the Passport Service overall, thanks to efficiency and the introduction of new technologies. We simply do not need the same amount of processing capacity. Damian Green is currently looking at the impact assessments for all the options around where we take that capacity out and has not yet reached a decision.

Q166 Paul Flynn: It just so happens that the proposal is a cut in the area that could least-it is not made evenly across the country.

Dame Helen Ghosh: We are looking at the options as to where the greatest impact and best choice are.

Q167 Paul Flynn: I hope you come around with a suitable decision and the right decision eventually. The Prime Minister told the Civil Service that he intended to stand government on its head. The only merit in this posture is money falls out of people’s pockets when they are in that position. Do you really think that the savings that you have, which you say you have to make, can be done at a time when there are reforms required? Are not the aim and the cut too deep in order to preserve the quality of the service provided?

Dame Helen Ghosh: The principle on which we are all operating, and I think have to credit Suma with the first use of this phrase, is what we are aiming at is better with less. We know we will have fewer staff and less financial resource at the centre, and what we need to focus on is doing the things that really make a difference-not, as our distinguished predecessors were saying, initiativitis, but on the evidencebased activity that really makes a difference. That is what we are building into our programmes.

Q168 Paul Flynn: On initiativitis, the worst part of crime is the perception. The fear of crime is a greater cause of anxiety than the crime itself. When people go on to their websites this morning and find out their neighbours have been burgled and there are acts of vandalism in their street, isn’t this going to, without any real purpose, increase their fear of crime and their perception of crime? If they ring up the police, they’re going to know that, in every other street in their area, everyone is ringing up the police saying, "Do something more in my area." Isn’t this an example of initiativitis, of using a gimmick, a pretty vacuous gimmick, which is likely to have harmful effects?

Dame Helen Ghosh: Absolutely not. What it will do is give people accurate information, which I think we owe the public in the public sector. It will then enable them. They can click, as I am sure you have done this morning. I have clicked my postcode; I got the map of my local street crime. I was then instantaneously able to click my local police team and the earliest beat meeting, should I wish to go to it. We are even proposing beat meetings online, so you don’t have to leave the comfort of your home. The reverse may also be true: that there is a lot of fear of crime where there is actually no crime. I am hoping today there are a number of your constituents who are flicking into the website and discovering that, despite their fears, actually crime is very low. That is what we’re aiming at.

Paul Flynn: People are being told there are no police to cover their area, when they click in. That is not helping. It remains to be seen. This sounds just about as productive as the cones hotline was. I think in future we’ll see this as being a mere gimmick.

Chair: I don’t think that last point was a question.

Q169 Kelvin Hopkins : Two very key points: you are obviously an enthusiast for devolving to community groups. First of all, I am not quite sure who these community groups are. They seem a very vague concept. In my own local area, I would be very dubious about devolving anything to some of them, because of capability and so on. The other point is that they are not accountable. The obvious group to whom to devolve things would be local authorities, because they are democratically accountable; somebody can be held to account if things go wrong. You know that there will be standards of financial management and that sort of thing. The other point is even more worrying: you seem to marginalise the concept of equity. Most of my electors want fairness; they want to feel they’re being treated the same as other people. Yet one of your comments suggests we are not about equity. Is that not really fundamental in democratic society?

Dame Helen Ghosh: I believe that the Prime Minister himself has said, recognising this point about difference in the capacity of local groups to respond to the Big Society agenda, that we still need a significant amount of support. The Office for Civil Society, which Ian knows more about than I do, will be offering that kind of support, both in terms of financial support and capacity building support. I very much recognise Lord Turnbull’s comments, because I was one of the people, probably when he was my permanent secretary, working with local community groups out in east London, and indeed had to learn the set of skills that he described. I absolutely agree with your point that the problem is making sure that you know who really represents the community, as opposed to the people who claim that they represent the community. There is a lot of experience. Working with local authorities, tenants associations and genuinely representative groups, I think it is possible to identify and listen to the voices of the invisible people. I know the Office for Civil Society is focusing on this.

Ian Watmore: Yes, indeed. Two thoughts: one is that the Office for Civil Society is trying to help the charitable sector through what are difficult times, and we had a meeting last week with several leaders of the big charities talking about the capacity of the system and how we can grow that more broadly to take up the challenge that has been laid out. The second thing is the promotion of other forms of enterprise to take out roles locally-social enterprise, mutuals, spinouts from government, that kind of thing, because the Big Society in a local setting is not just charities; it is a combination of bodies that we want to promote, and that’s what the office is pushing as we speak.

Sir Suma Chakrabarti: This question of equity and accountability is an important one to have a good discussion about. The PAC is also on the same issue at the moment. Take youth justice, which is a very localised approach with partnerships at the local level. Already you have quite a bit of variation in terms of performance and in terms of the tools that different youth offending teams use. At the moment, what happens is the centre-we are the centre, the Youth Justice Board-essentially tries to get equalised approaches. With this new approach, we would be looking much more to the local authorities, which provide 51% of the money for youth justice, to take much more of the leadership in this, and that would have to be right. You have to think about what is the right unit for accountability and, in some cases, it will be local authorities. In some cases it will be below that. It depends on the issue, I think, and how many things you have to join up. In the case of youth justice, you are having to join up a whole range of services and local authorities, which makes a lot of sense.

Q170 Kelvin Hopkins: Community groups give voice to concerns, but their ability to manage large budgets, employ people and all of that, is something that must be questioned, especially if they are not democratically accountable.

Sir Suma Chakrabarti: Helen has more direct ontheground experience of this but, in the old regeneration programmes, this was a standard issue-the capability of many groups to manage not just budgets, but express what they wanted in a way that joined up all the various elements. There was a lot of capacity building at the time, and some of that we have to return to.

Dame Helen Ghosh: Indeed and, in those sorts of cases, what government did do, or what the public sector did do, was put the money in to employ someone who was capable, in terms of just organising the project, managing the project, doing all the things that Suma described. In the Big Society model, government at some level will continue to do that and it is important that it should.

Q171 Chair: Could we briefly talk about what you are each doing in your Departments, first of all about the Transforming Justice programme. This is primarily about getting £2 billion of savings, isn’t it?

Sir Suma Chakrabarti: Actually, it started before we knew what the target was for savings.

Chair: But you guessed.

Sir Suma Chakrabarti: No, we started this in February 2009. There was a different Government in place at the time. We were lucky enough to have, in Jack Straw, someone who did think, whether he was in power or the Opposition came to power, that there should be a programme of reform that should be worked through.

Q172 Chair: You have 197 initiatives, but there does not appear to be an overarching strategy.

Sir Suma Chakrabarti: If that is how you read it. It is not how the Institute for Government, which is formally evaluating this programme, reads it. They have given us a very positive evaluation. There are seven programmes, essentially. It is a mixture of things. There is some policy reform, quite clearly, which we have been working on for 18 months. Those have been announced: sentencing, rehabilitation but also legal aid. Then there is a mix of change management reforms. When the Ministry of Justice was created, we had all these different arm’s length bodies, all with their own back office functions, very much replicating each other. One of the things we are trying to do is have a shared service across all the ministry’s bodies. In fact, Newport is a major winner out of all this for us, because we already have a shared service centre there and it will grow because of this. The Home Office already purchases its services from it. There is quite a lot of change management as well as policy reform, as part of this.

Q173 Chair: Is this incremental reform?

Sir Suma Chakrabarti: I am afraid it is not. Given the profile of the cuts, it cannot be. It is £500 million a year from our budget. The policy reforms have to go through Parliament of course. They will not really give us the savings until years 3 and 4. The first half of the reforms are actually very big changes in processes, structures and so on, which I described.

Q174 Chair: Forgive me, but I am reliably informed that the IfG evaluation highlights the concern that no overarching strategy for Transforming Justice has yet been produced, but you would dispute that.

Sir Suma Chakrabarti: I would dispute that because this was the review they did, I think, back in May last year. Then they invited me and Ken Clarke to come and give a seminar for other civil servants to hear about our experience. It is somewhat odd because they are actually highlighting it. I do believe Mr Julian McCrae was in front of you highlighting MoJ. I seem to have read the transcript, I think.

Q175 Chair: I am glad you put that on the record. Thank you. Do you think there’s a tradeoff? What we are concerned about here is the capacity of the Civil Service to implement change and to change itself at the same time. Do you think there’s a tradeoff between doing things quickly and decisively, and incrementally?

Sir Suma Chakrabarti: There is a risk, which I think we all need to be honest about, which is that you are running massive organisations that have to still keep performing while you are trying to change them as well. In our case, prisons, probations and courts still have to be run effectively. At the same time, we are trying to change the way they are run. There is always the risk that the business as usual will suffer as part of this, and you have got to make sure you keep the right skills to keep the business going, as well as getting enough change management into your top teams. That is the sort of management objective that all of us are facing at the moment.

Q176 Greg Mulholland: I would like to ask Dame Helen Ghosh about Renew DEFRA. Do you think it is fair to say that it was a success, or largely a success? How actually has the impact of the programme been measured and what are the lasting effects for the Department?

Dame Helen Ghosh: The Renew programme in DEFRA was one that I introduced in 2006, coincidently with a capability review, which fortunately pointed in the same direction. It was essentially doing two things: trying to get our basic systems better, sorting out our financial management systems and our HR processes, but more importantly, making us more flexible to changing priorities and requirements of Ministers. What we introduced was a system for the headquarters department, about 2,500 of us, to organise ourselves around projects and programmes. Rather than having a business plan with lots of teams and tasks under teams, we had a set of 10 highlevel programmes for the Department, each of which were organised with subprojects with a beginning, middle and end, and with project managers and senior responsible officers. We moved staff around using a flexible staff resourcing tool that is very similar to what you see in professional services organisations.

All of this meant that, by the time we had our 2008 capability review, we were one of the next most improved Departments-after the Home Office, which was the most improved, thanks to my predecessor’s work-and we got plaudits and continue to get from the Treasury, in terms of good financial management and moving our money and our people around in response to changed needs. That meant for us that, when it came to things like the SR10, we were in a very good place, we knew where our money went and we could respond quickly to the needs of the new Government coming in. I know that the team there will be using the model even more to deliver these kinds of efficiencies. I think it worked for us, and other bits of Government are imitating some of that, organising themselves around projects and programmes. Indeed, Ian is.

Ian Watmore: We are doing that in the Cabinet Office. In a rare piece of joinedupness, I have borrowed Helen’s change manager to come and do the job for me, so that is taking the lessons that she has learned through to the Cabinet Office. I think a lot of the Cabinet Office’s work lends itself to that sort of project/programme style of working. We are learning a lot from what Helen’s already gone through.

Q177 Greg Mulholland: Considering the Home Office was described not so very long ago as not being fit for purpose by a senior Minister, how do you think the scale of the challenge is at the Home Office, compared to those that you faced back in 2006 with DEFRA?

Dame Helen Ghosh: I have been very lucky in that David Normington had been doing a lot of work since. In terms of things like the financial management of the Department, the basic HR systems and the quality of the top team, he has absolutely transformed it, and we now rate among the very highest in Government, from people like the NAO and the Treasury, on things like financial management and risk management. Equally in places like the UK Border Agency, which Lin Homer led until recently, there are still significant challenges in such a complex operation, but looking at things like the handling of asylum cases, dealing with backlogs and the general efficiency with which they deal with cases, they have come on a million miles. I am very lucky that I can take that on and forwards now.

Q178 Greg Mulholland: Are there specific policy or organisational issues that you could identify that are going to be a particular problem for the efficiency changes and reforms that I think everyone acknowledges need to happen?

Dame Helen Ghosh: The Home Office is an interesting Department. This comes back to some of the discussion we were having earlier. It is easy to focus entirely on the new agenda-the localism, the Big Society, post-bureaucratic age agenda. There are still a lot of things that a Department like the Home Office will do centrally: it will still have a major responsibility for things like serious organised crime, counterterrorism, a lot of the immigration and nationality stuff. They will be central Government activities, and we need to make sure those are carried out as efficiently and effectively as they possibly can be. Some of that will require pretty traditional Civil Service skills. I think I have four Bills going through the House in the course of this year, which require a lot of those traditional skills about policy making, evidencebased and dealing with Parliament, all of that kind of stuff. I need to make sure I retain those skills. Equally, I need really good change managers, both to support and facilitate people like the police with their efficiency, but equally the big change programmes in places like UKBA to introduce eborders systems and new IT for casework. I have a complicated mix of change management skills that I need and facilitation skills, and then some of these very traditional skills that the Civil Service has always had.

Q179 Greg Mulholland: What about a specific question? Do you think locally elected police commissioners make it harder to achieve the efficiency savings, because they will need to be supported at a local level, or will there be savings to compensate?

Dame Helen Ghosh: Going back to the discussion we were having earlier, there is no new money beyond the budgets I already have for local police and crime commissioners. We will be living within our budgets while delivering local police and crime commissioners. The only additional cost around police and crime commissioners is effectively the cost of the elections.

Q180 Greg Mulholland: What about the cost of supporting them?

Dame Helen Ghosh: That would be expected to be found from within the existing cost, for example, of supporting the existing police authorities.

Q181 Chair: On this question of cost reductions, obviously they are very brutal reductions in both your Departments and, indeed, in the Cabinet Office. One of our witnesses, Professor Kakabadse, says in a supplementary memorandum to us, "More worrying is the current debate on cutting of costs without deliberately focusing on where fat lies, and what is lean and should be protected." Is that a concern you share as you implement these cuts?

Ian Watmore: I would perhaps challenge the assertion with the professor, whom I have not spoken to. If that is what he said, I would challenge that, because the whole point of setting up the efficiency and reform group in the Cabinet Office and the Treasury was to tackle the areas that people regard as waste or fat or any other words. For example, we have property that we do not need around the country. If we can get hold of all the leases of all the properties that we have and gradually release them as they become due, and do different deals with landlords and so on, that is a way of reducing cost that has no direct impact on the frontline services. Similarly on the procurement agenda, if we can purchase goods and services more cheaply than we were previously, that is a saving that does not impact the front line. There is a lot of work going on to try to find those savings. We have already this year-these are unaudited figures, but they are what we count-achieved £2 billion of savings just from that alone in the last few months. We expect to achieve over £3 billion this year, and that is even before the CSR started. These are savings that are designed to protect frontline services or protect the critical budgets that might go into critical national infrastructure and defence budgets.

Q182 Chair: Do you all share that view?

Sir Suma Chakrabarti: I do. We have the same agenda as Ian on estates and everything else. The one additional point I would make is it is also very important to match demand to supply. That does reshape some front-line services. Why are we closing 141 courts? It is because they’re very underutilised. There is not enough demand for them, so there will be some reshaping of services accordingly. The prison population is not rising as fast as it used to and that is allowing us to decommission some prison places as well, some of the more expensive parts of the estate. That is also sensible at the same time.

Q183 Chair: On this question of decentralisation and depending far more on the ability of officials right down the food chain to take decisions and act autonomously, do you agree that this is going to require quite a substantial retraining and reeducation of parts of the Civil Service in order to do this?

Ian Watmore: I think we do, very much so. To give you a very good example of that, in order to bring about the local, Big Society type options we have talked about, we need people at the front line who are very good commissioners of those services.

Chair: The fourth capability?

Ian Watmore: Yes, exactly. I thought that was a great point that came out of the earlier discussion. Commissioning is not procurement. What we will always be in danger of is saying, "Yes, we need commissioning," and then at the local level recreating a sort of procurement process that might have been designed for an aircraft carrier, whereas what we really want to be able to do is get people to commission services and outcomes from people, in a quick, short, sharp way with minimal bureaucracy and minimal overhead from the local community providers. That is a change of skill that we have to lead.

Q184 Chair: Are you able to protect training budgets and, indeed, enhance training budgets? If this is, say, a threeyear change programme, it is been remarked to us that an organisation the size of the Civil Service would need to spend millions and millions of pounds on training in order to effect this change programme. Do you have that money in you budgets?

Ian Watmore: We have. I think the important point that we are all wrestling with in Departments is not just preserving a budget but spending it wisely. There is a lot of focus going into developing both the training and the culture change that goes with all of this in ways that are futuresfocused and not the way it was in the past, which means creating different training programmes. As a group of permanent secretaries, we have launched a new approach to HR across the Civil Service from April, one theme of which is to get a new approach to Civil Service learning that is targeted on all these sorts of skills.

Q185 Chair: This is such a central part of the programme, I wonder if you could do us a note on behalf of all Departments about what is being spent on training and how that is being spent in order to effect this delegation and decentralisation. That would be extremely useful.

Ian Watmore: Absolutely, that would be fine.

Q186 Paul Flynn: Are the roles of your Departmental boards supervisory or advisory?

Ian Watmore: They are both.

Dame Helen Ghosh: They are both.

Ian Watmore: Lord Browne has been very clear on that in all his answers.

Q187 Paul Flynn: Where does the supervisory part come in?

Ian Watmore: In terms of the board as a whole, which is a mixture of Ministers, nonexec directors and civil servants, we are supervising the work of the Department which, if it is a small Department, might be very direct but, if it is a very large Department, could be very devolved and very diffuse. That is definitely part of the supervisory function. The advisory, which is where people focus on the nonexecutive director community, one of the things we are looking to them for is advice from their backgrounds that we can take advantage of. It will be balanced with an awareness that it is not always like that in the public sector compared to the private sector. We have that discussion a lot.

Q188 Paul Flynn: Many of these non-executive directors are GOATS––Herd 2––coming on to provide their wisdom. There is an interesting suggestion from the Institute of Directors, that the leading nonexecutive director should have responsibility for doing assessments for other members of the board and presumably on yourselves and the political people involved. Is this an idea you have enthusiasm for?

Ian Watmore: Not as you have described it, I have to say. The idea that we do have enthusiasm for is for the board to be selfcritical in terms of the way it operates and the way the Department operates. Lord Browne and the lead nonexec directors will play a pivotal role in that, but the fundamental accountabilities do not really change between the permanent secretary accounting officer role and the Secretary of State role for looking after the Department. That is the bit that is not changing, so this is supplementing those roles, not changing them.

Q189 Paul Flynn: You say that you are futurefocused. I cannot recall any politician coming along and saying they were focused on the past. Is it just a question of new government, new jargon?

Ian Watmore: Apart from back to basics, maybe. What I mean by that is that the training programmes that are set up in a government, or any organisation, often reflect the skills you did want to have. When you need new skills, such as we were talking about with the commissioning, then obviously you need to devise different programmes to make sure of that. Just sending people on training courses is not enough. They’ve got to be relevant to the work they are going to do and they have to be part of a broader change. That was the only point I was making.

Paul Flynn: That is not exactly a staggering new idea, I don’t think, but I am grateful for it.

Q190 Chair: Is there a tension between accountability to a board and accountability to Parliament?

Ian Watmore: The interesting difference from business, which I have experienced, is the accountability to Parliament is different. It is not something that business people are used to. They are used to being accountable to their shareholders, their partnership structures or whatever their legal ownership is. Parliament and Ministers introduce a different dynamic to it. Certainly for those of us who cross the boundary from private sector to public sector, it is new and it is different. Having been here six or seven years now, I think what we ought to be able to do is use the boards to focus on areas that we perhaps have not been focusing on, but I do not see it changing the relationship between the primary officers, whether they be elected or unelected, and Committees such as this one, which I think play a vital role.

Sir Suma Chakrabarti: Can I give you an example that goes to the heart of it? As accounting officers, we are obviously accountable to Parliament for financial management and so on. I had to take a direction from Jack Straw, when he was Secretary of State, on a particular item of expenditure. I tried to replay in my mind, with the new board, whether that would have been different. I do not think it would have been. The debate would have been widened, in terms of other Ministers and nonexecs all taking part in it, because the issue would have gone to the board, I think, because it was a large investment. At the end of the day, I still have my accounting officer responsibilities. Even if the board decided that this had to go ahead, I still had the right as accounting officer to ask for a direction and I still would have done, so I do not think that changes actually.

Dame Helen Ghosh: I have an example similarly where I asked for a direction and got a direction, but again it was a classic instance of having to make a very quick decision, in talking to my Secretary of State, then Hilary Benn, about a financial decision, and that was the basis on which, in the space of about an hour, we had to take a decision that wouldn’t have gone anywhere near a board. Again, these are circumstances that could arise in the future. I don’t think it will change those fundamental accountabilities. It will enrich the debate. Having very experienced powerful nonexecutives on an advisory and supervisory board will enrich the debate around things like, is this delivery, timetable and scope of the thing you are trying to deliver realistic? That kind of input from some experienced nonexecutives will be terrific in terms of successful change programmes and growing our skills as civil servants. We can learn a lot from them, so I think it is a very rich prospect, myself.

Q191 Chair: You do not anticipate a situation where something controversial occurs and the permanent secretary tells the Select Committee, "Well, that’s what the board decided. That’s why we did that."

Dame Helen Ghosh: No, because the board will not be the decisionmaking body. This is back to Ian’s point. It is the Secretary of State, under their statutory authority, who makes the decisions. The position will be exactly as it is now. You could summon me to talk about how the decision was implemented, the financial implications of it and so on but, if you wanted to talk about why the decision was taken, it would be for the Secretary of State to come.

Q192 Chair: These boards do not actually have fiduciary responsibilities?

Dame Helen Ghosh: No.

Ian Watmore: Not in the way you would expect them to have in the private sector, no.

Q193 Chair: They are advisory boards.

Dame Helen Ghosh: And supervisory of our performance, yes.

Chair: If there are no other questions, that has been an extremely useful session. I am sorry it was a little curtailed, but we had a very highvalue morning.

Ian Watmore: Never apologise. It was very interesting to hear the other witnesses as well. I think we enjoyed it in the back row as well.

Chair: It was a privilege to be in the same room as them, wasn’t it? Thank you, too, for very helpful evidence and we look forward to that extra memorandum from you, Mr Watmore.