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Institute for Government’s view on the machinery of government issues raised by the LSE Growth Commission’s report

The London School of Economics (LSE) Growth Commission publishes its final report recently. The Institute for Government engaged in a productive partnership with the Commission, to explore the implications of a long-term growth strategy for the machinery of government. While the views expressed in the report are those of the Commissioners, they link closely with many areas of the Institute’s work.

The Commissioners highlight the importance of good policy making processes and of ‘institutional design’. We agree with the thrust of the arguments set out below.

The report says:

The Commission’s discussions have highlighted how in many crucial areas – notably education, infrastructure and financing for innovation – there has been a sustained failure to implement long-term strategic approaches to policy.”

The Institute’s work on better policy making has highlighted the importance of improving the quality of Whitehall’s policy making process more generally. If government is to rise to the challenge set out by the Growth Commission, it should also take into account the ‘policy fundamentals’ we set out for better policy making:

• Clarity on goals

• Open and evidence-based idea generation

• Rigorous policy design

• Responsive external engagement

• Thorough appraisal

• Clarity on the role of central government and accountabilities

• Establishment of effective mechanisms for feedback and evaluation.

We said that “in the current system no one – in departments or at the centre of government – has responsibility for ensuring that policy making is high quality.” We made a number of recommendations to address this.

The report says:

“We must break the familiar cycle of institutional churn and political procrastination to find ways of ensuring that difficult and contentious long-term decisions are based on the best available independent expertise.”

We recognise what the Commission’s says about ‘institutional churn’. Our wider work on Whitehall’s relationships with arm’s length bodies (ALBs) has argued that Whitehall could significantly improve how it sets up and oversees public sector institutions. We agree that decision making around how arm’s length bodies are created and abolished has at times been haphazard.

Government is doing more to address its relationship with ALBs but institutional churn is still a risk.  At the very least a more coherent and comprehensive approach to ALBs based on more useful classifications, as we recommended in our report ‘Read Before Burning’ would  aid long-term institution building.

A similar lesson applies to the centre of government, we recommended that setting up and abolishing government departments should be done with great care and only when absolutely necessary.

The report says:

“This is not a plea to take the politics out of long-term investment: apart from its moral imperative, a healthy democracy is vital for keeping policy responsive and government accountable. But politics is best in its right place – making strategic choices, setting objectives and holding executive bodies to account.”

The UK should build on its track record of institutional innovation to create, as the report says, a “better balance between political discretion, technocratic input and predictable rules”. Politics has a vital and tough role to play in both the short and long term success of the UK’s growth agenda. As our recent report into the success of The Games showed, London 2012 demonstrated what can be achieved when politicians work where they are most effective: leading the public debate, getting broad political consensus, acting as ambassadors and being accountable to parliament and the people. Allowing others outside of politics to work where they have the expertise without undue interference is what helped make London 2012 a success and should be learned from.

The report says:

“Unlike in many other democracies, the Whitehall machinery for providing strategic advice and overseeing implementation is relatively small-scale and informal and has been prone to radical change from one government to the next. This needs to change. The absence of stable machinery at the centre of government makes it more difficult to develop and implement a long-term strategy for promoting economic growth.”

The role of the centre of government in the UK has been a long-term topic of discussion but a long way from being settled. We have commented on the recent continual change of personnel at the top of the Civil Service. Stability at the top is important, particularly during times of major reform and cuts, as our work on transforming government departments showed. The units at the heart of government are notorious for being here today and gone tomorrow. Our report Shaping Up discussed the impact of the constant churn at the Centre and identified a ‘strategic gap at the heart of government’. We expressed concern when the Strategy Unit and Policy Unit were abolished. We also said it was a false economy  to scrimp on support for the Prime Minister.  For more on what we have said on the role of the centre:

Our work on better decision making in Whitehall has emphasised the need for proper performance management of Whitehall’s most senior civil servants, underpinned by meaningful management information. We fail to see how government can rigorously assess its own performance without such information. Lord Heseltine’s own report stressed the need for better “monitoring and accountability’, underpinned by 'a Whitehall management information system' encompassing performance and financial data. These views are in line with our research and we will continue to challenge government on this.

The Institute will be following up some of the themes relating to the machinery of government and growth in the coming weeks and months.


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