Non-executive directors in Whitehall: how useful have they really been?

The role of non-executive directors in Whitehall departments has developed over recent decades. A new Constitution Unit project, led by former senior civil servants, aims to investigate the role of these outside experts and the impact they have had. David Owen introduces the project and invites contributions from those who have been involved with the work of non-executives.

What role is there for outside expertise in the running of a government department? For some time now in the UK, one way in which such input has been made has been through non-executive board members or non-executive directors. The Constitution Unit is undertaking a project to look at who non-executives are, what they do and the impact that they have had. The work is being led by former senior civil servants Alan Cogbill, Hilary Jackson and Howard Webber. We have felt encouraged following discussions with Cabinet Office, who have expressed interest in seeing the results.

Non-executives: the evolving government approach

Governments have drawn on external contributors for a long time, but the term ‘non-executive’ is thought to have been first used in the early 1990s. In 2005, the Treasury set out guidance on non-executives in its Corporate Governance Code.  The code commented that much what it said of non-executives, as well as of the operation of departmental boards, was new, ‘reflecting an agenda which has developed rapidly’. It recommended that each central government department board should have at least two non-executives, preferably more, with the aim of providing support and challenge.

Following the 2010 election, the use of non-executives developed with the appointment of a lead non-executive for government, former BP chief executive Lord Browne.

This drive formed part of Cabinet Office minister Francis Maude’s wider civil service reform plan for the civil service. He saw non-executives as having a key role in delivering savings, providing the kind of input for which consultants had previously been paid millions of pounds.

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Brexit and departmental restructuring: an unnecessary distraction?

peter-waller

Theresa May’s new cabinet brought the first significant restructuring of Whitehall departments since 2008. In this post Peter Waller considers the pros and cons of these changes. He concludes that the downsides outweigh the advantages, suggesting that there were alternative options that would have allowed dedicated Brexit and International Trade ministers to join the cabinet without the difficulties involved in establishing new departments.

In announcing her new cabinet, Theresa May indulged in a certain amount of Whitehall restructuring. Two new departments were created – the Department for Exiting the European Union and the Department for International Trade.  To balance the books (at least in part) she abolished the Department for Energy and Climate Change, transferring its functions to the Business department. The Business department (now formally the rather turgidly titled Department for Business, Energy and Industrial Strategy) in turn lost responsibility for higher education and science policy, which returned to the education department from where it had come almost a decade earlier.

The new Prime Minister thus made the first significant changes to the Whitehall infrastructure since 2008, when Gordon Brown created DECC. David Cameron, whether by design or lack of interest, had maintained the departmental structure he inherited. So the 2016 changes found Whitehall needing to set up new departments, something it had not done for half a generation.

So are these changes likely to prove worthwhile? What are the pros and cons of marking a national turning point – which Brexit undoubtedly was – with new departments with a new focus?  Writing as someone who spent a high proportion of my Whitehall career in departments whose boundaries were constantly changing, I rather sadly conclude that in this area decisive action by Theresa May is likely to be rather more troublesome than the benign neglect of her predecessor.

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Post-Brexit trade negotiations would pose significant practical challenges for Whitehall

Oliver_Patel

The implications of Brexit for the UK’s trade arrangements, a subject on which Leave and Remain campaigners have sharply disagreed, were addressed in the first two seminars of a series on Brexit hosted by the Constitution Unit and the UCL European Institute. Drawing on the comments of the seminar speakers, Oliver Patel discusses the impact that post-Brexit trade negotiations would have on Whitehall and the EU. Whitehall, in particular, would face a number of practical difficulties. Though not insurmountable, these mean that the process of negotiating new trade deals would be far from straightforward.

All of a sudden, everyone is talking about trade deals. The EU referendum Leave campaign argue that outside the EU the UK will prosper as it will be able to negotiate favourable trade deals with growing economies like India and Australia. Remain campaigners argue that this will not be easy and that being in the EU gives us more clout. Their cause was boosted by Barack Obama’s claim that the UK would have to join the back of queue if it wanted its own trade deal with the US.

Our first Brexit seminar and associated briefing paper assessed the impact of Brexit on Whitehall and Westminster. The panel agreed that the process of withdrawing from the EU would cause major headaches for Whitehall. This is primarily because of the various international negotiations which the UK would subsequently have to engage in, such as a withdrawal agreement with the EU and new free trade agreements with non-EU countries.

Sir Simon Fraser, former Permanent Under-Secretary at the Foreign and Commonwealth Office (FCO), noted that the UK government currently employs very few (if any) trade negotiators, as the function has long been outsourced to Brussels. He concluded that the practical challenge of negotiating multiple international agreements in the event of Brexit – whilst also managing the ongoing business of government – would be huge. However, he does not view the challenge as insurmountable, so long as Whitehall increases capacity and expertise in key areas and co-ordinates the process effectively.

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Would Whitehall be able to rise to the challenge of Brexit negotiations?

Nick-Wright

Much will be expected of the civil service if Britain votes to leave the EU. Every Whitehall department and diplomats in Brussels will be embroiled in complex negotiations to thrash out a series of new relationships. Without additional resources and expertise, the UK’s ability to obtain the best possible deal may be hampered, writes Nick Wright.

Following a vote to leave the EU, the UK would face an extensive round of highly complex negotiations to agree and manage withdrawal. Given the all-encompassing nature of EU membership, a crucial question is whether Whitehall – particularly the FCO and Cabinet Office – is sufficiently equipped and resourced to achieve a satisfactory outcome (whatever that might entail). In short, given the likely scope and intensity of the negotiations, could Whitehall face a ‘capabilities-expectations gap’ in terms of what it must deliver while simultaneously managing day-to-day government business?

No country has left the EU, so there is no template or precedent to follow. We do know that the negotiations would need to address both British withdrawal and its new relationship with the EU, and be ratified by the remaining EU-27, as well as the UK and European Parliaments. There are several possibilities for this: it could, for example, seek to be part of the European Economic Area (EEA), following the ‘Norwegian’ model (although David Cameron has ruled this out); or instead emulate a more detached ‘Swiss’ relationship through the European Free Trade Area (EFTA). The development of a special, ‘British’ model is also possible as the UK expects ‘more than to be grouped with Norway and Switzerland’ in the event of a Brexit. Whatever the decision, at least three new treaties may be required, giving an idea of the scale of what must be agreed within the two-year notice period set out in Article 50(3) TEU (although there are provisions for this to be extended).

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Former special advisers in Cabinet 1979-2013

As part of our project on special advisers the Constitution Unit has produced a brief research note looking at special advisers who went on to become Cabinet Ministers. This blog post picks out some key findings and offers some thoughts about what the findings tell us about special advisers and wider concern with the professionalisation of politics.

In this project, we are building an evidence base that will provide the most detailed description yet of who special advisers are. We are therefore interested in what special advisers go on to do after their time in government.

Among the many destinations for special advisers later in their careers are the most senior posts in British politics. The Prime Minister and leader of the Opposition were both special advisers and the speed of their ascent to the head of their parties has been noted by Phil Cowley as exceptional in post-war British politics. Both David Cameron and Ed Miliband have experience as Cabinet ministers but that is relatively rare among their fellow special advisers.

As the Unit’s research makes clear, just 16 Cabinet ministers were previously special advisers. To provide some context: Cabinet usually has 22 full members at any time; and there have been over 500 individuals who were special advisers before May 2010. Less than 5% of special advisers go on to become Cabinet ministers. This suggests that the widespread perception of special advisers as simply politicians in training is mistaken.

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British Cabinets are still largely made up of people who have not served as special advisers to Ministers. The Labour government more than doubled the number of special advisers in post at any time, and it is associated with a handful of high profile special advisers turned Ministers. Under Gordon Brown,four former special advisers were brought into the Cabinet. From 2007-2010, former special advisers made up nearly one third of the Cabinet: the highest ever proportion in British political history, though this seems low for the supposed age of the professional politician Whether such levels will be reached or surpassed again is a matter for speculation.

Lord Adonis is on record as praising the experience of being a special adviser as an excellent apprenticeship for future Ministers. He says he benefitted from it. Nowhere else does one get the opportunity to experience life at the top of government as a political actor, learning how Whitehall responds to your requests. Nowhere else can one see the difficulties, pitfalls and routes to success for a Cabinet Minister so closely. Like all apprenticeships, taking this experience on board and putting it into practice when your turn comes round can surely aid performance.

The fact that only a minority of Cabinet ministers were previously special advisers serves to remind us that there is no one route to the highest offices in government. That will come as a relief to critics concerned about the professionalisation of politics and as a disappointment to Adonis and his ilk. In relation to the special advisers project, this information helps us to think clearly about the sort of skills, experience and other benefits that special advisers receive from their job. How much of the success of Cameron, Miliband et al., is due to the skills and political networks they developed during their time as a special adviser?

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The research note contains more detailed information than this blog post and we encourage you to download it here.

MH

The latest special adviser reshuffle

The full breakdown of special adviser movement.
Note: an asterisk denotes change due to Lena Pietsch’s return from maternity leave; SSoS refers to ‘Senior Secretary of State’.

Last Friday, the Cabinet Office published the first list of special advisers (spads) in post since the September 2012 reshuffle.

It appears they were uploaded at 7.08pm that night. An hour earlier, Andrew Mitchell had resigned his post as Chief Whip. Mitchell had only just appointed a new spad, Meg Powell-Chandler, and he may have been planning to appoint another. Since spads’ appointments are technically terminated when their appointing Minister leaves office, Powell-Chandler’s tenure was abruptly cut short.

Andrew Mitchell’s replacement as Chief Whip is Sir George Young, who left the Cabinet only six weeks earlier. His return brings the possibility that Robert Riddell, his spad as Leader of the House (2010-12), will make a return to government. Young is unlikely to keep on Powell-Chandler or appoint anyone else, because the Chief Whip under Coalition has so far only taken on one on spad, giving the other ‘slot’ to their deputy from the partner party.

Since the reshuffle, a couple of significant appointments have been made at the centre of government, with Oliver Dowden and Ryan Coetzee being brought in to the Prime Minister and Deputy Prime Minister’s offices, Dowden as Deputy Chief of Staff And Coetzee as Clegg’s chief strategy spad.

Some line departments now have more than two spads. Michael Gove and Iain Duncan-Smith now have three spads each. Another impending appointment means that BIS will now have four spads in the department: two for Vince Cable, two for the Conservative ‘junior’ ministers, Michael Fallon and David Willetts.

Jeremy Hunt has kept one of his spads from DCMS, Sue Beeby, and has agreed to appoint a second spad, Sam Talbot-Rice. Talbot-Rice is not included on Friday’s release because he had not started in his post. The Constitution Unit understands that he will take up his post on November 19 and will act as Hunt’s ‘policy special adviser’. Chris Grayling (MOJ) and Maria Miller (DCMS) are two Secretaries of State likely to hire a second spad soon.

Both of Andrew Lansley’s spads at DH have left the government, unique among spads with reshuffled ministers. The only spad to leave their post without their minister being reshuffled was Bridget Harris. She was one of the six Lib Dem ‘departmental’ spads appointed to monitor developments across government, reporting to Nick Clegg.

Three spads have moved to work for different ministers in different departments. Amy Fisher has moved from Defra to MOJ; Victoria Crawford from DFT to DFID; Guy Levin from DCMS to DFID. That is unusual: spads are usually personal appointments, and move with their minister.

Jonathan Caine is unique as spad to the Secretary of State for Northern Ireland. As predicted in a previous blog post, he is the only spad who has remained in a department in spite of a change of Secretary of State. That may be explained by his previous history: he was a spad in NIO under John Major for five years before being brought back in 2010. Arguably, he is an ‘expert’ spad.

But it is worth noting that the pending appointment in DH and BIS means that the Government will soon set a record for the number of spads in government. With fourteen joining and only ten leaving, the number of spads in post increased between July and October 2012 from 81 to 85. But the reported appointments at DBIS and DH as well as potential appointments in the Whips’ office, MoJ and DCMS mean that the number of spads can be expected to reach 87 and perhaps as high as 90, topping the previous record of 85 spads in 2004 under Labour. The rise in numbers may be brought about by the fact of coalition (and the need for greater cross party interaction); and recognition of the need for more politically committed advice and assistance to Ministers. But it is also a product of the rise in the number of ministers in the Coalition Government—especially ministers attending Cabinet.

Last weekend, the Public Administration Select Committee (PASC) published its report ‘Special Advisers in the thick of it’. The Committee came out against a cap on the numbers of spads. That was sensible: the focus should be on the effectiveness of special advisers, not their numbers. Spads are here to stay, and the sooner we have a dispassionate and informed debate about their role, the better. But whether or not the public and Westminster observers will agree is a different matter.

MH

[This post was edited on 23/10/12 to take account of Coalition practice in appointing spads to whips.]

NHS Reform Under the X-Ray

“The person I trust most for my health, number one, is my GP. And I’ve always seen him or her as a kind of a gateway to any other services. And it’s his judgment, ultimately, or her judgment, that I would back.”  That’s what Eric Pickles told The Telegraph last Saturday. There’s something bucolic about the government’s attempt to put commissioning power into the hands of local GPs, and take it away from “faceless bureaucrats”  in the Primary Care Trusts; it comes from the England of Cameron’s mother, the Berkshire Magistrate, from John Major’s England of “cricket grounds, warm beer, green suburbs, dog lovers, and old maids cycling to holy communion”.  But, the government are also, as Hague once put it, “Thatcher’s children”. Andrew Lansley wants to empower patients, and by empower them, he means increase their choices, and by increase their choices, he means create a market, and by create a market, he means promote efficiency and cut NHS costs, and by cut NHS costs he means offset the effect of the £20 billion of savings required by 2015.

The leaked account of the Strategic Risk Register, which lists the potential pitfalls of the reforms, suggests it challenges both horns of the government’s approach. GPs, it is alleged to say, may lack the experience and skills to manage funds efficiently. Equally, the introduction of a market may lead to private companies failing to do more with less, and simply siphoning away public funds in profit. Consequently, the NHS could eventually prove “unaffordable”.If this is an accurate report of the contents of the Strategic Risk Register – if it seriously moots the possibility of the reforms rendering the National Health Service prohibitively expensive – then it is not surprising that Andrew Lansley does not want to publish the report until after the Health and Social Care Bill is enacted.

The government is appealing an Information Commission order that they should release the full document. The Department of Health has pointed out that Risk Registers express the dangers of policies in “worst case” scenario terms and so can be open to misinterpretation if read out of context. It suggests that Risk Registers in their current form could not be produced if they were subject to FOI requests, for fear of giving the public the wrong impression.This is a version of the chilling effect argument, which Blair put like this:

“Governments, like any other organisations, need to be able to debate, discuss and decide issues with a reasonable level of confidentiality. This is not mildly important. It is of essence. Without the confidentiality, people are inhibited and the consideration of options is limited in a way that isn’t conducive to good decision-making. In every system that goes down this path [FOI] what happens is that people watch what they put in writing and talk without committing to paper…’

The Information Commissioner recognises the danger of FOI causing a chilling effect.  However, in this case it emphasised the fact that, whatever information is released vis-a-vis health reform, officials will still be required to be fully frank when they produce Risk Registers. The Commissioner felt that publishing information about NHS reform might make officials less forthright on that particular subject during the current process, but that there would not be a chilling effect on the record of risk across the policy spectrum.

The appeal will be heard by the Information Tribunal on 5 and 6 March, which may or may not be before the third reading of the Health Bill in the House of Lords – the last chance to substantially amend it. However, Labour propose to discuss the publication of the Risk Register  in an opposition day debate on 22 February. It is possible that this move will prove more effective than the Freedom of Information Act in getting the Strategic Risk Register into the public domain.