House of Commons Public Administration Select Committee
Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary
Further Report , with the Government Response to the Committee’s Nineteenth Report of Session 2010–12
Twenty Third Report of Session 2010–12
Report and appendix, together with formal minutes Ordered by the House of Commons to be printed 26 March 2012
HC 1914 Published on 28 March 2012 by authority of the House of Commons London: The Stationery Office Limited £0.00
The Public Administration Select Committee (PASC)
The Public Administration Select Committee is appointed by the House of Commons to examine the reports of the Parliamentary Commissioner for Administration and the Health Service Commissioner for England, which are laid before this House, and matters in connection therewith, and to consider matters relating to the quality and standards of administration provided by civil service departments, and other matters relating to the civil service.
Current membership Mr Bernard Jenkin MP (Conservative, Harwich and North Essex) (Chair) Alun Cairns MP (Conservative, Vale of Glamorgan) Michael Dugher MP (Labour, Barnsley East) Charlie Elphicke MP (Conservative, Dover) Paul Flynn MP (Labour, Newport West) Robert Halfon MP (Conservative, Harlow) David Heyes MP (Labour, Ashton under Lyne) Kelvin Hopkins MP (Labour, Luton North) Greg Mulholland MP (Liberal Democrat, Leeds North West) Priti Patel MP (Conservative, Witham) Lindsay Roy MP (Labour, Glenrothes)
Powers The powers of the Committee are set out in House of Commons Standing Orders, principally in SO No 146. These are available on the Internet via www.parliament.uk
Publications The Reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the Internet at http://www.parliament.uk/pasc
Committee staff The current staff of the Committee are Steven Mark (Clerk), Charlotte Pochin (Second Clerk), Alexandra Meakin (Committee Specialist), Paul Simpkin (Senior Committee Assistant) and Su Panchanathan (Committee Assistant).
Contacts All correspondence should be addressed to the Clerk of the Public Administration Select Committee, Committee Office, First Floor, 7 Millbank, House of Commons, London SW1P 3JA. The telephone number for general enquiries is 020 7219 5730; the Committee’s email address is [email protected].
Leadership of change: Further Report 1
Contents
Report Page
Report 3
Conclusions and recommendations 4
Appendix: Government response 5
Formal Minutes 17
List of Reports from the Committee during the current Parliament 18
Leadership of change: Further Report 3
Report
1. We reported to the House on Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary in our Nineteenth Report of Session 2010–12, published on 20 January 2012 as HC 1582. We received the Government response to that report on 19 March 2012.1
Review of the working of the Head of the Civil Service position 2. We recommended in our Report that “in July 2012 the Government conduct a full review of the working of the Head of the Civil Service position in practice to consider whether a full-time Head of the Civil Service is required to provide the Civil Service with the necessary organisational leadership”.2 The Government response “acknowledge[s]” our recommendation and states that “how the roles are operating will be kept under review by the Prime Minister” but claims that “six months may be insufficient to fully assess the success of the current arrangements”.3 The Government does not explain what would be learned by waiting nine or twelve months to conduct a review, that could not be learned after six months. We reiterate our recommendation that the Government should conduct a six-month review of the role. Such a review would be valuable, even as an interim measure.
Format of Government responses to our Reports 3. It would be of assistance to us and, we believe, to others for the Government to respond in full to each of our recommendations and conclusions individually and in order, rather than grouping responses, as they have in this case. We have written to the Government to ask them to follow this practice in future.
1 The Government’s response is printed as an Appendix to this Report. 2 Public Administration Select Committee, Nineteenth Report of Session 2010–12, Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary , HC 1582, para 68 3 Appendix, p 7
4 Leadership of change: Further Report
Conclusions and recommendations
Review of the working of the Head of the Civil Service position 1. The Government does not explain what would be learned by waiting nine or twelve months to conduct a review, that could not be learned after six months. We reiterate our recommendation that the Government should conduct a six-month review of the role. Such a review would be valuable, even as an interim measure. (Paragraph 2)
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Appendix: Government response
Letter from Rt Hon Francis Maude MP, Minister for the Cabinet Office to the Chair of the Committee Thank you for the Committee’s helpful report on Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary.
Please find enclosed the Government’s response to the specific recommendations made in this report.
As I and others indicated when we met the Committee last year, we intend to publish a Civil Service Reform Plan in Spring 2012. It will articulate the challenges and opportunities facing the Civil Service, and set out a roadmap for action against a small number of priority areas for change including, for example, building capability and implementing modern management systems and processes.
As you may have already noted the Public Accounts Committee invited Sir Bob Kerslake and Sir Jeremy Heywood to attend to discuss their respective roles and some of the recurring challenges across Government and requested a letter prior to the hearing. This letter is enclosed as appendix A.
Once again, we welcome the Committee’s thoughtful consideration of these important issues, and look forward to continuing engagement with the Committee in this area.
19 March 2012
Government response The Government welcomes the Committee’s report on “Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary.”
As acknowledged by the Committee the roles of the Head of the Civil Service and the Cabinet Secretary are vital in leading the Civil Service through a period of substantial change to meet the Coalition Government’s objectives, to support economic growth and well-being, to improve public services, to devolve power to communities and citizens and to reduce costs. A full response to the Committee’s eighteen recommendations is set out below, grouped together where this is helpful.
The combined role of Cabinet Secretary and Head of the Civil Service
The role of Head of the Civil Service, and the relationship between the Head of the Civil Service and the Prime Minister and the Cabinet, are matters of vital importance to good governance and define the nature of the Civil Service itself. Our starting point for this inquiry was the recognition that, while the structure in which one individual holds the combined roles of Cabinet Secretary, Permanent Secretary at the Cabinet Office and Head of the Civil Service had been perceived to be an effective arrangement for leadership of the Civil Service and provision of support to the Prime Minister over the last thirty years, the Civil Service faces new and substantial challenges to reform,
6 Leadership of change: Further Report
discussed in detail in PASC’s recent report on Change in Government: the agenda for leadership. Might an alternative arrangement at the top of the Civil Service prove more effective? Existing structures may have supported Civil Service reform through periods of incremental change: but the present agenda for reform, which includes substantial cuts in administrative budgets alongside considerable transfers of functions from the centre, requires a different approach to Civil Service leadership. It is in this context that we examined the decision to review and adapt the structure at the top of the Civil Service. (paragraph 16)
The Government agrees with the Committee that the role of Head of the Civil Service and his relationship with the Prime Minister, Deputy Prime Minister and the Minister for the Civil Service is vitally important; and, that given the substantial challenges of serving a coalition Government, of delivering substantial administrative changes, and of reforming the Civil Service the time was right to review the structures in place at the top and consider the options.
The role of Parliament in changing Civil Service structures
We suggest that, in the interests of good and transparent government, a discussion with PASC ahead of the decision to divide Sir Gus O’Donnell’s role as Cabinet Secretary and Head of the Civil Service would have been beneficial. (paragraph 17)
The Government recognises the importance of transparent government, however, as acknowledged by the Committee (paragraph 31), it is reasonable for a Prime Minister to choose who he or she wants at the most senior levels of the Civil Service and to decide which structures best suit the requirements of the Government.
The Prime Minister was presented with options by the outgoing Cabinet Secretary Sir Gus O’Donnell and decided, with the support of the Deputy Prime Minister, that the adopted structure would best serve current needs. Ultimately, both the Cabinet Secretary and the Head of Civil Service are accountable to the Prime Minister.
The post of Head of the Civil Service is a Civil Service appointment, regulated by the First Civil Service Commissioner, not a public appointment regulated by the Commissioner for Public Appointments. It therefore falls outside the scope of posts which have been considered by the Government and the Liaison Committee as ones for which the preferred candidate should be subject to a Select Committee pre- appointment hearing. Sir Bob Kerslake, as Head-designate of the Civil Service, readily agreed to appear before PASC before taking up the appointment. We considered this a valuable opportunity for him to place on record how he planned to discharge his responsibilities, and we are grateful to him for his readiness to appear. This evidence session was not a pre-appointment hearing to examine his professional competence. Nevertheless, we take this opportunity to make clear that we are, on the basis of the hearing, entirely satisfied that he has the competencies to discharge his responsibilities. (paragraph 18)
The Government welcomes the Committee’s endorsement of Sir Bob Kerslake and their confidence in his abilities and competence to discharge the full responsibilities of this role. Sir Bob Kerslake’s strong operational and public service background and his experience of
Leadership of change: Further Report 7
leading large organisations through periods of significant change made him an ideal candidate for this role.
The proposed arrangements and Access to the Prime Minister
It is reasonable for a prime minister to choose who he or she wants at the most senior levels of the Civil Service and for him to decide which structures best suit the requirements of the government and their respective capabilities. However, these arrangements must ensure that the Head of the Civil Service has the seniority, the respect and the ear of the Prime Minister in order to fulfil his role, particularly one essential role of the Civil Service: the requirement to speak truth to power. Time will tell whether or not the new Head of the Civil Service has the necessary authority to carry out his functions. (paragraph 30)
The active working relationship between the Head of the Civil Service and both the Prime Minister and Deputy Prime Minister will be critical to the successful implementation of Government policies across Whitehall and the reform of the Civil Service. For this reason the Prime Minister and Deputy Prime Minister must ensure they meet the Head of the Civil Service regularly. Again, only time will tell whether the two offices can maintain parity of esteem in the eyes of the Prime Minister and Deputy Prime Minister. (paragraph 37)
We welcome Sir Bob Kerslake’s statement that he will be attending Cabinet on a regular basis. We note that the job description for his new post indicates that the Head of the Civil Service only has “the option to attend Cabinet as appropriate”. We recommend that Sir Bob attend Cabinet as a matter of course, and be seated at the Cabinet table. We recommend below that a review of the working of the Head of the Civil Service position in practice be conducted in July 2012. The report of that review should include specific details of the number of meetings held between the Prime Minister and Sir Bob Kerslake, and the number of occasions on which Sir Bob has attended Cabinet. (paragraph 39)
The Government agrees that it is vital that the Head of the Civil Service has the necessary authority to deliver in this role. This will require him to have appropriate access to the Prime Minister to enable him to “speak truth unto power”. To enable this Sir Bob Kerslake has meetings with the Prime Minister and the Deputy Prime Minister on a regular basis, as well as with the Minister for the Cabinet Office; and attends Cabinet.
The roles of Cabinet Secretary and Head of the Civil Service differ in terms of their responsibility but are of equal importance. The Cabinet Secretary will focus on supporting the Prime Minister, the Deputy Prime Minister and Cabinet government, while the Head of the Civil Service will focus on leadership and the professional management of the Civil Service – a workforce of 450,000. Attendance at Cabinet rightly reflects these responsibilities.
Naturally, how the roles are operating will be kept under review by the Prime Minister, however, six months may be insufficient to fully assess the success of the current arrangements.
8 Leadership of change: Further Report
Time commitment of the Head of the Civil Service and the need for a full time Head of the Civil Service?
We take very seriously the warnings we have received about the time commitment required of the new Head of the Civil Service and give notice to the Government that this new arrangement may not be sustainable. The Government must be prepared to revisit this structure in the light of experience. (paragraph 45)
In his comment that the Department for Communities and Local Government is “much more of a policy department than an operational department”, the Minister for the Cabinet Office has acknowledged that certain permanent secretaries with high- profile operational responsibilities, such as those in the Home Office and the Ministry of Defence, would find it harder to combine the two roles of Permanent Secretary and Head of the Civil Service, and would therefore be at a disadvantage in applying to be Head of the Civil Service. If the Head of the Civil Service were to become a full-time role, as we recommend below, there would be no constraint on who might apply. (paragraph 51)
We note the arrangements which have been made to try to ensure the effective discharge of Sir Bob’s responsibilities as both Head of the Civil Service and Permanent Secretary of the Department for Communities and Local Government. We welcome Sir Bob Kerslake’s commitment to the considerable and important tasks required of the Head of the Civil Service, and the steps he has taken to ensure the continuity of management in the Department for Communities and Local Government while he is undertaking his role as Head of the Civil Service. We invite the Communities and Local Government Select Committee to monitor the effectiveness of this arrangement. We remain to be convinced that delegation of this nature will suit the role of Head of the Civil Service. (paragraph 55)
The position of the Head of the Civil Service is currently a part-time role, as it has been ever since the position was created in 1919. Given the considerable upheaval in the Civil Service as it tackles the challenges of a new role against the background of substantial public service reform and significant spending reductions, a thorough consideration of whether a full time Head of the Civil Service is now required would have been timely. In view of the evidence we have taken in this inquiry, a full-time Head of the Civil Service is the logical conclusion to be drawn from our previous report, Change in Government: the agenda for leadership, which recommended the establishment of a change programme involving a stronger centre of Government, and the top management of all departments. In this change programme, the Head of the Civil Service ought to be responsible for the engagement of departments with change and reform programmes, the alignment of departmental change programmes across government, and the follow- through to ensure that change is successful. This will be difficult to achieve alongside the role of a departmental permanent secretary. (paragraph 66)
We welcome Sir Bob Kerslake’s commitment to his new role and we respect his intention to give it the full attention it deserves. He has set himself an ambitious list of priorities and measures by which he will judge his success. We doubt whether he will be able to fulfil all the duties listed in his lengthy job description, and achieve his priorities, in the two days a week allocated for the post. We recommend that in July
Leadership of change: Further Report 9
2012 the Government conduct a full review of the working of the Head of the Civil Service position in practice to consider whether a full-time Head of the Civil Service is required to provide the Civil Service with the necessary organisational leadership. (paragraph 67)
As the Committee notes, the Head of the Civil Service has not been a full- time position since 1919. The Government does not agree that the Head of the Civil Service needs to be a full time role, a point that the Committee acknowledges in recommending that it be combined with that of the Cabinet Office Permanent Secretary (paragraph 105).
The Government agrees that the role of the Head of Civil Service has changed substantially. The separation of the Head of the Civil Service role from that of Cabinet Secretary recognises this and will enable Sir Bob Kerslake to focus his time and energy on driving forward the Civil Service reform agenda.
The Prime Minister and the Head of the Civil Service are confident that with this change the role can be successfully delivered within the expected time commitment. Naturally there will be occasions when Sir Bob Kerslake will be required to spend more time in his role as Head of the Civil Service or in his role as Permanent Secretary for Communities and Local Government, for this reason it is vital that he has strong deputies, a view supported by many of those giving evidence to the Committee. Being a mainstream delivery department, Communities and Local Government, unlike the Cabinet Office, has the advantage of enabling Sir Bob Kerslake to understand at first hand the delivery challenges facing front line staff.
The role of Head of Civil Service was open to all current Permanent Secretaries. The Civil Service has a strong talent pipeline to support a Permanent Secretary from any department, enabling them to combine the roles of Permanent Secretary and Head of Civil Service.
As previously, we acknowledge your recommendation that a review be conducted on the role of the Head of the Civil Service; the Prime Minister will keep the success of this role under active review and make changes as appropriate.
Lines of accountability for Permanent Secretaries
Dividing the reports structure for departmental permanent secretaries and heads of secretariats between ‘service’ and ‘cross-cutting’ functions not only reflects the traditional quasi-independence of Whitehall departments from the centre, but also attempts to reflect the limitations of one individual to manage so many people. The danger is that the divided reporting line structure may lead to a divided organisation and divided and weak leadership. Strong, undivided leadership is essential to governance of the Civil Service and will require the Cabinet Secretary and Head of the Civil Service to act as one. We recommend that the July 2012 review of the operation of the new structure includes an assessment of this issue, and of whether the division of permanent secretary reports is the right one. (paragraph 79)
The Head of the Civil Service and the Cabinet Secretary will work closely to lead the Permanent Secretary cadre, jointly chairing some meetings, such as the weekly Wednesday morning meeting of Permanent Secretaries; and through a strengthened Civil Service Board and the continued drive towards a collaborative leadership model they will
10 Leadership of change: Further Report
strengthen corporate leadership across the Civil Service and ensure that departmental ‘silos’ are broken down.
All Permanent Secretaries are, and will, continue to be subject to the same performance management arrangements. The split in line management responsibilities will improve the performance management and accountability of Permanent Secretaries, not weaken it. By having two separate roles, the Head of the Civil Service and the Cabinet Secretary will have fewer direct reports and so will be able to devote more time and energy to this aspect of their roles. The previous Head of Civil Service and Cabinet Secretary had over 30 direct reports.
We agree with the Minister that the new structure at the top of the Civil Service should be judged on how it works in practice. The success of this new structure will inevitably depend on the personal chemistry both between the three individuals, Sir Jeremy Heywood, Sir Bob Kerslake and Ian Watmore, and between them and the Ministers they serve. The effectiveness of this arrangement is therefore inherently unstable and must certainly be reviewed if any of the three personnel are changed. Any failure of that personal chemistry could have serious consequences for the governance and leadership of the Civil Service. (paragraph 80)
Governance and leadership of the Civil Service will continue to be conducted collaboratively so will not be solely dependent on the chemistry between the Cabinet Secretary, the Head of the Civil Service and the Cabinet Office Permanent Secretary. Permanent Secretaries are actively involved in the leadership and governance of the Civil Service and all are measured on this corporate leadership as part of the performance management process.
We would not necessarily need to review or change the structure if there was a change in personnel and would hope that the internal talent pipeline of the Civil Service would be strong enough to sustain individual changes without necessarily requiring a complete review of the structure.
Effect on Civil Service Reform
We welcome Sir Bob Kerslake’s commitment to recruit a Director General for Civil Service reform which reflects a recommendation of PASC’s earlier report Change in Government: the agenda for leadership: the role is necessary to drive reform from the highest levels in the Cabinet Office. We are disappointed to note that Ministers have not yet accepted the need to strengthen the centre of government to lead reform across Whitehall. We believe that the Head of the Civil Service will come to support this idea. Again, we recommend that this issue is reassessed in the July 2012 review of the new structure which we have proposed. (paragraph 90)
We have already appointed additional resource to the Cabinet Office and are currently recruiting a Director General for Civil Service Reform, as recommended by a previous PASC report, to strengthen the centre. The successful candidate for the Director General position will need to have significant experience of leading change in large organisations and be able to provide challenge to departments as and when necessary. The recruitment process for this individual has begun with the aim of making an appointment by early April.
Leadership of change: Further Report 11
The Government intends to publish a Civil Service Reform Plan, setting out priority areas for action for cross-Civil Service reform, in Spring 2012. This paper will articulate the challenges and opportunities facing the Civil Service, and set out a roadmap for action in order to achieve the changes set out above, including, for example, building capability and implementing modern management systems and processes.
However, for such reform to be successful and sustainable it must be owned by departments, not purely driven by the centre and so it is important that this accountability is maintained within departments.
The Permanent Secretary for the Cabinet Office will continue to ensure that the Cabinet Office provides the Head of the Civil Service with effective support in delivering their role on Civil Service reform.
Staffing and offices for the new Head of the Civil Service
The part-time nature of the role means that for the majority of Sir Bob’s time he will be not physically be present in the Cabinet Office, and based instead at the Department for Communities and Local Government, one mile away. The physical separation of Sir Bob Kerslake’s two roles increases the risk that the Head of the Civil Service may be excluded from key discussions: such exclusions could not but adversely affect his standing, and would undermine his crucial leadership role. They would also restrict his ability to fulfil the necessary constitutional requirement that the Head of the Civil Service be able to speak truth to power. (paragraph 93)
We welcome the fact that Sir Bob Kerslake will be provided with office accommodation to give him the opportunity of equal access to the Prime Minister. We expect this commitment to be delivered in practice. Sir Bob will require considerable staffing support to achieve the Government’s objectives for Civil Service on a part-time basis. We recommend that the staffing for the Head of the Civil Service position is considered as part of the review of the new structure to take place by July 2012. (paragraph 94)
The Head of the Civil Service has accommodation in 70 Whitehall within a very short distance from No 10. He and the Cabinet Secretary share a private office which further supports coordination of the roles as well as helping to ensure access to the Prime Minister.
The Head of the Civil Service will be involved in all the key discussions he needs to be and has continuous access to his Head of Civil Service private office and support teams in the Cabinet Office.
The role of Permanent Secretary of the Cabinet Office
Concerns that the role of Head of the Civil Service would be downgraded and sidelined by the Cabinet Office under the new arrangements were expressed to us before we received the detailed organisation chart and tables of responsibilities. It is now clear that the Permanent Secretary of the Cabinet Office is intended to report to the Head of the Civil Service and that the Head of the Civil Service will work from an office in the Cabinet Office. Though we welcome this as logical, this reporting line may have less real relevance in practice since the Head of the Civil Service will be devoting the majority of his time to his departmental role. (paragraph 99)
12 Leadership of change: Further Report
Our reports Change in Government: the agenda for leadership and Good Governance and Civil Service Reform: ‘End of Term’ report on Whitehall plans for structural reform emphasised the importance of a strong centre of government to drive forward change and transformation programmes, coordinated by the Cabinet Office. It could be argued that it is not the old Cabinet Secretary role which is now being split, but the role of Head of the Civil Service, which is being split between a part-time departmental Permanent Secretary and a junior Permanent Secretary in the Cabinet Office. We believe the logical development would have been be to combine the role of Head of the Civil Service with the far more compatible role of Permanent Secretary of the Cabinet Office to create a role which could concentrate full time on driving forward Civil Service reform. This would have helped to provide the Cabinet Office with the authority to break down departmental silos and bureaucratic inertia in order to bring about change. (paragraph 100)
The Head of the Civil Service will be supported by the Cabinet Office and its Permanent Secretary to drive Civil Service change. The Civil Service reform team has been strengthened and significant support and challenge will be provided once the position of Director General, Civil Service Reform, has been filled. This will provide the support required by the Head of the Civil Service and Minister for the Civil Service, to effectively lead the Civil Service Reform Programme.
Appendix A: Letter from Sir Jeremy Heywood and Sir Bob Kerslake to the Chair of the Public Accounts Committee Thank you for your letter of 24 January, and for your good wishes. We are both enthusiastic supporters of the role of the Public Accounts Committee and the work of the National Audit Office; and we are keen to maintain an open and regular dialogue on our shared agenda of improving value for money across Government.
Your letter asked us to set out our views on various areas of our responsibilites. You and the Committee may wish to read this in conjunction with the Government’s response to the recent Public Administration Select Committee report on “Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary”.
Your Committee identifies a number of “recurring challenges across Government”, understanding costs and benefits; project management; performance management and information; capability; and skills, responsibility and accountability. As the Committee notes, there are many examples where the Civil Service has already made improvements in each of these areas. However we acknowledge the need for continuing improvement and, while we would argue that it is not unique to the Civil Service or even the wider public sector, we share the Committee’s appetite for identifying and improving areas where these challenges remain.
Your letter implies that these challenges are distinguishable from the policy and implementation challenges of the Government of the day. We agree that the Civil Service needs to retain the core values and capabilities which allow it to serve governments of any complexion, but the challenges you have highlighted do need to be viewed in the context of the current acute fiscal pressures and the Coalition Government’s agenda for decentralising and opening up public services.
Leadership of change: Further Report 13
It is this context which led the Prime Minister and the Deputy Prime Minister to conclude that they would be best supported over the period ahead by having both a Cabinet Secretary and a Head of the Civil Service. This would not only increase the senior capacity directly in support of the Prime Minister and the Deputy Prime Minister, but also increase the leadership capacity of the Civil Service throughout a period of concerted implementation and rapid change.
The division of these roles means that the Cabinet Secretary role will be centred on providing advice on policy, propriety and implementation issues to the Prime Minister and the Deputy Prime Minister and supporting the work of the Cabinet and all Ministers. The Head of the Civil Service will focus on leadership and the professional management of the Civil Service to ensure that it has the capability to deliver the priorities of the Government of the day. We have produced a short set of slides which you may find helpful, which we attach to this note.
Leadership of the Permanent Secretary cadre is shared between the roles. This includes sharing the chairmanship of some meetings, such as the weekly Wednesday morning meeting of Permanent Secretaries. Advice to the Prime Minister and Deputy Prime Minister on the most senior Civil Service and public appointments and on machinery of government matters at a UK level is also a shared responsibility.
In relation to your specific question on the performance management of Permanent Secretaries, the Head of the Civil Service will have direct line management of the Permanent Secretaries of the main domestic departments, whilst the Cabinet Secretary will line manage the heads of Cabinet Secretariats and the Permanent Secretaries of other Government departments, including HM Treasury and the Foreign Office. This split in line management responsibilities is intended to improve Permanent Secretary performance management and accountability as each will have fewer direct reports. The former Cabinet Secretary, Lord O’Donnell had at different times up to 35 senior Civil Servants reporting to him, a number which he himself regarded as almost unmanageable. Notwithstanding the shared line management responsibilities under the new arrangements, the two of us will work very closely with all our Permanent Secretary colleagues. We attach a note that provides more detail, both on line management responsibility and on performance management.
In relation to your question about our respective responsibilities for addressing the “recurring challenges”, the Minister for the Cabinet office has set out the Government’s view that the Civil Service should become smaller, flatter, less hierarchical and more fluid; and that it needs a culture of innovation, openness and entrepreneurship. This vision, and how the Government will set out to achieve it, will be articulated in more detail in a Civil Service Reform Plan to be published in the Spring.
The responsibility for implementing this vision is for the Head of the Civil Service. We will appoint a Director-General for Civil Service Reform in the Cabinet Office to work with Departments to support us in delivering that programme.
On a day to day basis, the split of responsibilities set out above will allow us respectively to concentrate on our core roles in support of the Prime Minister and Deputy Prime Minister and leadership of the Civil Service. However the vision for change will be delivered most
14 Leadership of change: Further Report
successfully as a shared endeavour, and the key to that will be through working collectively with Permanent Secretaries, including through a newly constituted Civil Service Board, and building up the corporate identity of the Civil Service. We would be pleased to talk further about the Civil Service Reform Plan and our respective roles within it at the hearing on 22 February.
15 February 2012
Leadership of change: Further Report 15
Enclosure: Reporting Lines Reporting lines for Permanent Secretaries will be split between the Cabinet Secretary and Head of the Civil Service.
The Cabinet Secretary will be responsible for Secretariats and other cross-cutting functions (including HMT); and for foreign policy (including FCO and DfID). The Head of the Civil Service will be responsible for the domestic policy departments.
Cabinet Secretary Head of the Civil Service Permanent Secretaries Simon Fraser (FCO) Lin Homer (HMRC) Mark Lowcock (DfID) Ursula Brennan (MoD) Nick Macpherson (HMT) Una O’Brien (DH) JIC Chairman Martin Donnelly (BIS) Kim Darroch (NSA) Jonathan Stephens (DCMS) Ivan Rogers (EGIS) Moira Wallace (DECC) Paul Jenkins (Tsol) Bronwyn Hill (DEFRA) Richard Heaton (Parliamentary Counsel) Perm Sec (DfE) John Beddington (Chief Scientist) Ian Watmore (CO) Jil Matheson (ONS) Robert Devereux (DWP) Keir Starmer (CPS) Perm Sec (DfT) Helen Ghosh (HO) Suma Chakrabati (MoJ) Malcolm McKibbin (NICS) Peter Housden (Scottish Government) Gil Morgan (WG) David Nicholson (NHS) Other Direct Reports Chris Wormald (DPMO) As per departmental responsibilities Melanie Dawes (EDS) Sue Gray (Propriety and Ethics)
16 Leadership of change: Further Report
THE PERMANENT SECRETARY PERFORMANCE MANAGEMENT PROCESS Objective setting • All Permanent Secretaries to agree objectives for the forthcoming year
• Objectives to be informed by key priorities from No. 10, Deputy Prime Minister, Head of the Civil Service, the Cabinet Secretary and departmental business plans.
• All objectives to be signed off by Ministers or Secretaries of State and lead NEDs by the end of March.
Mid-year review • 1:1 discussions conducted at the mid-year stage with Permanent Secretaries by the Head of the Civil service and the Cabinet Secretary.
• Mid-year discussions informed by departmental data as published in the quarterly data summaries and Permanent Secretary self assessments on their delivery against their objectives.
End-year review • Head of the Civil Service and Cabinet Secretary to conduct end-year appraisal discussions with their respective direct reports.
• Discussions informed by feedback from Secretary of State/Minister; feedback from lead NED; Permanent Secretary self assessment; departmental data published in the Quarterly Data Summaries; input from Cabinet Office, No.10 and HM Treasury on departmental performance; and 360 degree feedback
Permanent • PSRC provides additional challenge on their performance Secretary ranking of Permanent Secretaries. Remuneration Committee (PSRC) • The Chair of PSRC will put final recommendations to the Prime Minister.
Leadership of change: Further Report 17
Formal Minutes
Monday 26 March 2012
Members present:
Mr Bernard Jenkin, in the Chair
Charlie Elphicke Greg Mulholland Paul Flynn Priti Patel Robert Halfon Lindsay Roy Kelvin Hopkins
Draft Report (Leadership of change: new arrangements for the roles of the Head of the Civil Service and the Cabinet Secretary. Further Report with the Government Response to the Committee’s Nineteenth Report of Session 2010-12), proposed by the Chair, brought up and read.
Ordered, That the draft Report be read a second time, paragraph by paragraph.
Paragraphs 1 to 3 read and agreed to.
A Paper was appended to the Report as an Appendix.
Resolved, That the Report be the Twenty Third Report of the Committee to the House.
Ordered, That the Chair make the Report to the House.
.
[Adjourned till Tuesday 17 April at10.30am
18 Leadership of change: Further Report
List of Reports from the Committee during the current Parliament
The reference number of the Government’s response to each Report is printed in brackets after the HC printing number.
Session 2010–12 First Report Who does UK National Strategy? HC 435 (HC 713) Second Report Government Responses to the Committee’s Eighth HC 150 and Ninth reports of Session 2009-10 Third Report Equitable Life HC 485 (Cm 7960) Fourth Report Pre-appointment hearing for the dual post of First HC 601 Civil Service Commissioner and Commissioner for Public Appointments Fifth Report Smaller Government: Shrinking the Quango State HC 537 (Cm 8044) Sixth Report Who Does UK National Strategy? Further Report with HC 713 the Government Response to the Committee’s First Report of Session 2010-11 Seventh Report Smaller Government: What do Ministers do? HC 530 (HC 1540) Eighth Report Cabinet Manual HC 900 (HC 1127, Cm 8213) First Special Report Cabinet Manual: Government Interim Response to HC 1127 the Committee’s Eighth Report of Session 2010-12 Ninth Report Pre-appointment hearing for the post of HC 1220-I Parliamentary and Health Service Ombudsman Tenth Report Remuneration of the Parliamentary and Health HC 1350 Service Ombudsman Eleventh Report Good Governance and Civil Service Reform: ‘End of HC 901 (HC 1746) Term’ report on Whitehall plans for structural reform Twelfth Report Government and IT — “a recipe for rip-offs”: time for HC 715-I (HC 1724) a new approach Thirteenth Report Change in Government: the agenda for leadership HC 714 (HC 1746) Fourteenth Report Public Appointments: regulation, recruitment and HC 1389 pay Fifteenth Report Smaller Government: What do Ministers do? Further HC 1540 (HC 1746) Report Sixteenth Report Appointment of the Chair of the UK Statistics HC 910 Authority Seventeenth Report The Big Society HC 902 Eighteenth Report Change in Government: the agenda for leadership: HC 1746 Further Report, with the Government Responses to the Committee’s Eleventh, Thirteenth and Fifteenth Reports of Session 2010-12 Nineteenth Report Leadership of change: new arrangements for the HC 1582 roles of the Head of the Civil Service and the Cabinet Secretary
Leadership of change: Further Report 19
Twentieth Report Government and IT-“a recipe for rip-offs”: time for a HC 1724 new approach: Further Report, with the Government response to the Committee’s Twelfth Report of Session 2010-12 Twenty First Report Future oversight of administrative justice: the HC 1621 proposed abolition of the Administrative Justice and Tribunals Council Twenty Second Report The Prime Minister’s adviser on Ministers’ interests: HC 1761 independent or not?