Interview: Ian Watmore

Like every new government, the coalition is fast discovering just how difficult it is to change the systems and cultures of a complex, interlinked set of large organisations. It came to power with a clear direction, a mandate for change, a strong sense of urgency and an enormous amount of political energy – but in some areas it’s struggling to maintain the pace. On the NHS and public services reform, for example, political disagreements within the coalition have dramatically slowed progress. And parts of the programme of government efficiency reforms have also fallen behind schedule, as a diminishing civil service struggles with legacy, capability, resource and transitional problems.

Given this timetable slippage – which is beginning to produce a feeling of thwarted ambitions very familiar to long-time observers of public sector reform – it’s easy to forget how much the civil service has changed. When, in 2004, Ian Watmore (pictured above) left his job at consultancy Accenture to become the government’s first chief information officer, he remembers, “most of the departments’ chief information officers didn’t even know each other: I spent the first meeting introducing them all”.

Having met, he adds, the CIOs “actually worked quite well together as a team, and things like Directgov were born”. Even under the Labour government, those first stirrings of interdepartmental collaboration on IT – collaboration that, Watmore recalls, initially “tended to rely on people’s willingness to cooperate, and a consensus-based model” – began to evolve into much more directive system, under which the government CIO is a leader rather than a facilitator. But this move towards greater central direction has accelerated rapidly under the coalition, with Cabinet Office minister Francis Maude aggressively extending his control over aspects of departmental spending while departmental ministers – who are protective of their independence on policymaking, but have scant interest in guarding the autonomy of their departments’ back office or supply chain operations – offer little resistance.

“Behind us now we have the imperative from government ministers that: ‘This is the way it will be done’,” says Watmore. “So we’re operating as before in a joined-up way, but with much greater strength and much greater teeth for those people who won’t play ball. And I think the result has been that we’re doing things much better”. Those tentative initial moves to collaborate, he adds, have been turned into a “much more industrial-strength version. It’s not optional; therefore people pitch in and take it seriously.”

The man in the middle
Now installed as chief operating officer of the Cabinet Office’s Efficiency and Reform Group (ERG), Watmore is charged with overseeing all the cross-departmental work underway to improve the civil service’s efficiency – and he is plainly glad to be able to wield the kind of powers that he lacked during his days as government CIO. What’s more, because the ERG’s remit runs across so many different fields of work, he’s able to coordinate action on several fronts when issues cross professional as well as departmental boundaries.

This is very much true of Watmore’s former stamping ground: information technology. The government’s poor record on running major IT schemes, he argues, is not due to problems with the technology itself: “What happens is that the implementation of government projects goes wrong, and that’s found out by the technology – which is just the encoding of what was fuzzy or flawed thinking,” he says. The problem is that policymakers place unrealistic demands on IT systems, allow projects to become too big or complex, or fail to manage programmes properly; thus, says Watmore, “I’ve always seen the IT and the major programme world going hand in glove.”

His solution is the Major Projects Authority, led by David Pitchford. This new ERG team is, Watmore says, designed to do two things: “One, to get in early when an idea is crystallising, before it’s become fixed in people’s minds, and to make sure that implementation is thought about early on. And two, to call a halt to things when they really aren’t going right. We don’t want to apply Mastermind rules – ‘I’ve started so I’ll finish’ – but to say: ‘No, we’re going to have a time out. We’re going to think about whether we want to carry on; and if so, how’.” As a way of avoiding IT disasters, Watmore believes, the MPA may prove more important than the work under way to improve the civil service’s IT skills.

Meanwhile, he argues, the civil service must work to improve policymakers’ skills in project management, thus helping to build policy ideas around a realistic understanding of how they can be delivered. Policy personnel, Watmore says, need “much greater personal experience of big projects and business operations”. Then, while the MPA provides external challenge on policy ideas, policy teams will have a “growing capability to smell the dangers for themselves”.

Heading for the sound of gunfire
It was partly the opportunity to be inside government at a time of such rapid reform that attracted Watmore back into the civil service, following a spell in what he calls “my mid-life crisis job” leading the Football Association. During his previous five-year stint in the civil service under Labour, he says, “the government was very mature: they’d worked out a way of working”. But now “there has been a lot of change in a short period. The mood has been driven by a sense of energy. One of the things this government has emphasised right from the beginning is pace: the deficit is not waiting for us, so we’ve got to get on with it.”

Watmore adds, though, that he’d have been keen to re-enter public service under any government. “I loved my time in the civil service,” he says; when the FA job “didn’t work out, I didn’t give it a second’s thought: if the system would have me back, I’d love to return.”
Clearly, though, he’s returned to public service at a time of dramatic cuts which have “meant that the job of a civil servant has been tough, in terms of dealing with some very difficult issues in the wider system of government; and it’s been tough on the civil service, as we’ve had to take pay freezes, change terms and conditions; a lot of staff have lost their jobs. It’s been a tough environment as well as an energising one.”

The ERG has not, of course, avoided the pain itself: from 600 staff the group has shrunk to 475, many of them on temporary contracts. But it’s those “issues in the wider system of government” that represent the thorniest task facing the group, which is responsible for implementing Francis Maude’s ‘tight-loose’ efficiency drive: Watmore is pursuing simultaneous reform of government procurement, arm’s length bodies, training, IT, property, communications, and staff terms and conditions, whilst managing a set of ‘control regimes’ in various fields of spending, and reshaping the government’s relationship with its major suppliers.

Tight-lipped, no loose talk
The tight-loose idea is not, Watmore explains, unique to government: “All organisations, public or private, operate a tight-loose philosophy,” he says. “It’s just a question of what they choose to manage tightly at the centre and what they choose to devolve to the front line. This government has decided to focus ruthlessly on the commodity cost end of government, while giving people much more freedom to innovate locally on key aspects of policy.” So where central controls can save money without constraining local people’s ability to shape services, they should be implemented.

There is a potential tension here, though: rigid central controls designed to save money almost always limit freedom of manoeuvre at the front line. Take property: under the ERG’s control regime, lease breaks are being exercised and properties’ occupants moved into spare space in other public buildings – but doesn’t that process, which is defined by the arbitrary timing of lease breaks, mitigate against local people’s ability to take a strategic view and maximise back office synergies, shared service user interfaces and better collaboration?

Watmore resists the idea, arguing that for many civil servants property is a rather utilitarian commodity. “What people should be worried about is whether the office is fit for purpose, modern and flexible; whether it encourages the collaborative style of working that people need to solve business problems; and whether they can access all their key stakeholders,” he says. “If they can achieve that, it shouldn’t matter where they are.”

However, he does note that the ERG has moved into the Treasury’s building – a shift undertaken in part to better align Cabinet Office and Treasury policymaking. “By choosing that the Cabinet Office should co-locate with the Treasury, it helps to achieve that strengthening of common purpose,” he says. “Because we’re all in the same building, it’s easier for us to collaborate on key issues.” In some circumstances, it seems, factors beyond pure cost savings can be allowed to influence relocation decisions: “We may try to force co-location for good reasons, [as in the case of] the Cabinet Office and the Treasury, and make that the hub of a property plan around which other people can fit,” he suggests. “So it’s not entirely about lease availability; it’s also about getting more collaboration”.

Mandation across the nation
Whichever way you cut it, it’s obvious that the centre is fast expanding its control over many public functions – and Watmore is clear that this centralisation has been crucial to the ERG’s biggest achievements to date: “The places where we’ve had most immediate successes have been in the [spending] moratoria, by clamping down and saying: ‘We’re not going to spend money on that’; and by renegotiating deals with suppliers,” he says.

Imposing a requirement that all significant departmental spending on, for example, marketing and advertising receive ERG sign-off has, Watmore argues, already saved several hundreds of millions of pounds. “And people are now finding cheaper and better ways to get their message out,” he adds. “Instead of pumping lots of expensive advertising through the system, they’re finding communities of like-minded people and linking up on their websites – so we’re getting ‘better for less’”.

Meanwhile, the ERG has been renegotiating contracts with suppliers, integrating departments’ previously separate arrangements and trying to get government operating as a single buyer. Many of the biggest departments’ commercial directors have been named as ‘crown representatives’, each responsible for leading relationships with a handful of big suppliers.

Here, again, departments’ individual freedom of manoeuvre is being constrained, as their own contract managers must now work closely with the relevant crown reps. But Watmore argues that departments have embraced the initiative as an effective way to save money. “We weren’t getting the best deals from those suppliers in every place; crown representatives ensure that everybody takes advantage of the best arrangement with that supplier,” he says. “It’s mandated in the Treasury letter [distributed with] the spending review, which says this is part of the way we’re going to work; but even if it wasn’t, I think everybody would want to take part because they’ve seen how successful it is.”

So what’s next?
The ERG has been hyperactively busy for a year now – and there’s no sign that the pace is slackening. “The areas where we’ll make the next waves of impact will be on implementing the new ICT strategy; and on moving public services online, so the majority of services are provided first and foremost digitally,” says Watmore. And can he yet see on the horizon the point at which this first, intense wave of reforms will have been largely completed? “I think the spending review forces us to do the majority of the change in the first or second year – particularly that which is close to the centre, like civil service change and head office functions,” he replies. “So probably around the midpoint of the Parliament you’d begin to see that period coming to an end. It’s what we do beyond that that’s beginning to exercise us now, with the die firmly cast in the next year or two.”

This last, rather enigmatic comment is a reference to a project that is just getting off the ground: a scouting mission to decide “what comes after a pay freeze and downsizing: how we create the future for the civil service out of a necessary retrenchment” (see news). It is obvious, says Watmore, that the localism agenda will demand “a change in people’s mindsets. This government is not trying to drive policy from Number 10 or the centre; it’s trying to enable it to come bottom-up out of people’s businesses or communities. That will require people to behave differently.”

Meanwhile, says Watmore, the civil service will have to learn how to operate with fewer staff, and in an increasingly interconnected world. “Very few problems to which the public services are the answer are confined to a single department’s brief,” he says. “And I think the characteristics that will most define the civil service of the future will be around flexibility and collaboration, working across and outside traditional boundaries”.

In the future envisaged by Ian Watmore, the civil service will be more of a facilitator than a manager, run by highly-collaborative professionals operating across organisational boundaries. That vision, though, won’t be achieved until the government has closed the gap between its income and its expenditure – an objective that, says Watmore, requires the civil service to “focus simultaneously on cutting costs as well as improving services and reforming the way things are done. It’s that combination that will dictate whether the government is perceived to be successful”. So there will be more collaboration later, perhaps; but more mandates first.

And what, in Watmore’s opinion, is the key factor that will decide whether the ERG is able to achieve its aims – and, thus, to contribute to hitting those ambitious coalition objectives? The answer, he says, is unity at the centre. “The ERG is part of the Cabinet Office, working closely with the Treasury and Number 10, and what will dictate success will be the degree to which the three traditional centres of government work together, work cooperatively, and have a common agenda for the rest of the system,” he replies. “I’ve been doing a lot to make sure that my team is joined up with the rest of the Cabinet Office; that the Cabinet Office is joined up with Number 10 and the Treasury.”

Having worked both in the Cabinet Office when Tony Blair was PM, and as a departmental permanent secretary during Gordon Brown’s tenure, Watmore obviously remembers the confusion and delays created by a lack of unity at the centre; the ERG, he believes, will be able to achieve its aims only if ministers and officials in those central departments work closely together to pursue a coherent, shared vision for change.

“Having experienced life in a department, I know how important it is to have a clear set of priorities coming out of the centre and not have different and sometimes competing or overlapping priorities,” he concludes. “For us, that is the most important enabler of success.”

CV Highlights

1958    Born in Croydon, Surrey
1980    Graduates from Trinity College, Cambridge with a degree in Maths and Management Studies; joins Andersen Consulting as an IT/management consultant
1990    Made a partner at Andersen
2000    Becomes Andersen’s (later Accenture’s) UK managing director
2004    Joins the civil service as government CIO and the first head of the IT profession
2006    Appointed head of the Prime Minister’s Delivery Unit
2007    Made permanent secretary, Department for Innovation, Universities and Skills
2009    Leaves government to become chief executive of the Football Association
2010    Returns to the civil service as ERG chief operating officer