Interview: Francis Maude

The Labour government has done plenty of talking about improving the efficiency of government, says Francis Maude (pictured above) – but it hasn’t been ready to swallow the medicine that its experts have prescribed; a Conservative administration, he says, would be ready to push these changes through.

“There’s been a lot of work done on efficiency,” he says, citing the work done by Peter Gershon some years back. “The National Audit Office concluded that while the work Peter did was very good, it simply didn’t get carried out. Then there’s the operational efficiency reviews that have been conducted – one of them by Martin Read, who’s been working with us. So there’s lots of work being done on what the potential is for much better efficiency, much more effective spending. What’s been lacking is the political will to drive it through.”

Maude, the shadow Cabinet Office minister since 2007, is adamant that the Tory leadership does have that political will. Meanwhile, he’s been working to improve the shadow cabinet’s understanding of the issues facing the civil service: as the head of the Tories’ implementation team, Maude has managed the series of pre-election discussions between senior officials and shadow ministers, while masterminding the training of inexperienced frontbenchers in how to work with civil servants. Certainly, a new Tory government would need both political will and a deep understanding of the issues if it is to achieve its ambitious plans on efficiency: at last year’s party conference, shadow chancellor George Osborne pledged to cut the costs of Whitehall by a third.

The Conservatives’ Productivity Advisory Board – on which Gershon and Read now sit alongside two other former government efficiency advisers, Lord Levene and defence specialist Bernard Gray – gives the Tories serious expertise in government processes and potential savings. And this is crucial, for the party hopes to create efficiencies without damaging frontline services:

“Our task, if we win, will be to ensure that the cost reductions fall not on the front line, but on the inefficient spending,” says Maude. But how would a Tory government ensure that, faced with falling incomes, departments and agencies don’t focus budget cuts on the front line rather than embarking on painful internal reforms? “You’re quite right to identify that as a tendency and a risk,” Maude replies. “There is definitely a tendency for organisations to protect their senior and central parts and to cut their extremities. Our task will be to ensure that it doesn’t happen – and the fact that we know there is a risk means that we are at least forewarned, and can do our best to forearm ourselves against it.”

One way to foster reform, Maude believes, is to change the incentive and appraisal systems for the senior civil service. “At the moment, there’s no incentive for the civil service to save money; in fact, in some cases the reverse is the case,” he says. “Civil service managers can be penalised if they take costs out, because it gets marked down as inaccurate forecasting. And at the moment there’s a perverse incentive, in that status is determined by the size of your budget and your empire, whereas in the best organisations you get rewarded for running something that is lean and effective rather than big.”

To turn around these dynamics, Maude plans to introduce a “fiduciary responsibility” into SCS terms and conditions, and to test financial management skills in the appraisal system. Last December, he also announced plans to tie top officials’ bonuses to departmental performance, and to incentivise civil servants to improve efficiency; he even raised the idea of assessing cross-departmental working in civil servants’ appraisals.

The shadow minister also signals that a Tory government would push hard on efficiency programmes that, he says, have moved too slowly under Labour. Shared services, he believes, is a case in point: “What won’t be acceptable any more is the sort of leisurely, formulaic process that frustrated [back office and IT specialist] Martin Read so much,” he says – though Maude has softened his line on in-house shared services, which he criticised last year for fostering “turf difficulties” over who runs each scheme. “Either in-house or outsourced shared services can deliver significant savings,” he says now.

Further savings, Maude believes, could be found by driving down procurement costs. The Tories’ plans to publish government contracts have prompted concerns over commercial confidentiality among some businesses, raising fears that contractors might hike their prices – but Maude is sceptical. Suppliers are likely to drop their prices to government “in the months and years ahead”, he says, “and we will provide them with plenty of opportunities to do so”.

So the Tories are aggressive on efficiency, back office reform and transparency; but on the operation of the civil service, Maude – who spent seven years in government until losing his seat in 1992 – is something of a traditionalist. He sees a role for special advisers, he says, “but they should not be replacing civil servants as the principal advisers to ministers”.

Further, Maude argues that departments have become far too dependent on long-term consultants and interim staff: “I’ve found it surprising the extent to which [work that] when I was a minister would have been done by mainstream civil servants is now being done by consultants who are there on a long-term basis, or by interim staff. It’s a much more expensive way of doing things, and it reduces the ability of the core civil service to do what it’s historically been very good at.”

During the 1980s, Maude says, when consultants were brought into government “it was on a strictly time-limited basis with a very clearly defined remit. You didn’t see consultancy firms becoming embedded in government departments to the extent that they currently are; it’s very demoralising to the core civil service.”

To enable the civil service to fill the gaps left by departing interims and consultants, Maude has backed the professionalisation agenda – particularly in finance, procurement and tendering – and called for “greater interchange with the private sector and the civil service at a more junior and middle-ranking level”. Last December, he suggesting appointing full-time, government-wide HR, IT, procurement and finance chiefs, in a move that would foster professionalisation whilst extending central control over some Whitehall functions traditionally left to departmental management.

Interestingly, this centralising move is notably at odds with some of Maude’s past pronouncements on the topic: at the 2008 Tory conference, he told CSW that “The fact that the centres of government in Treasury, Cabinet Office and Downing Street have become so powerful is very damaging. Permanent secretaries should not see the cabinet secretary as their boss; they should be responsible to their ministers.”

However, last year – acting on advice from think-tank the Institute for Government – the Conservative leadership signalled that central control would strengthen in some fields, and Maude has now adopted a different tone. “There are some things that need to be tightly controlled from the centre, and that currently aren’t very tightly controlled,” he says. “Some operational things need to be controlled, like head count; the centre doesn’t have the power at the moment to exercise control. You need to have some pretty tight control, but very defined on a few things, which might include the delivery of shared services”.

This extension of central controls within Whitehall, though, would be matched under a Tory government by a weakening of Whitehall’s control over the front line of service delivery. “We know that huge numbers of public servants at the front line get hugely frustrated by the way things are currently done: by the restraints, the detailed targets, the monitoring, the auditing, the regulating, the inspecting – all of which get in the way of them doing what they want to be doing, which is delivering public services,” says Maude.

“So the deal will be, yes, there is going to be less money around in the future, but the other side of this is that there will also be less interference, less micromanagement, more responsibility taken by people at the front line. And that means more freedom for them to do things themselves in a way that responds to the needs of the public.”