From the ill-fated NHS bill and forest privatisation to planning reform and dealing with rioters, no one can say that the coalition government is not interested in policy. Yet after more than a year of hard knocks, David Cameron is finding out the hard way that delivering real change on the ground – the kind of change he needs for re-election – requires an alchemy of both political nous and civil service expertise.
The Prime Minister knows better than most that his government’s performance may ultimately rest with the people who work behind the scenes in the most prestigious yet mysterious arm of the Cameron Downing Street: the Number 10 Policy and Implementation Unit.
When Cameron took office last summer, he arrived with two key procedural ambitions: to end the Blair- and Brown-style micromanagement of Whitehall and to keep his opposition pledge to cut the number of special advisers. It’s also fair to say that his mind was not overly focused on policy because the need to tackle the deficit and identify spending cuts was the overriding, all-consuming priority.
Within days of the last election, Cameron disbanded the Prime Minister’s Delivery Unit and the Prime Minister’s Strategy Unit. But after a series of policy controversies and reverses, he decided in February this year that he needed a new approach. The shock departure of communications chief Andy Coulson acted as a catalyst for the new setup.
Despite his belief in localism and delegated responsibility, Cameron realised what each of his predecessors over the past 40 years has realised: that Downing Street needs strong central clout to craft and deliver policy change. He decided to create a combined ‘Policy and Implementation Unit’, a 12-strong Brains Trust and personal management consultancy rolled into one. However, mindful of his pledge on special advisers, he staffed it with civil servants rather than political appointees: the exact opposite of Blair and Brown’s habit of getting politicos to run the policy machine.
The key appointment was the hire of Paul Kirby in March as Head of Policy Development. A former council officer and Audit Commission director, he had hit it off with George Osborne in opposition while on secondment from KPMG. Kirby is in overall charge of making sure that all Whitehall departments do what they promise. An iconoclast, he shares with the PM’s senior policy adviser Steve Hilton a passionate belief in payment by results. Like Hilton, Kirby’s background is far from the playing fields of Eton. A Liverpudlian, his father was one of those who were handed redundancy notices as Derek Hatton’s infamous taxis scuttled around the city delivering P45s in the 1980s.
Kirby works hand-in-glove with Kris Murrin, the Head of Implementation, to ensure that policy translates into action. Australian-born Murrin is another staffer with an unorthodox background, combining stints as a former TV psychologist with work in Blair’s own Delivery Unit. She briefed the Tories in opposition on how Whitehall works – and briefed Whitehall on what the Tories wanted.
The Policy and Implementation Unit itself is staffed by officials of various ages, some of whom have links to the Conservatives, some of whom are traditionally neutral civil servants. Many have worked both in and out of government. All of them have to ‘man mark’ individual departments, as well as cut across departmental boundaries to ensure policy is joined up. (See the clickable image at the top of this article to read about who they are and what they do.)
So far, the Policy Implementation Unit has been successful in helping David Cameron in cleaning up after previous U-turns and in avoiding repetition of past mistakes. It is viewed by the Conservatives and Liberal Democrats as a shared resource, and Lib Dem policy chiefs Polly Mackenzie and Richard Reeves work with it as closely as Tories Steve Hilton and his deputy Rohan Silva.
But despite the political input, perhaps what is most interesting about the Cameron Downing Street is the importance of civil servants. While Kirby and Murrin are in overall charge of the unit, they report directly to Jeremy Heywood, the Permanent Secretary of the Prime Minister’s Office (PMO). Heywood, who has impressed Cameron with his radicalism, will take over as Cabinet Secretary from January 1 but will retain overall responsibility for the unit. His relationship with Ian Watmore, the incoming Cabinet Office Permanent Secretary and a former Accenture management expert, will be crucial to the implementation agenda.
As if to underline the diminution of the special adviser cadre, the Prime Minister has taken the unusual step of not replacing James O’Shaughnessy, who resigned as Policy Director this month. His role, once seen as the vital link with the Conservative Party, has been absorbed by Hilton’s team. O’Shaughnessy had been disillusioned for some time by the marginalisation of his role. While Hilton was seen by insiders as providing the Prime Minister with ‘emotional intelligence’, O’Shaughnessy provided the ‘rational intelligence’ – the yin to Hilton’s yang.
Former Number 10 insiders believe that although Cameron is learning that he needs a firm central grip on his departments, he could be storing up further trouble by watering down the status of his political advisers. Under Blair and Brown, Policy Unit staff sat in on all key departmental meetings and were seen as the PM’s ‘man in the room’. They weren’t more powerful than Cabinet ministers, but often they had more clout than ministers of state and stood up to civil servants as a result. The Policy Implementation Unit’s success or failure will be a key test not just of the Prime Minister’s own political judgement, but also for his faith in the power of the civil service to deliver real change.