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Strategic Thinking in Government: Without National Strategy, Can Viable Government Strategy Emerge?

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Strategic Thinking in Government: Without National Strategy, Can Viable Government Strategy Emerge? House of Commons Public Administration Select Committee Strategic thinking in Government: without National Strategy, can viable Government strategy emerge? Twenty Fourth Report of Session 2010–12 Volume I: Report, together with formal minutes, oral and written evidence Additional written evidence is contained in Volume II, available on the Committee website Ordered by the House of Commons to be printed 17 April 2012 HC 1625 Published on 24 April 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 Emily Commander (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]. Strategic thinking in Government: without National Strategy, can viable Government strategy emerge? 1 Contents Report Page Summary 3 1 Introduction 5 2 What do we mean by ‘strategic thinking’ and why is it important? 7 Emergent strategy 10 3 Emergent strategy: how does the Government define the UK’s national interests 12 Public opinion in defining national interests 14 4 Emergent strategy: advancing national interests 17 5 Assessment of current strategic thinking in Government 19 6 The challenge for cross-departmental strategic thinking 21 Promoting the capability of the Civil Service 21 Strengthening the centre of Government 23 Address longer-term context as well as short-term problems 24 Improve the proper use of Scenario Planning in managing uncertainty 26 Ensuring the proper use of science 28 Breaking down departmental silos 30 Aligning financial resources with strategic thinking: 31 Promote Ministerial Leadership on National Strategy 34 Broadening the role of the National Security Council (NSC) 35 7 Conclusion 37 Conclusions and recommendations 38 Annex: Committee’s visit to Ottawa and Washington 44 Formal Minutes 47 Witnesses 48 List of printed written evidence 48 List of additional written evidence 48 List of Reports from the Committee during the current Parliament 50 Strategic thinking in Government: without National Strategy, can viable Government strategy emerge? 3 Summary The UK faces complex, diverse and unpredictable domestic and global challenges. The process by which National Strategy is developed to tackle these challenges, and by which policy and the consequent tax and spending decisions are aligned with the nation’s long- term interests, public values and identity is the process of ‘emergent strategy’. Emergent strategy occurs inevitably and is to be discerned from the policy choices and decisions that the Government makes. The challenges facing the UK cannot be tackled simply by the publication of a deterministic plan for Government but require strategic leadership. Such leadership is central to the process of National Strategy, or the emergent strategy will be incoherent and chaotic. When there is strategic leadership it can establish a virtuous circle, as strategic leadership develops effective policies and positive outcomes, which reinforce the public’s values and aspirations and which in turn can inspire that leadership. Alternatively, the absence of strategic leadership or weak leadership will result in a vicious circle in which bad policy and failure in outcomes undermine the values and aspirations of the public and faith in their leaders. We do not consider that the process of strategic thinking in Government currently reflects a virtuous circle of emergent strategy. We have little confidence that Government policies are informed by a clear, coherent strategic approach, itself informed by a coherent assessment of the public’s aspirations and their perceptions of the national interest. The Cabinet and its committees are made accountable for decisions, but there remains a critical unfulfilled role at the centre of Government in coordinating and reconciling priorities, to ensure that long-term and short-term goals are coherent across departments. Policy decisions are made for short-term reasons, little reflecting the longer-term interests of the nation. This has led to mistakes which are becoming evident in such areas as the Strategic Defence and Security Review (carrier policy), energy (electricity generation and renewables) and climate change, and child poverty targets (which may not be achieved), and economic policy (lower economic growth than forecast). We invite the government to publish an annual ‘Statement of National Strategy’ in Parliament which reflects the interests of all parts of the UK and the devolved policy agendas. This would be a snapshot of how National Strategy has developed providing an opportunity for reassessment and debate about how tax and spending decisions support the Government’s national strategic aims. If published in late spring or early summer, this would mark the start of the new spending round. The clearer expression of the nation’s strategic aims would help to ensure that short- term decisions are made in the context of the long term national strategic framework. This would also improve the ability of the Government to communicate a coherent narrative. Poor strategic thinking militates against clear presentation, which was evident 4 Strategic thinking in Government: without National Strategy, can viable Government strategy emerge? in the aftermath of the Budget and in response to the possibility of industrial action by tanker drivers. This report sets out our recommendations to overcome the barriers to working strategically in Government. The strategic aims of the Government, informed by public opinion, should drive individual policy decisions and align with financial decisions. The Budget process should provide clearer links between long-term objectives and specific budgetary measures. A focus on working strategically across departmental silos, driven by a strong centre of Government, will provide the Government with the capacity to deal with current issues, and the resilience and adaptability to react to the unknown and unpredictable problems of the future. The challenges facing the UK mean that strategic thinking is both increasingly difficult to achieve, and more vital. Failing to do so in the long term undermines national self- confidence and in the short term could have catastrophic consequences. Strategic thinking in Government: without National Strategy, can viable Government strategy emerge? 5 1 Introduction 1. In our first inquiry of this session, we sought to answer the question, ‘Who does UK National Strategy?’ The answer we received was ‘no-one’. We concluded that “as things stand there is little idea of what the UK’s national interest is, and therefore what our strategic purpose should be".1 2. This conclusion met a disappointing response from the Government, which demonstrated a misunderstanding of what we meant by National Strategy. We found that “despite our urging to the contrary, the [Government] response has failed to engage more fully with our findings or to address adequately our proposals for improvement.”2 In particular, the government resisted our recommendation to set out ‘National Strategy’. 3. However our report has been widely read across Whitehall, and has set the agenda for a broader discussion on the need for strategic thinking. Our conclusions also struck a chord with the military: we have been told that the Report is regularly discussed and analysed at Shrivenham Defence Academy Staff Courses, Royal College of Defence Studies, RUSI and the recommendations are frequently referred to by Defence Chiefs. Recently Parliament’s Joint Committee on National Strategy endorsed the substance of our call for ‘National’ or ‘Grand Strategy’ by identifying the need for an “overarching strategy” which should include the policies and programmes of domestic departments. 4. When we published our report, we made clear
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