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Listening to Sir Keir Starmer’s recent lament that the “flabby” state is failing Britain was to experience deja vu all over again. More than a quarter of a century has passed since another Labour prime minister, one Tony Blair, vented his frustration with the public sector by complaining that trying to reform government had left him with “scars on my back”. In similar vein, David Cameron’s lot used to excuse their struggles to get stuff done by blaming resistance from the amorphous administrative “Blob”. Dominic Cummings told Boris Johnson that the solution was to pack Number 10 with “weirdos”, “misfits” and “wild cards” – a self-description if ever there was one – while purging the senior civil service. He was still working his way through his “shit list” of mandarins when he got the boot himself. You will not recall the Johnson administration as an able and stable outfit dedicated to serving the needs of the public. The grim chaos of that period is a warning to the current government that braggadocio, stunts and wheezes will not make the state smarter.
Most prime ministers become exasperated with the bureaucracy under them at some point. It has taken eight months for Sir Keir to conclude that a “weak”, “overstretched” and “unfocused” state is failing to properly perform its “core purposes”. He’s not wrong. The contract between government and citizenry is in a bad way. “The public has lost faith in the state to deliver,” says one cabinet minister who worries about this a lot. “People find themselves paying more in tax, but do they feel the benefit in the public realm? They don’t.”
Fixing this should be one of Labour’s most pressing priorities. It inherited a flatlining economy, faces escalating geopolitical threats that demand more funding for defence, and money is tight. Backbench rebellion is brewing over plans to cut billions from the rising welfare bill by reducing some incapacity benefits. Ministerial mutiny is stirring over the squeeze to departmental budgets being demanded by the Treasury so that Rachel Reeves doesn’t breach her own fiscal rules. That increases the imperative to extract maximum value from every taxpayer penny.
It is fundamental to Labour’s case that the state can be a “force for good”. Proving this to be true is essential if the populist right is to be seen off. Evidence that government is not a burden on people’s backs, but an enabler that improves their lives, is critical to its chances of re-election.
As thinking at Number 10 has developed, they have settled on some broad conclusions. One is that too much power has been subcontracted to quasi-autonomous organisations known as “arm’s length bodies” within government and as quangos to everyone else. In a speech delivered at a business campus in Hull, where the first bottle of Dettol was produced, the prime minister presented himself as the antiseptic to what he disdained as the “watchdog state”, “a cottage industry of checkers and blockers” that he portrayed as antithetical to “democratic accountability”.
He has taken a big first scalp, and with it a serious gamble, by announcing that NHS England, the largest quango of them all, will be abolished. The sorry history of that organisation serves as a caution about how not to do reform. NHS England was set up by the Cameron government to put distance between ministers and the day-to-day operations of the health service. But the Department of Health was still, and rightly, held responsible for the performance of the NHS, and ministers still, and inevitably, wanted a lot of say over how it was run.
There will be few mourners at the funeral of NHS England, because it created a micro-managing double-layer of management accompanied by confusion about lines of command and accountability. A cabinet colleague reports that Wes Streeting decided to act because “he knew what he wanted to do with the health service, but found that he had a system without levers”. To the dustbin of history goes a previous government’s botched attempt to extract more from one of the most expensive and essential arms of the state. Another reorganisation of the NHS will cause near-term upheaval, but the health secretary has reassured twitchy cabinet colleagues that it will pay a dividend over the longer term in delivering better performance. His personal ambitions, and the government’s hopes of convincing voters that it is turning around the NHS, depend on his being right.
Sir Keir says every other quango will have to justify its existence. Yet here we encounter contradictory thinking. Before it has fully audited the purpose and quality of quangos already in place, Labour has been merrily setting up a host of new ones, from the Independent Football Regulator to GB Energy. Its unhappiest offspring is the Office for Value for Money (OVfM). Championed by the chancellor, its supposed role is to invigilate government spending to ensure that it is not wasteful. When the unit was scrutinised by the Labour-chaired Treasury select committee, the MPs concluded that it was “an understaffed, poorly defined organisation which has been set up with a vague remit and no clear plan to measure its effectiveness”. Ouch. The OVfM does not sound like it is offering value for money. Labour’s thinking about the efficient state needs more work.
Another area where ministers want radical change is Whitehall. Cabinet ministers protest that it is not their intention to “beat up” the civil service Cummings-style while also insisting that reform is long overdue. Tony Blair, who wasn’t much interested in the wiring of the state when he was prime minister, never really got to grips with this. Jonathan Powell, chief of staff during the Blair years and a figure of significant influence once more since his return as national security adviser, once told me that their failure to reform the civil service was his greatest regret about New Labour. Another veteran of that era, Pat McFadden, the endearingly lugubrious Cabinet Office minister, is leading the push. He denies that his role model is Elon Musk and says he won’t be wielding a chainsaw. Let’s call it a hedge-trimmer then. He wants a slimmer civil service that weeds out its underperformers and thinks less cautiously.
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Having long experience of listening to ministers grumble about civil servants, I find that the complaints haven’t changed much over the years. Whether the politician speaking is Labour or Tory, the charge list includes inertia, group-think, arse-covering, being too comfortable with mediocrity and obsessing over process at the expense of outcomes. Funnily enough, the professional deformations that politicians ascribe to civil servants sound awfully like their own. Mr McFadden says “governing as usual” is for the birds and the future state must work more like a startup by adopting a “test-and-learn” mindset to find creative ways to improve delivery. He wants Whitehall to develop an appetite for risk, because “if we’re terrified of failure we’ll never innovate”. Absolutely. But mistakes can’t be learned from unless they are acknowledged and owned. That will be counter-cultural not just for the civil service but a shock to the system for politicians as well. Good luck with that. I’ll treat Mr McFadden to a ticket to a Bruce Springsteen concert if he can make it happen.
The subject that most excites some ministers is “digital reform”. The need is urgent. Ridiculously, about half of the government’s digital budget is currently spent on maintaining and keeping secure data systems, some of which are so out of date they go back to the 1970s. About half of government interactions with the public are still paper-based. Government digital services have been consolidated in Peter Kyle’s department. The technology secretary tells me that his mission is to make the way government interacts with the public “fit for the age we’re living in” “to look and feel more like bank and travel services do now”. In June, he will launch the gov.uk app designed to offer access to a wide range of state services. A ChatGPT fan, he is also an evangelist for how AI can be exploited to make the state a better servant of the people.
There are many unanswered questions about the extent to which digitising government will make it more productive. What we do know is that AI can’t change a dressing or fill a pothole. Ministers shouldn’t be beguiled by some fantasy that there’s a single shiny gizmo that will magically make everything better. “Smarter government” will require bold thinking, remorseless attention to detail and sustained effort over many years. If it were easy, successive prime ministers wouldn’t have been gnashing their teeth about it for so long.
