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Cabinet Office

Volume 574: debated on Wednesday 29 January 2014

The Minister for the Cabinet Office was asked—

Offshoring Services

Our policy on offshoring is unchanged from that pursued by the previous Government. Our procurement policy is to award contracts on the basis of value for money, which means the optimum combination of costs and quality.

Cabinet Office document ISSC2 states that back-office jobs and functions in the Departments for Work and Pensions and for Environment, Food and Rural Affairs will be privatised and offshored in a joint venture with the Government and Steria UK. Which functions and jobs will be offshored and to where? Does he agree that any threat to offshore jobs, particularly those handling sensitive personal data, should be given urgent attention by the Government?

Concerns about data security are taken very seriously, and certainly inform our approach to offshoring. But as I say, the approach that we take to offshoring is exactly the same as that followed by the previous Government. The hon. Lady may know that the shared business services joint venture, also with Steria, which was set up by the last Government, has some elements that are offshored, and the same will be the case with this joint venture.

Will my right hon. Friend encourage contractors to recognise that where there is a very cost-effective office in a rural community providing shared services, such as the DEFRA office in Alnwick, retaining jobs there makes sense?

I know my right hon. Friend’s concern about that office and I know that Steria and the management of the shared services centre will be looking at that very carefully. They will want to make sure that the service is provided at an improved quality—the quality has not been optimal up to now—and at a much lower cost. There will be many different ways of doing that, but I know that they will want to look very carefully at the service provided by their colleagues at Alnwick.

Civil Service (Commercial Skills)

The Government have been working for the past three years to drive up the level of commercial skills across central Government. There is still a long way to go, given the shortcomings of where we started. The need to press ahead with redoubled speed was highlighted in our recent cross-Government review of contracts. We are creating the Crown Commercial Service, which will come online later this year.

I welcome the important steps that my right hon. Friend is taking to improve these skills. I believe that more needs to be done to continue to upgrade skills in commercial areas, particularly relating to project management and commissioning. Is he satisfied that sufficient civil servants will be going through the new commissioning agency really to make a difference to the skills base in Whitehall and beyond?

I recently attended the one-year-on event of the new Commissioning Academy, which we set up a year ago. It has achieved a good deal. During the next 18 months, we want 1,500 senior public sector commissioners to have participated in the academy. It is part of a wider programme to improve commercial skills not only in Whitehall but right across the public sector.

What assessment has my right hon. Friend made of the work of the Crown representatives in driving value for money for taxpayers through procurement reform?

Our Crown representatives, who come predominantly from the private sector with a huge amount of commercial experience, have helped us to generate significant efficiencies. We buy better if we act as a single customer in Government, to maximise our buying power and improve our performance as a customer. We are renegotiating contracts with a number of suppliers, and by centrally renegotiating we have saved the taxpayer £800 million in each of the financial years during this Parliament.

When does my right hon. Friend expect that all those in charge of major Government IT contracts will have gone through the programme at Oxford Said business school, and is he satisfied that that is the very best place to send these people?

I am absolutely satisfied with the Major Projects Leadership Academy, which was set up to address what was identified by everybody as a major deficiency in Government and is now approaching its second anniversary. There is a requirement for all major project leaders to be alumni of the academy by the end of 2015, and all of them will have at least started training by the end of the current year. We started with a real deficiency of skills and experience, but we are building those with civil servants, which has been very much welcomed.

Just before Christmas, the cross-Government review of major projects identified a number of serious weaknesses in the way contracts with Serco and G4S had been administered. Will the Minister confirm that the review’s conclusions will be implemented in full? Will he also consider requiring senior civil servants to spend three years in a commercial environment before becoming permanent secretaries?

I can confirm that we have accepted the recommendations, and Departments are producing their plans for implementing them imminently. With regard to the requirement for senior civil servants to get commercial and operational experience, we have already set out that someone looking to be appointed as permanent secretary of a delivery Department must be able to show at least two years of commercial or operational experience before being considered.

May I push the Minister on that? Is it not a bit wishy-washy to refer to “commercial” skills? I am co-chair of the all-party management group. What we want across the civil service are pure management skills. Moreover, we want Ministers with some ability to manage a Department. The fact is that most of the Ministers who appeared before me when I chaired a Select Committee could not manage the proverbial in a brewery.

The hon. Gentleman may have more experience of the latter activity than I do, but the truth is that Ministers are not actually required to manage Departments; that responsibility sits very clearly with the civil service leadership. I think that they would be the first to accept that he makes a valid point. We have a deficiency in leadership and management skills as well as in commercial skills, and we need to address that. Concerns about the quality of the leadership and management of change come up consistently in the civil service staff survey, and as great organisations are always changing, we need to rectify that deficiency.

Of course we agree that we want greater commercial skills, and indeed management skills, in the civil service, but with the fiasco over the west coast main line, botched contracts over rural broadband roll-out and the lamentable implementation of the universal credit, with the Minister squabbling publicly with the Secretary of State for Work and Pensions, when will Ministers, rather than blaming officials, take some responsibility for their own shambles?

On that last point, the hon. Gentleman will know that it was my right hon. Friend the Secretary of State who spotted that things were not right with the implementation of the universal credit and commissioned the review that disclosed the problems to the Department for the first time, as the National Audit Office and Public Accounts Committee report makes absolutely clear. Far from evading responsibility, it was my right hon. Friend who spotted the problems and set to work solving them.

Does my right hon. Friend acknowledge the widespread appreciation of his personal commitment to improving skills in the civil service, which is truly commendable? Will he also take this opportunity to welcome the fact that the Public Administration Committee has just announced a new inquiry into skills in the civil service, and will he encourage people to send us as much evidence as possible?

I absolutely welcome the inquiry that my hon. Friend is leading and will certainly encourage a lot of evidence to be given. We have to be open about the problems that exist. Otherwise, there is no chance whatsoever of solving them. The first stage in finding solutions is being honest about the problems.

Youth Services

We are strong believers in the value of high-quality youth services. We will shortly publish a report on what local authorities are doing to comply with their statutory duty, along with our plans to support those who want to deliver high-quality services in an innovative way.

As the Minister says, local authorities have a duty to secure sufficient educational leisure-time activity for the improvement of well-being and the personal and social development of young people, but the average cut to youth services has been 27%, with some local authorities cutting their youth service budgets completely. What measures is he taking to ensure that local authorities meet their statutory responsibilities, and how is he measuring the impact of the cuts on the well-being of young people?

The statutory duty exists. We are concerned about the vulnerability of youth services, as is the hon. Lady. It is a mixed picture: boroughs such as the London borough of Hillingdon in my constituency, for example, are investing more in youth services now because they fixed the roof when the sun was shining, but there are cuts. We are finding out an accurate picture of what is happening, because we did not have one, and we will shortly publish the offer we can make to local authorities that want to commission services in an innovative way.

Following on from that last answer, does the Minister agree that it will be difficult, if not impossible, to provide a fair start to all young people in Rotherham, given the £970,000 cuts to the youth service with which the council is now forced to deal?

I fully accept that there are very challenging pressures on local authorities as a result of the cuts. Each of them is dealing with the cuts in different ways. What we sitting in the centre can do is map what is happening, help local authorities by signposting other sources of funding, help them to look at examples of good innovative practice around the country and help them if they are really committed to commissioning high-quality services for young people. We know the value of those services, and we are absolutely committed to them.

Will the Minister be mindful of the Youth Commission report on the role of youth workers in schools, which I chaired? It highlighted the value of qualified and empathetic youth workers supporting young people in school settings on healthy living and engagement issues. Will he urge colleagues in the Department for Education to make sure that Ofsted take that into account in their inspections?

I am certainly very happy to raise that with colleagues in the Department for Education. Over the years, I have developed a deep admiration for the work of youth workers, who can have an extraordinary impact on young people. I will therefore raise that point with other Departments.

These questions tend to ignore the enormous amount of voluntary work already done by youth organisations in our constituencies—people helping young homelessness projects, street pastors, sea cadets, air cadets, Army cadets, scouts and guides. Huge numbers of youth organisations are run or assisted by adult volunteers, and they do not need the intervention of the state to thrive and prosper.

I fully agree with my right hon. Friend’s points. A huge number of organisations seek to help and develop young people. Part of the challenge for us is to try to connect them with local authorities, which have a statutory duty, to see whether services at local level can be joined up more effectively for the benefit of young people in the area.

Will the Minister hold discussions with the relevant Ministers in the devolved legislatures to ensure that best practice in youth service provision right across the United Kingdom is replicated to the benefit of young people throughout the UK?

Such provision is a devolved matter, but we are having active conversations with devolved Administrations, specifically about the opportunity to develop the National Citizen Service in other areas. I am absolutely delighted that we have been able to run very successful pilots in Northern Ireland, and we are in active conversations with other Administrations to follow that lead.

I congratulate my hon. Friend on the remarkable start that the National Citizen Service has made and on all that is happening. May I urge him to meet the Marine Society to talk about what sea cadets and other parts of its very successful existing portfolio can deliver for it?

I would be delighted to have such a conversation. We have had very constructive conversations so far with the cadets about links that could be made with the National Citizen Service. As we look to expand it very ambitiously, we are obviously open to conversations with any organisations that can help.

The Minister has previously said that youth services are too easy a target for cuts, and he was right. In fact, his Government have squeezed councils so hard that they have presided over £300 million- worth of cuts to youth services, but at the same time they have squandered £241 million on free school places in areas where they are not needed. Ministers’ pet projects or young people—will he tell the House which he thinks are more important?

The hon. Lady totally ignores the reason why there are cuts in the system, which is to get control of the deficit that we inherited. We passionately believe in the value of youth services for young people. That is why we have developed the National Citizen Service, which has an evidence base to support the value that it gives to young people. As I have said, we are now prepared to work with local authorities to see how they can commission, in an innovative way, really effective youth services in their area.

Social Finance

Britain is proud to lead the world in developing the emerging market of social investment. Big Society Capital has already committed £140 million, and the number of social impact bonds has risen sharply. Grants are flowing to help social entrepreneurs to become more investment-ready, and a new tax relief will go live in April.

I refer to my entry in the Register of Members’ Financial Interests.

Having properly evidenced early-intervention programmes is the biggest known deficit reduction programme. In order for such programmes to start up, we need effective social finance. Will the Minister meet me to discuss what more his Department and, above all, Big Society Capital can do to maximise that possibility?

I congratulate the hon. Gentleman on his leadership in setting up the Early Intervention Foundation and on the work that it published today on domestic violence. He is entirely right that part of the value of social investment is its ability to create space to finance early intervention. That is where a lot of the social impact bonds that I mentioned are focused. I know from my conversations with Big Society Capital that it is very interested in engaging with What Works centres, including the Early Intervention Foundation. Following the hon. Gentleman’s question, I will write to the chief executive, asking him to update me on his engagement with the Early Intervention Foundation and other What Works centres.

Does my hon. Friend agree that the social impact of the delivery of public services should be taken account of during the procurement process, as well as the purely economic impact?

Yes, the Government agree with that. That is why we put the Public Services (Social Value) Act 2012 on the statute book. Later this month, we will publish a one-year-on review of that Act, because it matters to us. We are keen for commissioners—the people who spend public money—to think intelligently about how money can be stretched as far as possible.

Privatised Shared Services

5. What assessment he has made of the efficacy of privatised shared services across central Government Departments. (902238)

The Government’s first priority is to drive down costs for the taxpayer and cut the massive budget deficit that we inherited. There has been cross-party agreement on the need for shared services for the past decade, but very little had been achieved until over the past 12 months. That is why I am pleased that last year we launched a joint venture with Steria that will save taxpayers at least £400 million and create a new, dynamic UK business services company.

The announcement in December that the Ministry of Justice’s shared service centre in Newport could be privatised has caused huge fears and uncertainty among the work force, who fear that their jobs will be outsourced and potentially offshored, which could happen under this model. Given the Prime Minister’s commitment to onshoring jobs last week, will the Cabinet Office reassure the workers in Newport that the plans will be shelved?

We will certainly not shelve any options that could bring improved services and cut the cost to the taxpayer. I am aware of the uncertainty. That will be resolved as soon as possible so that people know where the future lies. To give a bit of reassurance, I remind the hon. Lady that the first shared service centre in Swansea, which has been fully outsourced rather than being a joint venture, is taking on more staff.

National Citizen Service

A new, independent organisation called the NCS Trust has been established to lead the programme in 2014. We are delighted that more than 70,000 young people have had this hugely positive experience since 2011. The trust will build on that success. In 2014, more young people than ever will have the opportunity to take part in the National Citizen Service.

In September last year, I joined 40 young people on Big Challenge Sunday. Guided by the park ranger, Trevor Hoyte, they painted fences and picked litter in Rugby’s Caldecott park. That was appreciated by local people and the young people gained valuable life skills. Should not Members from across the House encourage more people to take part in the National Citizen Service?

Yes, we should. I thank my hon. Friend for his support for the National Citizen Service. The NCS has a twin value: it gives young people the chance to do something in their community and, as he said, it helps them to develop confidence and skills that will make them more employable. That is why we are so ambitious for it and why there is cross-party support for it, led by the Leader of the Opposition.

Topical Questions

My responsibilities are for the public sector Efficiency and Reform Group, civil service issues, the industrial relations strategy in the public sector, Government transparency, civil contingency, civil society and cyber-security. [Interruption.]

Order. There is still rather a lot of noise in the House. What is required is an air of respectful expectation for Karen Lumley.

Thank you, Mr Speaker.

Does my right hon. Friend the Minister share my concern at the reports that a trade union is threatening to use so-called leverage tactics against our NHS staff? Can he confirm that those allegations fall within the scope of our review of trade union activities?

I share my hon. Friend’s concerns at those suggestions. It is appalling that hard-working staff in our NHS should be subjected to the threat of such bullying and intimidation. I can confirm that the review that we are establishing will be fully empowered to investigate those suggestions.

In light of the newly released Cabinet papers about the 1984 miners’ strike, and given the continued sense of injustice that prevails across the coalfields, will the Minister agree to publish all the documents and the communication between the then Government and the police at the time of the strike; to a full investigation into the events surrounding Orgreave ahead of the 30th anniversary; and to make a formal apology for the actions of the then Government? Does he agree that it is only through full transparency and reconciliation that we will finally see justice for the coalfields?

The documents will be released in the usual way under the law that was passed under the last Government. I was representing a coal mining constituency during the miners’ strike and saw at first hand the violence, intimidation and divided communities in a dispute that took place without a proper national ballot being held. The hon. Gentleman asks for an apology—no.

T5. As well as reversing the previous Labour council’s cuts to youth services and taking trade union money and putting it into apprenticeships, North Lincolnshire’s Conservative council has adopted dynamic purchasing systems such as e-tendering to support local businesses. Are the Government evaluating the benefit of such systems to the wider public sector? If so, will the Minister look at the North Lincolnshire examples? (902267)

There is huge scope for councils to give more business to smaller businesses, and my hon. Friend gives a good example that many more local authorities should copy.

T2. Sunderland has a great record on technology start-ups, but these small companies still find it difficult to compete and bid for Government work. What more can the Minister do across Government to support this growing industry in the north-east? (902264)

We can do more, and we are already doing much more than was previously the case. The amount of Government business going to small businesses, both directly and indirectly, has risen to nearly 20%. I am afraid that the last Government were not even measuring how much went to smaller businesses. There is much more that we can do. We have streamlined the procurement processes, which previously seemed almost deliberately to exclude small businesses from being able to bid. [Interruption.]

The Minister has ploughed on, to his credit, but it has been difficult for him to be heard. His words should be heard, and I hope that there will be some courtesy from Members.

T6. I welcome the Minister’s offering IT procurement to small and medium-sized enterprises through the G-Cloud. Is he aware of a local constituency company called The Bunker secure hostings, which offers data for SMEs to access G-Gloud? (902268)

I am glad that G-Cloud, which we set up, now has 800 suppliers on it, two thirds of which are SMEs, and that an increasing amount of business is being awarded through it. I hope that the business in my hon. Friend’s constituency will be successful in winning business through that innovative way of enabling the purchase of IT services.

T3. Last week, the Information Commissioner said that there were “serious shortcomings” in the Cabinet Office’s handling of freedom of information requests and called the Department’s poor performance “particularly disappointing”. Why is the Minister setting such a bad example, given that his Department is supposed to lead on openness and transparency across Government? (902265)

It will be clear to the hon. Lady that the Cabinet Office deals with some of the most complex and difficult freedom of information requests, a lot of them involving previous Government papers, for which a long consultation process has to be entered into before any decision can be made. The situation will be better in some quarters than others, but in general our record is good.

T8. Given that a fifth of Government procurement spend now goes to SMEs, will the Minister redouble his efforts so that these engines of growth further boost our long-term economic plan? (902270)

We have made massive progress. Under the previous Government there was no attempt even to measure how much business was going to SMEs, but we are now measuring that and improving it. We have cut out a lot of the bureaucratic nonsense that often prevented small businesses from even being able to bid for business, let alone win it. The result of that, as my hon. Friend says, is that nearly one fifth of Government business goes to SMEs one way or another. It is our ambition for that to rise to 25%, and I am optimistic we can achieve that.