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Innovating through machinery of government changes. Looking at the drivers, costs, process and outcomes of changes to government departments and arms-length bodies. IFG/LSE Joint Report. 43 departments were affected by mergers and demerges from 1979-2009 Over 30 in-depth interviews - PowerPoint PPT Presentation
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Innovating through machinery of government changes
Looking at the drivers, costs, process and outcomes of changes to government departments and arms-length bodies.
1
IFG/LSE Joint Report
• 43 departments were affected by mergers and demerges from 1979-2009
• Over 30 in-depth interviews• 23 UK current and former senior civil servants• 7 private sector experts• 3 Canadian former and current senior civil
servants• 1 Australian civil servant• 1 UK politician
2
Five key findings
3
1 Department changes are costly.
Restructuring costs are at least £15-£20m and can be substantially more where pay differentials are great.
2 The final driving factor to change is usually political.
Administrative and policy rationales may be present but political factors usually act as the tipping point to change.
3 There is little to no planning done by politicians in advance of the change.
The Cabinet Office has insufficient time, skills and resources to properly advise on changes.
4
Transition team officials have insufficient time to prepare before effecting the changes.
Most teams given 0-4 days to effectuate change.
5 Departments need more support during changes.
Cabinet Office support is largely with budget arbitration.
1. Department changes are costly…
Costs based on interviews with senior civil servants, Department annual reports and documentation of change, Civil Service Statistics and Select Committee Hearing Minutes.
89% 91%
19%
5%
DWP
£173,374,300
14%
81%
Defra
31,041,700
32%
48%
DIUS
£15,289,600
9%
DECC
£15,687,500
11%
% of Administrative
Budget20% 22% 18% 3%
Indirect
Recurring
First Year
… with differential pay affecting departmentsfor years to come.
5
Total
31,041,700
Indirect
10,000,000
Recurring
15,000,000
First Year
6,041,700
Productivity
Differential Pay Settlement
IT integration
IT Investment
HR Systems Integration
Accommodation
% of Administrative Budget 4% 9% 6% 18%
“The one thing that dogged us for about 6 months was differential pay.
MAFF was in the bottom quartile in Whitehall paylink and DETR, because
they had the money and frankly because they had made some poor decisions with the trade unions, were in the top quartile – put those two together and you get an
industrial dispute.”Former Senior Civil Servant, Defra
“The one thing that dogged us for about 6 months was differential pay.
MAFF was in the bottom quartile in Whitehall paylink and DETR, because
they had the money and frankly because they had made some poor decisions with the trade unions, were in the top quartile – put those two together and you get an
industrial dispute.”Former Senior Civil Servant, Defra
Costs of DEFRA as calculated at the end of it’s first year.
Costs based on interviews with senior civil servants, Department annual reports and documentation of change, Civil Service Statistics and Select Committee Hearing Minutes.
2. The main driving factor is politics…
Drivers of MoG Changes as cited by senior civil servants (% of MoG changes,1980-2008)
23%
29%
Politics48%
Policy
DeliveryMedia Reporting
Stakeholder Pressure
4%
Signalling 10%
Minister Departure 12%
PM interest 18%
Cabinet formation 18%
Job creation/empire-building 39%
Results based on codification of 18 senior civil servants involved in department level machinery of government changes between 1979-2009.
“The most common circumstance is the process of cabinet making.
Most of the biggest changes in the last 10 years with exception of MoJ have been as
a result of meeting the needs of colleagues for a job.”
Senior Civil Servant, CO
“The most common circumstance is the process of cabinet making.
Most of the biggest changes in the last 10 years with exception of MoJ have been as
a result of meeting the needs of colleagues for a job.”
Senior Civil Servant, CO
… even though many changes also have policy or delivery rationales.
7No. of times theme is cited
“Personalities came into it in a big way but the argument
for the new division was delayed by personalities for
some time and that was overcome and with some
hardship to individuals but it was much more a policy
change.” Former Cabinet Secretary
discussing MoJ
“Personalities came into it in a big way but the argument
for the new division was delayed by personalities for
some time and that was overcome and with some
hardship to individuals but it was much more a policy
change.” Former Cabinet Secretary
discussing MoJ
3. There is limited to no planning in advance of department changes
8
Home loyalties
No Planning/Shock
Resistance to change
Staff Morale
Cultural Challenges
Anger
Superficial planning
Delivery Risk
No Support
Disruption
81%
62%
43%
38%
38%
29%
29%
29%
29%
24%
Results based on codification of 18 senior civil servants involved in department level machinery of government changes between 1979-2009.
Top issues cited by senior civil servants (% of MoG changes,1979-2009,in which issue was raised)
“[X] had already been asked to be SoS for that Department. He was in the car half way down Victoria Street [en route] to his department when he was called back and told:
‘Actually we’ve changed our mind. You’ve got [Department A] and [person Y] wants [Department B]…’
[Y] wanted [B]...So they just put it together. There was no examination of any kind at all. It was just done. And most MoG changes are just like that”.
Senior Civil Servant, CO
“[X] had already been asked to be SoS for that Department. He was in the car half way down Victoria Street [en route] to his department when he was called back and told:
‘Actually we’ve changed our mind. You’ve got [Department A] and [person Y] wants [Department B]…’
[Y] wanted [B]...So they just put it together. There was no examination of any kind at all. It was just done. And most MoG changes are just like that”.
Senior Civil Servant, CO
4. Transition teams have insufficient time to prepare.
9
40%
57%67%
33%
Demerger
7
43%
Merger
10
50%
10%
New
3
Senior civil servant recollections of MoG change process (% of MoG changes,1979-2009)
1 week
> 10 days
0-4 days
Preparation Time: Time given to Senior Civil Service and Transition Teams to prepare Department for change in advance of first day of business.Time Required to Refocus Department: Time taken to configure Department business processes, culture and systems toward new change mandate.Results based on codification of 18 senior civil servants involved in department level machinery of government changes between 1979-2009.
“I don’t see why you couldn’t have had more planning around DECC. It didn’t have to be done over night and it might have just helped the
birth pains of the brand new Department. They had no IT... The first few weeks were really difficult
because all the staff were in the wrong place. The ministers were in a
[different] building...
I know somebody who went to see [the Minister] and said it was a bit
like going back to WWII. There were messengers coming in with bits of paper because they didn’t have IT connected and so on. If they had been given a month instead....”
Former Senior Civil Servant, BERR
“I don’t see why you couldn’t have had more planning around DECC. It didn’t have to be done over night and it might have just helped the
birth pains of the brand new Department. They had no IT... The first few weeks were really difficult
because all the staff were in the wrong place. The ministers were in a
[different] building...
I know somebody who went to see [the Minister] and said it was a bit
like going back to WWII. There were messengers coming in with bits of paper because they didn’t have IT connected and so on. If they had been given a month instead....”
Former Senior Civil Servant, BERR
5. Making changes better requires greatercentral support.
10Results based on codification of 18 senior civil servants involved in department level machinery of government changes between 1979-2009.
6
6
Central support re shared services
Annouce earlier
6
Differential pay easing
4
IT - common platforms
5
Support with resource transfers 5
7Clear guidelines
Central capacity in org. planning
39%
33%
33%
33%
28%
28%
22%
Top themes cited by senior civil servants which would ease the process of MoG changes.
“I have not found the Cabinet Office helpful in
any machinery of government change I
have been involved in.
[Department X] or [Department Y] or when
[Department Z] was created. Ultimately, it
came down to sorting that for ourselves.”
Former Senior Civil Servant, Defra
“I have not found the Cabinet Office helpful in
any machinery of government change I
have been involved in.
[Department X] or [Department Y] or when
[Department Z] was created. Ultimately, it
came down to sorting that for ourselves.”
Former Senior Civil Servant, Defra
4 recommendations for better MoG changes
11
1 month prior:
Announce changes and begin planning
1 month prior to 2 months post:
Support from the centre
6 months post:
Affirmative resolution on change
18-24 months post:
Post-change assessment
Unlink from reshuffles and announce 1 month creation.
SoS, PS and CO prepare business plans for change
CO provides a scratch team to set-up interim HR, facilitate IT and finance systems changes.
CO provides organisational change expertise
Affirmative parliamentary resolution before substantial change work begins
Business plans including costs of the change available in advance of the debate
Department Select Committees and NAO audit the change against the original business plans 18-24 months post-change.
FOR DISCUSSION:CHANGES BY THE CURRENT ADMINISTRATION
12
High impact/low profile changes so far
13
High impact/low profile changes so far
14
Rumoured Who Title Responsibilities Department
OGC Reform/ PMSU/ PMDU gone? Francis Maude
Minister for the Cabinet Office ICT/Cabinet Office units CO
Universities to Education Vince Cable Business Secretary
Trade, competitiveness, competition policy, consumer protection BIS
Operations Director Lord Browne TBD
Scrutinising performance of all Whitehall CO
Possible changes
The emerging picture?
15
MoJ
Home Office
DWP
Defence
DFID Education
BIS
DECC
Transport
Foreign Affairs
HealthDCLG
Defra Scot/Wales/NI
Operations
Civil SocietySecurity Const.
ReformOpera-tions
Cabinet Office
Treasury
No. 10
EXTRA SLIDES FOR Q&A
16
3
1
7
11
3
7
5
3333
12
1
7
11
11
4
10
2
5
7
3
1
7
23
1
6
1
0
5
10
15
20
25
30
7978777675747372717069686766656463626160595857565554535251 09080706050403020100999897969594939291908988878685848382818050
Total Number of Departments
Depts affected
Department reconfigurations, 1950-2009
913
83
137
2814
6
19
619
11
Churchill
Eden
McMillan
Douglas-Home
Wilson 1
Heath
Wilson 2
Callaghan
Thatcher
Major
Blair
Brown
Labour Average
Conservative Average -11
-2-1
3-5
-24
1-3
21
-2
0
# Departments Affected Net Change
LabourConservative
Note that the averages calculated for Labour and Conservatives are averages for the political parties over this time period. They do not reflect premier tenures.
Labour expands while Conservatives consolidate
55
2
1
6
11
77
2
3
1
19551951 1964 19901974 1979197619701957 200719971963
7
5
33
2
6
11
5
77
3
1
19511950 1964 20011983 200519971955 1970 1974 197919741959 199219871966
Post-appointment department changes Post-election department changes
Labour
Conservative
Figures in red are for emphasis only and indicate the years when new PMs abstained from reconfiguring departments.
Department reconfigurations are common after leadership changes
Prime Ministers changes by term
20
14
3
7
2
21
11
7 81Churchill
Eden 33
Macmillan 132
Douglas-Home 77
Wilson (1) 287
Heath 1412
Wilson (2) 66
Callaghan 11
Thatcher 92
Major 63
Blair 195
Brown 1111First 2 YearsRest of Term
21
Methods of Reform Process Examples LoopholesFormal dissolution and transfer of statutory functions to another department or departments
Secondary Legislation: Proceeds by Order in Council subject to the affi rmative resolution procedure
Ministry of Overseas Development
The choice between negative and affi rmative resolution procedures is not clear cut: (Poll itt 1984)
Examples: Department of Trade and Industry in 1983 was created via a "merger" and Transfer of Functions Orders were utilised instead of dissolving its former parts; Department of Economic Affairs was dissolved via a Transfer of Functions Order rather than using the affi rmative resolution procedure.
Transfer of statutory functions from one department to another
Secondary Legislation: Transfer of Functions Order under the negative resolution procedure
Civil Service Department
Department of Trade
Department of Trade and Industry
Transfer of Functions regularly delayed: (PASC 1995)
DCLG: Created May 5, 2006; Order July 31, 2006ODPM: Created May 29, 2002; Order November 4, 2002Defra: Created June 8, 2001; Order November 12, 2001DEE: Created July 5, 1995; Order December 4, 1995
Transfer or cessation of non-statutory functions
No need for the use of statutory instruments in this case
None identified None required
Cessation of statutory functions
Primary Legislation: Approval of both Houses
None identified Delayed legislation: Poll itt 1984 claims there are countless examples of statutory functions fall ing into disuse and waiting to be formally eliminated in revising legislation.
Creation of new statutory functions
Primary Legislation: Approval of both Houses
Department of Constitutional Affairs: Constitutional Reform Act of 2005 confirmed changes to the judiciary.
Bodies may be created administratively and then subsequently become statutory or created by administrative action pending statutory authorisation: (Poll itt 1984)
Example: Department for Constitutional Affairs was effectively created in 2003 but not confirmed until 2005.
Creation of new government bodies under new Secretaries of State
Secondary Legislation: Proceeds by Order in Council subject to the negative resolution procedure
Department of Economic Affairs
Welsh Offi ce
None required
Legislative process for select MoG changes