Speech

Future of public services reform: Matthew Hancock speech

Minister for the Cabinet Office Matthew Hancock spoke about reforming public services.

If there were such a thing as a patron saint of reform in government, perhaps it would be Samuel Pepys. As an MP and Secretary to the Admiralty in the 1670s, Pepys had the job of turning round the country’s biggest employer, the Royal Navy.

The seventeenth century Navy’s problems included:

  • grossly inefficient procurement: contractors making huge profits supplying the fleet with unseaworthy ships and inedible rations
  • a lack of operational experience at the top: too few senior officers with seafaring and navigation skills
  • and limited funds: thanks to huge debts incurred by Cromwell and a series of disastrous trade wars with the Dutch

To improve the Navy, with royal finances tight, there was only one option open to Pepys: reform.

He began by rationalising procurement, getting tough on suppliers, agreeing common standards, and using the Navy’s market power to strike the best possible price for the Crown. Next came professionalization: for the first time would-be lieutenants would have to take competitive exams.

As President of the Royal Society, Pepys encouraged officers to apply the latest insights from fast-developing science, from astronomy to navigation. In the following century the Navy’s commitment to innovation would help Britain emerge as a global leader and crack the problem of determining longitude at sea.

Today we face a problem Pepys would have recognised: how to improve public services when budgets are tight?

There are huge differences of course. Now, it’s less about winning the battle for maritime supremacy, and more about the battle for a truly 7-day NHS, for outstanding local schools and apprenticeships. To ensure all professions are open, that anyone can make it to the top, and that there are well-paid jobs for all who seek them.

Today I want to make the case for reform, set out some specific areas where reform needs to accelerate, and describe the changes we need to see to make reform happen.

First, the case for reform.

Five years ago, many argued that with the onset of tight budgets as a result of earlier overspending, public services would inevitably suffer. [It has been argued that] for years that there was an ironclad link between the quality of a service, the value government attached to it, and the amount of money spent on it. From that it followed that any reduction in spending would invariably make things worse.

Now, of course it’s easier to build better public services when money is plentiful. Reform in tight times is that much more difficult.

Indeed one of the reasons we must deliver a surplus and start paying down our national debt is that economic insecurity and the costs of servicing that debt divert resources away from public services.

But what we learnt in the last Parliament confirmed an age-old reformers’ dictum: how you spend money is at least as important as how much you spend.

In the last Parliament we made many tough decisions and reduced the deficit by over half. Yet a million more children are now taught in good or outstanding schools, crime is down by quarter, and public dissatisfaction with the NHS is at its lowest level ever: all because we found savings and focused resources where they were needed most.

And to those who say that because we’ve made savings, there are no more to find, just look at what’s happening in the world around us. You can now set up a direct debit, book a flight, find a flat, or do your weekly shop at a time and place of your choosing, without being put on hold, without having to queue, without being passed from pillar to post, without having to pay people commission, without having to like it and lump it if the service isn’t up to scratch.

Technology marches on. The businesses that have thrived in an online age have done so not just by winning on quality and price, but on choice and convenience too.

I’m not saying private is good and public bad. Far from it. There are plenty of dreadful private services. But our aim in public services should be to be the best. And the point is that by harnessing technology and excellent service, the best keeps on getting better.

So the case is clear: government can transform its performance.

Next is the question of why it must.

At one level this is justified in terms of the billions of necessary efficiency savings, and the vital need to achieve surplus. In the last Parliament efficiency and reform generated unprecedented savings, but we now must go further.

We need to save a further £10 billion annually by 2017 to 2018, and up to £20 billion by 2019 to 2020. And increasing public sector productivity is crucial to driving up the UK’s overall productivity.

But it’s about more than the savings targets and productivity statistics. When public services aren’t responsive to the needs of users, it’s the people who rely on them most who suffer. Transforming public services is not some bloodless technocratic exercise in budget management; it is a noble cause.

Every pound we save makes our economy more secure; every efficiency we find frees up more to serve society’s needs; every successful reform helps us support the needs of the most vulnerable, and break down barriers to social mobility.

We must transform our public services so that they are structured wholly around the needs of the public, rather than by accidents of history or the internal logic of the machine.

So, since we can and we must transform public services, what must we do next?

I believe we must transform not just individual policies, but drive changes to the very way government functions. Much of government policy is rightly set in departments with the focus to reform a particular area. Our reforms to education and welfare, for example, are crucial, and led brilliantly by those 2 departments.

But increasingly transforming government means working across departmental lines. In terms of policy, we have now brought together, in 10 Implementation Taskforces, the key manifesto priorities that we are determined to drive through.

Unlike Cabinet Committees, which essentially exist to clear policy proposals across the collective responsibility of government, these task forces are about executing cross-departmental agendas, from childcare, to youth unemployment, immigration to housing. They comprise not just the key ministers, but the top officials and experts in any area.

And just as policy increasingly needs to break down the silos, so delivery increasingly cuts right across government. In property, project management, procurement, digital, data and people, transformation comes by working across departmental lines.

Let’s look at a couple of these functions.

Take property. In the past each department thought of its estate as an asset. Now, we rightly treat it as a running cost.

Our central Government Property Unit is revolutionising the use of property.

Since 2010 we’ve reduced the central government estate by 2 million square metres. That’s equivalent to 27 Buckingham Palaces, generating £1.4 billion in capital receipts and saving £625 million in running costs.

We’re now going further, bringing civil servants together into hubs: modern, efficient accommodation shared by multiple departments.

But there’s much, much more to do. It’s not just about saving money, important though that is. More efficient use of property can also make for better service delivery, particularly on the front line.

The police and fire service often work together, from dealing with arson to responding to road accidents. Having them in one place can mean crucial time is saved when they arrive on the scene. That’s exactly what Worcestershire County Council have done in Bromsgrove, replacing 2 old and expensive police and fire stations with a joint HQ.

And why, after so many years, is the other end of Victoria Street and places like it being redeveloped? Because the government used to occupy large swathes of it and now no longer does.

Let’s take another function: major projects.

Before 2010, two thirds of major projects ran over time and over budget. Some major projects had no clear senior responsible owner, unclear accountability to ministers and Parliament, and poor information on the delivery of that project.

We now have a project delivery function, with central leadership and oversight provided by the Major Projects Authority.

It’s driving forward a culture of better management information with clear lines of accountability. It’s the approach that delivered us the Olympics, and now it’s being put to work across the government’s £488 billion major projects portfolio. Last year better project management saved the taxpayer £3.3 billion.

Let’s take another.

The Government Digital Service is achieving on a virtual plane what the Property Unit is doing in physical space: saving money by bringing services together, while improving the user experience.

Famously, GOV.UK has brought 1,882 websites into a single portal, saving over £60 million a year, making information and services quicker and easier to find.

We’re now scaling up this approach, and this is where the idea of ‘government as a platform’ comes in. Instead of each department custom building every component they need to deliver a service, we’re working across government to build a common set of plumbing, core digital building blocks which departments can reuse.

In the last Parliament we focused on making some of central government’s most significant services digital by default. Twenty of those services are now publicly available — everything from applying for carer’s allowance, to registering to vote.

Take carer’s allowance. In redesigning the application process to put the user first, we were able to remove 170 unnecessary questions, transforming the user experience.

But with around 700 types of transaction between government and the citizen there is clearly much more to do. And in doing so, becoming much more responsive to citizens in the wider public sector.

Crucial to this is the principle that by listening to user feedback and analysing the data that comes with usage, an early prototype service can be constantly improved.

Public opinion was once like a fine Scotch whisky — sipped and savoured occasionally, through the imperfect medium of public consultations. Now, digital technology means it’s much easier to hold a genuine iterative dialogue with the users of public services.

This sort of data is important when designing services, but it’s a crucial driver of reform too. As TripAdvisor showed the tourism industry, the sunlight of transparency, mass feedback, and the ability to choose your service provider drives up standards and gives customers a better deal. From healthcare, to schools, to crime maps, open data is informing citizens about the choices that they make.

So instead of a target culture we are moving to a data culture, where we use data analysis to guide the service in real-time.

For example, we’ve worked with the Department for Communities and Local Government on their national fire incident reporting system, developing a dashboard that will help non-specialists make sense of the hundreds of thousands of calls fire brigades receive each year, so they can put resources in the right place and take preventative action.

These reforms, through better policy, better delivery, and better data and accountability, are at the heart of the changes we need to see.

So finally, I want to turn to the most important cog in this machine.

It’s the cog, without which, government would grind immediately to a halt. A cog that comprises many of the best minds in the country, and delivers some of the most complex tasks in the world.

The Civil Service are mission critical to the delivery of any reform, and to any improvement we seek. We cannot make these changes despite the Civil Service. We make them through the Civil Service. Properly led by democratically elected ministers, now with the extra clarity of direction granted by a majority government, we must ensure the Civil Service itself can deliver too.

For the task of the Civil Service is to improve the state of the nation, according to the mandate of the people. It is a high calling. It must be open to all, truly reflecting the country it governs and it must be run to the highest possible standards of management, agile and high performing.

I have said before I want jobs in it to be as good as at Google. That is no casual dream. There is no reason at all why it can’t be one of the best places to work in the world. It has the mission: to serve our nation.

It has many of the best people. Now it needs to have the confidence and the clarity, with the very best training, management and HR.

Three and a half centuries may have passed since Pepys’s Naval reforms but the principles endure: get a grip on the costs, get the right people in, get better at applying the latest technology.

Today that means a more productive, innovative, collaborative civil service: delivering better public services because it’s relentlessly consumer-focused; doing more for less by transforming the way it works.

That is the means, but it’s not the end. The end is to build a Britain that we are proud to call home. Where we combine as no other nation can, the best of our traditions with the cutting edge. Where public services and free enterprise alike serve working people, offering hope and opportunity to those who need them most.

For too long the system has served those with the skills to work it, or with the money to opt out. We must say no more. So let us raise the banner of reform, driven by data not dogma, planning around the needs of people, not the boundaries of departments.

We seek reform to realise the potential of all our citizens, to unleash the talents of our nation’s children so that background is no barrier to success, to bring our country together, united on the principle that work will be there for all who want it and help for those who need it.

And we reform in the interests of all, but above all on behalf of those who rely on public services the most: the very old, the very young, those out of work, those who can’t work, those who have to give up work to care for a relative.

That is who we are striving to serve. We must not fail them.