Britain’s long – and sometimes successful – history of reforming the civil service

Shaking up government with lessons from industry sounds like a good idea... which is why, as Sean O’Grady explains, it has been tried many times before

Suddenly, radical reform of Whitehall is in fashion again. Sir Keir Starmer spoke last week of civil servants lingering in the “tepid bath of managed decline” and now his de facto deputy, cabinet office minister Pat McFadden, has urged departments to behave more like tech startups by adopting the “test and learn culture” of the best digital companies, bringing in outsiders, and abandoning “mind-bogglingly bureaucratic and off-putting” application processes for civil service jobs.

Ministers have also picked up on Kemi Badenoch’s inchoate rhetoric about “rewiring” government, though not going so offensively far as her claim that 10 per cent of civil servants are so bad they should be in prison because they leak official secrets and “agitate” against ministers. Doubtless, the creation of a Department of Government Efficiency in the United States, led by Elon Musk, has prompted some reflection on this side of the Atlantic.

So the civil service is under scrutiny, if not attack. But not for the first time...

Is bringing in outsiders to Whitehall departments a new idea?

No, and the private sector has often been regarded as a sort of magic elixir for bureaucratic inertia, real or imagined. It has been done frequently, in fact, and with varying degrees of success. For example, more than half a century ago the Conservative government led by Ted Heath, a self-consciously technocratic and corporatist administration, recruited businessmen to try to improve efficiency, and this approach was placed on a more permanent and formal footing by Margaret Thatcher when she became prime minister of a great reforming government in 1979.

Within days, she had appointed Derek Rayner, joint managing director at Marks and Spencer (then regarded as the apogee of British corporate success) as head of a small Downing Street “efficiency unit” with a remit to oversee public spending. Rayner was told to concentrate on “functions that can be cut out, wasteful work systems... and unnecessary demands on the public (forms, surveys, etc) and less perfectionism and rougher justice in administration”.

The work expanded, and the abiding legacy of the Rayner years was his “Next Steps” paper in 1987. In the contemporary spirit of privatisation, this advocated turning as many Whitehall departments as possible into operationally independent and more commercially focused “executive agencies”, with about half of such units being reformed by 1994. Examples include the Driver and Vehicle Standards Agency, Natural England and HM Prisons and Probation Service, all previously administered directly by departmental civil servants.

Does it work?

Given that so many governments have periodically revisited these ideas, it must either be that the British civil service is unusually resistant to change or that all the rhetoric about the superior ways of the private sector is just guff; exaggerated if not irrelevant in public services that never can be businesses, and an inadequate substitute for policy.

In 2012, the Conservative-Liberal Democrat coalition complained of “ingrained, cultural problems” and bravely launched a “civil service reform plan”. In words that sound eerily familiar, then prime minister David Cameron declared it was about “harnessing the world-beating talents of those who work in our civil service and making sure they aren’t held back by a system that can be sclerotic and slow,” adding: “That means learning from the best in the private sector.

“Of course, delivering good public services is very different from running a business. But the way the best businesses nurture talent, flatten management structures, reduce unnecessary bureaucracy, and improve services while reducing costs all hold lessons for us in the public sector.”

How do outsiders fare in the civil service?

As with regular civil servants, their success depends on the confidence they inspire in their political masters and colleagues. Despite all the talk of radical reform in recent decades, some of the more adventurous external appointments were made during and after the Second World War: Lord Beaverbrook (proprietor of the then mighty Daily Express) was brought in to boost aircraft production; Frederick Lindemann, Churchill’s scientific adviser; and John Maynard Keynes, the economist drafted to help negotiate advantageous post-war credits from the United States.

Has the civil service ever been “fit for purpose”?

No, which is why it’s so often been reformed in recruitment, from the earliest attempts at professionalisation – the Northcote-Trevelyan reforms of 1856 – to the attempt to end the “cult of the generalist” (archetypically an Oxbridge classicist) under the recommendations of the Fulton Committee in 1968, which led to the hiring of professional scientists and skilled managers. The civil service of today is vastly more open to outsiders at every level than ever before.