Cabinet Office ‘needs enhancing’ to properly support PM says George Osborne

Former chancellor also floats boosted powers for departmental boards to sack perm secs
George Osborne talks to the Commission for Smart Government

By Jim Dunton

09 Nov 2020

George Osborne has backed the idea of reforming the centre of government to give better support to prime ministers, suggesting it is what he would have tried to do if he had become PM.

The former chancellor, who left office after the EU referendum in 2016, was giving his thoughts on Whitehall change to an evidence-gathering session of the Commission for Smart Government, set up by Conservative peer Lord Nick Herbert. 

Osborne was quizzed on a range of topics and asked directly by former Home Office and Department for International Development perm sec Sir Suma Chakrabarti for his views on the creation of a Prime Minister’s Department, which is an idea supported by the commission 

The former chancellor said he was aware of the lack of departmental support prime ministers received in comparison to other cabinet ministers and considered that a rejigged Cabinet Office could be the answer. 

“I can now say, with some years passage, that I did give some thought to what it would be like to be the prime minister,” Osborne said. “I had an exceptionally good relationship with David Cameron and still do, but he didn’t really have the kind of support that I had as chancellor from the Treasury.

“He had some very smart people working for him. But he didn’t have a systematic ability to draw on his own sources of information. He relied on departments, it was often turf battles and departments were reluctant to give information, and the Treasury is probably the worst offender.  I think Gordon Brown had a similar experience going from chancellor to prime minister.”

Osborne said the Cabinet Office had “become a bit too much of a clearing department”, making sure that write-arounds had been signed off on and Treasury approvals granted. “What it’s not been particularly good at is brokering the deals and imposing a prime ministerial input,” he said. 

Osborne said the illness and subsequent death of cabinet secretary Sir Jeremy Heywood in 2018 had left a “massive hole in the middle of government” because ministers“had not created in the institutional arrangements something that would outlive one person”.

“I have a high regard for Mark Sedwill, but you shouldn’t really rely on one individual,” Osborne said of Heywood’s successor as cabinet secretary. “There should be a machinery, which is enhanced  if there’s a very exceptional individual.”

Osborne said he would have looked to “enhance” the Cabinet Office along the same lines that former Labour prime minister Tony Blair found ways to enhance the power to deliver of No.10 – through the creation of the Prime Minister's Delivery Unit.

“In opposition we got into all this ‘we’re going to scrap all of this stuff when we get in’, which we did,” Osborne said. “And then we spent years trying to recreate it but never actually calling it that. 

“I’m not saying that there’s not a role for Dominic Cummings or Steve Hilton. But there should be a more enduring centre.

“So I would recreate some of that machinery that Blair edged towards. I would enhance the Cabinet Office’s power to broker the deals, rather than just go through the process, and it would become a kind of prime minister’s department. You would have to have incentives for senior civil servants that that was where they wanted to spend a big part of their career, which they do – a lot of senior civil servants will go through EDS [the Cabinet Office’s Economic and Domestic Affairs Secretariat], or something. That was essentially my plan, if I’d ever had chance to implement it.”

Elsewhere in his evidence, Osborne suggested that civil servants – particularly senior civil servants – should be subjected to greater levels of accountability for their advice. He cited the Windrush scandal as an example of a situation in which officials had a significant degree of culpability that had been overlooked. 

New powers to fire perm secs

The former chancellor was also asked for his thoughts on the role of departmental boards and non-executive directors, introduced to try and bring additional real-world experience and challenge to departments.

Osborne said departmental boards could perform a useful function but were “essentially advisory boards” that could easily be ignored if a secretary of state so chose.

“If you want the board to be more than just an advisory board,  they have to have the hard power, which a corporate board ultimately does have,” he said.

“To make the boards work, they could have the ability to fire the permanent secretary, or at least force some kind of review of their employment. 

“Secondly, they could review the performance of ministers and either privately send that to No.10 or [do it] even more publicly.”

Osborne also floated the idea of appointing ministers who were neither MPs nor members of the House of Lords as a way to bring additional expertise into government.

“I think you could experiment more with having a wider range of people who wouldn’t necessarily have to be in the House of Commons or the House of Lords,” he said. 

“Whether you call them ministers, or whether  you call them something else, I don’t know. That feels like something other countries can do and it gets around that basic problem that a lot of sane people don’t want to go into politics. People might want to come and spend three, four and five years in public service and go out and do something else.”

Osborne said that at the start of his time as chancellor he had tried to enlist “absolute top world-class economist” Ken Rogoff at Harvard University as “essentially the chief economist of the government”. 

“For personal reasons he couldn’t make the move to the UK,” Osborne said. “But I definitely would have liked to have been able to do more of that.”

Osborne’s whole evidence session can be seen here.

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