A balance must be struck between a strong centre of government and the individuality of departments if Whitehall reforms are to succeed, Sir Simon Fraser has said.
Speaking at an Institute for Government event on leadership and reform, the outgoing perm sec – who leaves his role at the Foreign Office at the end of the month – stressed the importance of protecting departmental identities as part of civil service reform.
While acknowledging departments will have to “think radically about new ways of doing things across Whitehall” if they are to meet spending targets, Fraser said any plans to dilute departmental boundaries in favour of a stronger centre would be a “mistake”.
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“Whitehall departments have distinct purposes, characters and cultures, and one of the most distinct of course, is the Foreign Office,” he said.
“It is a fact that we in the Foreign Office face different challenges, and different operating environments – in Mogadishu for example – from DWP or HMRC or, indeed, the Treasury. So it would in my view be a mistake for the civil service reform to weaken the culture and the community of individual departments.”
While Fraser said he recognised the benefit of having a stronger centre to coordinate common functions across Whitehall, maintaining departmental identities was vital.
“We definitely need an effective, strong, coordinated centre, but Whitehall is also a federal structure of diverse departments led by strong political leaders,” he said.
“We need to drive some areas of efficiency and reform from the centre – for example on procurement, professions, property, human resources amongst others – but that reform succeeds best when it recognises and accommodates the differences between departments.”
Fraser also used his speech to warn civil service leaders against allowing staff to bear "a disproportionate brunt" of the pain of departmental spending cuts.
Describing measures undertaken by the Foreign Office to reduce costs between 2010 and 2015, Fraser said that much of the “low hanging fruit” had already been removed, making the next round of savings more problematic.
“We, like other departments, genuinely did more with less and we are proud of that – and I am sure there is more we can do to streamline administration, to work smarter, to innovate and to increase flexibility – but I am not sure how much more we can do."
He warned: "I would argue that while there is certain scope for efficiency, innovation and productivity, we cannot expect civil service staff to bear a disproportionate brunt of cuts through reduced terms and conditions and by doing more and more with less."
And the FCO perm sec repeated calls for a more “flexible” and autonomous approach to managing civil service pay restraints.
He said: “I do hope it will be possible to allow senior managers of departments more scope in how they can manage pay within an overall limit set by the Treasury. [Then] we [departments] can address the particular pressures experienced by the organisation and by groups of individuals, and have more choice available, for example, in balancing the size of the workforce against the level of pay.”
Chancellor George Osborne last week confirmed that civil service pay rises would be limited to 1% for a further four years, saying the move would help to protect public sector jobs.