John Manzoni on shared services; Land Registry privatisation paused; and the case against civil service diversity quotas – three non-Brexit stories you may have missed

Written by Matt Foster on 4 July 2016 in News

While all the focus in recent days may have been on the consequences of Britain's historic decision to quit the European Union, that doesn't mean life in Whitehall ground to a halt. Here are three key, non-Brexit stories you may have missed since the referendum result

1) Manzoni concedes shared services plan was "frankly overoptimistic"

MPs on parliament's public accounts committee chose the first day back after the referendum result to take a detailed look at the government's shared service centre programme, the subject of a fairly critical recent report by the National Audit Office.

The NAO's report found that the Next Generation Shared Services strategy, government's high-profile 2014 bid to transfer back-office functions to two shared service centres working across departments, had not "achieved the significant anticipated savings and benefits" originally promised.

While the spending watchdog found that the two centres had delivered £90m of overall savings, it pointed out that this was some way off the £128m a year originally forecast, and flagged "delays in designing, building and testing the systems", which meant only two of 26 planned departments and agencies had signed up to the single operating platform by the time of its report. Meanwhile, the watchdog found that four customers had quit their shared services contracts.

National Audit Office slams Cabinet Office over shared services “failure”
Interview: DCLG permanent secretary Melanie Dawes on devolution and encouraging the civil service to let go
Land Registry sell-off could undermine transparency, warns Open Data Institute

Civil service chief executive John Manzoni appeared before PAC last week to answer questions on the troubled programme, and conceded that the timescale for the original shared services strategy was "frankly overoptimistic".

And while he said the "ambition" of creating shared services across government "remains in tact", he said there were "multiple things" the Cabinet Office could learn from the way the scheme had played out, including the need for a more "front-footed" approach from the centre of government.

"All of the departments in it have saved between 20 and 25%, which is actually right up there with the best of the private sector benchmarks," he said. "So the piece that is business-as-usual? That has been and continues to be successful.

Manzoni added: "The bit that got into trouble was founded on common back office processes. That is what was never put in place a priori, and should have been. And then subsequently because of the delays in that and because [...] to some degree, Cabinet Office were not sufficiently front-footed to enforce that [...] it then became less and less valuable to individual departments, who subsequently chose, in some cases, to say we're not going to do this, we're going to do something else."

The Next Generation Shared Service Strategy was intended to cut the number of departmental service centres from eight to five, with two independent centres (Independent Shared Service Centre 1 and ISCC 2) serving multiple departments. 

The strategy kicked off with the creation of ISCC1, which began life as the Department for Transport's own service centre and was supposed to be extended to cater for more departments.

But DfT permanent secretary Philip Rutman outlined some of the problems of expanding the programme in his own evidence to PAC.

"The history of this is we had a DfT business case for a DfT shared service centre. That then became a cross-government shared service centre in 2013-14," he said.

"It was at that point that there was a missing piece, which was the integrated business case we talked about. Without that strong, clear, compelling business case in truth, getting the continued adherence and the behavioral response of the other organisations that joined our shared service centre [...] proved, in the end, impossible.

"So we have now reverted to a DfT-focused shared service centre which continues to be a positive experience with a positive business case. Not as positive as it was back in 2012, but nevertheless it's fundamentally a positive experience."

In its own evidence to the committee, the Public and Commercial Services (PCS) union tore into the plans, and called for the NAO's findings on the Shared Services Strategy to be taken into account as the government considers outsourcing the Ministry of Defence's own Defence Business Services body.

"In light of the National Audit Office’s damaging report and MoD’s own experience of private sector involvement in DBS, PCS believe MoD should urgently halt and review all plans to outsource or privatise any part of DBS," the union said.

2) Land Registry privatisation plans on the backburner?

The government's consultation on its plan to privatise the Land Registry closed in May – but not before some high-profile opposition to the move, including from former chief land registrar John Manthorpe, the Open Data Institute and more than 300,000 members of the public who put their names to a petition.

The Department for Business, Innovation and Skills wants to move the Land Registry – which keeps an up-to-date register of land ownership in England and Wales – to the private sector by 2017, as part of wider plans to raise £5bn from government asset sales.

But the plans came under fire in the Commons last week with MPs from all sides of the House questioning the case for selling off the Registry.

Conservative MP Will Quince – a former property solicitor said the government had "misunderstood what the Land Registry is fundamentally about".

"It is more than just a data provider or an authority for recording title," he said. "It registers title, guarantees rights to land and provides guarantees pre- and post completion searches.

Quince added: "The reliability of the register is vital to the property market, and any loss of confidence in the register would significantly affect the property and mortgage markets and, therefore, the economy as a whole.

"While the Land Registry can, at times, feel clunky and hugely frustrating for property professionals, at its heart it is based on the principles of integrity and impartiality, and I fear it is that that we put at risk if we accept the proposals to privatise."

Labour's Bill Esterson meanwhile raised concerns over the transparency of the new organisation, warning that the Land Registry could "go to private interests that are not subject to the same checks and balances", including Freedom of Information legislation, as the rest of the public sector.

"Judging from the interested parties so far, these are interests that are already tied up overseas, including in tax havens," he added. "Given that we are dealing with trillions of pounds of property that underpins our whole housing sector, this can only be downright dangerous."

But it was the response from minister George Freeman that is likely to be of most interest to the Land Registry's more than than 4,500 civil service staff as they await details on their fate.

Freeman said ministers had "heard the concerns expressed in the House loud and clear", adding that the government, led by a new prime minister, would decide how to proceed "later in the year".

However, his response was hardly brimming with confidence about the likelihood of privatisation going ahead in the form touted.

"I am aware, as all of us painfully are on the government benches, that the[government's] majority is 12," he said. "It does not require many people to take a different view from the government of the day in order for us to assess the likelihood of getting a measure through.

Freeman added: "I have no idea what those currently looking to form the new administration will want to do when they are in office, but anyone listening to the debate will have heard loud and clear the view of those who have spoken on both sides of the House.

"If anything is to be done to look at the future of the Land Registry, it will need to be clearly focused on solving particular problems that exist today and dealing with specific issues that need to be addressed."

3) Civil service gender champion pushes back against diversity quotas

Gender diversity at the top of Whitehall has been back in the headlines in recent months, following a reshuffle of permanent secretaries that resulted in two fewer women at the top of the civil service.

That prompted calls from Labour for the organisation to consider introducing quotas at perm sec level to try and level the playing field.

But at a hearing of the Women and Equalities Committee, Whitehall's gender champion Melanie Dawes (also the perm sec for the Department for Communities and Local Government) pushed back against specific diversity targets – and highlighted the progress the civil service is already making on readying the next generation of female leaders.

"We do not have specific targets for levels of representation but it is something we discuss quite actively in the civil service," she said.

"There are pros and cons. I myself do not favour quotas and we do not organisationally. I do not know many women who do, to be honest. In a civil service context, the principle of appointment on merit is a very deep-seated one. It is very much part of our values. It is overseen by the Civil Service Commission. It is very important not to dilute that in any way."

Dawes said there was "quite a lot" that could be done without strict "top-down" quotas to make sure that civil service leaders were bringing in talent from a wide enough pool.

"For example, permanent secretaries do have choice about who they bring onto their senior boards from within their overall senior leadership," she said.

"I took a choice a year ago to bring my HR director onto my senior team and make it seven rather than six. That immediately upped the ante on the gender front. That kind of choice of who is actually on that board helps.

"It does not have to be based on grade entirely; it can be based on choice. Sometimes it is a symbol of what you care about. That is why, for me, the representation on those senior teams is something that is a bit more flexible and that we ought to pay more attention to."

The DCLG chief also pointed out that 40% of the Senior Civil Service is now made up of women, and that at director-general level – one step below perm sec grade – the organisation is at 37% representation.

"We do, however, still have quite a bit that we want to do," she said. "The number of permanent secretaries is seven at the moment, out of 37 posts, that are filled by women.

"I would like to see that higher. There is a huge commitment right across the top of the Civil Service to that. We want to see more progress there."

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Matt Foster
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Matt Foster is CSW's deputy editor. He tweets as @CSWDepEd

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