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Ministers should have final say over the appointment of permanent secretaries – new report

Giving ministers the final say over the appointment of permanent secretaries will increase transparency and accountability at the top of Whitehall and would more closely reflect what already happens, concludes the Institute for Government (IfG) in a new report published recently.

In the latest report in its series on accountability in Whitehall, the IfG says the appointment process for Whitehall’s top jobs should be more effective at ensuring people are selected for their ability to do the job and their ability to maintain the confidence of ministers.

Contrary to the position taken by the Civil Service Commission, the IfG concludes that giving ministers the right to make the final decision over the appointment of permanent secretaries – from a shortlist of independently-assessed candidates – would improve the appointments system by codifying what already often happens.

Fears that such a move would lead to the politicisation of the Civil Service are unjustified, says the report’s lead author, IfG Fellow, Akash Paun. The report says:

“So long as there is a rigorous merit-based assessment preceding the exercise of ministerial choice and appointed candidates are bound by the existing civil service code and values, then there would not be an increased risk of politicisation, but a system that is more accountable and more closely reflects the reality.”

Permanent secretary appointments should be a clear process, leading to the appointment of the person most able to do the job and most able to work well with ministers. At present however there is significant ambiguity about how much involvement ministers really have in the process, even following the recent guidance published by the Civil Service Commission. We found that ministerial influence over appointments was currently exercised through often “opaque and undocumented channels.”

“Selection panels are known to take active steps to avoid the possibility of a (Prime Minister’s) veto – to the point of avoiding recommending a candidate likely to be opposed by a minister”, the report concludes.

“Managed moves” lack transparency

Recruitment from outside the Civil Service is also more the exception than the norm at permanent secretary level. Since 2010 there have been 21 appointments of permanent secretaries. Of these, only 10 were filled through external competitions – to which non civil-servants could apply. And of these, 9 were won by serving civil servants and the 10th by the head of a Non-Departmental Public Body.

“Managed moves” remain common - a mechanism by which the civil service leadership – often at the request of ministers – fills a vacancy simply by shuffling a serving official from elsewhere in Whitehall into the post, without any formal competition at all.

Our research established that a third of permanent secretary appointments since 2010 have been made through managed moves, contrary to the government’s stated emphasis on external recruitment and on increasing the commercial and operational experience of civil service leaders.

There however a lack of transparency around the use of managed moves, with no published data on their use or the reasons for them, says the report. One senior Whitehall figure admitted that managed moves were sometimes used ‘more in desperation than long-term planning’.

Matching the candidate to the job

The current system of appointments at permanent secretary level could also be improved to ensure the right people with the right experience are appointed to particular jobs. One senior official described jobs as going to the next person in line, effectively saying the jobs go to the next person in the “taxi rank of director generals awaiting promotion.”

Performance objectives should also more closely relate to the most important challenges faced by the department. The recent publication of permanent secretary objectives is welcome but seen by many as a flawed process and had no clear link to performance pay decisions.  It would be sensible to include in the objectives a requirement to maintain the confidence of and strong relationships with the ministerial team.

Clarity about the expected length of term a permanent secretary should serve would also help performance management and improve expectations on both sides. We say that 4 years is a realistic term to serve but with the possibility of renewal, subject to a formal performance assessment.

However performance management of permanent secretaries remains a weak spot in Whitehall. It compares poorly to systems operating inside the departments. This may be because there is no formal corporate leadership on HR and talent management of the sort provide for in New Zealand for example. Better succession planning could save months of delay in appointments when there are sudden departures.

Institute for Government Fellow, Akash Paun, said:

“There are many myths surrounding the appointments process for permanent secretaries. In reality, ministers have a huge amount of influence already, but this is often exercised informally and behind the scenes. Far better would be to have a more rigorous independent assessment process that presents a shortlist of candidates to the Secretary of State to choose from. This would not only be more transparent, but would also allow for clearer accountability.

“If ministers had to take the final selection decision themselves then they could be called to account for their choices – and would find it harder to blame the staff should their pet policy projects run into trouble down the line.”

The report also recommends that during the shortlisting process the Civil Service Commission should assure itself of all candidates’ suitability for working with other ministers and with a different government administration. There is a need for continuous monitoring and public reporting of diversity indicators relating to applications and appointments to senior posts in Whitehall, the Civil Service Commission could also play a role here.

The IfG’s recommended system for permanent secretary appointments – with ministers selecting a candidate from a pre-vetted shortlist – is close to the system that operates for hundreds of important public appointments. Posts including the chairs of the BBC Trust, the Care Quality Commission, the Financial Conduct Authority and the UK Statistics Authority are filled through this process.

Related information

The report “Permanent Secretary appointments and the role of ministers” is published by IfG Fellow Akash Paun, Researcher Joshua Harris with Sir Ian Magee, IfG Senior Fellow and former Whitehall permanent secretary, who has also written the foreword. This work is part of our accountability in central government series.

For this study, the IfG interviewed over 20 senior people, including secretaries of state past and present; drew on the quantitative evidence available; analysed the available literature; ran a well-attended seminar with many interested parties; and made comparisons with what happens in three very different countries.

In January we held a seminar on the appointments process with First Civil Service Commissioner and Commissioner for Public Appointments, Sir David Normington, Ian Davis, Non-executive Director, Cabinet Office and the Rt Hon Caroline Spelman MP.

The Institute’s other work to date in this series incudes ‘Supporting ministers to lead: Re-thinking the Ministerial Private Office’, which recommended a stronger private office team with a civil servant Chief of Staff and our background paper looking at the accountability systems operating in New Zealand, Australia and lessons for the UK.