Lord Gus O'Donnell speaking at the Institute for Government (second from right), with, from right: Tom Sasse, IfG senior researcher; Emma Norris, IfG director of research; Lord Freud, former Department for Work and Pensions minister; and Anne Perkins, journalist and former deputy political editor at The Guardian
Former cabinet secretary Lord Gus O’Donnell has laid out plans for departments to cluster together to create career pathways for civil servants to develop skills in specific policy areas as part of moves to cut Whitehall staff turnover.
Speaking at a launch event for the Institute for Government's report on staff moves, which found eight departments with an annual staff turnover of more than 15%, O’Donnell said he wanted the report to “start on important debate” on how to structure Whitehall career development.
The Moving on report found that although only around 9% of staff leave the civil service each year, the proportion moving between departments has risen from around 7% in 2010 to around 23% in 2018.
O’Donnell said he had benefited from moving around government before he was named cabinet secretary and head of the civil service in 2005, a post he held until the end of 2011, but called for several changes to tackle some “bonkers” moves.
“When I think about my own a career, would I have been better off only staying in one department, which would have done well in your figures?” he asked. “No, absolutely not. That fact I was in the Treasury, the fact I got overseas in the Foreign Office [at British Embassy in Washington], the fact that I worked in Cabinet Office, I think was hugely important, as was the fact that I managed a bit of time outside as well [with the International Monetary Fund and World Bank].”
However, he said enabling civil servants to plan their career development based on specific policy clusters could help them build specialised policy expertise, particularly when they reach the senior civil service.
Such an approach could help address the fact that people often move to unrelated policy areas to secure a pay rise – a trend highlighted in the IfG report.
“When you want someone who is going to be good at DWP [Department for Work and Pensions] policy, you actually want them to have spent some time in Treasury as well, and you also want someone in Treasury to know about DWP.”
“Do you want people to only spend their lives in one department? Absolutely not. Do I want them to as our fast streamers are – God bless them – being sent all over the place? No. I want clusters. I want someone who really cares about the economy and business to spend their life in Treasury and BEIS [Department for Business, Energy and Industrial Strategy] and places like that.
“I want someone who cares about health to spend some time in social care and places that are doing that and to understand a cluster of things. If I know someone really interested in international relations and wanted to do Home Office, MoD Foreign Office, [do I want them] to be sent to the Ministry of Justice? No. This is bonkers.”
He later added: "If you’re an real specialist in social policy, why would we let you go off and do something completely different?”
O'Donnell added that to support such an approach, were he in charge he would restrict people's ability to leave some jobs prematurely, albeit with an enhanced bonus pot. “I would say, ‘there’s your contract for this number of years and there’s a big bonus at the end of it.
“We don’t do that. I think we need to give strong financial incentives for people to stay and live through these things."
IfG report author Tom Sasse highlighted that pay reform would be needed before a more managed clusters structure would work.
“The reason people move is that they could get a 10% pay rise, and that is what their managers currently can’t offer them in their department,” he said. “If you stop people from moving but don’t give them any pay rise, you’re just going to end up with an unhappy workforce. You need to fix the system around it and not just stop people from moving.”
Also at the session, another former cab sec Lord Robin Butler said competition inside the civil service had made managers “impotent” in planning their workforce.
“We have had fair and open competition in the civil service and that runs very deep, but since there has been internal competition for jobs it has really gone mad," he said, because of the volume of internal applicants for each job.
He said the recruitment system had become "anarchic" in a way that meant O'Donnell's proposed clusters approach would be impossible.
“Management has got to be empowered to have more powers, and I like the idea of banning people from moving, [or] even applying for jobs too often, because but management loses its control completely on producing people and teams fit for the job,” said Butler, who was cabinet secretary from 1988 to 1998.
O’Donnell agreed there was a need to move away from a “completely open system". “I would like there to be a stronger role for management in pursuing my idea of clusters," he said.
There was also a need to improve retention in senior project delivery and operational roles, especially through pay, said O’Donnell.
“I would really like to get more incentive for someone to see a project though – Universal Credit is a classic example. How can we incentivise people to see through these things?
“I think people, particularly the fast streamers, join the civil service to do policy. I regret that... all my successors, I think, have moved in that direction. We’ve all tried to get more status for operational stuff, [but] we need to think about that."
He said retaining commercial skill was one area where the civil service would "never ever be able to compete with the private sector".
“When you’re into commercial stuff, and talking about getting the best deal, in those areas you are very visible to the private sector. If you’re good you’re going to be tempted away." he said.
“Basic economics explains nearly all of these things, I would say, as to why we can’t get people in the right places. You would expect the civil service to be pretty good on policy and relatively poor on operations, and I think that is what we have got.”
Asked why these changes had not been made before, O’Donnell one reason was that “quite often you have minsters interfering in the running of the civil service”. However, he added he took this point "very personally" and wondered why he had not implemented them.
“The answer is you are trying to do so much. You don’t want to be forever changing the system, you want to leave the system some time to carry on as it is, to be getting on with the agenda, which is just huge and possibly too big.
“But that is a partial excuse and I accept the fact we need to think about and learn why we haven’t managed to do the changes that actually a lot of us all agree are the right ones.”