NCN #3: Revolution in the Head
Why reforming the state is pivotal to consensus change
If you have not read the first New Consensus Notes, I recommend you do so as it includes necessary caveats to the style of writing and ideas introduced in the series.
Consensus continued
I paused this series (New Consensus Notes) last year in anticipation of a new government, and with it the possibility of a paradigm shift. The 2024 election results, with a radicalising and fragmenting system demonstrating the desire for transformation have reinforced my suspicion that a sea change is occurring. The question I originally posed was what were the main policy areas a new consensus could be formed, and what political methods would be required to do so? The vague theme centralised around security of opportunity for individuals (as the ‘I’ and the ‘we’) and the thriving and protection of the nation internationally. The first piece focused on energy and green political strategy – something Labour, if they make progress, could solidify as a core consensus principle following on from the Tories’ progress in the 2010-24 governments. Over the next few pieces I will explore the other areas consensus could occur, and the state apparatus needed to achieve it.
State Reform – tricky but necessary
Regardless if you believe in a consensus change or gradual evolution, to achieve anything the tools of government must be reformed. The last fourteen years, and previous to that the thirteen years of New Labour government, have been mired in several failures of policy delivery. Slogans and elections were awash with promises of reform, but real change has proven elusive.
Not every Prime Minister or No.10 team is responsible for the failure to achieve change. External developments and events have hit Britain hard, with the economy hurt and political capital diminished by belligerent populist insurgencies. But the British failure should not be factorised away by history. Instead, the structural, and importantly controllable, elements of the British state must be rejuvenated in order to better adapt in a world fraught with danger. As the state is about to embark on its first political nationalitionalisation in over fifty years; a revolution in the head is needed.
The issue with reforming the British political state structures – of which I define in this (incomplete) list as Number 10, Prime Minister, the Civil Service and Whitehall generally – is the degree to which they are fused. Our system is a fluid structure of power bases, where roles, ideas, reforms and power shifts from one zone to another – an ever flowing and almost undefinable river. Not much has drastically changed in core principles of what Peter Hennessy once called ‘good chap’ government – also called the ‘platonic ideal’ of government.1 In short, this is the idea that government can be run by everyone agreeing around a table; opinion is sought in cabinet and the Civil Service, responsibility is diffused and decisions which are made are usually late and of poor quality. While this system has worked well historically, in the 21st century, with a political climate like it is and the vast problems stacking up against Britain, it can no longer be relied on.
There is no easy fix or ubiquitous view of how the state should be reformed. A new unit in No.10, a reorganisation of cabinet, yet another new department or a reformed and powerful parliament? None of these alone will fix our broken executive system. Neither will a codified constitution – which would require the complete upending of our political system for little noticeable (and politically realistic) gain. A more efficient strategy would be to reform the executive decisively in a few very powerful areas. The one fantastic element of the fluid system is the lack of a separation of powers: all de facto power, if the PM has a stable majority, lies with No.10. If the PM sets the tone, the system of Whitehall and the Civil Service must be able to match them, following seamlessly like a flock of birds or shoal of fish. This makes change evidently possible.
However, in recent years No.10 and the rest of the governing powers of Whitehall have worked in constant tension. The fluid system breaks down when different powers decide to assume self-ascribed roles as the protectors of the so-called constitution. When this happens the system always grinds to an awful halt. Legitimacy is a two way street, and is owned by both politicians and civil servants alike; however this factor has acted as a catalyst to divide the executive rather than unite it in duty. If there is to be a major consensus shift, which democracy needs to survive, there must also be institutional unity. This will only be achieved with a rewiring of the state to support this.
To reconnect the main powerbases of the British state we must switch to an authority model, rather than old-chap agreements or diffused power. Clear lines of responsibility for delivery and action must be established from the top down, while the 500,000 strong service requires a mix of rejuvenation and reform. Only rationalising our executive power bases can a real shift in British governing performance take shape – permanently.
NB: I’ve cut the literature / reports used in this to a minimum for length purposes. Key sources are listed in the footnotes below.
No.10 Reforms - Impossible?
In Anthony Seldon and I’s book The Impossible Office? we propose a new Number 10 structure, designed to empower the prime minister, utilise top talents and better structure the cabinet hierarchy. First we suggest:
In the place of this incoherent mayhem, we propose establishing a ‘Department of Prime Minister and Cabinet’ (PM&C) modelled loosely on the body that exists in Australia, which created a PM department in 1911, and the PM&C in 1971. This will allow the prime minister to reassert his authority that has been lost, principally to the Chancellor. Similar bodies are the Executive Office of the President in the United States, the Canadian Privy Council Office, and the Bundeskanzleramt serving the German Chancellor in Berlin. But the Australian example provides the best match for the UK, not least because it oversees the entire operation of the Civil Service, and because it has proven its quality and flexibility over fifty years serving different administrations and rising to fresh demands as they emerged. It ensures that the Australian Cabinet has detailed briefing on all issues to come before it, and it establishes a series of Task Forces to keep abreast of emerging issues. All senior officials across the Australian Civil Service spend part of their career working in the PM&C, helping make a cohesive system of government.
The British version of the PM&C, replacing the tired and failing No. 10 and Cabinet Office apparatus, should be organised into five separate divisions, serving the prime minister (physically situated in No. 10), overseeing Cabinet and Civil Service, then economics and finance, home and social, and finally foreign policy.2
To utilise this new PM&C structure, we would completely reorganise the hierarchy of the British state (as also recommended by the Institute for Government):3
We propose that the irregular Deputy Prime Minister (DPM) position should become formalised, with the three most senior Cabinet posts – Chancellor, Foreign Secretary, and Home Secretary – each stepping up and becoming DPMs overseeing the three remaining divisions of the PM&C and the Cabinet committees associated with them. The Chancellor would be responsible for the economic and financial division. The Home Secretary should oversee home and social policy. The Foreign Secretary should oversee the international division of the PM&C.
Essentially cabinet hierarchy would read like this:
PM
—------------------------------------------
DPM - Chancellor
DPM - Home Secretary
DPM - Foreign Secretary
—------------------------------------------
Secretary of State - 16+ remaining.
Fundamentally it would would formalise the senior cabinet ranks of the state and award relevant powers to each. There are several benefits to this. First, you free up time for the PM with all cabinet committee’s being assigned to each DPM, second by devolving a greater degree to constitutionally recognised powers of DPMs to run policy and make executive decisions you will achieve quicker delivery by avoiding the PM-decision logjam. Third, you achieve higher quality policy in each relevant area and are supported by specific No.10 units, ministers and departments. Fourth, the PM can limit the power of the Chancellor by ranking two ministers next to them – this Quad would essentially rule the party and create a balance of ideological and political power. You could even have the Home DPM with a vote on the Economic Council (see below) as a counterweight to the Chancellor. Overall, devolved authority and clear lines of responsibility mixed with high-political teamwork of an established Quad – with the PM as the chairman – is the model No.10 would do well to shift towards.
Units (and relevant task forces) are another useful set of tools and should mould to what a PM needs. The core ones needed will be: Data Science, Policy, Delivery, Economic and Strategy (which could just be the Quad + No.10 senior advisors). Each would be under the relevant division of PM&C and integrate with the relevant committee. They need to fuse both with elected ministers and civil servants and not remain as bastions of warped, media-driven special advisor thinking or hierarchical distraction of senior civil servants.
Civil Service Empowerment
To support the vast new skills and needs of a consensus-changing government, there will need to be some shifts in Civil Service management and leadership, which have been acutely lacking over the past decade – especially since Jeremy Heywood’s death in 2018. The following are six concrete ideas to make this work over a 5-10 year period.4
1. (Re)Creation of a Civil Service Department.
While the old department was abolished in 1981 by Thatcher, its original incarnation, inspired by the Fulton report, created the Civil Service college which remains a key structure for training today.5 The new department would give the service political weight and institutional presence – as well as a structure (outside of the overburdened Cabinet Office) that can focus on the long-term increase in performance in several areas – whether recruitment, skills, standards, reform and infrastructure. The Department would essentially integrate into the Civil service division within No.10. Thus it can be aligned with the needs of a demanding and expanding state attempting its first nationalisations in 50 years.
2. Split the role of Cabinet Secretary and Head of the Civil Service.
The role of Head of the Civil Service, which requires managing some 500,000 people is too much work, and too important, to be combined with the significant role of Cabinet Secretary. Creating a new role to lead the service and the new Department on fixed five-year contracts, with an externally competitive recruitment process, would create a more focused, higher-performing leadership role through an accountable process. There is a near consensus over this simple reform from key CS academic / institutions: Hennessy, Seldon, Maude, the IfG, and Reform.
3. Statutory Footing.
If the Civil Service is to increase its performance, it needs to be able to change efficiently. A simple bill could be created giving the Civil Service statutory footing, making reforms accountable and legally enshrined. As law the reforms made would gain political weight and prevent any attempts at institutional capture or disruption from the senior Civil service. With a protected process of reform higher performance can be achieved. This could also be combined with the executive / No.10 primary legislation for greater political weight.
4. Pay and Resource Increase.
Increasing pay, as well as resources to retrain generalists into specialists, is fundamental for increasing the performance of the service. Better pay, even a mere 10% increase across grades, would start the reversal of austerity and restore some pride and pay competitiveness to the service. In turn, an eye to investing in people and skills would attract better people, restore morale and increase overall performance over a sustained period.
5. Abolish the 2-year rule.
A simple fix would be to abolish the 2-year rule and extend the amount of time civil servants remain in departments. Staff turnover should never exceed 10%, especially in key departments such as HMT and the Cabinet Office. Four- or five-year posts would allow expertise to be gained and reduce the generalist archetype of many civil servants. Longer periods in departments could be guaranteed on the proviso of technical training within the department to shift individuals into specialisations. Top civil servants would still move around, but doing so less frequently with more expertise.
6. Open recruitment and promotion.
Hennessy, the doyen of Civil Service history, and Cummings, the enigmatic disrupter, both agree the fundamental issue with the Civil Service is the people in it.6 Further opening the recruitment process to outside competition – if not completely – then significantly is a necessary reform. Increasing punishment for senior servants who capture the process and enact shadow (sometimes politically motivated) recruitment should be introduced. This also applies to promotion with outside-department observers and non-service members part of the recruitment and promotion process. This would enable a greater diversity of skills and background, as well as a fairer system of promotion. Higher diversity and more skilled / industry savvy appointments will increase performance.
Whitehall Power Rebalance
There will be a wider piece in this series of fiscal and monetary powers of the state which will need to be revolutionised if serious revenue is to be raised. Fixing Whitehall squabbling and power differentials between No.10 and 11 is key to creating a united executive. Only with unity, partial rewiring and a higher degree of separated power can a new consensus be forgerd.
The Treasury, as Seldon and I have mused, could be cut back in one significant way by:
establishing a new body, the Economic Security Council (ESC), chaired by the PM, to mirror the NSC, bringing together all the key economic ministers and officials, to help redress the imbalance. Cameron is a keen supporter: ‘it is essential [if] the PM [is to be] in a commanding position’, he said. The Economic Security Council would require some overriding powers to break Number 10/11 feuds, perhaps with the ability to lock in specific areas of spending/cutting listed in a manifesto into a budget, preventing the Treasury’s ability to block a prime minister, similar to the House of Lords’ inability to stall fiscal bills in subordination to the Commons.7
Or, possibly, devolve capital spending to one or two key spending departments that remain invulnerable to budgets or spending reviews (unless in times of recession). Placing the Home Secretary on the council to give the PM a 2-1 political vote may spark fireworks but would be a counterweight to the overwhelming structural power of the Treasury.
A beefing up of the No.10 economic team, with access to better data and information is key. Creating a shared information system centred in the ESC could be a step, though this would be hugely difficult to get the Treasury's cooperation with. Alternatively a separate information stream is key, as seen with the abolished CPS (Hennessy). The other key wiring needed is the OBR. As we will cover in a future piece, No.10 needs to rewrite the fiscal rules and gain more guiding influence on how it wants the OBR to function. At the moment, and the one thing I do agree with Truss on, is its Osborne-wiring and holy-reputation within the markets means it's a block to consensus-change reforms. This is partly because of fiscal rules, which we will tackle in a later article.
In terms of the rest of the departments, it would be best to empower the Energy department, as I noted in the last NCN, to first build small then big once it has nurtured the correct expertise and gained political capital. The other major areas that need focus is the Housing department, requiring an influx of Yimby builders within their expertise network able to redefine large housing projects and move away from the unsustainable red-brick house development corporations. Finally, the Home office must relinquish immigration into a new beefed up department. Creating a new settlement for immigration and reimagining the role of modern citizenship / values is key to a new consensus around immigration. It's no longer acceptable for both politicians and civil servants to not engage in the knotty issues of place and belonging, as well as illegal immigration. Both housing and immigration will be covered in two separate pieces.
Change Change Change
There are several large state reforms I’ve argued for, namely: a reimagined No.10 with the Prime Minister & Cabinet department, which will hold the units and committee secretariat under five divisions. These will be run by each relevant DPM, with strategy set by the PM and policy action and delivery achieved by those under them. The Civil Service will have fundamental leadership, convention and personnel changes in order to equip it for the higher-intervention consensus and fully integrate with a larger No.10. The Treasury must relinquish power – but not absolutely. Its expertise must be utilised, but one in an info-sharing way rather than a baronial way. Clipping the political wings of the Chancellor with the new DPM structure will help this. Lastly, the departments of consensus formation – energy, housing and immigration – will all need changes in structure and personnel.
All these changes may seem a lot, but a large degree must be implemented by a Labour government if it is to achieve lasting change and successful governing terms. The mission driven boards are a start from Starmer, but it's hard to see how they shift the fundamental power of the Treasury or unite government. As noted in Labour's governing Iceberg’s series, the party’s core historical mistake is to allow structural problems combined with factional ministers to limit their governments. A revolution in the head will prevent this and deliver lasting and fundamental consensus change. If not, it will be the Tories (or other parties) who will forge it.
Tom Egerton is a political writer and researcher, his new book The Conservative Effect, co-edited with Anthony Seldon and published by Cambridge is OUT NOW, you can order it here: with Cambridge, Waterstones or Amazon. Follow Tom on X / Twitter here.
Hennessy, P. (2001) The Prime Ministers, pp. 3-15.
Seldon, A and Egerton, T. et al, (2024) The Impossible Office?, pp. 417-18.
Institute for Government [IfG], (2024) Power with purpose: Final report of the Commission on the Centre of Government.
Bingham, K. (2021) From Wartime to Peacetime: Lessons from the Vaccine Task Force. Oxford Romanes Lecture. Available at: https://www.civilservant.org.uk/library/2021-Kate_Bingham-Romanes_Lecture.pdf
Fulton, J. (1968) The Civil Service: Report of the Committee. London: HM Stationery Office.
Gandon, A. (2023) ‘Civil Unrest: A portrait of the Civil Service through Brexit, the pandemic and political turbulence.’ Reform.
Haldane, R. (1918) Report of the Machinery of Government Committee. London: HM Stationary Office.
Kaye, S. (2022) ‘Reimagining Whitehall: An Essay.’ Reform.
Maude, F. (2023) Independent Review of Governance and Accountability in the Civil Service. Gov.UK. Available at: https://www.gov.uk/government/publications/review-of-governance-and accountability/independent-review-of-governance-and-accountability-in-the-civil-service-the-rt-hon-lord-maude-of-horsham-html
Northcote, S. and Trevelyan, C.E. (1854) Report on the Organisation of the Permanent Civil Service. London: HM Stationery Office.
Seldon, A. and Newell, R. (2023) Johnson at 10: The Inside Story. London: Atlantic.
Hennessy, P. (1990) Whitehall. London: Fontana. p. 206.
Seldon and Egerton et al, Impossible Office?, p. 416.