By Matt.Ross

15 Jun 2011

Like his secretary of state Iain Duncan Smith, DWP permanent secretary Robert Devereux has a quiet manner. This cannot, however, conceal the vast scale and ambition of the organisational change and policy delivery projects that he’s pursuing. Matt Ross meets him.

Type Robert Devereux’s (pictured above) name into Google, and just six of the first 50 results refer to the permanent secretary of the Department for Work and Pensions. Given his position at the head of the largest employer in the civil service – in 2010, the DWP and its agencies had more than 130,000 staff – it’s remarkable that he’s so comprehensively outshone online by his namesake the Earl of Essex, one of Elizabeth I’s courtiers. “I know – it disappoints me,” comments Devereux, with a wry smile, as we sit in the department’s Tothill Street HQ.

“Essex was Elizabeth’s lover,” chips in the photographer, with the unerring instincts of the paparazzi.  “So they say. He fouled up in Ireland, and lost his head,” the DWP chief responds; Essex, a flamboyant and disobedient general who eventually turned against the queen, was convicted of treason and executed in 1601. Devereux’s wry smile broadens: “I hope for better things,” he adds. And is there a family connection with the earl? “Who knows? If you go back through my paternal line, you get back as far as Cornish fishermen, then Irish fishermen, then the record stops,” he replies. “So we can hypothesise that we’re the same line; but we don’t know.”

In fact, Devereux’s low profile is entirely deliberate. He’s worked hard to nurture his reputation as a discreet and safe pair of hands for tricky briefs – such as his last job leading the Department for Transport. His determination to stay out of the limelight does not, however, extend to adopting a risk-averse management style. Far from it – and anyway, a cautious approach would be precious little use to him at the DWP, where he’s been charged with implementing both huge budget cuts and a programme of policy and service delivery reform that is ambitious even by coalition standards.

The job in hand
“What makes being here exciting is the scale of what the government’s embarked upon,” says Devereux. “Every single thing you can see in the landscape here is changing.” He canters through a partial list of major policy changes: “We’ve already signed contracts for the largest payment-by-results scheme: the Work Programme. We’re reforming Disability Living Allowance. We’re changing the basic state pension. We’re enrolling everyone in employment into pensions. We’re replacing our oldest IT systems.”

Perhaps the biggest change of all is the merging of a range of different benefits into one. “Rather than people of working age having to deal with three or four benefits and tax credits and housing benefit, they’ll just have Universal Credit,” Devereux explains. “So if you’re out of work, we’ll assess all the things that contribute to what we’re prepared to pay – your family situation, disability, housing – and if you move into work, your earnings will automatically be assessed by dint of our engaging with HM Revenue and Customs’ data.” Anyone familiar with the UK’s current patchwork of separate benefits will understand both how dramatic a change this is, and the enormous potential to cut administrative costs, hasten payment timescales, increase fairness, and cut fraud and error rates.

They will also get an inkling of just how risky and complicated a task this is – and Devereux’s mission will not be made easier by the coalition’s swingeing budget cuts. “The government has chosen to set some challenging targets for the cost of running today’s business: there’s 25 per cent efficiency improvements for the operational business, and a 40 per cent reduction in the cost of the corporate centre,” he says, adding that he’s weighted the cuts towards the centre to minimise the pressure on frontline services. “If you put [those budget cuts] together with the size of the transformation, you can’t just say: ‘Let’s all just pedal a bit faster then.’ That’s not going to work.” In other words: this amount of budgetary and policy change demands major organisational reform.

The professionals
Given the strengthening winds of change, Devereux believes, the DWP will benefit enormously from the fact that it hosts the new government heads of IT and HR – Joe Harley and Chris Last respectively. “Masterstroke!” he exclaims, arguing that their appointment is a testament to the quality of these key DWP managers. Their cross-departmental roles, he explains, will ensure that DWP reforms line up neatly with the approach being taken elsewhere in Whitehall – and choosing hands-on, portfolio-bearing departmental officials as heads of profession rather than making new appointments at the centre of government avoids the risk that “someone else is appointed to a Cabinet Office role who may not be remotely of the same stature”.

The cross-government roles of Harley and Last, says Devereux, mean that “I’m pretty much guaranteed that the sorts of civil service ways of doing things across government will be ones that my own people have got confidence in, and not ones that have been dreamt up in the centre and unhelpfully sent our way.” In projects demanding cooperation between departments – such as the need to align DWP and HMRC systems for the Universal Credit – the profession heads’ pan-Whitehall roles are bound to prove valuable. And would Devereux feel the same way if he were still at the DfT, say, and watching the DWP’s influence wax in this way? “The thing I’m most interested in is competence,” he replies. “What [Efficiency and Reform Group chief operating officer] Ian Watmore has done is appoint two very substantially competent people, and that must be right.”

While Harley and Last oversee far-reaching reform programmes within their professions, Devereux himself has an equally ambitious agenda in his role as the head of the government policy profession. He has for some time argued that policymakers must work much more closely with frontline service providers, who can ensure that policy ideas are deliverable and point out the risks and challenges in implementation. But the government’s new ICT strategy, and the creation of the Cabinet Office’s Major Projects Authority, take this approach much further, insisting that policymakers must both integrate their work with that of project management and IT professionals, and develop policy in a much more iterative, incremental fashion.

A team game, not a relay race
Policymaking is changing fast, says Devereux. “Previously, we’d have had a whole bunch of policy conversations about what we were going to do; we’d have spent the best part of a year developing a contract for the IT support, which would have taken another year to complete; and eventually someone would have got their pencil out and started thinking about building the IT system.” Sometimes, the result of this kind of approach was that “people were trying to optimise the policy without thinking as far about delivery”, and ultimately policymakers’ “policies and IT systems made people’s jobs more difficult – not deliberately, but because choices were made without knowledge. That’s the world I’m trying to change.”

Universal Credit, then, is being developed in quite a different way. Devereux has, he says, established “a set of so-called ‘Agile’ teams” in Warrington, comprising frontline staff, policymakers, project managers and IT specialists. Many of the policy details remain undecided – the bill won’t be ready for months yet, and key decisions are yet to be made about how the system will be administered. But in the meantime these teams are already working out how Universal Credit will apply to a set of typical clients, and developing and testing appropriate systems. “So at the end of every month we’ve got some code that works; something that users can test,” he says. “We’re starting the delivery earlier in the process. Anybody who thinks you can have a policy and then, as it were, leave someone else to, quote, ‘do’ it has got a misconceived policy.”

This kind of approach, Devereux argues, produces policies that work far better, improve the efficiency and effectiveness of frontline roles, and maximise cost-effectiveness. “[Policymakers’] reliance on other professions is actually a strength in the policy process. “The more people realise their interdependence, the better”, he says. “I need all the relevant professionals in the room, and policy is one piece of that; it’s not that policy is king and everybody else takes dictation.”

IT’s a challenge
This new, iterative, multidisciplinary approach to implementing policy is likely to be sorely tested in one of the major challenges facing the DWP: the replacement of the ancient and convoluted IT systems that, says Devereux, “do the heavy lifting” and feed all the individual benefits systems. “Those legacy systems were written 20, 25 years ago,” he says. “And every time ministers wanted a change, somebody’s gone into one of these systems and written a new piece of code. So these things have lots and lots of additions to something that was already complicated to start with, with a language and functionality that is old.

“One of the defining things about Universal Credit is that we’re going to rewrite this core engine,” Devereux continues; the individual benefit systems running, for example, Jobseekers Allowance and income support “will continue as we run down the caseload, but by autumn 2013 I shall have a brand new system to do the heavy lifting for Universal Credit”.
As if that wasn’t enough of an IT challenge, the government has set out plans to make Universal Credit one of the biggest public services to be delivered primarily online. Claimants “will be able to see their own claim online, and when their next payment is due. They’ll be able to apply for jobs and report changes of circumstances online”, says Devereux; this will, in turn, produce big savings as DWP sheds front office and call centre staff.

Untangling the web
Few departments have yet made a success of putting major public services online; most people casting around for a good example refer to car tax, whose introduction came during Devereux’s tenure at the Department for Transport. In his experience, what’s the key to successful online services? “Car tax is staggeringly simple in comparison to Universal Credit,” he replies. “I don’t want to underestimate Joe’s task in terms of making it all happen, but in the past sometimes we’ve relied a bit too much on the brilliance of our own IT and not thought enough about the culture of the users.” It will be crucially important as Universal Credit is introduced, he says, “to explain it to people, to reset the culture about the ways in which they interact with this department. I’m fretting less about whether the IT will be there than I am about getting the cultural change and the message sent out to people that this is a good way to do business.”

After all, if the DWP invests in an online service but struggles to persuade people to make the shift from traditional channels, its cost base will actually increase. “You only ever save serious money when you shut the original channels down,” Devereux notes. He wants Universal Credit to go live for new claims in autumn 2013. Those on existing benefits will then be progressively moved across as their circumstances change, and by 2017 everybody will be on the new system. “By that time we should be in a position where there isn’t anybody on the legacy systems, at which point I can indeed shut them,” he says.

From jobcentres to jobseekers
At that point, Jobcentre Plus will need far fewer than its current 90,000 or so staff – but by then, the DWP corporate centre will also be much smaller. The cuts are so big, says Devereux, that “we’re not going to get by simply by taking consistent amounts of resourcing out of the structures we already have. We decided instead to make a virtue of the fact that there’s going to be a much more straightforward set of products, and to think radically about the right way to structure the corporate centre.”

A final decision about the future status of Jobcentre Plus has not been taken, Devereux maintains – but from the way he frames the issues, it seems likely that it will lose its executive agency status. Its work is “central to everything that ministers are trying to do”, he notes, implying that politicians need direct control over its policies and operations. Then there’s the money: “In a world where I need to make a 40 per cent reduction in the corporate centre, the simple overheads of some of these structures raise questions,” he says.

There’s also the matter of whether jobcentres are the right places to deal with the kind of working Universal Credit claimants who currently receive tax credits from HMRC. “We’ve done a lot of work with customers, and one of the things that people who are in work are saying is that they don’t want to be dealing with Jobcentre Plus,” says Devereux. “One interesting question is: what will we call the institution that deals with Universal Credit? On that hinges a lot of decisions about what frontline services will look like. Because a lot of it’s going online, other choices open up around simply making a virtue of the Universal Credit name.”

Cutting the centre
These decisions will take a little while, he says; but in the meantime, he’s moving fast to cut costs at the corporate centre. At the DfT, Devereux pushed through the organisational reforms and job losses required to meet the coalition’s budget cuts at breakneck speed; and when he arrived at the DWP in January, he adopted the same strategy. “What I found on arrival [at the DWP] was a set of plans to progressively reduce staff over, essentially, four years. And that doesn’t strike me as the most sustainable way to get to a new organisation, as what it means is that you keep taking people out, and you keep on reorganising the department continuously,” he says.

“People know there’s a reduction coming, and you either keep that story running for months and months, or you take action,” he continues. “And the most precious thing for me is morale and the sense that people know what they’re doing and can see some future in the organisation.” On this basis, Devereux’s team has planned to “reshape the organisation profoundly this year – we’re targeting [a reduction in both staff and costs] in the order of a third in 2011-12 in the corporate centre – so we can say: ‘We’ll do this exercise, we’ll do it once, we’ll put it behind us, and then we’ll all know what our roles are”.

By 1 October, his top team will have its new shape. “We’re on course to make decisions about all the senior civil servants before the end of July, and we’re going to try to do the rest in the balance of the year,” he says. “And I won’t want very substantial further adjustments to be made.”

Life in tumultous times
The challenges facing the DWP are, individually, substantial; combined, they’re positively intimidating. Devereux believes that the new departmental boards, chaired by secretaries of state and including non-executive directors from the world of business, will help smooth the journey. DWP has “a capacity to do change projects”, he notes. “Matching that with the political world is much improved by having a corporate board that has all three of the critical players sitting around the table. The challenges are real; the risks are real – but the improvement in governance is a material step forward.”

Nonetheless, Devereux is in a position where he might rise far higher up those Google search results than he’d like. His department is undergoing dramatic job losses and organisational change while trying to run a major IT handover, deliver an ambitious flagship policy, and pioneer the introduction of online services. Doesn’t all that simultaneous change create rather a lot of risk? “Welcome to my world!” he exclaims. “Governments arrive with very substantial agendas and a clock that’s already ticking down towards the next election. And the reason why civil servants get out of bed is to make a reality of all that. So yes, there’s a lot to be done, and there are manifestly more risks in doing it over one period than in taking forever over it.”

“But then, change generally isn’t well managed over a long period anyway,” he concludes. “It’s a challenge – but I’m quite happy to take it on.”

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