“I am confined in many ways with a lot of policies that are one-size-fits-all-of-government,” he said. “I have civil service grading structures in this business which give me, seven, ten levels [of management] – that is really old-fashioned. You’d struggle to find anything like that in any other infrastructure business.”
The Highways Agency finds civil service recruitment processes too cumbersome, he added; slow decision-making damages its ability to compete with businesses for talented graduates. While large private firms can make job offers on the day of an interview, he said, the agency can’t even confirm an offer until it’s carried out security checks – “and that can take anything up to a month, or more.”
“Really slow processes like that say to a new candidate, who is not being offered a particularly special employment package, that this is a really slow, bureaucratic business,” Dalton added.
With recruitment slowed by cross-government processes, Dalton said, the agency is finding it difficult to expand its workforce to deliver on the government’s infrastructure investments. “I haven’t got the space for the normal churn I might get,” he said. “I’ve got to be quite dynamic in the market, and civil service structures don’t enable you do to that.”
Treasury-set pay controls are also a problem, he added: “I have no flexibility, and public sector pay constraint – in the form that it’s running at the moment – is entirely inconsistent with [pay levels in] a thriving wider construction industry.”
Dalton also said that, although he agrees with the ideas behind Cabinet Office spending controls, the way that they operate can take up resources that would be better used to deliver projects. “We invest a huge amount of time looking upwards to our sponsoring Department [for Transport] and the Cabinet Office, demonstrating that we are compliant with their requirements, which is time and resource that would be better spent on managing my suppliers and contractors,” he said.
“If we agree that we will follow the Cabinet Office model, because it makes good business sense to do so, why are we not trusted?”, he added. “We have heavy approval processes for relatively small amounts of money, and yet quite a lot of trust for some very big amounts of money.”
The Highways Agency is set to become a government-owned private company in 2015, giving it greater freedoms and ability to plan for the long term. “Being a company that can set its own destiny, plan a bit better for the future, will make us far quicker to respond, far pacier,” he said.
It will also allow the agency to avoid annual budget rules, which he said do not allow it to plan for the long term. When flooding prevented the agency from spending £20m on resurfacing work in January and February, Dalton complained, the Treasury reclaimed the resultant underspend at the end of March. The agency has now had to cut another programme to carry out that work.
The Cabinet Office declined to comment.
Read more: Interview, Graham Dalton