Will there be Further Whitehall Wars this autumn?

by ukcivilservant

There was a startling but hardly noticed announcement, a couple of years ago, that ‘a ministerial policy decision cannot be sufficient justification alone for proceeding’.  Priti Patel, Matt Hancock and the rest can apparently announce whatever they like – but civil servants shouldn’t take any notice unless they are convinced that the plans are ‘feasible’.  Here is how we got here.

Ministers are frequently accused of being too ready to seek political advantage by announcing impossible or badly thought-through policy objectives, or by allocating insufficient time and resources to otherwise achievable policy objectives.  Jill Rutter’s half jest summarised the underlying issues rather well:

Civil Servants say to ministers that “We won’t tell you it can’t be done if you won’t sack us when it is not done”.  Maybe it is time we recognised that this constitutional pact has run out of road?

The story began in 2011 when the Institute for Government recommended that it should be made easier for senior civil servants to challenge ministers’ policy decisions in the same way as they had for many years been able to challenge a ministerial spending decision.  (Officials would ask for a formal written ‘Ministerial Direction’ if the spending appeared to be irregular, or improper, or to represent poor value for money.)  Permanent Secretaries would ask for a Policy Direction if they were not satisfied that ‘clear, well-reasoned timely and impartial advice’ had been provided, and that the decision was in line with the aims and objectives of their organisation. 

Not surprisingly, this particular idea did not find favour with ministers who were shortly afterwards faced with an equally threatening suggestion of Procedural Directions.  These were proposed by the Better Government Initiative and supported by the Public Administration and Constitutional Affairs Committee and The Constitution Society.  In short, ministers would be held to account if they were to deviate from the processes laid out in the Cabinet Manual. 

One example, had this mechanism already existed, might have been Tony Blair’s failure to circulate pre-Iraq War legal advice to Cabinet colleagues.  Others might have been some of the decision-making either side of the Brexit referendum. Sadly, this attempt to fetter Prime Ministerial discretion was no more welcome to the government than had been the Policy Directions. 

But there was progress on the policy front.  Treasury ministers quietly, in 2011, introduced Feasibility Directions.  These allowed officials to require ministers to direct them to proceed with projects even if officials doubted that the project’s objectives could be achieved either at all, or within the timescale and resources stipulated by the minister. Here is an extract from the guidance:

‘Feasibility often overlaps with value for money and/or propriety. The judgement to be made is whether government has the ability to carry out the proposed policy effectively and credibly. Precedents, market testing and pilot studies can give confidence that a new policy or proposal will be feasible. Conversely, warning signs include novelty, high administration costs, high error rates and significant compliance costs. Where there is doubt about the quality of administration, the proposed course may well also be inefficient or improper.’

Whitehall watchers awaited the first Feasibility Direction with great interest.  Would it be seen as evidence, yet again, of ministers’ unrealistic expectations, driven by short term political considerations? Or would it be evidence, yet again, of the need for ministers to be able to override their cautious, unimaginative and unambitious civil servants?

It was therefore quite telling that a National Audit Office report five years later asserted that Accounting Officers ‘appear to lack confidence to challenge ministers where they have concerns about the feasibility or value for money of new policies or decisions, not least because standing up to ministers is seen as damaging to a civil servant’s career prospects’. 

The first Feasibility Direction did not in fact appear until 2018 when a minister took responsibility for the risks associated with accelerated introduction of new ‘T Level’ exams.  This was a perfectly sensible and uncontentious use of the mechanism. 

The seven year wait for the first Direction was no doubt one reason why the retiring head of the National Audit Office, Sir Amyas Morse, announced in 2019 that he was concerned that the balance of power between ministers and senior civil servants had shifted, with officials increasingly unable to challenge bad decisions.

“I still don’t think we’ve sorted out the question of the interaction between the political agenda and delivering good results and value for money.  There’s pressure to do things too quickly or to announce very high-profile world-beating projects. Allowing ministers to have a say in the appointment of senior officials has led to a position where ministers have a great deal of power over their civil servants. That’s unfortunate. They’re intelligent people. They understand that the consequences of disagreeing with a minister are likely to be pretty ugly.”

A small number of further Feasibility Directions were issued by the Business Secretary as his officials rushed to support the private sector during the 2020 COVID-19 crisis. 

Senior Responsible Officers were another Whitehall innovation which is taking a long time to take off.  SROs were from 2013 to be personally accountable, including to Parliament, for the delivery of major projects such as the National Cyber Security Programme.  It was hoped that newly appointed SROs might be concerned to ensure – before accepting their appointment – that they were not suffering from appraisal optimism, and that their project was properly resourced and had sensible timescales and objectives.  This would reduce the chances of their having to account to their Permanent Secretary and Parliament when things went wrong.  And it would ensure that a senior official – the SRO – was forced to challenge ministers if a major project were being established without proper resources etc.

In practice, however, little at first appeared to have changed.   SRO appointment letters were little more than that.  They specified neither the programme’s objectives nor its resources or timescales.  And most departments at first decided to appoint very senior staff as part-time SROs, rather than nominate those officials who were truly responsible for key projects. The SRO for the National Cyber Security Programme was for instance told that he would need to devote only two days a month to the role!

But SROs were strengthened by the introduction of Accounting Office Assessments – see further below.  The Universal Credit SRO appointment letter, for instance, requires the SRO to prepare an Accounting Officer Assessment ‘if the programme might depart from the four standards (regularity, propriety, value for money and feasibility), or from the agreed plan – including any contingency – in terms of costs, benefits, timescales, or level of risk’. The letter is also firmly linked to the Business Case, so the SRO is personally accountable for delivering the intended economic and net present values. Indeed, some of the Universal Credit material suggests that the relevant SRO was able to renegotiate the programmes timescales and be clear to Parliament what the reasons were.  So this particular (if isolated?) Minister/official dynamic appears to be working well. 

Finally, Accounting Officer Assessments were introduced in 2017.  Following a Public Accounts Committee recommendation, the Treasury announced that ‘Accounting Officers should personally approve, in advance, all significant initiatives, policies, programmes and project’ and so be able to provide assurance to Parliament that those activities provide value for money and are feasible etc.  The guidance went on to say (emphasis added):

‘The analysis should consider the issue in the round. A ministerial policy decision cannot be sufficient justification alone for proceeding. The accounting officer’s job is to try to reconcile ministers’ policy objectives with the standards for use of public funds.

The full accounting officer assessment should provide a frank examination of the key issues including any sensitive issues. It should address the essence of the policy which is being delivered, its purposes and its prospect of successful delivery or implementation. It is therefore not usually published in full, but is shared with the Treasury.   A summary of the key points from an accounting officer assessment of a major project should however be prepared and published.’

Will AO Assessments Make a Difference?

Ministerial Directions were once regarded as nuclear weapons – more effective in the silo rather than launched.  But they have come to be seen as a grown-up way of allowing ministers to account for political decisions to override strict value for money criteria.  SROs’ ability to launch Accounting Officer Assessments are similarly unlikely to be used very often, but they should in theory discourage ministers from announcing badly thought through projects such as Prime Minister Cameron’s ‘Big Society’ or Prime Minister Theresa May’s social mobility agenda.  Boris Johnson’s ‘levelling up’ might meet a similar fate. All the aspirations were no doubt sincere but there was no organisation or institutional weight behind them. 

The signs so far are not promising, given the number of ill-thought-announcements during the initial response to the COVID-19.  Officials are clearly not obliged to prepare an AO Assessment immediately a minister indulges in some blue sky thinking.  But I suspect that they will nevertheless prevaricate far too long before offering serious challenge to ministers.  And the Treasury’s guidance allows a fair bit of wriggle room later on:

Often, big intricate decisions have long lead times. In such cases, it is good practice to make the accounting officer assessment in principle at an early point, firming it up at suitable strategic points as the policy or proposal is developed. This makes for orderly evaluation of the key features of the policy, with no surprises at the final decision point. Apart from providing time to redesign a policy or proposal, early assessment may flag up how the proposal can be better designed to meet both ministers’ and parliament’s requirements …

Also, unlike AO Assessments associated with major projects, AO Policy Assessments, will not automatically be shared with Parliament.  I fear that the result is that they will not differ in substance from the traditional Mandarin warnings that ministers’ policy proposals are ‘brave’ – ‘courageous’ even!  So it could all come down to the energy and inquisitiveness of MPs and Select Committees.  They could – perhaps supported by the National Audit Office and the media – start insisting on seeing AO Policy Assessments.  If so, we could see a significant improvement in the way this country is governed.

The test may well come in this year’s Spending Review.  Faced with yet further cuts, departmental ministers may fail either to cut existing programs or to prioritise their wish list.  Mistakes will be made.  Will Permanent Secretaries, on five year contracts, assert that ‘a ministerial policy decision cannot be sufficient justification alone for proceeding’ – or will they prioritise their careers?

[This is a shortened version of a more detailed history on the Understanding the Civil Service website.]

Subsequent Debate

The IfG’s Alex Thomas sparked an interesting exchange with Jill Rutter and others after reading this blog. (Jill was one of the authors of the IfG’s 2011 report recommending the introduction of Policy Directions.) The debate revolved around the difference between Policy Directions (which weren’t introduced) and AO (Feasibility) Assessments (which were).

Jill stressed that Policy Directions were not intended to impede the introduction of policies which civil servants thought to be bad ideas. They were solely intended to come into play when officials thought that the evidence did not support a particular intervention as a reasonable way of delivering the ministerial policy objective.

Alex could live with the feasibility test as a way of reconciling ministers’ policy intentions with the sensible use of public funds. But ministers are already required to consider civil service advice before taking significant decisions. Ministers therefore take responsibility for the decision, not least if the they choose an option other than the one recommended by officials on the basis of evidence and analysis.. A further challenge, by way of requiring a Policy Direction, would surely further damage minister/civil servant relationships. The publication of the Direction would certainly enhance accountability by exposing the debate to public view. But it would damage the collegiate nature of minister/official relationships within Whitehall.

In reply, Jill wondered whether the relationship was already so decayed there is no option but formalisation. Both sides would lose something important – but she was not sure the relationship was now salvageable.

Martin Wheatley and Jonathan Potts rounded off the discussion by suggesting that the problem that Policy Directions were intended to address would be better solved through strengthened parliamentary scrutiny – a noble aim but not one likely to be achieved in the near future?

Martin Stanley
Editor Understanding Government