As head of the influential centre-right think tank Policy Exchange, Neil O’Brien tells Joshua Chambers that his organisation aims base its findings on evidence, not ideology – unlike some of its rivals.
In a period where press and political antagonism towards the civil service is de rigueur, it is deeply unfashionable to call for a stronger civil service, let alone suggest that the highest paid civil servants earn too little and the lowest-paid earn too much.
Yet Neil O’Brien (pictured above), director of the centre-right think tank Policy Exchange, believes just that. “What we’ve tried to do is argue for a more flexible service where promotion, seniority and pay are all much more strongly linked to performance,” he says.
Given that Cabinet Office minister Francis Maude says on the Conservative Party’s website that his “proudest political achievement” is the establishment of Policy Exchange, it’s worth taking note of the organisation’s views on the civil service. Further, it has close ties in other areas of government policy: the first chairman of the think tank was current education secretary Michael Gove, while at its 2011 summer party David Cameron urged the organisation to continue developing new ideas for his government to implement. So far, it claims credit for thinking of the Office of Budget Responsibility, the Green Investment Bank, and the proposed election of police commissioners, among other policies.
The think tank was formed after the Conservatives' disastrous election defeat in 2001. “The right appeared to have learned absolutely nothing between 1997 and 2001,” O’Brien explains there had been “a second equally crushing landslide, no progress intellectually or politically, so there was a great desire to have ideas that would move things on a bit, and that’s still the mission.”
Ultimately, he says that Policy Exchange therefore sees itself as “the most centrist of all centre-right think tanks,” and a “pragmatic” organisation “rather than the more heroic approach that you sometimes get from other think tanks, like: ‘Why don’t we just privatise the NHS?'" Indeed, Policy Exchange preached caution on the coalition’s NHS reforms, and said that GP commissioning couldn’t be implemented to the proposed timescale. O’Brien also says his organisation is non-partisan, and looks to work with the other two major parties on public sector reform.
Policy Exchange prides itself on its evidence-based approach, and plans to launch a research project in the autumn setting out just how a leaner civil service could operate. But O’Brien doesn’t come to the project entirely without his own views - he thinks the civil service is bogged down by secondary objectives and needs to be liberated. “Government shouldn’t be allowed to impose regulatory burdens on the public sector that it’s not happy to impose on the private sector as well,” he says. For example, he cites the increase of public sector employment in deprived areas to reduce unemployment, or leading by example with equal pay audits introduced by the Equality Act. “The problem with doing it is that the costs are invisible. It’s hypocritical for politicians to simultaneously demand that the public sector has to do lots of things that the private sector doesn’t, for political reasons, and then to say: ‘Why are your costs so high?’”
Ultimately, O’Brien backs market provision for delivering many public services. However, he is still wary about the extent to which the coalition is expanding the use of markets. “People like us who are generally impressed by the power of markets, and sympathetic to the idea that they can be used more widely in some areas, should also be the people who are most cautious about markets,” he says. For example, he warns, it’s possible that outsourcing can result in the loss of many skilled civil servants to the private sector, where they are able to out-negotiate the public sector, he warns.
There will also be other implications when government starts to expand its use of markets, O’Brien believes. “It’s quite a different set of skills for the commissioners – civil servants [who are] currently running conventional, command and control services,” he says. For example, civil servants will have to “estimate how much profit is reasonable to make, try and set results and payment structures to reduce ‘creaming’ and ‘parking’, and try and impose a reasonable level of competition – but not so high that you obliterate the market.”
In particular, O’Brien says that there must be close attention to the payment structures used, because when markets were introduced into social care, there was a payment structure that made it very expensive to use voluntary agencies, which have a better record of success than state-owned services. This was despite government research showing that the total cost of running publicly-owned services was the same as outsourcing to the third sector, he says.
He also warns about expanding the payment by results model into complex policy areas where it is difficult to measure outcomes. There is a binary outcome in employment, which makes the use of payment by results viable, he says, but there are now proposals to introduce it when tackling problem families – something especially relevant given the riots that took place a week before this interview. “If I deal with this problem family in a way that they get jobs and stop reoffending, who gets the money? What happens when all these payment by results schemes start to overlap? That’s just one of the many complexities that’s going to emerge as government gets more and more interested in this sort of stuff,” he says.
O’Brien can happily expand and expand on a topic until he has exhausted all possible questions, and indeed himself. Then he will sit quietly, awaiting the next question, and the next challenge. We therefore move on from markets and onto digital service provision, an area into which Policy Exchange is expanding. It seems fitting that this pro-market think tank itself acts in a capitalist manner, constantly looking to expand into new policy areas where it can seek to influence the government’s agenda.
O’Brien is shocked by how poorly the public sector uses IT. “There’s so little technology in public services, it’s just mind-blowing,” he says. The government’s aim to increase digital delivery is laudable, he thinks, but there will be huge pressure on civil servants to IT projects that work well – especially systems that allow multiple services to collaborate. On this topic, O’Brien is all questions and excitable outbursts, but he hasn’t yet decided where he stands on some of the bigger issues such as whether to sell government data for a profit, or alternatively whether to release it for free. He hasn’t seen any hard data either way, he says, before detailing the arguments on both sides.
However, he is clear that any data released should be released in a usable format, and that government should take responsibility for this. “Government does need to think a bit about getting stuff out there in a usable format, not allowing these things to be perverted. We say: ‘Publish your data,’ and it ends up that departments publish things in horrible PDFs, non-machine readable, complying with the letter and not the spirit.” It’s not acceptable to expect ‘arm-chair auditors’ to be able to sift through it, he adds.
As a comprehensive-educated man from Huddersfield, it does seem a little odd that O’Brien has been attracted to right-wing politics at a time when there are very few northern Conservative politicians in positions of prominence. This background may also seem surprising given that just before David Cameron embarked on a tour of the north of England in 2008, Policy Exchange was widely reported to have suggested that many northern cities were “beyond revival” and urged mass-migration to the South of England. O’Brien giggles as he describes the first interview he did in the job; it was with a reporter from the Yorkshire Post, who started by asking how he could possibly work for such an organisation. He believes it was an “eminently sensible report” which was doomed by a “spin-failure.”
Not that O’Brien seems that interested in the press, or the cut and thrust of politics. For him, the job is interesting because “this is where the intellectual life is at the moment.” Much of the leftwing is in the same position as the Conservatives in 1997, he thinks: unable to grapple with the changes required. Indeed, he recounts that he “had dinner with a very senior Blairite minister a while back, and he said: ‘I’m very worried that my party might have the misfortune of getting back into government in four years time and we’ll have, as things stand at the moment, nothing to say’.”
Speechlessness certainly isn’t a problem for O’Brien, however. He seems keen to dip into every policy area, from police reform to energy markets, and as I leave he presses various policy documents into my hands. He sees his job as getting the “right ideas to the right people at the right time.” Given that he has so many of them – and the ear of many prominent Tories, it would be wise to assume that some of them will stick.
CV Highlights
2000 Graduates from Oxford with first in PPE,
2000 Joins “Business for Sterling” campaign against UK membership of the euro
2005 Founds Open Europe think tank, campaigning for European reform
2008 Joins Policy Exchange as Director