Cut civil service numbers, increase pay and abolish perm secs: commission shares radical reform proposals

A new Prime Minister's Department and ability to appoint non-MPs as ministers also among suggestions
The report also calls for a new Prime Minister's Department. Photo: PA

Ministers should cut the number of officials in government and boost civil service pay in a bid to increase the concentration of high-performing staff in the civil servants, a group of political and Whitehall experts has said.

Cutting headcount and increasing pay is part of a proposed strategy – which also includes scrapping annual performance reviews – to help the civil service to increase its “talent density”, and is one of a number of radical suggestions put forward by the Commission for Smarter Government this week.

Its policy paper – which also urges ministers to set up a “powerful” new prime minister’s department and hire a “crown headhunter” to hire more external talent – argued that is “impossible to be too radical” when it comes to reforming government in the face of huge challenges and rapid technological change.

“The story of government reform in this country and elsewhere is far more often of missed opportunities caused by insufficient radicalism and persistence, than the reverse,” it said.

The commission, whose members include former Ministry of Justice permanent secretary Suma Chakrabarti, ex-National Audit Office chair Lord Michael Bichard and former government lead non-executive director Sir Ian Cheshire, argued that pay should be one of the main levers to increase performance in the civil service.

“Current pay frameworks can be a constraint in hiring or retaining exceptional people, especially in roles requiring specialist skills, such as project management or digital. The gap between civil service pay and the private sector is widening, and the salaries of civil servants are also considerably lower than their equivalents in the rest of the public sector,” it said.

The report concluded that ending this disparity "may be most straightforwardly achieved by reducing the number of civil servants overall", adding:  "It is desirable in any case to improve the ‘talent density’ – the concentration of high performing staff – in the civil service".

Formal standards and training must also play a role in reforming government and improving performance, the report argued.

Officials seeking promotion to the senior civil service should have to pass a test demonstrating their digital capabilities. This should be part of a package of core skills requirements for entering the SCS and include numeracy and data managemen;, financial management; project, programme and portfolio management; and "substantial" operational delivery experience outside the civil service.

Existing SCS staff should also be expected to meet this “SCS standard” within two years, the report said.

Alongside these initiatives, a “crown headhunter” should be appointed to “turbocharge the hiring of external talent”, according to the commission.

“Make a reality of the default assumption that all roles should be open to outside recruitment by dismantling current process and cultural barriers to external hiring,” the paper said.

And departmental permanent secretaries should be replaced by chief executives “with a clear focus on strategy, execution and organisational effectiveness”, it said.

Reform should address ‘all players’

The report argues that “reform needs to encompass the way all the players in government work, ministers, political appointees and public servants, and make their experience of working more positive and fulfilling”.

It therefore calls for an MBA-style executive training programme, “equivalent to the leading business school offers”, to train not only civil servants but also other public sector leaders and politicians.

“Narratives about ‘Whitehall wars’ or ‘hard rain’ have rightly been left behind, not least because of the experience of Covid, with a shared realisation that there are failings across our system of government that we need to fix together,” the report said.

The call for greater training comes alongside several recommendations specifically addressing ministers – including one to allow the prime minister to appoint experts who are not MPs or peers as ministers “to bring greater talent onto the ministerial bench”.

Each secretary of state should meanwhile be empowered to create a council of advisers, modelled on the Treasury’s Council of Economic Advisers, to bring outside expertise into the department, the report says.

Prime Minister’s Department to give centre ‘greater strategic strength’

Alongside these talent-focused reforms, the report calls on ministers to establish a new Prime Minister’s Department, to provide the centre of government with “greater strategic strength”.

The department streamline and subsume the Cabinet Office “to provide stronger support to the prime minister and government in bringing departments together, defining and delivering on strategic goals, and bringing about government reform”.

Ministers should set up a Treasury board within the new department, to provide strategic direction and oversight of the government’s programme and spending priorities. This would be led by the chief secretary to the Treasury and replace spending reviews with a “best-in-class system of financial planning”, a Plan for Government, the report says.

The proposed Prime Minister’s Department would also oversee an Office for Public Service Effectiveness. The commission has urged the government to transfer the role of minister for the civil service away from the prime minister “so it gets full-time attention in a separate cabinet-ranked role”.

'Government must reform or fail'

Commission chair Lord Nick Herbert said the Covid pandemic had not only deepened the challenges facing the UK, but "revealed that our system of public administration urgently needs a fundamental overhaul".

“As politicians begin to focus on rebuilding, it is crucial that they do not pass over the opportunity and the necessity to reform the machinery of government," he said.

The report notes that the “very scale of the task facing government might encourage leaders to put the intricacies of systemic reform aside”, this would be “precisely the wrong response”.

“It is because the challenges are so great, and the world in which government is operating is changing so fast, that government must reform itself, or fail.” 

According to the commission, any proposals for reform must be able to pass the following test: “Does it make government work better for the people?” to ensure different parts of government work together effectively, and that reforms work for all people.

“That means strong attention to equality and diversity, making it a matter of serious substance, not gestures or fashion. It means being honest about the ways services too often let down the very people in our society who most need them."

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