Interview: DCLG permanent secretary Melanie Dawes on devolution and encouraging the civil service to let go

Written by Suzannah Brecknell on 25 January 2016 in Interview
Interview

At the Department for Communities and Local Government, Melanie Dawes is busy encouraging civil servants to give up their powers over local public services. She opens up to Suzannah Brecknell about stepping back, asking big questions, and the importance of taking all your holidays

In 2006, Melanie Dawes took a risk. She left the Treasury, where she had worked for 15 years as a policy adviser, and joined HM Revenue & Customs as director of large business services. It might not seem like a huge transition for a career civil servant, but Dawes looks back on that move into a leadership role in a larger operational department as one of the pivotal moments in her career. 

“It was a conscious decision on my part to broaden out and do something very different and put myself in a different environment,” she says. “It was definitely the most accelerated period of personal development for me and an immensely rewarding time. It pushed me out of my comfort zone and I learnt an awful lot about my true strengths and weaknesses. I also really enjoyed it, so it taught me that taking a risk and getting out of your comfort zone is something that really brings value to you but also can be great fun.” 

Now, as permanent secretary at the Department for Communities and Local Government, Dawes is encouraging her peers across the civil service to take some risks of their own. Working “very closely alongside the Treasury”, her department is brokering deals which will see Whitehall departments giving up some of their power, passing money directly to local areas to design and deliver certain services as they see fit.


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In total eight devolution deals have been announced. Manchester City Region was the first (in November 2014) and there have been seven more since Dawes joined the department in March – plus an agreement to devolve control of some health and social care services in London boroughs. Alongside these are 39 local growth deals which provide funds to local enterprise partnerships (LEPs) for projects to drive economic growth.

If that doesn’t sound like enough of a sea-change in the relationship between central and local government, the department is about to start consulting on major changes to local government funding set out in the 2015 Spending Review. Under these changes councils will keep revenue from business rates, rather than handing it back to DCLG to be redistributed through grants, and Dawes tells CSW that the funding consultation presents “a really big opportunity to think about where local government can really make a difference in doing more”. 

Dawes’s background – in contrast to her predecessor Sir Bob Kerslake – is entirely in central government. She has spent most of her career at the Treasury, and, most recently, three years at the Cabinet Office. So what drew her to the communities department? “For me, DCLG’s just a really interesting department,” she replies. “It combines some of the biggest economic issues of the day: housing, devolution, and trying to increase growth... but it’s also very cross cutting in that it’s also about delivering services in a more integrated and joined up way around vulnerable people. What I love about my role at DCLG is that breadth of opportunity that we’ve got to make a difference.” 

Dawes sees a lot in common with her previous role at the Cabinet Office, where her job “was to try to help Whitehall to join up to deliver the government’s priorities”. At DCLG, she explains, a central focus of her work is “about joining up for local areas and for local people across Whitehall”. 

“I see great people from [different] departments who want to work more closely together and sometimes it’s about enabling that and supporting people who want to work differently in a system that can often...” she pauses, searching for the best way to discuss the challenges of the Whitehall machine before opting to simply describe her role as “supporting people who want to join up across boundaries”. 

“I know the kind of things that can get in the way,” she goes on. “Sometimes it’s just that we’ve set up a policy on a national level and it can be very hard to then delegate – devolve it to local areas. Sometimes it’s just that people are very busy delivering big national priorities and the more devolved agenda is never anybody’s priority.” 

It is, however, DCLG’s priority, so much of the department’s work is what Dawes describes as “supporting people to do the right thing”. When talking about how her department works with partners both in and outside of government, Dawes’s language is that of soft power and influence: they facilitate conversations; they ask big questions; they work together to come up with solutions. 

At a PAC hearing in November, challenged on the power she has to ensure Whitehall has the right expertise to support local areas taking on new powers, her reply was that of a confident Whitehall veteran: “We do have quite a collegiate atmosphere across the permanent secretary group. I would expect to pop over the road to talk to [Transport perm sec] Philip Rutnam if I thought he didn’t have the right staff.” 

Yet there is an iron force alongside that soft power: Treasury support for these devolution deals is vital both politically and to agree changes in the way money is distributed. Dawes refers to this iron force when she says there is “very much a sense of one team between us and the Treasury to strike deals with local areas on behalf of government as a whole”.

Despite her acknowledgement that devolution is not everyone’s priority, Dawes is optimistic about attitudes towards it among her peers in the senior civil service. Even in the last year, she says, those peers have begun to view devolution as an opportunity to change the way they work. “Departments like BIS, Transport, Health and Education are already a long way down the track in thinking through in very imaginative ways the new opportunities that devolution brings."


It’s not just attitudes that are changing: the latest round of devolution deals differ from previous waves of localisation because they move accountability out of Whitehall’s departmental framework. In 2012, when the coalition government announced its first City Deals, Sir Bob Kerslake wrote a letter to all departments setting out how accountability for the deals fell to various accounting officers across Whitehall. The local growth deals gave local areas more freedom about how to spend the money they had been allocated, and now accountability is being formally passed down to the areas signing devolution deals.

In the same PAC hearing last year, Dawes told MPs that deciding this is “a really important part of the process, whether it involves a memorandum of understanding or a change in accountabilities that accounting officers are recording”. This is important, she tells CSW, because “if in the end Whitehall remains very tightly accountable for delivering very clear specific outcomes it’s very hard to devolve real responsibility to a local level”. As accounting officer in DCLG, she remains responsible for the system accountability across local government and publishes a system accountability statement every year. “Setting out exactly how that landscape is changing is quite an important part of that [statement],” she says.

This picture will be re-drawn again in five years time when the changes to council funding take effect. Dawes is keen not to pre-empt the imminent consultation here, but what role does she see her department taking, as this new world of devolved power emerges? “The role we have at the moment is to be the place that provides the joint cross-government voice alongside the Treasury,” she says, and suggests that voice will still be needed as discussions continue on the way services are funded and provided. “I don’t think that in five years’ time we will have reached a destination,” she says. “We will be continuing to have a conversation, and DCLG will continue to have a really big role in, I hope, being ambitious; continuing to ask the big, interesting questions and work with local government, other departments and partners to try and come up with the solutions.” 


The word “ambitious” also crops up when we start discussing plans for DCLG as an organisation. “One of the things that people in DCLG said to me as I arrived was that they really wanted to have a sense of the positive change that we were going to do in this department,” she says. “We knew we were going to have to be more efficient but there’s so much strength in the department and there was a real appetite for setting out a positive vision of the kind of department we wanted to become as we go through our next round of change.” 
So, after a conversation involving staff across the department, a new corporate vision was published in November. “It’s about becoming streamlined, smarter, stronger,” says Dawes, adding: “For me it’s about being a more confident department, ambitious about ideas, flexible in moving our effort around and focusing on the government’s priorities [but also] being prepared to step away and not do everything.” 

Communication about that vision, and staff input into it, seems to have had a positive effect on morale in the department: staff engagement scores rose by four percentage points in 2015 with a three point increase in scores around organisational purpose and vision, according to the latest civil service People Survey. This is even more striking given the “next round of change” was already well underway when the survey took place – a voluntary exit scheme ran during the autumn and had just completed when CSW met Dawes in December. “That’s got us off to a very good start in terms of the numbers,” Dawes says, referring to the Spending Review settlement which requires the department to find a 20% saving on its paybill as part of a 29% administration saving overall. 

“We’ve promised ministers that we will go further [than the 20% paybill cut] if we can but that’s broadly what we’re planning for,” Dawes says. The department is also reviewing the way it uses its buildings; creating a single set of corporate services to serve not just the core department but also agencies such as the Homes and Communities Agency (HCA); and hopes to build some additional revenue from the HCA to contribute to the 29% efficiency saving.

There will also be careful prioritisation of the work DCLG carries out. “What we’re doing now is really focusing in on where we can scale back our effort,” Dawes says, “and where we really need to prioritise in order to deliver our objectives. That’s all about the statement in our vision about being willing to step away and not cover everything.” 

In some cases, however, the department is consciously not stepping back and is instead becoming more deeply involved in new areas. Through the HCA, for example, it has an increasingly important role lending directly to the public through the Help to Buy scheme. And a few weeks after CSW met Dawes, the prime minister announced one of this government’s most interventionist policies yet: directly commissioning the creation of up 60,000 new homes on public land. The HCA will form joint ventures with private sector partners to deliver these homes. Although it is something new for central government, Dawes told MPs on the Communities and Local Government Committee that she’s confident it can be done, since several London boroughs have already set up similar schemes. 

This kind of work requires new skills and capabilities in DCLG. For example, it has increased capability to model financial risks. What new skills might the department need as it moves towards a more devolved service provision? “We have a lot of the right skills already,” says Dawes. “We’re very connected, we’ve got very good relationships with local areas, we’ve got very good partnerships with other departments. I think we need to become even more commercial and savvy about striking deals. I would like to see more people in DCLG who’ve worked in local government.” 


When she became perm sec at DCLG, Dawes also took on the role of gender champion for the civil service. She has been forthright about progress on diversity, which seemed to stall in recent years. Speaking at a Women into Leadership Conference in September 2015, run by CSW’s publisher Dods, Dawes said: “We kind of lost our way a little bit a couple of years ago on this agenda, if I am truly honest, and I felt that a little bit myself.” 

She reassures CSW that senior leaders are very committed to redressing this: “Diversity and inclusion is one of the most exciting things for the civil service in this parliament; there’s no question in my mind that the whole of the service’s senior leadership – right from Jeremy Heywood across departments – is really committed to this,” she says.

Improving diversity won’t be about “just doing one thing,” she continues: “It’s about building a more inclusive culture and that is about policies such as flexible working and making sure that our talent programmes are properly diversity-proofed. But it’s also down to how all of us behave day by day, about understanding our own individual unconscious bias and being prepared to challenge or to congratulate people who are doing things in the right way.”

During September’s leadership conference Dawes also raised concerns about the tendency to use gendered language describing some elements of leadership which are simply a function of the job. 

“When you are in senior roles it is tough. You have to make difficult decisions, you have to implement cuts, and sometimes you have to do the very difficult thing that you wish you didn’t have to do – as you know it’s going to have a really hard impact on people – but it’s your job to manage it and make it happen in the most effective way possible,” she said.

“There is something in the nature of senior leadership which involves doing things which many of us would rather not always have to do. So I just think we need to be a little bit careful when we call those things ‘macho’ or ‘male’ decisions, because if we do so, we turn this into a male space, and almost make our own problem slightly worse.”

Dawes is certainly trying to lead by example in showing that leadership – while not easy – does not necessarily mean sacrificing a private or family life entirely. She believes it’s important to take all your annual leave each year: “If you don’t, you lose your sense of perspective and you’re not as effective in the job”.

Every Friday Dawes makes sure that she is home in time to meet her daughter as she returns from school. “I’ve always made that space for her, and I’ve worked a variety of flexible working patterns particularly when she was younger,” she says. Her daughter is now at secondary school, and Dawes is keen to emphasise that this commitment to her private life is possible even as she has moved into more senior posts. “Even in my role as perm sec I think it’s very important to create that time, and I manage to create it for us as a family,” she says. 

That Dawes has been able to work in different patterns is one of the strengths of the civil service’s offer as an employer, something she thinks it should be proud of. “The civil service as a whole has transformed in the 26 years that I’ve been a civil servant,” she says. “When I first arrived there had only ever been four women perm secs and now there are eight at the same time. I still think there’s a lot more we can do, particularly to have even more senior role models in the civil service, but we should also be proud of what we’ve achieved because compared to most other employers we provide great opportunity for women right up to the very top.”

It’s hard to imagine a permanent secretary in the late 80s talking openly about the importance of combining work with family life; harder still to imagine one telling MPs, as Dawes told the CLG committee, that “maybe Whitehall doesn’t have all the answers”. Yet it’s this latter sentiment which seems to be a big part of the work she’s leading at DCLG, and the risks she’s asking her peers to take in handing out their powers to find better answers to the big questions facing the country. 


MELANIE DAWES ON…
...The Troubled Families programme
When I go out and talk to local teams who are delivering Troubled Families [an initiative designed to join up services supporting families with multiple challenges] I’ve been very struck by how frontline social workers talk about the power of data and metrics. For the first time they’ve got joined-up data across the range of public services, but also they are able to measure and track the outcomes in a way that they find values their work and allows them to feel truly accountable in a way that was harder to do before. So the power of data, even in these very difficult to measure areas, has been an important part of the programme.

CV HIGHLIGHTS
1987    Graduates from New College, Oxford, with a degree in PPE
1989    Joins Department for Transport as economic assistant 
1991    Moves to Treasury as economic assistant and then economic adviser 
1997    Joins Economic and Monetary Union Policy Unit as team leader
2002    Appointed director, Europe, HM Treasury 
2006     Moves to HMRC as director, Large Business Service 
2011     Joins Cabinet Office as head of Economic and Domestic Affairs Secretariat 
2012     Acting permanent secretary, Cabinet Office, before returning to Economic and Domestic Affairs Secretariat 
2015    Appointed permanent secretary at Department for Communities and Local Government

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Suzannah Brecknell
About the author

Suzannah Brecknell is senior reporter for Civil Service World. She tweets as @SuzannahCSW

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