Every Chancellor, like every Cabinet Office minister, dreams of cutting waste and reducing bureaucracy. It is surprising how few of them succeed at it. That is because you need to know how to do it, and few ministers do.
Michael Heseltine MP did a reasonable job in the Thatcher and Major administration. Pretty soon the number of officials rose again. Francis Maude MP had a go for Cameron, but in that decade, officialdom grew by a quarter (conveniently put down to the problems of Covid and Brexit). Sir Jacob Rees-Mogg MP, Boris Johnson’s efficiency minister, thought axing 90,000 civil service jobs — about a fifth of the total — was quite reasonable, but time, Boris and he all moved on before anything happened.
The result is that we still have over half a million civil servants in government departments, and even more public servants running museums, infrastructure and all the rest. It’s a nice earner, too: the proportion of civil servants in the ‘Senior’ grade has doubled in ten years. Whitehall has become a dense jungle of ministerial and non-ministerial departments, executive agencies, regulators, quangos, you name it, many of them with duplicated or overlapping functions. Ministers do not even know exactly how many civil servants there are. No wonder people complain about red tape.
The only significant reform since the civil service was created in 1854 came under the Thatcher era. Her adviser, Sir Robin Ibbs, proposed to reduce Whitehall to just a few hundred elite civil servants who would make policy. But senior civil servants are rarely good managers, so those policies, ran the plan, would then be delivered by separate ‘executive agencies’ — or even outsourced to the private sector. A bit of that happened, though Whitehall remained very far from the ‘few hundred’ target. And as soon as Thatcher had gone, the mandarins started to rebuild their empires once again.
Thatcher also culled a number of quangos, having learnt from an Adam Smith Institute report, Quango, Quango, Quango, that there were no fewer than 3,068 of them. But they again soon sprang back, until David Cameron cut a fifth of them. A waste-cutting minister might ask why we have quangos at all. (I’ve always advocated sending them home on full pay, waiting six months and seeing if we are actually missing any.) The quangos that execute policy should be turned into agencies. The advisory ones should be abolished: ministers can get advice whenever they like without maintaining permanent talking shops at public expense.
We need to return to the Ibbs strategy, and at the same time cut all the duplication that goes on. A streamlined civil service would mean the Cabinet Office, which is supposed to run the whole show, could lose 90% of its staffing, according to management consultant Tim Ambler in his 2023 Adam Smith Institute book Shrinking Whitehall. The rag-bag Department for Digital, Culture, Media and Sport could also lose 90% by turning its functions into charities or industry bodies, and cutting all the overlaps. Big reductions would come from similar rationalisations at Education, the Treasury, Transport and others.
So if you are looking to cut waste in government, start at the top.