Planning for the future of the Government’s estates

The Government appears to be making progress towards its target of relocating 22,000 posts by 2030, and steady progress towards a target of reducing the proportion of Senior Civil Service posts based in London to 50% of the total. However, a number of issues with the framing and reporting of these targets makes it difficult to judge how substantial the Government’s achievements are. It is striking that the Cabinet Office has published so little information on the rationale and design of its Places for Growth programme, and also its new Plan for London. In particular, the Cabinet Office has not published a clear and definitive statement on the exact region from which it is seeking to relocate posts, nor of exactly what its target for senior officials is. In some of its communications it is also adopting a boosterish approach to reporting progress, which is likely to give an exaggerated picture of its achievements. Overall, the Cabinet Office has not done the basics of launching a programme well, notably failing to be clear and consistent in framing the rationale underlying the programme and the targets it is aiming to achieve.

Publishing details of the rationale and success criteria for a major programme is essential for public transparency and assisting parliamentary scrutiny. This is not only a democratic good in itself; by exposing the justifications for their interventions to scrutiny, departments can hope to strengthen the design of their policies and gain greater public confidence in their decisions. In future, whenever the Cabinet Office launches a named programme, it should publish a prospectus document in advance of its operation, setting out details including the programme’s rationale, key objectives, and evaluation plan. It should additionally maintain a dedicated webpage on GOV. UK, on which it periodically publishes updated metrics of progress, as well as other corporate announcements related to the programme. Retrospectively, the Cabinet Office should, alongside the response to this report, publish this information, both for Places for Growth and for its Plan for London, on a dedicated GOV.UK webpage, and commit to updating it with metrics of progress at regular intervals, at least annually. In publishing this information, the Cabinet Office should clearly show how Places for Growth and the Plan for London fit together.

The Government has made high-profile commitments that Ministers would spend significant working time in regional offices—though without clearly explaining what value this was meant to deliver. To date, Ministers have not been able to meet this commitment, making flying visits rather than basing themselves outside London for significant amounts of time to conduct substantive work. The responsible Minister himself suggested a good reason for this: ministerial work is closely linked to Parliament and the Cabinet, and long travel times make it impractical for Ministers to spend very significant working time away from Westminster. The Government should either live up to its public commitment for Ministers to spend more time working outside the capital, or issue a revised ambition with an accurate statement of what Ministers can actually commit to. This should extend to the Government’s purpose in building Cabinet meeting rooms in two of its new Hubs, and the Cabinet Office should include in its response to this report details of when the Cabinet plans to meet in Edinburgh and Cardiff. (Paragraph 33) 48 Where Civil Servants Work: Planning for the future of the Government’s estates

The Cabinet Office has made high-profile statements about the economic benefits to be delivered by Places for Growth, referring to research which supports its estimates. However, it has only just published information about this research, and this information was not written for easy digestion by the general public. This is a clear example of bad practice, as it prevents Parliament and the wider public from comprehensively reviewing the arguments and evidence underlying the alleged benefits of the programme. The Cabinet Office should, alongside its response to this report, publish details of the research underpinning its claims of economic benefits in a form which clearly explains how the claims made in previous Places to Growth press releases have been calculated. Moreover, the Government Analysis Function should, within six months, publish a statement on its website and write to heads of the analysis function within all government departments urging them to bring the transparency requirements of all government analysts into line with the best practice guidelines set by the Office for Statistics Regulation. This should make clear that, whenever economic research is referred to in press notices and ministerial statements, departments should present links to a published form of this research.

The Government is not only relocating posts from London to the regions and nations, but also relocating posts from local offices (often in economically deprived towns) to large regional Hubs (mostly in big cities). We are concerned that the Cabinet Office is not seeking to estimate the net economic impacts of its different relocation policies, once these local office closures are taken into account. The Cabinet Office should publish within six months analyses of economic losses in towns where government offices have been or are going to be shut down under the Government Hubs programme, as well as the expected benefits in areas where Hubs are opening. (Paragraph 49) Government Property Agency: Managing the office portfolio

The rationale for the creation of the Government Property Agency was that by taking over the management of all government office buildings it would lead to co- ordinated decision-making and efficiency savings. But with the departments with the biggest office estates remaining outside the GPA’s control, the Government is potentially missing out on opportunities to bring together different public bodies and optimise the location of its office estate. To help ensure joined up decision- making across government, it should be a requirement for every accounting officer, before approving any major property consolidation or relocation proposal, to obtain assurance that their officials have explored opportunities to co-ordinate location and design decisions with the Government Property Agency, in its management of the office portfolio. The Cabinet Office should work with HM Treasury to develop this guidance for accounting officers, and write to us within six months to confirm the results.

In order to do its job effectively, the Government Property Agency needs good quality workforce plans from departments, enabling it to plan for the right size and location of government offices. This has been made more difficult by uncertainties resulting from government policy and communications. On the amount of time civil servants should work in the office (which thus affects the demand for office space), high-profile statements from Ministers have been at odds with key policy Where Civil Servants Work: Planning for the future of the Government’s estates 49 programmes. Meanwhile, the Government has made sudden and unclear statements about the size of the civil service, most recently stating both that it had scrapped targets for headcount reductions and that it was still committed to achieving the same scale of cuts but clarifying neither how this was to be achieved nor over what timescale.

In its response to this report the Cabinet Office should write to us with a definitive statement of government policy on the flexibility civil servants should have on how often they work in the office. Within the same period, the Cabinet Office should write to us with a clear statement on what size of headcount reductions the Government is modelling, in what timescale this is intended to be achieved, and what impact this will have on departments’ requirement for office space. Until the GPA has greater certainty over departments’ workforce plans and demand for office space, it should review whether to proceed now with those Hubs currently in the planning stage, and not actively plan for any additional Hubs.

The Cabinet Office has provided a plausible explanation for the GPA’s practice of charging departments rent on offices which the Government owns and has no intention of selling. This answer emphasises the value for money which the GPA is able to secure by acting as office property manager for multiple departments. As this value depends on scale, it is important that individual departments stay within these arrangements, rather than trying to find better deals from commercial landlords on a local basis. Nevertheless, to tie departments into these arrangements successfully, the GPA needs to be able to demonstrate that it is providing value for money. The Government Property Agency should commission an external review, to publish within twelve months, of the value for money of the service which it is providing to departments in return for its rental charges. (Paragraph 68) Civil service culture and people: Implications of the relocation agenda

Previous governments which implemented similar programmes of civil service relocation acknowledged the risks and potential disadvantages–for example, significant upfront costs of relocation and redundancy packages, plus a loss of efficiency and coherence from moving policy roles far away from Whitehall. The Government is doing things differently this time–for example, generally recruiting new starters to regional offices to fill vacancies when they arise rather than relocating existing staff relying on videoconferencing, and seeking to relocate more SCS posts in order to create more senior career pathways outside London. This approach does, however, present novel risks, such as the potential development of a two-tier departmental culture, if regional offices mainly comprise new starters who have never worked in Whitehall. A further risk is that departments may be exclusively filling vacancies to locations outside London, even where such posts require significant presence in London, in order to meet Places for Growth targets.

The Cabinet Office should issue guidance to departments that London should not be ruled out as location for new recruitment, where it is more appropriate for certain posts to be based in the capital. It should also use the Civil Service People Survey to monitor and address evidence of a perception among regionally-based staff that they 50 Where Civil Servants Work: Planning for the future of the Government’s estates have lower engagement scores or views on career prospects. Equally, should the Civil Service People Survey reveal engagement to be higher in regional offices, the Cabinet Office should conduct research into what departments running Whitehall offices may be able to learn from them.

Co-locating officials from different departments within the same regional Hubs potentially offers the opportunity to create collaborative teams, generating new insights and leading to more joined up policy-making. At the same time, past experience suggests that problems may arise from the fact that different departments are individual employers, with their own pay scales for officials below the Senior Civil Service grades. We disagree with the Minister’s assessment that there are no risks to consider here. Instead, we believe this has the potential to both lead to tensions where staff from different departments are co-located, and cause practical issues where staff seek to move between departments within Hubs in pursuit of improved pay and conditions. To help realise the wider potential of the Government Hubs programme, the Cabinet Office and GPA should promote case studies which demonstrate the practical benefits of staff from different departments working together within regional offices. The GPA should report on such case studies, highlighting the practical impacts on policy-making, in its annual reports. The Cabinet Office should also monitor the extent to which staff within regional Hubs transfer between departments, investigating both the reasons for it and the level of disruption this causes to departmental business.

The stagnation of civil service pay poses challenges for retention, recruitment, and morale—and may in some cases lead to real hardship. Moving posts out of the capital, where costs of living are lower and where the Government does not pay a London premium on civil service salaries, has the potential to offer financial benefits to both the Government and its officials. Nevertheless, a large contingent of staff—especially senior posts—are always going to be required to work in London, and the Places for Growth programme will on its own do nothing for the individuals holding such roles. Civil service relocation has a role to play within the overall policy relating to civil service pay, but it should not be seen by the Cabinet Office as a replacement for addressing underlying issues.

Recruiting staff to regional offices has the potential to open up the civil service as a career to a wider number of people. This can have benefits both for civil servants (enabling them to pursue a career in government without necessarily having to move to London) and for government policy (if it leads to greater understanding within departments about the differing needs of local communities). The Government’s thinking about how to achieve these benefits appears unclear, however. In particular, there is a risk that in viewing certain communities outside London as being more representative of the country as a whole, the Government is stereotyping communities outside the capital as all being essentially the same and all being radically different to the varied communities in London, overriding local differences in needs and interests. It remains to be seen how HM Treasury’s Darlington Economic Campus will improve policy-making for the remainder of the country.

The previous system of Government Offices for the English Regions received some criticism at the time for not sufficiently doing bottom-up policy-making for the regions they were based in. However, there was at least a comprehensive structure in Where Civil Servants Work: Planning for the future of the Government’s estates 51 place, in which the same government departments were represented in each region, as a scaled down version of Whitehall for local areas. The Government’s current approach to the Places for Growth and Government Hubs programmes is much more haphazard. Without a clearer rationale for why a particular function has been relocated to a particular regional Hub, the Government increases the risk both that its programmes will fail substantially to influence policy-making and that a future government may reorganise or reverse what it has done.

To increase the impact and rationale of each regional Hub, the Cabinet Office should co-ordinate the local outreach work undertaken by each department’s regional offices (liaising with local authorities, businesses, and third sector stakeholders). The objective should be to systematically improve central government’s understanding of local needs, and the local impacts of government policy, in each region and nation of the UK.

The Government’s claims for Places for Growth imply that it expects there to be an appreciable difference in mindset between policy officials employed in London and those in regional offices, and a corresponding change to policy. However, the responsible Minister was not able to pinpoint how policy advice drafted in a regional office would be different from that drafted in Whitehall. Even where some staff in regional offices may be more likely to have different educational and professional backgrounds, the majority of policy officials are likely to be university graduates wherever they are based given current recruitment criteria, with a certain broad shared framework of intellectual values and approaches this tends to imply. It remains unclear, both as to what changes Ministers want to see in the policy advice they receive from officials, and how the fact of basing more officials in regional Hubs will achieve these changes. The Cabinet Office should publish details of its understanding of how the location of officials influences the advice they provide, setting out how exactly it expects recruiting staff to regional offices will lead to tangible differences in policy development and improvements to the welfare of citizens and communities. (Paragraph 96) Overall conclusions

Overall, the Cabinet Office has a number of successes to point to regarding the Places for Growth and Government Hubs programmes. The number of posts allocated to regional offices under Places for Growth is growing rapidly, and HMRC and the GPA have made significant progress in meeting their objectives of consolidating the office portfolio into a smaller number of larger, more modern buildings. However, these promising signs are undermined to an extent by weaknesses in the framing, reporting, and rationale for these programmes. Notably the reported economic and cultural benefits of civil service relocation have not been clearly demonstrated.

Beyond the specific design and impacts of these programmes, we were struck by what they revealed about the Cabinet Office’s approach to policy-making. The fact that Civil Service relocation has been pursued by several previous governments provides an historical comparison against which this Government’s approach stands out for its lack of published research, its failure to seriously engage with the trade-offs to be 52 Where Civil Servants Work: Planning for the future of the Government’s estates managed, and its exaggerated approach to progress and benefits. The Cabinet Office’s approach to presentation is particularly disappointing, given it is the responsible department for the Government Analysis Function, Government Communications Service, and Evaluation Task Force—all of which provide guidance to departments on the robustness of policy development or communications. This lack of rigour manifests itself as a vagueness at the heart of this policy, with the Cabinet Office not providing a clear account of why certain functions are being located in particular places, what difference this will make to government policy, or how exactly this will impact on regional communities and their citizens. (Paragraph 99) Where Civil Servants Work: Planning for the future of the Government’s estates 53