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Mr. Fallon: Does my right hon. and learned Friend find it as telling as I do that of more than 100 local authorities and 100 NHS trusts consulted by Gershon in his review, only 12 local authorities and 12 NHS trusts responded?
Mr. Clarke: I did not know that, but it is a telling fact that gives some indication of how they intend to respond once our debates are over and the report has been put, together with many others that now reach them, on the shelves of the chief executive's office in county halls and NHS trusts up and down the country.
This process is not even new—it has been tried before. The underlying drive behind the Gershon review, is on page 10 of the report:
"The focus on productive time of frontline professionals reflects existing initiatives to reduce bureaucracy and significant investments in workforce reform and ICT across the health, education and police sectors in the 2002 spending review."
The same things were put forward in the 2002 spending review, when we were given value-for-money public service agreements. In 2004, those have become efficiency agreements, but they are essentially the same, although much bigger numbers have been put on to them.
Nevertheless, I hope that some good comes of Gershon and the other attempts to consider central government efficiency, because they are much overdue. My hon. Friend the Member for Arundel and South Downs cited several examples to show that we have been going in the opposite direction in the past four years of spend, spend, spend.
Some things, many of which are very important, we will never measure. In making efficiency savings, a great deal depends on improving the productive time of staff, especially professionals. That would be valuable because the productive time in most professions has not increased in the recent years of massive increases in expenditure. We are all used to meeting teachers, doctors, nurses and policemen who say that, despite the recent vast increases in expenditure, the amount of time that they spend on their productive work is decreasing. Increasing that time is one of the principal and desirable objectives of the review. However, the Government have been going in the other direction for some time.
Whatever the case for many of the changes that the Government have made in the name of reform, they have not tended to increase the productive time of our professional staff. For some reason, they renegotiated the contracts of all the key professionals in the national health service. I do not know why the Government bothered to do that. My experience of negotiating contracts with NHS professionals showed that it is a Pandora's box—the lid is best left where it was. The Government's negotiators lost. The guys from the British Medical Association are tough characters. The main achievement of the new contracts is to increase salaries and reduce work load significantly.
In education, the Government take credit for the large number of classroom assistants. They were not employed to improve efficiency but because the
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National Union of Teachers complained about teachers' work load. Extra people were brought in because the NUT complained about that. Extra people were employed to shift from teachers' shoulders the burden of work and share it with them.
Alan Howarth (Newport, East) (Lab) rose—
Mr. Clarke: I do not want to argue the merits of the case. My former right hon. Friend might be passionately in favour of all the improvements in professionals' working conditions, but they do not increase productivity. It is no good changing the statistics, as the Government have done, to try to prove that, because everyone works shorter hours with fewer duties, productivity is increasing. It is not.
Alan Howarth: My former right hon. and learned Friend, who is also a former Secretary of State for Education, takes a broad-brush view. However, has not he noted that the NUT is the one teachers' union that did not want the classroom assistants?
Mr. Clarke: That is a fair point.
Let me give examples to conclude my point. We will never know how the extraordinary figures will be delivered. Let us get behind them and examine the so-called efficiency improvements and savings. How will we know, when we get to the end of the period whether, for example, NHS staff are making better use of their time? That is one of the Gershon objectives. Under that heading, half the Department of Health's total efficiency targets will be delivered. Anyone who could produce some means of auditing that would be the most brilliant accountant or work study consultant that I had ever met.
The front-line professionals in schools, colleges and higher education institutions will use their time more productively, according to the report. That accounts for 30 per cent. of the total figure put down for the Department for Education and Skills.
How will we know whether our police services become 3 per cent. more efficient? It would be interesting to have a conversation with one's local police commander about how he would demonstrate that he was 3 per cent. more efficient in three years as a result of Gershon. We should be glad to know that local authorities will achieve further improvements in the productive time of their staff. Figures are attached to those headings. Of course, it is highly desirable that all those things should happen, but we will never have the first idea about whether they have been delivered.
Mr. Kelvin Hopkins (Luton, North) (Lab): I am enormously entertained by the right hon. and learned Gentleman's speech. He talks about efficiency, which is obviously a good thing in one sense, but improving public services often means higher staffing ratios. If we want better teaching in schools, we need smaller classes. In hospitals, we need more staff per patient to improve the service. In one sense, that decreases efficiency, but it makes for a better service.
Mr. Clarke:
I accept that that can sometimes happen. A sensible approach to efficiency in government should
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be a permanent duty of every Minister. It should not be based on arbitrary figures for staff reductions or on conjuring imagined monetary values for proposed productivity improvements.
Every Government have their different methods. If I were really going in for déjà-vu, I could tell the House about the Rayner reviews in the early days of Margaret Thatcher, when I was a departmental Minister. In those days, it was not Sir Peter Gershon but Sir Derek Rayner who came round and explained to us how to run our Departments, along with some bright young accountant who was still trying to find out what the responsibilities of the Department were. I hate to say it, but I went in for staff number reductions. I did it in the NHS—often specifying how many jobs had to go—in despair of anyone attempting to raise productivity.
I agree, however, that what is required is a wholly different approach to policy from the one that we have seen over the last seven years, in which the control of running costs, and the balance between administrative costs and what is being delivered by front-line staff, is a permanent feature of policy, to be built in to what is being done. I share the view of those critics who say that this Government, who lecture us on improving public sector efficiency, have actually been neglecting it for the last seven years.
Before this debate is over, I shall no doubt hear more examples of all the areas in which things have gone in the wrong direction, even in my old Department, the Treasury, which I hold in very high regard. One day, the Chief Secretary must explain to me why even the central Treasury, which does not employ very many people, seems to have increased by at least half as much again since I was there, and now has about 600 more civil servants than it did on the day I left it. I have no doubt that the Minister has found productive ways of employing the time of all those officials, and I suspect that I would find that situation reproduced across Whitehall if I were to look at the way things have been going in the last seven years.
The required policy changes would need a whole new speech to specify them, but I would advise my right hon. Friends to add some policy changes when they produce the James report and we all concentrate on efficiency again. To give an obvious example, we have far too many quangos. I would like to see a list produced by both sides, and by the Liberals, of the quangos that should be rapidly abolished. Of those quangos that now send me literature, I have often never heard of the acronyms of organisations that are now responsible for some comparatively obscure part of the public service. I would even get rid of some of those that have got themselves a certain dubious public popularity. The Electoral Commission drives me up the wall—it already has 150 staff, it is spending several million pounds and I am not sure what it is for—and there are a whole lot of other quangos that ought to be addressed.
We do not even know how many regulatory bodies we have; it is thought to be between 140 and 150. I would like both Front Benches to produce a list of at least half of them that could be abolished or amalgamated. I agree with the Liberals about getting rid of the Department of Trade and Industry. It would have some residual functions—but no great budget—which could be put among other Departments. The Chief Secretary told us about the increased budget of the regional development
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agencies; I would abolish them. I do not think that they make worthwhile use of public money or serve any worthwhile purpose. It is the old regional planning stuff all over again. As for the proposed new tier of regional government that some people are having referendums on in the autumn, I would kill it off now, if we are really trying to improve the efficiency of government in the country generally.
I suppose that this is true of many people at my stage of life, but over the last few years I have found myself genuinely feeling—all politics aside—that I am living in a country that is increasingly governed by regulation. I am increasingly faced with forms to fill in for all sorts of routine parts of my life. I increasingly have to deal with public bodies that I have never heard of, but which have suddenly found that their participation is essential in whatever I am doing. Far too much of the world nowadays seems to be run by a second-rate bureaucracy that is over-manned yet still growing. That is what the Government need to tackle, and that is what I am sure that my right hon. and hon. Friends will tackle. Smaller, better government is what we require in the modern world—it has been growing too fast—and that way lies the health of the public finances and the long-term sustainability of growth in the British economy.
4.28 pm
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