Big salaries for Brexit experts could sap civil service morale, departments warned

Former Foreign Office permanent secretary warns Brexit committee over morale concerns if outside experts are paid more than civil servants delivering UK's exit from the EU

Civil service morale could be undermined in the Brexit process if external experts are paid salaries "completely out of proportion” to those given to existing staff, the former head of the Foreign Office has warned.

Cabinet secretary Sir Jeremy Heywood acknowledged earlier this month that the UK was "short of certain specialist personnel and skills" needed for withdrawal from the EU, and confirmed that the civil service had opened itself "to approaches from external consultancies, accountancy firms, project management specialists, and many individuals" in a bid to plug those gaps.

Sir Simon Fraser, who served as permanent secretary at the FCO from 2010 to 2015, told MPs on the Exiting the EU select committee on Wednesday that it was sensible for government to draw on expertise from outside Whitehall given “the exceptional circumstances we face”.

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But he said departments must ensure that new hires have the right experience, as well as taking care when setting pay levels.

“You have to be very clear what the loyalties of those people are, what their relevant professional expertise is to working in government, as opposed to working in, for example, a private sector organisation,” he said.

“And, as a former civil servant I have to say there is a potential issue about fairness of remuneration for civil servants – professional, lifetime civil servants – if other people are brought in on remuneration packages that are completely out of proportion. I think we’ll have to look at those issues, because they could affect morale.”

Fraser's remarks echo warnings made by the EU-focused research body The UK in a Changing Europe in a report published last month. 

The organisation warned that "tensions" could arise in the existing civil service workforce if the drive to bring in staff needed for the UK's exit from the EU led to "any further bifurcation of salaries in Whitehall".

Brexit memo "over-written and exaggerated"

Wednesday's hearing came after a heated row between Downing Street and The Times over a leaked memo written by consultancy firm Deloitte, which suggested that civil service headcount would have to rise to cope with the challenge of Brexit.

Fraser said he did not believe the memo was "a particularly impressive document".

“It was over-written and exaggerated," he told the committee.

But the former Foreign Office chief said he understood the process set out in the memo – in which departments are currently submitting plans to the centre of government to feed into a central strategy for the UK's exit from the EU – was correct.

He said: "My understanding is that it is indeed proving to be a very considerable challenge in Whitehall to do this [drawing up a Brexit plan], that the government [...] is still in information-gathering mode, and is not yet at the point of integrating that into a central plan.

“And that, I assume, will have to happen before the triggering of Article 50 next year.”

He added: "This is an extraordinary complex range of activity across a wide range of domestic and international policies and it will definitely impose a great burden on the civil service."

“It needs to be done in a coordinated way both at the political level and at the civil service leadership level if it is going to succeed”.

"Brexit on the cheap"

The committee also took evidence from Dr Hannah White, director of research at the Institute for Government think tank, who said the new Department for Exiting the European Union was already “drawing in really great talent from across the civil service”.

“Three seems to be a lot of confidence within department that they have a good plan for how to make this work,” she said.

But White said her organisation had seen "less confidence from other departments" about their resources and capabilities ahead of Brexit, putting this down to the fact that the "process at the centre has been held quite close", for "political reasons as well as anything else".

This week's controversial Brexit memo – which Deloitte has said was intended "primarily for internal audiences" with "no access" to departments, but which The Times has continued to defend as having been circulated within government – said there was unlikely to be any shift in the government's departmental spending plans at next week's Autumn Statement.

But Dave Penman, general secretary of the FDA union for senior officials, said the fiscal announcement must be used to ready departments for Brexit.

"Whilst politicians squabble about hard and soft Brexit, there is a deafening silence from ministers over whether any additional resources will be provided to deliver this momentous task," he said.

"Brexit on the cheap appears to be the government's preferred approach, but this will satisfy no-one. Next week's Autumn Statement is the government's opportunity to outline how it will provide the resources the civil service needs to ensure a successful Brexit.”

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