Public Procurement and the Civil Society Strategy
Lord Maude of Horsham Excerpts(7 years, 2 months ago)
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Lord Maude of Horsham (Con)
My Lords, I draw attention to my entry in the register of interests, and I congratulate my noble friend on securing this important debate. Public procurement is rarely a subject that sets the pulse racing but it is important, accounting for, as we have heard, just about a third of public spending, and the way in which it is done and the success of how it is done make a huge difference to what the public get from the money that we in government spend on their behalf. If the value for money, the quality or the timeliness of delivery are wrong, people in real life suffer as a result.
My noble friend Lord Young knows a great deal about public procurement from the supplier or vendor side; I know quite a bit about it from the client side. I had responsibility in the coalition Government for public procurement and spent a lot of time dealing with the issues around it. I pay tribute to the noble Lord, Lord Wallace of Saltaire, who for virtually all that time was the House of Lords Whip assisting us in the Cabinet Office on these subjects, and who gave enormous support to the reforms that we were seeking to push through.
We found at the outset that public procurement was working in a rather bizarre way. Practices had been put in place, often attributed to the requirements of EU procurement rules but which in fact were being massively gold-plated, both through our regulations but much more through established practices, which almost deliberately seemed to exclude smaller businesses, social enterprises and civil society organisations from bidding for and winning public contracts. We therefore wanted to change that. We found that public procurement, especially in central government but much more widely in the public sector, was driven by a group of people I came to know as “procurocrats”—people for whom process was king and who had far too little commercial awareness. There are three parts of any procurement process: pre-tender market engagement, a formal tender process, and contract management. Overwhelmingly, the time and energy were spent on the middle part of that, which should really be the shortest and kept to a minimum. Typically, public procurement processes in this country took twice as long as they did in Germany, for example, which was quite unnecessary. Procurocrats used to say to me, “But, Minister, we’re not allowed to exercise judgment”, which puzzled me a little, because I thought that was what all of us in the public service were paid to do.
In the way public procurement operated, the sense was that the only thing that mattered was an arithmetic comparison of bids against a hugely detailed specification, which was drawn up to the most intensely detailed and quite unnecessary level of specification, really to replicate what was already being done and then to see whether it could be done more cheaply. That is not a good way to operate. The right way to do it commercially is to spend quality time before you draw up the specification talking to the market to see what is available, and then draw up the specification in response to what the possibilities are. That is how you harvest the gains from innovation and dynamism in the marketplace. We came to know that as injecting commercial DNA into the procurement process. Very few procurement services around the world are good at this, and we needed to make a lot of progress in the UK. We therefore crunched down the formal tender process as much as we could, managing to get it from being twice as long as it typically took in Germany to half that time, and we found that there were ways of doing it much more quickly. We then recruited people into the government service who could bring commercial nous and capability to the pre-tender process and strengthen the contract management. That was typically rather weak and delegated to junior people as a kind of boring process, but it was incredibly important.
We therefore removed the hurdles which had typically excluded smaller and more socially driven entities—civil society organisations—from bidding. There had been immensely complicated prequalification questionnaires. I once discovered one which was 70 pages long for a contract which was worth £80,000. That was ludicrous and meant that only big organisations could bid because they were set up to process prequalification questionnaires. There were performance bonds where bidders were required to put up money in advance before they were allowed to bid. There was a requirement to present three years of audited accounts, which meant that any new business coming on to the market with a new product, service or approach was almost automatically excluded from taking part. There was a requirement to show that you had insurance in place to cover the cost of the delivery of the service at the time when the company was bidding, which again excluded smaller organisations even from getting through the starting gate, let alone having a chance of winning the race. I mention also turnover thresholds.
All this created a huge bias in favour of the big outsource vendors because they looked like they were safe and reliable. I specifically exclude the one that was led by my noble friend at the time, but what actually happened was that their core competence became winning contracts—doing public procurement, not doing the work. Too many of them lost their ability to provide innovative solutions to public needs but they became excellent at winning contracts. If they were public companies, too often they were telling the financial markets that the key thing was top-line growth, so winning more and more contracts was essential to their stock market ratings. It became clear, as time went on, that too often they were tending to bid rather low in effect to buy the contract, but then they expected to make their money through changes to the specification. Those were all too common and we were hearing reports from some vendors that they expected an internal rate of return of 40% on changes to the contract. That is insane but it was because the pre-tender market engagement process had not been done in a sufficiently commercial manner.
These companies would then rely on weak contract management on the procurement side, and that is where the problems have since emerged. It is notable that some of the worst problems have been with what looked like some of the biggest and safest of the established outsource vendors. It did not need to be like that and we changed the way in which this worked to some effect.
A lot of social value was being lost because, certainly in central government, public procurement was not being run in a cross-government way. Things like facilities management—the running of buildings—would tend to be dealt with by a particular ministry on its own which would look to cover all its buildings across the whole country in one contract. Of course, that again would bias heavily in favour of the big national providers, whereas social value can be provided, particularly for activities like building management, where local suppliers are able to operate. It is much better to operate across government in the way we started to do, although we did not get anywhere near as far as we wanted. By doing so you can take a particular locality, look at all of the Government’s property within it, and then by multiplying up you get economies of scale without losing the local focus. Much more can be done.
We discovered that there was simply not enough capability within government so we set up the Commissioning Academy. It would be good to hear from my noble friend when he replies to the debate what progress has been made in developing the academy, which was available to the whole of the public sector. However, a lot of people tended to confuse procurement with commissioning. Commissioning is much wider and is particularly crucial in pre-tender market engagement. It was the noble Lord, Lord Adebowale, who opened my eyes most vividly to the whole essence of this activity and he deserves huge credit for the progress that has been made.
In the rest of my remarks I would like to talk about one programme which would have a huge effect if it were to be revived, regenerated and strongly driven again because some of the momentum has gone out of it in recent years. It is the programme for creating public service mutuals. Between 2010 and 2015 we promoted and supported the creation of more than 100 of them. I should say that it was very much about picking up an idea which had started to be developed by the previous Labour Government, but in their case it was limited to the National Health Service along with some restrictions that made it hard to give it scale and allow it to get traction. However, as I say, more than 100 public service mutuals were created, with tens of thousands of staff choosing to move out of the public sector to form themselves into entities that would continue to deliver the same service on a contractual rather than an in-house basis. We would negotiate contracts with the vendor, whether it was a government department, a council or part of the National Health Service. The largest number of mutuals were in the health and social care sectors. All those chose to be not-for-profit social enterprises, although they did not have to be. In some other cases they became mutual joint ventures while others opted to be simple commercial for-profit entities.
What they all had in common was that they generally reduced the cost and improved the quality of their services through massively increased workforce leadership and engagement. I found visiting these mutuals a most uplifting and inspiring experience. I always asked people whether they would go back and work for the council, the NHS or the ministry that they had spun out of. I never heard anyone reply by saying anything other than an immediate no. When I asked them why, the answer was always a variant on, “Because now we can do things. We can see what needs to be done. We do not have to submit a business case to some committee, which is like dropping a stone down into a deep well. We can see what needs to be done and we can just get on and do it”.
We concluded that a public service mutual brings together four very powerful elements: first, entrepreneurial leadership, of which there is much more in the public sector than we ever realised because such skills inside the sector tend to be used for circumnavigating bureaucratic obstructions; secondly, a liberated and empowered workforce; thirdly, commercial discipline and financial rigour because even the mutuals that became not-for-profit social enterprises would always talk about how they needed to be successful in business terms; and of course the fourth element was the public service ethos. Bringing those four elements together created a kind of alchemy that was very powerful indeed. I hope that the Government will put a much greater emphasis on this programme and revive it for the future. Particularly in the National Health Service, where there is such a need to drive improvements in productivity, there is no better way of doing that than through the promotion of public service mutuals. A great deal of social value is generated, particularly when they become able to operate in a more holistic way. Inclusion Healthcare started as a GP practice serving homeless people in Leicester. It spun itself out and became a very successful mutual and has grown through winning contracts to provide other services to the same group of people. The benefits both financially and in terms of the care that is being given to a demanding and very vulnerable group of people have been huge because the service can be configured around the needs of the individual rather than being delivered through numerous different agencies, which is far too often the case when we deliver public services.
I urge my noble friend on the Front Bench and the Government more generally to look at increasing the social value delivered through procurement, and to pay particular attention to the part that has been played and can be played again through an acceleration of the development of the public service mutual movement.
Trade Union Bill
Lord Maude of Horsham Excerpts(10 years, 4 months ago)
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Lord Maude of Horsham (Con)
My Lords, I am tempted to my feet for my first venture from the Back Benches in the few days after liberating myself from the Dispatch Box.
Lord Berkeley of Knighton (CB)
I think that it is the turn of the Cross Benches. The noble Lord, Lord Cormack, will be pleased to hear that I am wearing a tie that is both blue and red, and it is in that spirit that I offer these thoughts. Nothing enrages the public more than the way in which some parts of this Chamber are constituted through party-political funding. It seems to me that, until we can revamp the way in which that funding works, it would be very dangerous and unfair to change the status quo to tilt the playing field as it currently exists. For that reason, I wholeheartedly support my noble friend Lord Burns in his amendment.
Lord Maude of Horsham
My Lords, I first apologise to the noble Lord for inadvertently interposing myself before him. As I said, this is my first venture from the Back Benches. I am tempted into this debate because I am a veteran of discussions on party funding. I took part in the discussions under the chairmanship of Sir Hayden Phillips, then gave evidence to the Kelly committee, then had the pleasure of long hours with the noble Lord, Lord Collins. The one thing that strikes most ice into my heart is the prospect in this amendment of further talks on public funding. If they happen, please may I be excused?
There is a hugely important distinction to be made between what goes on in trade union law and what goes on in party funding law, which is at the heart of today’s debate. These are very separate issues, although there is clearly a relationship between the two. In those first talks that we had under Sir Hayden Phillips’ guidance, the key essence that we aimed for was a cap on donations. Different numbers were bandied around, but we broadly agreed on something like £50,000. The quid pro quo would have been a significant increase in state funding for parties. One reason why we made no further progress was that the Labour Party argued at that time that trade union donations would not be caught by that cap because they are individual donations, akin to membership subscriptions to a party paid by individuals to other parties. But, of course, that is not the case. First, they are not voluntary, proactive decisions, made in the way that people subscribe to other parties—or, indeed, as ordinary members of Labour subscribe to the Labour Party. They are made by inertia, as has been discussed, and there seems to be a broad consensus that this way of proceeding is not sustainable in the longer term. Equally, they are not donations to a party. The decision to give the money to the Labour Party—or, indeed, any other party—is a decision made not by a member of a trade union but by the leadership of the trade union, so of course they would have to be caught by the cap.
Even if we had moved immediately to a system of opt-in for the political levy, with subscriptions to the political fund, that would not have done nearly enough to avoid donations by trade unions being caught by any cap. The decision to give the money to the Labour Party would still rest not with the individual member but with the leadership of the trade union. That is the important distinction between the law of party funding and the laws as they apply to trade unions, which is what we are debating here today.
It is important that we reflect a little on this system of opting in and its effects, because it is outdated. I remember that in a debate in the other place, a Liberal Democrat Member of Parliament—now a former Member of Parliament, as, sadly, so many of them are—startled the House when he told it during the Labour Party’s deputy leadership campaign in, I guess, 2007, that he had suddenly received a ballot paper for the Labour Party’s deputy leadership election because he had completely inadvertently, as a Liberal Democrat MP, become a member of the Labour Party because as a union member he had not opted out. We had the absurdity at the time of many trade unions declaring that 100% of their members were paying the political levy. Even more absurdly, some trade unions were declaring that more than 100% of their members were paying the political levy. Those of your Lordships who may argue that the role of the Certification Officer needs reform should reflect on the fact that the Certification Officer at the time was content to allow that manifest absurdity to persist.
To those who, like my noble friend Lord Cormack, argue that this is in some way proceeding at breakneck speed towards reform, I say that progress has not even been glacial. There has been discussion in your Lordships’ House about the failure of the agreement made by Len Murray way back in 1984—more than 30 years ago—that the unions would reform their systems to make the ability of members to opt out much more real and visible. We know that that has not happened. Far too many unions do not make it visible in the papers and even if members opt out, in too many unions, there is no reduction in the subscription. I give way to the noble Lord.
Lord Monks (Lab)
This is not the first time we have heard that unions are not honouring the Murray-King agreement of 1984. As the report from the noble Lord, Lord Burns, indicates, the evidence is much more mixed than that. A lot of unions have done so, although it varied to some extent, but the Government had forgotten all about the agreement. The noble Lord, Lord King, had forgotten all about it until I gave him a copy, which he then passed on to the Government. The idea that this agreement was at the front of the Government’s mind—that they were scanning it to see whether there were any abuses and so on—and that that is the justification for a change in the system is absolute and utter rubbish. It is a misrepresentation of the history. Unions put the agreement into their systems in different ways. It could have been updated if the Government were concerned about it, but they had forgotten about it. They did nothing about it and have gone back to 1927 and the old reflex action of opting in.
Lord Maude of Horsham
It is an interesting idea that a voluntary agreement to move in a particular direction is then the responsibility of others to enforce. In order to avoid legislation on this in 1984, the leadership of the trade union movement at that stage said, “We will reform ourselves”. The reality is that they did not reform themselves because the opting-out possibility is not visible to most union members when they join or, indeed, afterwards. Even if you manage to find out how to do it and exercise that option, in most cases you get no reduction in your union subscription. The sense that this is in any sense a voluntary contribution is pretty absurd.
My view is that this is a long-overdue reform. The idea that this is breakneck progress is not to be taken seriously. This has been a steady, measured process, tested at a general election through a manifesto, and I hope that the Government will stick to their guns.
Baroness Symons of Vernham Dean (Lab)
My Lords, before the noble Lord sits down, I put to him the point that the noble Lord, Lord Burns, made in putting this amendment before the House. The argument is not about the principle of the opt-in process—it was clearly put in the governing party’s manifesto. The argument is about whether it is being done fairly. The noble Lord simply argued about the principle but the amendment is about the fairness of applying the principle. I am afraid that he did not listen to the clear argument put by the noble Lord, Lord Burns, and I am sorry that he did not.
Oral Answers to Questions
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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Stephen Mosley (City of Chester) (Con)
3. What assessment he has made of the effectiveness of the work of the Government Digital Service in implementing the digital-by-default programme.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
The Government Digital Service has created the award-winning, world-leading gov.uk, the single web domain for Government information and services, and 25 major services have been redesigned to make them simpler, clearer and faster to use. That will not only provide savings to the taxpayer but improve delivery for the public, so that it is focused on user need, not Government convenience. In the next Parliament, we will deliver government as a platform, building common services such as a once-for-all payments platform.
Stephen Mosley
The Government Digital Service has been one of the current Government’s unsung success stories, improving the efficiency and effectiveness of public services and saving the taxpayer money. Will my right hon. Friend, on the occasion of his final Cabinet Office questions, accept my congratulations on the fantastic revolution in public services that he has led over the past five years?
Mr Maude
I am grateful to my hon. Friend for those kind words. There has been a great success with the Government Digital Service, which the Washington Post has hailed, stating that the UK has set
“the gold standard of digital government”.
The Obama Administration and the Australian Government have created their own analogous organisations, explicitly modelled on what we have done.
Duncan Hames (Chippenham) (LD)
I do not know what the Minister is eating for breakfast this week, but you do not seem to be able to keep him down, Mr Speaker —I half expect him to announce a U-turn on his intended retirement before the week is out.
Is not the secret success of the Government Digital Service the confidence that it has given Departments to develop solutions in-house with an agility that was simply impossible in the days of lengthy contractual negotiations with large IT companies?
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
4. What savings have accrued to the public purse from the Government's reforms to trade union facility time.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
At the time of the last general election, there was no proper monitoring of trade union facility time in government. We now have controls in place that have saved the taxpayer some £26 million in the past year, and we have reduced the number of taxpayer-funded full-time union officials from 200 in May 2010 to just eight today.
Stephen Metcalfe
While I generally support the principle of the union movement—[Interruption.] Why is that surprising? I generally support the principle, but it is not for the taxpayer to fund. What was the cost of giving trade union representatives in the civil service taxpayer-funded time off when this Government came to power?
Mr Maude
Part of the problem was that it was not monitored, but the information we put together showed that the cost was £36 million, which we have cut to less than £10 million. There is a perfectly proper role for union officials to be embedded in the workplace, as they can resolve disputes and grievances quickly, but the situation was completely out of control and we have brought it under control.
Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)
Will the right hon. Gentleman take this opportunity to thank those civil servants—mainly trade unionists—who have had to implement Government policies, particularly in the Department for Work and Pensions, such as referring people to food banks? Perhaps against their own judgment, they have had to implement austerity, which has done great damage to the people of this country.
Mr Maude
I point out to the right hon. Gentleman, for whom I have great respect, that the need for austerity was caused by the huge budget deficit that we inherited from the Government of which he was a part. We would rather have not had to do that, but I give credit to civil servants across the country who have done a huge amount. The civil service is smaller than at any time since the second world war, but it is doing more than it was before and productivity has improved dramatically.
Jonathan Ashworth (Leicester South) (Lab)
The Paymaster General has spent the last five years attacking civil servants’ facility time and check-off. We now learn, a week before Dissolution, that he is inserting a gagging clause into the civil service code. Why is it so necessary and urgent to change the civil service code now?
Mr Maude
The change to which the hon. Gentleman refers simply makes clear what was already the case. There will be considerable concern about whistleblowing, and we will do whatever is needed to ensure that we continue to be much more open about things that have gone wrong. Things are much less suppressed than they were when the Labour party was in power.
Ann McKechin (Glasgow North) (Lab)
5. What progress he has made on promoting digital inclusion.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
6. What assessment he has made of the effect on local economies of the reduction of jobs in the civil service.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Although the civil service is now at its smallest size since the second world war, officials have helped to deliver efficiency and reform savings of £11 billion in this financial year to January against a 2009-10 baseline. I pay tribute to the hard work and dedication of hundreds of thousands of civil servants up and down the country.
Mr Donohoe
Can the right hon. Gentleman explain why he shut an office in my constituency that I fought long and hard to maintain, given that people have more than met the targets they have been given on every occasion in every year? Will he personally—he has not got long to go—have a wee look at that and perhaps write to tell me why he shut that office?
Michael Fabricant (Lichfield) (Con)
With the news this morning that HSBC is choosing Birmingham over Singapore or Hong Kong, and that Jaguar Land Rover is opening a new plant in the Birmingham area, will my right hon. Friend pay tribute to the civil servants who enabled that to happen in a new, clean, civil service that is lean and effective?
Mr Maude
I pay warm tribute to what my hon. Friend has done to support the bringing of employment to the west midlands. He is a hugely energetic local Member of Parliament. Yes, the civil service does these things extremely well. It is a smaller civil service, but it is more effective than it was. I think its leadership would agree that there is still much more to do.
Chris Ruane (Vale of Clwyd) (Lab)
My hon. Friend the Member for Central Ayrshire (Mr Donohoe) raised the issue of the Government closing down the Her Majesty’s Revenue and Customs office in his constituency. Why is the Minister closing down the HMRC office in my constituency, the Army recruitment centre in my constituency and the Crown courts in my constituency?
Mr Maude
As I said to the hon. Member for Central Ayrshire, every Department in Government has to look to its efficiency, make sure it can live within its means and do the job on behalf of the public. The civil service does not exist to provide employment; it exists to serve the public. We found that that can be done more efficiently and effectively, doing more and better for less. At the same time as employment in the public sector has fallen, it has risen in the private sector by 2.3 million.
Mr Gregory Campbell (East Londonderry) (DUP)
Does the Minister agree that in the parts of the United Kingdom where there has been an over-dependence on the public sector and large numbers of jobs in the civil service, such as in Northern Ireland where the Executive are trying to reduce the dependence on the public sector, central Government should support inward investment through the private sector?
Neil Carmichael (Stroud) (Con)
8. What steps he has taken to increase the accountability to Parliament and the public of senior civil servants.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
The Prime Minister can now exercise choice in making permanent secretary appointments. We have introduced fixed tenure for permanent secretaries. We publish their performance objectives, as well as improved management information, to allow them to be held to account. We have revised the Osmotherly rules to ensure that senior responsible owners are directly accountable to Parliament for project implementation and to allow former accounting officers to be called to Select Committees.
Neil Carmichael
Will the Paymaster General update the House on the role that Ministers might have in the performance review of permanent secretaries?
Mr Maude
We have now instituted a formal process where formal input must be provided by Ministers to the Cabinet Secretary and head of the civil service on the performance of their permanent secretaries. That input has to be taken into account as part of the end of year appraisal undertaken by the head of the civil service.
Mr Speaker
Order. There are so many noisy private conversations taking place it is quite difficult to hear the Minister’s answer. Let us have a bit of order for the Chair of the Public Administration Select Committee of the House of Commons.
Mr Bernard Jenkin (Harwich and North Essex) (Con)
At what may well be my right hon. Friend’s last appearance in the House of Commons at the Dispatch Box, may I remark that his five-year term as Minister for the Cabinet Office in charge of civil service policy for the Government will have truly left its mark not just on the civil service but on this House? His tenacity, commitment and sincerity are of great credit to him.
Mr Maude
I am extremely grateful to my hon. Friend for his kind remarks. I pay tribute to him for the way in which he and his Committee have held us to account for what we do. He has done that consistently and persistently. It has not always been comfortable, but that is what the House of Commons is for.
Henry Smith (Crawley) (Con)
T1. If he will make a statement on his departmental responsibilities.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
My responsibilities are for efficiency and reform, civil service issues, public sector industrial relations strategy, government transparency, civil contingencies, civil society and cyber-security.
Henry Smith
I would like sincerely to thank my right hon. Friend and neighbouring Member of Parliament for all his assistance and advice over many years., Can he estimate the amount of taxpayers’ money that has been saved through efficiencies in his five years in the Cabinet Office?
Mr Maude
In the course of this Parliament we have saved more than £50 billion through efficiency and reform savings. I am extremely grateful to my hon. Friend for the support he has given throughout the process. He is a completely brilliant local MP, and I am confident he will be back here after the election.
Lucy Powell (Manchester Central) (Lab/Co-op)
With your permission, Mr Speaker, I would like to pay tribute to the right hon. Gentleman, given that this is likely to be his last appearance in this place. He has a long record of public service, which he has always pursued with principle, dignity and drive. Even when it has not served his own career, he has never been afraid to speak out, and I have always respected him for having a clear agenda. He is a moderniser and impatient for reform, and despite our disagreements, I am sure that Members on both sides of the House will want to pay tribute to his distinguished career.
Looking to his future, I wonder whether he wants to follow in the footsteps of his friend Michael Portillo. If so, I am happy to arrange some practice sessions for him cosying up on the sofa with my hon. Friend the Member for Hackney North and Stoke Newington (Ms Abbott). I wish him well with his future plans, albeit with me taking his place in the Cabinet Office, and I wondered whether he wanted to take this opportunity to tell us some of his fondest memories of this place.
Mr Maude
I am extremely grateful to the hon. Lady for her kind and warm words; they are hugely appreciated. We have pursued a difficult and often controversial agenda of reform, but one of things that has given it strength has been the robust support from her and her predecessors. Whatever the result of the election—I hope it will not be the one she foresees—this programme of reform must continue and be followed through.
Mr Christopher Chope (Christchurch) (Con)
T2. In joining the tributes to my right hon. Friend for his sterling public service, may I ask what else he could have achieved in the past five years had he been a member of a real Conservative Government?
Mr Maude
That is a tempting question, but actually we have achieved a huge amount. I pay tribute to my right hon. Friend the Chief Secretary to the Treasury, who has worked closely with me and my officials on driving through this programme. It is hard to see how we could have done much more in that context.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
T4. Does the Minister agree that one of the great failures of this Government has been their inability to check the quality of private companies engaged to deliver our people’s public services? Has that not been one of the fatal policy weaknesses of this Government?
Mr Maude
We have improved the quality of the commercial directors and teams across Government so that we can monitor much better what is done than was the case under the hon. Gentleman’s Government, and I announced yesterday some principles for transparency that will take this process yet further. It is much better than it was, but there is still a lot to do.
Rehman Chishti (Gillingham and Rainham) (Con)
T3. My right hon. Friend has been an outstanding Minister on cyber-security. He recently visited Pakistan and met the chief of general staff in the Pakistan army. Did they discuss greater co-operation between our two countries on cyber-security and sharing the good practice he has developed in this area?
Mr Graham Allen (Nottingham North) (Lab)
T5. What assistance is the Minister for Civil Society giving to the National Citizen Service to maximise the number of students from disadvantaged backgrounds who participate in it so that they can play their full part in a programme that would benefit them more than those from more affluent areas?
Richard Graham (Gloucester) (Con)
T6. The Cabinet Office has been relentless in reducing waste from public services. However, does my right hon. Friend share my concern that the hidden cost to the taxpayer, as well as the lack of local accountability, from doing away with the shire fire and rescue services and trying to create a national fire service as Labour proposes would be considerable?
Cyber-security
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
With permission, Mr Speaker, I will make a statement on the Government’s national cyber-security programme.
Every day, the cyber threat is growing and we face ever more sophisticated attacks. According to one survey, 81% of large businesses and 60% of small businesses suffered a breach last year. Back in 2010 the coalition Government identified cyber as one of four tier 1 national security threats, and Britain has been among the fastest adopters of the digital economy. We are a world leader in digital services, which are a key part of our long-term economic plan. We cannot let our economic progress be undermined by those who would do us harm. No national Government can tackle the cyber threat alone, and international collaboration is central to our strategy, as is the closest partnership with the business community.
In 2011 we published our cyber-security strategy and have committed £860 million of funding over five years to the national cyber-security programme. That is to ensure that Britain remains one of the safest places to do business online. Cyber-security skills are scarce, and collaboration between Government, industry and academia is essential to build the skills and expertise we need.
Despite the huge budget deficit that we inherited, we have invested in our intelligence agencies and the National Crime Agency to build our capabilities to understand cyber threats and tackle cybercrime. GCHQ—often the object of poorly informed criticism—is home to a hugely impressive and patriotic collection of public servants, and I put on record my appreciation for the dedicated and highly skilled work they do to keep Britain safe.
We have worked with business to establish the cyber essentials scheme to raise awareness of five basic measures to keep companies safe. That scheme is now mandatory for certain types of Government procurement, and today 88% of FTSE 350 companies have cyber-security firmly on their risk registers. We created the national computer emergency response team—CERT-UK—to respond to major cyber incidents, and it played a significant role in protecting the Commonwealth games and the NATO summit in Wales. Following the Prime Minister’s successful visit to the US, CERT-UK will be leading joint exercising with its American counterpart later this year. The cyber-security information sharing partnership, based within CERT-UK, provides a safe space for businesses and Government to exchange information and develop responses in real time. CiSP now has 914 members and reports on 215,000 abused IP addresses daily.
Technology moves at an astonishing pace and we cannot stand still. Today I will set out further steps to keep us safe. Our new Cyber First scheme will be an elite development programme for the next generation of UK cyber-security talent. It draws heavily on Israel’s hugely successful Talpiot programme, which I saw first-hand on a visit to Israel in November. Talpiot provides the state of Israel with formidable cyber-security skills, and is also the seedbed for a fertile array of new businesses. Partly as a result, Israel now has more start-ups per capita than any other country.
Initially we will pilot Cyber First with a few tens of students. Each will receive £4,000 funding per year to study relevant undergraduate courses in science, technology, engineering and maths. They will be required to work during summer vacations or years out, either within government or in leading UK cyber-security companies. Participation in this elite programme will carry a commitment to work for the Government for at least three years before members start to see their financial support written down. This programme will be a vital pipeline of top-end cyber talent in the service of Britain’s national security.
Cyber First is the latest in a series of initiatives building cyber skills, including new apprenticeships, and introducing cyber-security to the National Citizen Service and ensuring that it is included in relevant courses leading to computing and digital qualifications for 16 to 19-year-olds. We sponsor cyber competitions in schools, as well as technical apprenticeships and PhDs; we are building cyber-security into computer science and computing degrees, and so far we have accredited six master’s degrees in cyber-security, created two new centres of doctoral training, three research institutes and 11 academic centres of excellence in cyber-security research. Two further universities—Kent and Surrey—have today been awarded centre of excellence status in cyber research. I can also announce the funding of three UK-Israel cyber research projects. Similar projects with Singapore will follow later this year, and I look forward to seeing the first cohort of joint UK-US Fulbright cyber-security scholars before too long.
All that builds on our much broader work to improve cyber skills, which has already seen 40,000 people enrol in the Open University cyber-security open online course. We have made good progress in developing digital and cyber skills more widely across the economy, and I warmly commend the work that my hon. Friend the Minister for Culture and the Digital Economy has done and continues to do on that.
For Government services, online safety is central. Gov.uk Verify, funded by the national cyber-security programme, is our world-leading identity assurance programme. I can announce today that we have put in place a new contractual framework for identity providers that will increase choice for citizens who wish to prove their identity online. I will announce shortly the details of the additional identity providers.
We have to worry about cyber-security because of the growth and development of the internet in the past 20 years. The internet has an amazing power to change people’s lives for the better. Cyber is a huge opportunity, as well as a threat. Britain’s cyber-security sector is worth more than £6 billion a year and employs some 40,000 people. We are on track to double cyber-security exports to £2 billion by next year. Our aim is to increase that to £4 billion by 2020, and we will promote more regional clusters to support more British cyber-businesses. We want Britain to benefit from the best digital economy in the world. Effective cyber-security is central to that success. I commend this statement to the House.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I thank the Minister for advance sight of his statement. It is now twice in two days that he has come to the House to make a statement. Tomorrow he will make it a hat-trick with his final Cabinet Office Questions. Clearly, he wants to see as much of us all as possible before he retires from this House.
I pay tribute to the Minister for his work in the past five years as the Minister for the Cabinet Office and in the many years he has served the public as a Member of this House. There are many things on which we disagree, for example how we should use digital government to empower people rather than cutting them off from services, but no one can doubt his dedication to public service. Nor can we doubt the dedication of those who work so hard to protect us, our nation, its citizens and businesses from cyber-attacks. I, too, would like to put on record my praise for the work done by the security services, the police and all civil servants who work in this area. They do a vital job day in, day out to protect our cyber-infrastructure and digital footprints, and I commend their work.
I am sure the Minister agrees with that sentiment. I hope, therefore, that the Government will clarify how those who protect us in cyberspace will continue to do so when the Chancellor is bent on reducing public sector spending to levels not seen since the 1930s, before there was even an NHS or a GCHQ. It is clear from the Office for Budget Responsibility and the Institute for Fiscal Studies that, after the Chancellor’s Budget last week, unprotected Departments face huge cuts to meet his spending plans and unfunded tax cuts. The Ministry of Defence, the police and social care services are under threat. Can the Minister confirm whether the budget for cyber-security will be protected, or are we to assume that because the Cabinet Office is an unprotected Department that this will not be the case?
I welcome the new Cyber First pilot. Indeed, I was privileged to launch the UK’s first MBA in cyber-security with Coventry university. The demand for cyber-security experts is growing at 12 times the rate of the overall job market, so it is vital that we train and equip more people with cyber-skills. Small firms are the victims of three quarters of all successful data breaches and are the most likely to suffer from a lack of cyber-skills. However, just as the Minister came late to the digital inclusion agenda and then chose a strategy that excludes 10% of our fellow citizens, he has come late to—indeed, neglected—cyber-security for small businesses. According to the Institution of Engineering and Technology, half of all small and medium-sized enterprises have not even heard of the Government’s cyber-security efforts. What is the Minister doing to change that and to make small businesses more cyber-aware?
Crime is changing. It increasingly happens online, but the Government do not have a strategy to tackle it. The cyber-security budget is overwhelmingly going to cyber-security and big businesses, leaving consumers to fend for themselves. The majority of the cyber-security budget goes into the single intelligence account, with the police left a tiny amount to tackle a growing tide of online crime with an overall £2 billion cut in funding. The Home Affairs Committee highlighted the black hole where low-level e-crime is committed with impunity. What is the Minister doing to ensure that the police have the resources they need in this area?
I welcome the announcement of a new contractual framework for Gov.uk Verify. However, it was only in October that the Government were predicting that hundreds of thousands would be verified by now. In fact, only 50% of people are successful the first time they use the service. The Minister says that details will be announced “shortly”. Given that there are only a few days left before Parliament is dissolved, will he tell us exactly when he plans to announce the details? Specifically, will it include a public sector provider of identity assurance, so that people can choose a provider they trust?
Finally, the statement makes no mention whatever of mobile. It has taken the Government five years not to eradicate not spots, and they have ignored the gaping hole in cyber-security which is mobile device security, particularly in the era of “bring your own” device. What is the Minister doing specifically on mobile?
I could not help but notice that the statement was somewhat light on actual policy announcements. A cynic might think that the Minister was rushing out a half-baked announcement to use up time. It is almost as if the Government are scrambling around for something to say to give the impression that they have made real progress in rising to what is one of the greatest challenges of the digital era and one of the greatest opportunities for UK business. The UK can lead in cyber-security as we do in online commerce, but it will take skills for the many—small businesses and citizens, as well as big businesses—not the few. It will take a Labour Government to ensure we have that.
Mr Maude
I am extremely grateful to the hon. Lady for her very warm words at the beginning of her response, which I enormously appreciate. Parting is indeed such sweet sorrow, but there is life beyond.
I am afraid it tailed off a little bit after that. The hon. Lady talked about cuts and the potential for continued funding for cyber-security in the next Parliament. She made the slightly odd suggestion that the trajectory of public spending would be at a level last seen in the 1930s. A little further research shows that the last time this level of spending was seen was in 1999-2000 under a Labour Government.
So far as funding for cyber-security is concerned, that will be dealt with in the context of the spending review that will take place after the election, but I do not know anybody who believes there is any possibility that there will not continue to be very significant funding for cyber-security. We are acknowledged across the world as being in the lead in this area. There is always a danger when one says that of being thought to be complacent. We are not remotely complacent. This is a very fast-moving set of threats and we have to move equally fast to keep up with it. We need to be on the case all the time.
The hon. Lady talked about the resources being devoted to tackling cybercrime. The Under-Secretary of State for the Home Department, my hon. Friend the Member for Staffordshire Moorlands (Karen Bradley) who has responsibility for tackling cybercrime is in her place on the Front Bench. She takes this matter immensely seriously. The national cyber crime unit is based in the National Crime Agency. A good proportion of the cyber-security programme is funding for the law enforcement agencies, which do fantastic work. I obviously echo her enthusiastic support for those who work to protect and preserve our national security, and I include in that those in our armed forces active in this field.
The hon. Lady talked about digital inclusion, which she knows the Government take extremely seriously. We support the huge amount of work being done by businesses, particularly Barclays and other companies, on digital activity to enable people currently excluded to be active online, and that will continue to be the case. She also asked about mobile security on mobile devices, which is obviously a serious matter. So far as the Government are concerned, CESG, part of GCHQ, provides good guidance and is reckoned to be world leading on smart devices.
So far as citizens and consumers are concerned, she will be aware of our Cyber Streetwise campaign and Get Safe Online, which are about making sure people know the risks. GCHQ estimates that 80% of successful cyber-attacks could be thwarted or mitigated by basic internet hygiene, and for that awareness is important. I am less concerned about whether SMEs are aware of what the Government are doing; I am more concerned that they are aware of what they need to do, which is to take basic steps on internet hygiene.
There is much more to do, and there will never be any scope for a Government or businesses to rest on their laurels. I found the hon. Lady’s objection that my statement was light on policy slightly startling. Quite rightly, the Government have elevated cyber-security to one of the four tier 1 national security threats, so we take it enormously seriously. At a time when we had to cut public spending, because of the appalling public deficit inherited from the last Government, this was one of the very few areas that we decided was sufficiently important to invest further money in, and we will continue to do that.
Dr Julian Lewis (New Forest East) (Con)
A number of Governments are known to have invested heavily in what might be termed “offensive cyber”. Given that we must do everything we can to protect our own systems, are there any messages we can send to such Governments about the consequences that would follow for them if they were unwise enough to launch a cyber-attack against this country?
Jim Shannon (Strangford) (DUP)
One of the aims of the 2011 cyber-security strategy was to have the UK more resilient to cyber-attacks and able to protect our interests in cyberspace. How well does the Minister feel that this has been achieved, and how does the news that 81% of firms suffered from cyber-attacks and breaches in the last year, as he said in his introduction, fit with that strategy?
Mr Maude
Awareness in the business world is much higher than it was—it was woefully low and remains so in most parts of the world—partly as a result of the Government’s efforts. As a result, many more companies are taking active steps to treat this seriously—not as something to be delegated to the IT department but as a board-level risk to be understood and managed by the board as a major risk to the business. We shall continue to drive home this message.
Mr Robin Walker (Worcester) (Con)
I congratulate my right hon. Friend on this important update. He talked about clusters. He will know that one of the most important cyber-security clusters in the UK is in world-class Worcestershire. One business he has visited there, Titania security, told me it was benefiting from a wide range of Government help, including the apprenticeships scheme, research and development tax credits and help with exporting from UK Trade & Investment. Will he update the House on how his Department could work with the Department for Business, Innovation and Skills to ensure that our cyber-security industry is the most competitive in the world?
Mr Maude
It is very competitive. I know that my hon. Friend has given enormous support to the cyber-cluster in Worcestershire. As a matter of historical accident almost, there are many such businesses in Great Malvern. When I visited in 2012, there were 40 or so cyber-companies; there are now more than 80. This is very fast growing. We help cyber-companies with exporting, and many of them are doing it. I visited Titania, in his constituency, and was hugely impressed by how many countries this relatively small company was selling its products to.
Mr Frank Roy (Motherwell and Wishaw) (Lab)
Cyber-security is a reserved matter, but will the Minister update the House on any conversations or meetings he has had with Police Scotland or the Scottish Government on this matter?
Mr Maude
We obviously co-ordinate as much as possible with the Scottish Government—my hon. Friend the Minister with responsibility for cybercrime could comment separately on any discussions the Home Office has with Police Scotland. The hon. Gentleman is right to imply that these matters require close co-ordination between Governments and law-enforcement agencies not just within the UK but much more widely, because cyber and the internet know no national boundaries.
Alec Shelbrooke (Elmet and Rothwell) (Con)
Following on from my right hon. Gentleman’s comments about GCHQ staff, what did he make of the Business Secretary’s comments that The Guardian Snowden publication was entirely correct and courageous, and will he outline his assessment of the effect that has had on the morale of our public servants at GCHQ?
Mr Maude
I happened to be visiting GCHQ shortly after my right hon. Friend made those remarks. The people who work at GCHQ do fantastic work—it is a centre of brilliant expertise and knowledge; they do difficult work away from the public gaze, and any comments that seem to undermine what they do in the service of national security have to be strongly deprecated.
Dr Julian Huppert (Cambridge) (LD)
The Minister is right to pay tribute to the work of GCHQ and to prioritise cyber-security, which is very important for all of us. He will be aware that a fundamental part of that is good encryption, so will he encourage individuals and companies alike to push ahead with strong end-to-end encryption, wherever possible?
Chloe Smith (Norwich North) (Con)
It has been an enormous privilege in this Parliament for me to serve with my right hon. Friend in his team at the Cabinet Office doing exactly this work. Will he update the House further on what he continues to do to keep our critical national infrastructure safe?
Mr Maude
I am hugely grateful to my hon. Friend both for what she says and for the incredibly important work she did, particularly in taking the message about the need to strengthen cyber-security defences out to the business community, which she did with her characteristic energy and clarity. So far as the critical national infrastructure is concerned, a huge amount of work is already under way to continue to ensure that we understand the vulnerabilities. Obviously, the critical national infrastructure is not primarily owned by the state—it is in private sector hands—so we need to understand the vulnerabilities and work with the owners of that infrastructure to ensure that the defences are as good as they can be.
Andrew Stephenson (Pendle) (Con)
I thank my right hon. Friend for agreeing to meet Training 2000 and me last October to discuss its plans to create an institute for cyber-security in Pendle. Following that meeting, it has followed up the leads he provided, and I am delighted to say that it is now progressing with its ambitious plans to create the institute later this year, to improve local cyber-skills and apprenticeships in the area. Given the importance of this issue to many Lancashire SMEs, what more can his Department do to support such proposals?
Mr Maude
Let me first pay tribute to the work my hon. Friend has done in this area. When I recently visited Pendle, I had the opportunity to discuss the matter with him. There has been no stronger champion of our potential to work with businesses to build the companies, the skills and the kind of centres for training that he mentions. I am confident that he will be in a position to take this work forward over the coming five years.
Neil Carmichael (Stroud) (Con)
Does the Paymaster General agree that the excellent news about a new university technical college at Berkeley Green in my constituency, providing skills and training in cyber, is perfectly timely in view of his statement and that it is likely to bring a real benefit to the Government Communications Headquarters?
Mr Maude
My hon. Friend is exactly right to draw attention to that. We need to build these skills—and build them early. The kind of college he mentions can play an incredibly important role in that, particularly, as he says, in view of its proximity to Cheltenham and GCHQ. We need to get to children earlier so that we can encourage more of them to specialise in these subjects. Under our Cyber First scheme, which I referred to in my statement, and in pursuit of the most gifted students, we will absolutely look to find really gifted students at a much younger age.
Stephen Mosley (City of Chester) (Con)
I welcome yesterday’s launch by the Cabinet Office of the report into cyber-insurance, which hopes to make the UK the world capital of cyber-insurance in the marketplace. It will not only give the UK insurance market the leading edge in order to become the world leader, but will encourage our small and medium-sized enterprises to take up cyber-insurance through the terms and conditions of their insurance policy.
Mr Maude
My hon. Friend is absolutely right to draw attention to this. We have, I think, got ahead of the game by commissioning the work we have done jointly with the insurance industry. Cyber-insurance is a market in its infancy. Many businesses do not know whether they are covered for damage and loss caused by cyber-attacks. The fact that Britain excels in the insurance market—London is the world’s centre of insurance—and that Britain is very good at cyber-security will enable us to become world leaders in this important area. The sophisticated pricing of cyber-risk will be a huge stimulus, particularly to smaller businesses, to ensure that they have done what they can to protect themselves. I welcome the industry’s support, particularly for smaller businesses and SMEs, of the Cyber Essentials scheme as a kitemark for taking the right steps to protect themselves.
Richard Graham
Thank you, Madam Deputy Speaker.
I congratulate the Minister for the Cabinet Office on both his statement and his strong commitment to a quiet revolution on our nation’s understanding of, and support for, the cyber-industry. My right hon. Friend knows the important cluster in Worcestershire and Gloucestershire, which now includes the future training centre rightly mentioned by my hon. Friend the Member for Stroud (Neil Carmichael). Does my right hon. Friend agree that places such as the new cyber-centre in Gloucester, led by Raytheon with innovative partners employing between 9,000 and 90,000 employees, should encourage local universities such as the university of Gloucestershire to play an important role in developing appropriate courses for future skills in this sector?
Mr Maude
My hon. Friend is completely right to draw attention to that and to emphasise the need for us to develop these skills early. These are scarce skills at the moment, but they do not need to be. We took steps early in the course of the coalition Government to start the process of building skills, and the kind of developments to which my hon. Friend refers are a crucial part of that.
Public Data Principles
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
I am laying the “Report on departmental open data commitments and adherence to public data principles for the period between April and June 2014”.
The report is released on a quarterly basis and details progress against our commitment to open up Government data.
[HCWS454]
Security and Intelligence Agencies: Contingencies Fund Advance
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
My statement of 17 March informed Parliament of the intention to access £66,800,000 from the contingency fund pending parliamentary approval of the supply estimates 2014-15. Royal Assent of the Supply and Appropriation (Anticipation and Adjustments) Bill has been further delayed therefore the Security and Intelligence Agencies are seeking an additional advance of £42,900,000.
As the Security and Intelligence Agencies are non-ministerial departments, I am making this statement on behalf of their Accounting Officer, to ensure that Parliament is informed of this advance from the Contingencies Fund.
[HCWS455]
Office of the Commissioner for Public Appointments
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
The Government have asked Sir Gerry Grimstone to lead a review of the Office of the Commissioner for Public Appointments. This will be the first review of the Office’s status and role since the role of the Commissioner for Public Appointments was created by the Public Appointments Order in Council 1995 on 23 November 1995. Although the Office of the Commissioner for Public Appointments is technically not a public body, the review will follow the guidance on conducting a triennial review.
The review’s purpose will be to establish the continuing need for the Office, and to examine its scope of responsibilities. In particular the review will consider the Office’s role in regulating the processes by which Ministers make appointments to the boards of certain public bodies and certain statutory offices. The review’s terms of reference have been placed in the Library of the House.
Sir Gerry will seek input from a wide range of individuals, including current and former Ministers, current and former officials and advisers, the Government’s Non-Executive Directors, the Office of the Commissioner for Public Appointments, Parliament, public bodies and those who have gone through an appointments process. The review will report in the summer.
TERMS OF REFERENCE. The role of the Commissioner for Public Appointments was created by the Public Appointments Order in Council 1995 on 23 November 1995, following recommendations made by the Committee on Standards in Public Life (under the chairmanship of Lord Nolan). We are now twenty years on, and this provides a suitable opportunity to review the role of the Commissioner and the processes around public appointments. In the light of the range and diversity of public appointments, it is important to ensure that the procedures are both effective and proportionate. The review will be led by Sir Gerry Grimstone and will report to the Minister for the Cabinet Office.
[HCWS448]
“The State of the Estate in 2013-14”
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
I have today laid before Parliament, pursuant to section 86 of the Climate Change Act 2008, “The State of the Estate in 2013-14”. This report describes the efficiency and sustainability of the Government’s civil estate and records the progress that Government have made since the previous year and since 2010. The report is published on an annual basis.
[HCWS450]
Government Efficiency and Reform
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
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The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
With permission, I would like to make a statement on Government savings from efficiency and reform.
Since May 2010, my Department has led a cross-Government programme, working closely with the Treasury, to ensure that taxpayers’ money is focused on front-line services. With rising public expectations for high-quality services, coupled with the huge budget deficit we inherited in 2010, the coalition faced a huge challenge to do more—and better—for less. Over this Parliament, we have secured unprecedented levels of savings, delivering for successive years £3.75 billion, £5.5 billion, and £10 billion, compared with spending in Labour’s last year. For 2013-14, we saved £14.3 billion, against a 2009-10 baseline.
That is testament to the hard work of civil servants across Whitehall and the strong support of my right hon. Friends the Chancellor and the Chief Secretary and other Treasury colleagues. Last July, the Comptroller and Auditor General recognised the pace and priority we had injected into the efficiency agenda. We started this with the introduction of tight spending controls just days after we entered government, and these controls have delivered the largest share of savings. Since 2010, we have negotiated billions of pounds off expensive legacy contracts and cut central Government spending on consultants and interim workers by over half. Like for like, the civil service is 21% smaller. I publish today our annual “State of the Estate” report, which shows that we have exited in aggregate more than one building every day since May 2010, reducing the total size of our estate by 20%.
As part of our long-term economic plan, our aim was to save £20 billion from central Government efficiency and reform for the last year of this Parliament, including by reducing losses to the public purse through fraud, error and uncollected debt. I can tell the House that we are on course to meet and indeed exceed this target. Up to January 2015, we have already identified £11 billion of efficiency and reform savings—over a third up on the same point last year—with the largest savings coming in the final quarter every year so far. With fraud, error and debt benefits still to be counted, we are well on the way to the £20 billion target. The full year’s savings will need to be confirmed by independent audit, and, as in previous years, we will invite the National Audit Office to undertake this.
We have made significant progress in transforming government and cutting costs, but this is only the beginning. At the autumn statement, we published, with the Treasury, a document entitled “Efficiency and reform in the next Parliament”, which set out our intention to save a further £10 billion for 2017-18 and £15 billion to £20 billion for 2019-20 compared with the current year. We now set out our next steps. We will implement a new approach to land and property, based on central ownership and management of assets and Departments paying market-level rents. This will provide greater incentives for Departments to rationalise space, as well as releasing land and property for productive use—for example, for up to 150,000 homes. To do this successfully will mean working even more closely with local government, including through our One Public Estate programme, which now operates across 32 local authorities.
The UK is now a world leader in digital government, and we will work with local government to take this transformative approach into the wider public sector. Digital services improve the citizen experience, while being significantly cheaper to provide. We will continue to reduce the cost of technology in government, as extravagantly expensive legacy IT contracts fall in over the coming years. To that end, I have signed an innovative deal to create a joint venture for data hosting that will save up to £100 million.
All of this work has been driven by an increasingly strong corporate centre, supporting and challenging Departments to work together to maximise efficiencies and improve services. We are strengthening central leadership across 10 key cross- departmental functions, including commercial, digital and technology, project management, legal and human resources. Later this week, we will publish our functional leadership model.
The chief executive of the civil service will lead the build-out of this strengthened model, under which the Treasury and the Cabinet Office will work together as the corporate centre to support Departments to continue their programme of reform and to deliver future spending consolidations. Spending controls will remain in place and evolve in time to strong functional standards, while Departments will need to own more of the transformation agenda. As part of this, we are recruiting 25 commercial directors across government and launching a new project leadership programme at Cranfield university. This programme will help to build project management skills in parallel to our successful major projects leadership academy.
I am grateful for the collaborative way in which the shadow Cabinet Office Minister has approached this important programme, which continues that of her predecessor, the hon. Member for Barnsley East (Michael Dugher), and also for the support of the Chair of the Public Accounts Committee and its members, who have seen the point of what we are seeking to do and given significant support to it.
We have made substantial and long-overdue improvements to the way government operates, but much more lies ahead. We have shown that we can drive down the cost of government while improving the quality of services. We have shown that we can get more and better for less, and that we have a long-term plan to deliver it. I commend the statement to the House.
Lucy Powell (Manchester Central) (Lab/Co-op)
I thank the right hon. Gentleman for advance sight of his statement. His statement today has a little bit more content than his empty statement of two weeks ago, but only a little bit more. One has to wonder again why it is that I keep being called to this House for his statements. Is it perhaps because he wants to continue his very long career of public office in the other place after May and is using Hansard to scrub up his CV? Or is it, more seriously, to distract me and this place from the disarray that is now besetting the Conservative party’s election campaign? Perhaps his and his colleagues’ time would have been better spent today deploring the despicable actions of the Tory candidate for Dudley North or by explaining to the public where the axe will fall, following last week’s confirmation of the Chancellor’s extreme spending cuts in the next Parliament.
The Minister has carried out his job in government of identifying efficiency savings with zeal and his work to reduce the cost of government bureaucracy is welcome. While I might disagree with him on occasion, I do not question his motives to reduce costs. I also commend the civil service for its work on the shared agenda.
The Minister for the Cabinet Office thanked the Chancellor for his support on this agenda, but I have to say to the right hon. Gentleman that it really should be the other way around. It is clear from the Office for Budget Responsibility and the Institute for Fiscal Studies that after the Chancellor’s Budget last week, unprotected Departments will face huge and colossal cuts to meet his spending plans and unfunded tax cuts. With all due respect to the Minister, no amount of back-office efficiencies will save front-line police, armed forces or social care services, or working families from the Government’s secret VAT plans. Only so much can be got from efficiency savings and even with his savings in this Parliament, the Government are still only halfway to their own deficit reduction targets. That is why, even with his savings, public services would face even bigger cuts in the next Parliament than they have in this one. Opposition Members have a better plan. We will balance the books in a fair way, ensuring a recovery for the many, not just for the privileged few.
We broadly support the approach to land and property that the Minister has outlined. On digital government, I am pleased to see that he has been reading our independent review on this topic. Just weeks ago, he was saying that the Government Digital Service could not work with councils to improve services and save money. Now he is championing this, and I welcome his conversion today. We agree that stronger functional skills in the civil service are important, and we will examine in detail the Minister’s plans for new commercial directors and a new project leadership programme.
Any new Government will have to think about how we can provide better and more responsive public services with less, but with just a few weeks to go, the country faces a clear choice at the election. No amount of spinning on efficiency savings will hide the Tories’ true agenda of cutting front-line public services and hitting families with a rise in VAT.
Mr Maude
I am very sorry that the hon. Lady has been so mean-minded about this. She has cast some unworthy aspersions on the reasons for my statement. The historic purpose of the House is to vote Supply and scrutinise the way in which Governments spend their money. I am astonished that, when I come to the House to explain how this Government have delivered savings running into tens of billions of pounds, and have protected front-line services by taking out the cost of government, the hon. Lady should trivialise something that is at the core of the historic mission of the House of Commons. She has done no honour to her position.
The hon. Lady should reflect on the fact that the Office for National Statistics, which began its series on public sector productivity in 1997, has shown that during the years of the Labour Government, up to 2010, productivity in that sector remained flat, while productivity in the nearest analogue, the private services sector, rose by nearly 30%. She should reflect on the difference that could have been made to the deficit of historic proportions that her party bequeathed to the coalition.
The hon. Lady talked about the future, and about the contribution that could be made by what she described as back-office efficiencies. We are talking about much more than back-office efficiencies; we are talking about the introduction of very different and improved ways of delivering public services. That can be done, and we have shown that it can be done. The public’s expectations in terms of the quality of public services are, properly, rising; the demand in terms of the quantity of public services is also rising as people—happily—live longer; and the amount of money that is available to support those public services is less, thanks to the deficit that we inherited.
We therefore must do more, and do it better, with less money. We have shown over the last five years that that can be done, and we have also shown that it needs to be done again. There should never be an end to efficiencies. The most efficient organisations in the world always look for further efficiency savings every year, and that is what this Government, under a Conservative leadership, will do in the next Parliament.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
Why has the rigorous challenge that the coalition Government have had to make to the way in which money is spent in many Departments not been applied to the criminal justice system? Having a larger prison population than nearly all the other European countries is not necessarily the most cost-effective way of keeping people safe. Will the Minister look at the American states that are trying to reverse that trend in order to spend the taxpayer’s dollar in the way that is most likely to keep the taxpayer safe?
Mr Maude
Let me say to my right hon. Friend, as we both enter our last week in the House of Commons, that, as he knows, the reason our prison population is so large is the rate of reoffending. I know that he will support, as I do, the rehabilitation revolution, led by our right hon. Friend the Lord Chancellor, which is committed to a radical reduction in the rate of reoffending that is the sole reason why our prison population is so much higher than those of comparable countries.
Kelvin Hopkins (Luton North) (Lab)
The Treasury’s problems are, above all, about income, not expenditure. There is a gap of £120 billion a year between the tax that should be paid and the tax that is actually paid. However, the Government have presided over tens of thousands of job cuts in Her Majesty’s Revenue and Customs, where senior staff collect 20 times their own salaries and junior staff 10 times theirs. Are the Government not shooting themselves in the foot?
Mr Maude
The hon. Gentleman is completely mistaken if he believes that there is a direct linear relationship between the number of HMRC officials and the amount of tax that is being collected. There is absolutely no evidence of that. The size of HMRC, in terms of headcount, was falling before the 2010 election, and the amount of tax being collected has risen. We can do things differently and we can do things better—we have already shown that that is the case—but if the hon. Gentleman thinks that the only problem with the public finances is that we are not taxing enough and not raising enough taxes, I am afraid that he and I differ. I think that we must cut our costs first, which is what we are doing and will continue to do.
Nick Herbert (Arundel and South Downs) (Con)
May I congratulate my right hon. Friend and parliamentary neighbour, who has done a superb job in driving these savings and thereby ensuring front-line services can be protected? He has done a fine job behind the scenes and will be much missed from this place, but I hope he will be able to continue in some way in this important public service. Does he agree that the key part of his statement was that these savings have been achieved as a result of a strong corporate centre—a central drive for efficiency—and is it not the case that that centre will have to be strengthened further if significant additional savings are to be achieved?
Mr Maude
I am grateful for my right hon. Friend’s kind comments, and I also hugely appreciate what he and the right hon. Member for Wentworth and Dearne (John Healey) have done in leading the work of GovernUp, which has made the case very powerfully, as indeed has the Public Accounts Committee, for a strong corporate centre in Government that can drive these sorts of changes. When we examined this, we found that, in almost all cross-government functions, the historical position of the British Government is to have an extraordinarily weak centre. That is part of the reason why it has been proved in the past to be so difficult to drive these sorts of efficiency savings, but we are changing that.
John Healey (Wentworth and Dearne) (Lab)
This was a swansong statement, if I may say so, which largely looked backwards rather than forwards. Nevertheless, what the Minister has announced today about stronger central leadership within Whitehall, clearer professional standards right across the Departments and more power to the elbow of the new chief executive of the civil service are welcome on all sides. The right hon. Gentleman over five years has made something of a start in ensuring we get better and more for less, but his statement this afternoon is clearly passing the baton for the next five years to this side of the House and my hon. Friend the Member for Manchester Central (Lucy Powell) on our Front Bench.
Mr Maude
I agree with every part of what the right hon. Gentleman says except the last part, but I am grateful for what he says and the work he has done on this issue. He is a very experienced former Minister himself and he has seen very vividly how we can do these things better. We have made a start but there is much, much more to be done.
Andrew Bridgen (North West Leicestershire) (Con)
As my right hon. Friend has stated, public sector productivity flatlined between 1997 and 2010, but what assessment has he made of improvements in civil service productivity since 2010?
Mr Maude
Productivity has improved dramatically. Like for like, the civil service is 21% smaller, yet I do not think anyone would say the civil service is doing less. It is not; if anything, in some places it is doing more. Productivity has markedly improved and I pay a very warm and genuine tribute to those hundreds of thousands of civil servants who do a fantastic job, often in very difficult circumstances. All of us in this House should be warm in our tribute to them.
Wayne David (Caerphilly) (Lab)
I agree with what the Minister has said about extending digitisation in government, but what is he doing to ensure millions of people are not excluded from the process of digitisation?
Mr Maude
That is a very good point. When the now Baroness Lane-Fox reported to me at the very beginning of this Parliament when she introduced the concept, which we warmly adopted, of digital by default—if a service can be delivered online, it should be delivered only online—she made the point, which again we strongly supported, that there must always be an assisted digital option, which ideally can be used to help people who are currently digitally excluded to become full participants in the online world, so, for example, older people can more easily communicate with distant family members. There is a big programme here that we are strongly promoting.
Mrs Anne Main (St Albans) (Con)
I am so pleased to hear that we are protecting public services while cutting down the cost of government, but does my right hon. Friend share my concern that we have been prevented from delivering one of the bigger cuts—namely, cutting the number of Members of Parliament by delivering our proposed boundary changes? Does he agree that although the Opposition refer to fairer cuts, they give no indication of what those cuts would be, and that the public therefore cannot trust anything they have to say?
Mr Maude
Aneurin Bevan once said:
“Why look into the crystal ball when you can read the book?”
The last Government did nothing to drive the sort of efficiency savings that we have achieved, so when it comes to making cuts in public spending, we can only fear that they would cut the services, whereas we are cutting the costs, which is the better way to go.
Paul Flynn (Newport West) (Lab)
Why has there been no reform of the continuing parliamentary scandals of cash for access to politicians and cash to buy peerages? Why has there been no brake on the revolving door that allows retiring Ministers to prostitute their insider knowledge to the highest bidder, and why are there no controls over lobbyists who are still free to buy influence and privilege in this House? Is not the Minister ashamed that, after his Government have been in office for five years, the reputation of politics remains firmly in the gutter?
Mr Maude
I cannot imagine a greater contribution to that reputation than the hon. Gentleman going on about it all the time. As he above all people ought to know, most people come into this particular form of public service, known as politics, for high reasons and with high motivation, and they do their job in an honourable way. He might just occasionally shrug off that carapace of cynicism and give due credit to the public servants in this House as well as to those outside it.
Richard Benyon (Newbury) (Con)
My right hon. Friend can leave the House knowing that he has done an outstanding job in reforming our public services, and it would have been nice to hear a little more humble pie from the hon. Member for Manchester Central (Lucy Powell). On the question of getting better digital coverage across our country, does he agree that the public estate should be made more available for things such as mobile phone masts if we are to have a 21st-century digital economy? What more can be done to encourage the public sector estate to make up for the absence of support from the private sector estate in getting greater digital coverage?
Mr Maude
My hon. Friend makes a really good point, and there is much more that we can do. For example, we will make available public sector Government-owned land and buildings for the siting of mobile phone masts, which will be beneficial in lots of ways. It will provide locations for the masts as well as income for the Government. We have now also published the second iteration of our map of the publicly funded digital infrastructure. This includes the many thousands of miles of fibre that have been paid for by the taxpayer but which are massively underused and under-exploited. If that network can be mobilised to support the roll-out of mobile coverage and rural broadband, it could accelerate the programme to which my hon. Friend and I are both deeply committed.
Duncan Hames (Chippenham) (LD)
It is three years to the day since the Minister took up my invitation to visit Ark Data Centres in Corsham with me, and I am delighted to hear that the taxpayer stands to benefit to the tune of £100 million from the Crown hosting joint venture with the company. Does he agree, however, that the benefits of digital services extend much further than that, in that they allow a total redesign of the processes that underpin our public services?
Mr Maude
My hon. Friend is completely right. The digitisation of services is sometimes seen as just a pretty front end on a website, but this goes much deeper. It is about a fundamental redesign of the way in which services are delivered, with the processes being designed and built around the needs of the citizen instead of around the convenience of the Government, which has far too often been the case in the past.
Andrew Stephenson (Pendle) (Con)
As this is probably my right hon. Friend’s last statement in the House, may I thank him for the numerous visits he has made to Pendle over the past few years and for recently meeting Training 2000 in the Cabinet Office to discuss its plans to set up a cyber-security institute in my constituency? Will he say more about public service mutuals, the increase in their number under this Government and how they can benefit productivity?
Mr Maude
I am grateful to my hon. Friend. The public service mutuals programme is important. There are now more than 100 of them, whereas there were fewer than 10 when the coalition Government were formed. More than 35,000 members of staff have joined public service mutuals, which are delivering public services to the value of more than £1.5 billion. Most of them choose to be not-for-profit, and have seen an extraordinary improvement in productivity by bringing together: entrepreneurial leadership, of which there is much more in the public sector than is generally thought; staff who are liberated from bureaucratic constraints; hard-edged commercial discipline; and the public service ethos. Those four factors, brought together, are an extraordinarily powerful driver of improved productivity and value.
Mr Andrew Robathan (South Leicestershire) (Con)
In my right hon. Friend’s swansong—I commend him for it and for his five years’ work, saving money for the public purse—I wonder whether I might pick up on one specific issue of government efficiency reform, which is the trade unions training fund. It was set up a dozen or so years ago by the previous Government; some £10 million to £12 million was given to trade unions’ training and, lo and behold, £12 million came back as a bung to the Labour party. Will he update the House on what has happened to that?
Mr Maude
My right hon. Friend should not assume that this is my swansong. Although it is my last week in the House of Commons, I am answering oral questions on Wednesday and I am looking forward to that—[Interruption.] I am looking forward to engaging with the hon. Member for Manchester Central (Lucy Powell) on that occasion. It is very nice to see my right hon. Friend the Chief Secretary to the Treasury here, as he has been my comrade in arms as we have driven forward these efficiency savings over that period. My right hon. Friend the Member for South Leicestershire (Mr Robathan) will know that I made a statement, either last week or the week before, about the reform of trade unions within central Government. We have cut the cost of the subsidies to trade unions significantly over that time, bringing into these things a proper sense of proportion.
Mr David Nuttall (Bury North) (Con)
I thank my right hon. Friend for his statement and for the work he has done, saving taxpayers billions of pounds. Does he agree that by merging Departments even greater efficiencies and savings could be made?
Mr Maude
I understand what my hon. Friend says. The studies that have been done on machinery of government changes do not always indicate that they pay for themselves, but there are undoubtedly ways in which we can organise government to yield—in addition to what we have already done—significant improvements.
Dr Matthew Offord (Hendon) (Con)
I congratulate my right hon. Friend on his statement. Many of us recall my hon. Friend the Member for Cannock Chase (Mr Burley) making his suggestions to the House at the beginning of this Parliament and being vilified by some Opposition Members. May I say how resolutely and quietly the Minister has gone about this work? Not only has he made the savings, but he has taken the civil service with him to improve the public services of this country.
Mr Maude
I am grateful to my hon. Friend. This has been a long process and it is fair to say that the further we have gone, we have discovered a deep appetite for reform and change within the civil service, particularly among its younger members, who often get frustrated. They are the people who complain most about bureaucracy, and they have welcomed the fact that Ministers have taken a real interest in driving out bureaucracy and speeding things up.
Security and Intelligence Agencies (Contingencies Fund Advance)
Lord Maude of Horsham Excerpts(11 years, 4 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
As part of the supplementary estimates 2014-15, parliamentary approval for additional resource of £34,201,000, additional capital of £28,255,000 and additional cash of £4,344,000 is sought for the security and intelligence agencies to reflect a number of in-year budgetary changes.
Pending that approval, urgent expenditure estimated at £66,800,000 will be met by repayable cash advances from the Contingencies Fund. This is required to meet contractual commitments.
A total net cash requirement of £111,456,000 has been requested as part of the supplementary estimates 2014-15 and the advance will be repaid upon Royal Assent of the Supply and Appropriation (Anticipation and Adjustments) Bill.
As the security and intelligence agencies are non-ministerial departments, I am making this statement on behalf of their Accounting Officer, to ensure that Parliament is informed of this advance from the Contingencies Fund.
[HCWS420]