Twenty-Ninth Report - Whitehall preparations for EU Exit

Government continues to spend too much on consultants to undertake work that could be better done by civil servants, and does not do enough to utilise or develop skills and experience in-house. At the peak, more than 22,000 civil servants … Read more Government continues to spend too much on consultants to undertake work that could be better done by civil servants, and does not do enough to utilise or develop skills and experience in-house. At the peak, more than 22,000 civil servants worked on EU exit, and at present that number is around 15,000. The civil service responded to this demand by moving staff between departments—two thirds of staff in DExEU came on secondment from other departments. A similar approach has been taken on a larger scale to respond to the Covid-19 pandemic. There has been high turnover among staff working on EU Exit, particularly at senior levels. Government has made extensive use of consultants to support preparations for EU Exit, and is also doing so on Covid-19, to fill supposed gaps in the capacity and skills of the civil service. The Treasury anticipates that consultancy and contingent labour will be an area of focus in the 2020 spending review to ensure departments are making the best use of spending in this area. The Cabinet Office intends to reduce government’s spending on consultants, by developing additional capacity and skills in-house to reduce the need for consultants. Recommendation: Government should set out how it will ensure it has a full and frank assessment of the impact of cross-government working/working on complex issues on civil servants. This should include both likely positive outcomes in terms of skills or experience gained from working in different departments, and also negative impacts such as workload, resilience and the likelihood of burnout. Government should accelerate its plans to reduce its reliance on consultants. It needs better challenge of spending on consultants; clear plans to transition skills in-house where there isn’t obvious business need for short-term staff; and then monitoring of progress both in terms of decreasing spending and increasing skills levels in the civil service. Show less

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Government still does not have a good grip on how much taxpayers’ money is being spent on cross-government priorities. The Treasury has acknowledged the need for more timely, transparent financial information on cross-government areas of work, including both EU Exit … Read more Government still does not have a good grip on how much taxpayers’ money is being spent on cross-government priorities. The Treasury has acknowledged the need for more timely, transparent financial information on cross-government areas of work, including both EU Exit and the Covid-19 response. Before the NAO’s analysis, it did not have its own comprehensive information on government spending on EU Exit for 2019–20 or any earlier period, although it is now tracking information in-year for 2020–21. It has relied on departmental processes to ensure money on EU Exit has been used as expected. Departments are expected to publish information on EU Exit spending in their 2019–20 Annual Reports, but these have been delayed due to Covid-19 and the Treasury has identified inconsistencies in what has been presented so far. The Treasury plans to use its new OSCAR II finance system to collect better information from departments in the future, and this functionality is planned to be introduced in phases over the next year. It is not clear how this system will overcome difficulties in recording data from multiple bodies, especially that which does not fit into accounting categories, such as spending on Covid-19 or EU Exit. Recommendation: The Treasury should set out how it plans in future to have the additional tools needed to deal with cross-government spending issues, over and 8 Whitehall preparations for EU Exit above the existing Accounting Officer framework of control. This should cover how it will assure the quality and consistency of information departments provide, and how its systems will provide meaningful information on areas of spending which don’t meet “accounting definitions”. Whitehall preparations for EU Exit 9 1 Learning from EU Exit preparations Show less

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Our previous work on Covid-19 has highlighted the gaps in economic planning for pandemics, even though the risk of a pandemic was one of the most likely risks government had identified. In July 2020, we recommended that the Cabinet Office … Read more Our previous work on Covid-19 has highlighted the gaps in economic planning for pandemics, even though the risk of a pandemic was one of the most likely risks government had identified. In July 2020, we recommended that the Cabinet Office should review its contingency planning for the most serious risks and ensure that these consider whole-of-government impacts, including economic modelling, and we will monitor how government responds to the issue.31 22 Q 44 23 Q 38 24 Q 4; C&AG’s Report, Contingency preparations for exiting the EU with no deal, Session 2017–19, HC 2058, 12 March 2019, pages 10–12 25 Q 6 26 Qq 8–9 27 Q 15; C&AG’s Report, para 11 28 Qq 15–16 29 Q 43 30 Q 17 31 Q5; Whole of Government Response to COVID-19, Thirteenth Report of Session 2019–21, HC 404 dated 16 July 2020 and Published on 23 July 2020 12 Whitehall preparations for EU Exit The government has announced that there will be a review of its response to Covid-19, which the Cabinet Office expects will provide some lessons for the future in terms of how the pandemic has affected different parts of the economy and different parts of the country.32 However the review has not yet progressed beyond the scoping stage. The Cabinet Office informed us that so far only initial discussions have been held and no date has been set.33 Financial Management Show less

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Government is not doing enough to ensure businesses and citizens will be ready for the end of the transition period, and it is unclear what has been learnt from the previous ‘Get ready for Brexit’ campaign. The Cabinet Office launched a new communications campaign, ‘The UK’s new start: let’s get …

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EU Exit preparations involved more than 22,000 civil servants at the peak and have cost at least £4.4 billion. But there has been no serious attempt to reflect and capture lessons for other challenges that government faces. Every government department has been affected by preparations for EU Exit and this …

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EU Exit and the Covid-19 response have shown up critical gaps in the civil service’s approach to planning, particularly for unexpected events or undesired outcomes. The Cabinet Office keeps a national risk register, with input from across government and particularly the Treasury. The risk register includes “unexpected events” in terms …

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On the basis of a report by the Comptroller and Auditor General, we took evidence from the Cabinet Office and HM Treasury (the Treasury) about the learning for government from preparations for EU Exit.1 The C&AG’s report drew together lessons from 28 previous reports by the National Audit Office examining …

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The Cabinet Office relies on information departments provide on their readiness to identify the highest risk elements of the programme, although it continues to use specialist support from the Infrastructure and Projects Authority to review projects and also uses commercial and digital experts to assess departments’ readiness.11 The Cabinet Office …

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The Cabinet Office set out the current governance and decision-making structures for EU Exit.13 There are two ministerial committees, one focused on operations which currently meets daily and one focused on strategy which meets less often. At an official level, there is a programme board and regular meetings of senior …

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The Cabinet Office recognises that other challenges government faces, such as the response to Covid-19, will also require cross-government working, working at pace, or working in new ways.18 The Cabinet Office feels that it has learnt a lot from EU Exit and put it into a practice via a process …

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The Cabinet Office has a key role in ensuring government is ready to respond to unexpected and unprecedented events. It is responsible for coordinating civil contingencies response to unexpected events, conducting COBRA meetings, working with local resilience forums and with devolved administrations.24 The Cabinet Office also keeps a national risk …

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Recent events have shown up the limitations in government’s forward planning capability when put into practice. Ministers specifically limited the amount of contingency planning the civil service was expected to carry out ahead of the EU Exit referendum in 2016.27 While the Cabinet Office felt that was a reasonable position …

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Government spent £4.4 billion on preparations for EU Exit between the referendum and January 2020.34 The Treasury admitted that it had not itself asked departments to provide information on their expenditure on EU Exit which it could consolidate to get an overall picture of spending for any period prior to …

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The Treasury has relied on existing departmental processes within the system of Accounting Officer accountability to ensure money on EU Exit has been used as expected.37 We do not believe that this is sufficient, given the weaknesses identified by the NAO in the information departments hold, particularly in regards to …

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The Treasury has acknowledged the need for more timely, transparent financial information on cross-government areas of work, including both EU Exit and the Covid-19 response.39 In the past, it has said that this is particularly difficult because these areas of work do not fit into accounting categories used to collect …

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At the peak, more than 22,000 civil servants worked on EU Exit, and at present the Cabinet Office reports that the number is around 15,000.43 The civil service responded to this demand by moving staff between departments. In particular two thirds of staff in DExEU came on secondment from other …

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There has been high turnover among staff working on EU Exit, particularly at senior levels. DExEU has had three Permanent Secretaries, the Border Delivery Group has had three Director-Generals, and there have been changes at Permanent Secretary grade in key Departments impacted by EU Exit, including Defra and HMRC.46 The …

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Demands on the civil servants working on the Covid-19 pandemic response and/or EU Exit have been high at a time when many are having to adjust to new ways of remote working.48 The Cabinet Office believes that morale across staff working on these two priorities remains high despite these challenges …

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Government has made extensive use of consultants to support preparations for EU Exit, and is also doing so on Covid-19. This Committee has raised concerns in the past about government’s increasing spend on consultants, and on the gap between the Cabinet Office’s and departments’ data on spending across government.50 The …

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The Cabinet Office set out that there is sometimes a need for consultants with 43 Q 101; C&AG’s Report, para 15 44 Qq 53, 54; C&AG’s Report, para 26 45 Qq 5, 18 46 Qq 46, 53; C&AG’s Report para 17 47 Q 53 48 Q 5 49 Qq 108–109 …

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The Cabinet Office launched a new communications campaign, ‘The UK’s new start: let’s get going’, in July. Its aim is to inform businesses and the public about what actions they need to take to be ready for the end of the transition period.53 The campaign has a budget of £70 …

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Despite the new campaign having been underway for some time, there remains a significant risk that businesses and individuals will not be ready for the end of the transition period. Government survey data suggests that 36% of SMEs still believe the transition period will be extended.58 The picture is changing …

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The Covid-19 pandemic has had an impact on readiness for EU Exit. The Cabinet Office is concerned that the primary focus of many small businesses during this year has been the impact of the pandemic on their business, rather than preparing for EU Exit. Current levels of readiness among businesses …

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Although the Cabinet Office believes it has been clear that businesses need to be ready for the end of the transition period, there are multiple dates in 2021 from which new requirements for businesses on importing and exporting to the EU will take effect.66 In February this year government announced …

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We are concerned that industry bodies have said that government has not provided key information needed by businesses to prepare, such as detailed guidance on how to apply for simplified customs procedures.70 The Cabinet Office provided an update on the status of two specific systems. The Goods Vehicle Movement Service …

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The Cabinet Office admitted that the market for customs agents is not expanding at the pace it needs to meet the increased demand post transition, despite an additional £50 million in funding announced by the government. This was an extension of previous funding of £34 million which had been used …

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In the event of major delays at the short Channel crossings, the Cabinet Office told us that there are plans to prioritise certain goods, such as exports of day-old chicks and fish for human consumption, and that additional freight capacity has been procured for the import of critical goods.73 The …

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