back to article UK govt right to outsource everything 15 years ago – civil service boss

The chief executive of the civil service, John Manzoni, has defended the government's decision to outsource everything 15 years ago, telling MPs it was "what everyone did at the time". Speaking at a Public Accounts Committee hearing yesterday, Manzoni said there was nothing wrong with outsourcing, but the government must now …

  1. Chris Miller

    Ah yes, if only the role of Chief Executive consisted of doing "what everyone else was doing at the time" rather than some capacity for original thought, expertise and judgement.

    1. Voyna i Mor Silver badge

      "doing "what everyone else was doing at the time""

      Alan Turing famously commented that AI should be thought of in terms of producing a mediocre brain, like that of a chief executive - not in terms of producing anything with actual powers of thought.

      The problem is that the mediocre brains get so rewarded for doing what any suit off the business school production line could do. I was interested yesterday catching part of a programme on Australia and noting that there a site foreman earns less than a skilled carpenter. Our Antipodean friends may have grasped part of a greater truth than can be comprehended by the Civil Service.

      1. Anonymous Coward
        Anonymous Coward

        Re: "doing "what everyone else was doing at the time""

        While I agree about chief executive's mediocre capacity for thought I should point out that it was the government of the time (and the one before) which told the civil service to outsource. It's not like the civil service sat down and said "well we've mulled it over and we think we should use outside companies and reduce our size"!

        Sometimes I think the formula goes like this:

        Government + civil service = slow progress, over priced projects, late delivery

        Government + outsourcing = even slower progress, even more overspend and later delivery

        I wonder what the common factor is between these two "equations"?

        1. dotdavid

          Re: "doing "what everyone else was doing at the time""

          "Government + outsourcing = even slower progress, even more overspend and later delivery"

          In my experience it's "Government + civil service + outsourcing". Oddly enough, adding another organisation to the plus list doesn't make things more agile.

        2. Voyna i Mor Silver badge

          Re: "doing "what everyone else was doing at the time""

          "While I agree about chief executive's mediocre capacity for thought I should point out that it was the government of the time"

          The government consists of the permanent part - the Civil Service - and the temporary nuisances who try to impose their fantasies on us until reality bites and they get moved. Guess which one really makes policy in areas outside drugs and benefits, those subjects belowed of the gutter Press?

          The Civil Service is reputed to have significant numbers of people in senior roles who got there before the outside world got professionalised and numerate. These people regard themselves as "administrators". When Slippery Sam comes along and says "Let my keen young folk come in and deal with all that pesky HR, remuneration and so on, and you can spend your days administering this extremely long contract, which will involve lots of face to face in nice restaurants" - it must seem like a Heaven-sent solution. Someone else has to cane the helots when the toast isn't quite the right colour, you can just get on with agreeing what that colour should be. And look at all the potential downsides that have disappeared from the books.

          1. Trigonoceps occipitalis

            Re: "doing "what everyone else was doing at the time""

            I have to take issue with you Voyna, some of the brightest and most effective engineers and scientist I have worked with have been part of the Civil Service. Like the lands where the Jumblies live they are far and few but, in my experience, more common than in industry but less than in academia. I think that is just a product of the relative number and my skewed job experience. But, please, don't write off all civil servants, some are doing their best when beset by the slings and arrows of political expediency and the dead hand of a fearfully mediocre majority.

            1. Voyna i Mor Silver badge

              Re: "doing "what everyone else was doing at the time""

              "some of the brightest and most effective engineers and scientist I have worked with have been part of the Civil Service. "

              Did you miss the bit where I specifically said I was referring to the people in senior roles with no such qualifications? To quote the famous Civil Service memo from before WW2 "Scientists should be on tap, not on top".

              Otherwise I agree with your post; there are some very good people in the Civil Service, I have met them. And you know what they complain about? People with no qualifications making policy in the interests of "good administration", i.e. keeping people like us in charge.

    2. LDS Silver badge

      It's the lemmings approach...

      ... if everybody else jumps from the cliffs, why shouldn't you?

      It's also the best execuse when you fail.

  2. Bc1609

    Manzoni and Heywood, Act II, Scene II

    See, how they feed their friends with our lost cash!

    O, that I were a consultant on that team,

    That I might taste that trough!

  3. Sir Barry

    Money

    Being paid more than £1,000 a day to screw things up?

    I can do that, where do I sign?

    1. Voyna i Mor Silver badge

      Re: Money - I can do that, where do I sign?

      Now I know where I went wrong all those years; if I was being paid over £1000 a day I don't think I could bring myself to screw up.

      1. Unep Eurobats
        Holmes

        Re: Money - I can do that, where do I sign?

        If you're being paid that much you can't screw up. I mean, it's impossible for anyone to believe that you have. Someone worth that much must be right ... right?

    2. This post has been deleted by its author

  4. Anonymous Coward
    Anonymous Coward

    Meg Hillier, the Labour Minister in charge of the ID Card... pot meet kettle!!!

  5. Franco Silver badge

    Classic public sector thinking, no thought of actually building systems to requirements and instead following industry trends. Hence the current drive toward cloud solutions.

    1. Terry 6 Silver badge

      "Public sector". Bo**ocks.

      It was what everyone did, and does. Just phoning an outsourced customer service centre shows that.

      1. Franco Silver badge

        I stated that it's bad that the public sector blindly follows industry trends regardless of business needs. Your response is that I am talking Bo**ocks because EVERYONE blindly follows industry trends?

        1. Terry 6 Silver badge

          Franco, whatever you meant, you said; "Classic public sector thinking, no thought of actually building systems to requirements and instead following industry trends."

          That's the bo**ocks. What makes it classic public sector thinking? If you'd put "classic corporate thinking" I'd have had to agree. But to say that when the public sector do this it is different to, and by implication more reprehensible than what the rest of the corporate sector does is, yes bo**ocks.

  6. Tom Womack

    Do they think we're daft?

    Yes, really high-end tech skills have a substantial market value.

    But this means that, if you train people up in-house, they will notice that they now have a substantial market value and they will leave. Until someone developing a billion-item million-transaction-per-second system for HMRC gets paid the same as someone developing such a thing for Tesco, there will be a flow of people from HMRC to Tesco.

    1. Anonymous Coward
      Anonymous Coward

      Re: Do they think we're daft?

      The benefits like a final/average salary pension, good sick leave terms, maternity/paternity leave etc etc are things the public sector offers that the private sector does not. It doesn't have to match £ for £ but recruitment practice needs to be a lot better.

      1. Anonymous Coward
        Anonymous Coward

        Re: Do they think we're daft?

        I've worked for a major IT services company for over a decade and now I'm working for a charity (no, not for free, but for less than I could get contracting) and I'm looking at a public sector role next - because I think I should give something back to society. Job satisfaction is another element of the package.

        1. Mutton Jeff

          Re: Do they think we're daft?

          Interesting, that you equate Pub Sec to charidee.

          1. KeithR
            Linux

            Re: Do they think we're daft?

            "Interesting, that you equate Pub Sec to charidee."

            In that neither is in the business of turning a profit, it's a valid comparison.

      2. Anonymous Coward
        Anonymous Coward

        Re: Do they think we're daft?

        Private sector do, or up to very very recently offer final salary pensions. Tesco, Nissan to name but two.

      3. Doctor Syntax Silver badge

        Re: Do they think we're daft?

        "a final/average salary pension"

        Don't be fooled by this. There are two factors. One is the rate at which the pension accumulates (1/180ths Civil Service vs 1/60ths industry) and salary. Consequently my Civil Service pension is a good deal smaller than my industry pension even though it covers slightly more years worth of service.

      4. Alan Brown Silver badge

        Re: Do they think we're daft?

        The benefits THAT USED TO BE OFFERED like...

        There, FTFY.

        There's no long-term benefit from staying in the public service, rather quite substantial penalties unless you're one of the troughers at the top echelon. It's been like this for about 15-20 years.

    2. IHateWearingATie

      Re: Do they think we're daft?

      It's a real issue - I left the civil service to go back into consulting as although I enjoyed my time there, the pay sucked and looked as though it would suck for a long time to come (yes I swapped my integrity and soul for money - I didn't want to get past the pearly gates anyway).

      I wouldn't be too worried about a slow churn in and out as that happens to private companies as highly skilled techies look for a new challenge. The wonder is whether they will be able to get them in the first place

    3. Nigel 11

      Re: Do they think we're daft?

      Until someone developing a billion-item million-transaction-per-second system for HMRC gets paid the same as someone developing such a thing for Tesco, there will be a flow of people from HMRC to Tesco.

      And follow this chain of thought.

      HMG outsources to $ORG. $ORG needs some more staff. So it advertises with a salary sufficient to cause a flow of staff from Tesco to $ORG. $ORG then bills HMG for their services. Plus a profit margin. Plus administrative overheads.

      And HMG now has to employ a contract manager to keep track of whether things are going OK. And a lawyer, when they aren't.

      And this is supposed to save money??

      I wonder how many of the people responsible for the outsourcing are now working for $ORG?

      1. Anonymous Coward
        Anonymous Coward

        Re: Do they think we're daft?

        Until someone developing a billion-item million-transaction-per-second system for HMRC gets paid the same as someone developing such a thing for Tesco, there will be a flow of people from HMRC to Tesco.

        But that was the beauty of Aspire!

        HMRC outsourced to $ORG1 and $ORG2, who also did business for Tesco, staff simply rotated between Tescos and other clients and HMRC, with some staff staying longer than others. Mostly people won because switching jobs didn't involve taking a pension hit etc.

    4. Tom 7 Silver badge

      Re: Do they think we're daft?

      High-end tech skills in public service have surprisingly high value. I worked at a small council and got job offers - not to do anything but prevent me being around the council office taking the piss out of their extremely expensive efforts to lever even simple tasks away from the council and into their profitable grasp. The unfortunate thing was they were worse than we were at doing the job, incredibly worse.

      But their lawyers were brilliant at running rings round the councils, once they had made the decent ones offers only idiots like me (who actually have a smidgen of self respect left) could refuse.

  7. Anonymous South African Coward Silver badge

    What I've been saying all along - outsourcing is NOT always the answer.

    1. werdsmith Silver badge

      The Answer

      1. If you are selling outsourcing, then it is (was) the answer.

      2. If you are a CIO/CTO and wanting to make a mark, then it was the thing to do because they could show to the board the BS financials that the salesperson in (1) above has been selling.

      3. Cloud Services are just the new outsourcing in disguise.

  8. localzuk

    Translation

    "In some sense it was right 15 years ago to outsource; it was what everyone did and there's nothing wrong with it."

    We jumped on the bandwagon.

    "But actually the future from here has to be transformational and we have to do things in a different way and for that we need all these skills in."

    We ignored the need to be flexible, and we are now so far behind it will cost a fortune to fix it all.

    "These skills we are talking about have a market value. So realistically we need to be in a position where we are growing our own because we cannot afford to bring all the skills we need in from the market."

    We don't want to pay the knowledgeable people to do the job. Instead, we're going to set interns on the task, and let natural selection detemine who keeps the job.

    1. LDS Silver badge

      "and let natural selection detemine who keeps the job"

      You mean the good ones will look for and go to companies that values their skills, while the inept ones will stay with the public sector, don't you?

    2. Rich 11 Silver badge

      Re: Translation

      And:

      He said it was a process that will take years.

      In other words, outsourcing all those jobs wasn't the right thing to do after all.

      I don't actually blame the Civil Service on this one (although Bacon is right about them being far too slow to respond to the situation). Every so often politicians get into a willy-waving contest about who will trim the most waste from public services, without stopping to consider if it really is waste that's going to be trimmed. They don't seem to realise that they're going to waste more of our money on the likes of Fujitsu and Crapita in the long run.

      1. annodomini2
        FAIL

        Re: Translation

        They understand perfectly and take a nice highly paid non-executive directorship when they don't get re-elected or stand down.

        Not our money after all...

  9. Anonymous Coward
    Anonymous Coward

    problem not just in IT skills though

    in the rush to be the minister to announce the most changes/savings skills are being discarded all over the place from environment and agriculture to space and business. At the same time there is no time given to profligate "consultants" who just happen to be the experts in their field but dont work for massive multinationals.

    Watch this space for UK.gov to rob itself of the ability to specify the services it needs outsourcing..It has already done a fairly good job of making sure the last Civ servants that care can't actually deliver anything...

  10. Anonymous Coward
    Anonymous Coward

    You do not transform a business by recruiting senior technologists

    Based on the statement, the esteemed gentleman is an idiot and a typical chip off the old block. He does not justify his 6 figure salary on merit, but said salaries are never given based on merit anyway.

    You do not transform a business by recruiting senior technologists. You transform it by recruiting technology rank and file. You can recruit rank and file capable of transforming an institution only if they are given the opportunity to work on forward looking projects and correspondingly develop their technical expertise. Then they naturally transform an institution by developing themselves. All you need to do as a manager is to nudge here or there to keep it on course.

    So shall we go through what the esteemed gentleman is doing with a pencil:

    1. Recruiting technology rank and file - nope, you gotta be kidding.

    2. Forward looking projects which can allow said rank and file to personally develop - nope, you gotta be doubly kidding.

    3. Allowing said imaginary rank and file to work on imaginary projects. Well as all of it is in imaginary lala-land... we may say yes. Neah... Let's put it where it belongs - quadruply kidding.

    1. Anonymous Coward
      Anonymous Coward

      Re: You do not transform a business by recruiting senior technologists

      2. Forward looking projects which can allow said rank and file to personally develop

      A bit of chicken and egg this one, I think to get forward thinking projects on to the agenda you need people who 'seem' credible to set the whole thing in motion.

      At times it seems that management and the "rank and file" no longer see or respect each other and hence it takes some new blood or an outsider to wake people up.

  11. Anonymous Coward
    Anonymous Coward

    And another point

    Is that most Gov Departments are getting rid of the people who know how to do stuff in IT and keeping those who know how to speak the Civil Service words - aka Civil Service Competencies.

  12. Doctor Syntax Silver badge

    "Manzoni said the Cabinet Office had 32 consultants on its books paid more than £1,000 per day."

    It also has a Manzoni on the books. It might be one too many.

  13. Sequin

    I was one of the civil service IT staff sold off to outside suppliers 15 years ago. We had been told for years by managers how poor we were compared to the lean and keen private sector, and how much time and money would be saved by selling us off. I didn't take redundancy at the time as I was newly married with a kid on the way and I thought that they might be telling us the truth.

    After a couple of months working for the private sector (Sema Group) I realised that we were just as good, and in many cases considerably better than our private sector equivalents. Most of us also had pride in providing a public service, something that was lost when we were sold off.

    1. Terry 6 Silver badge

      I realised that we were just as good, and in many cases considerably better than our private sector equivalents. Most of us also had pride in providing a public service, something that was lost when we were sold off.

      Sums it up so well. Civil service and Local Authority frontline staff work their socks off for lousy pay, apply immense knowledge of their fields and commitment to sometimes impossible jobs and are then told that a big corporate outsourcer can do it better, for less. For no good reason other than politicians can't believe that anyone believes in public service. Because they have their noses in the trough together with the oustourcing companies.

      1. Anonymous Coward
        Anonymous Coward

        Civil service and Local Authority frontline staff work their socks off for lousy pay, apply immense knowledge of their fields and commitment to sometimes impossible jobs

        Bwahahahahahahahahaa! Bwahahahahahahaaa! ....cough...splutter..Bwahahahahahahaaa!

        I've worked as a civil servant on tech projects, and although the pay wasn't great, expectations, quality and output were so low that it was laughable, as was the "dedication" of my colleagues. So, go on remind me, on which planet do these dedicated public sector heroes live?

        1. Terry 6 Silver badge

          AC

          That might apply to civil service tech staff. The local authority tech staff and the various civil service and LA front line staff that I've worked with in the different aspect of my work have all been dedicated, concerned and professional. Especially compared to the people who have come in form private organisations etc.

          1. Captain DaFt

            The problem is, there's two types of civil service workers; Those that are dedicated to the mission of the organization, and those that are dedicated to the organization above all else.

            Guess which one prospers.

            1. Lotaresco

              I don't believe it!

              Where does one find the mythical first variety? I've yet to meet a civil servant dedicated to "the mission".

  14. Lotaresco
    Flame

    The Civil Service didn't have the skills then

    The Civil Service didn't have the IT skills required fifteen years ago, it certainly doesn't have the skills now. Not only does government pay badly but the career structure stifles talent and civil service culture puts no value on technical ability. The civil service still reserves the top jobs for the classics and PPE graduates who tend to see computers as some sort of novelty paperweight.

    The culture of the civil service is risk averse and because it's not their money, civil servants will spend huge amounts of money on IT in an attempt to avoid risk or at least to ensure that someone else takes the blame if the wheels fall off. It won't take years to fix this, it will take decades. It won't happen because before it happens there will be another government with other priorities.

  15. rtb61

    Here is how the outsourcing bubble works. You have an annual budget for IT and when it is internal it is an annual sum. When you outsource it, you can pick the cycle to outsource and create the illusion of saving by multiplying the low point in the cycle by 12, true the internal spending was still lower and that was with carrying over needy asset costs from higher cycles but you had the higher cycles added in, rather than a lower cycle multiple by 12 to create a fantasy annual budget.

    So they knowingly lied for kick backs, you can not make those mistakes by accident, all a straight up lie for kick backs. Everyone in governments around the world were doing it because everyone around the world was being bribed, from corrupt politicians to corrupt political appointees they were feeding the beast who was paying them, corrupt corporations.

    Now they have chaos, so temporally rebuilding internal system to fix things, only temporarily of course and once fixed, bam, straight back to corruption and outsourcing. There is also a second item in the agenda, a secret one. They are having huge problem recruiting for IT in 'lack of' intelligence services, the professionally paranoid because face it, who wants to be a great big privacy invasive dick (there are a few of course but as a routine they can never be trusted with anything), not have one mind you (in fact the opposite is far more likely the reality, hence the need to spy on everyone else's 'er' business), just be a knob head prying into everyone's private lives whilst being totally spied on yourself (when you are professionally paranoid, no one trusts any one).

    So employed in one section of the civil service and transferred to another, take it or quite and have your loyalties questioned and you status as free citizen challenged.

  16. AlanT1

    Just because...

    Just because everyone was doing it does not make it right UNLESS you subscribe to the Lemming theory of national government.

  17. This post has been deleted by its author

  18. johnarudkin.net
    Facepalm

    We've seen it before, and the danger is, we'll see it again

    The issues here are unfortunately too common. @DigitalNW discussed the "Skills Gap" in its salon in January. The problem is that leaders themselves are only the products of the last generation. It is not easy to find original thinkers and decision makers - but that is what is needed. How do we do that? It has to be based on the test of time and how close to correct these leaders have been over time - ie. Have they REALLY been successful?; Have they predicted things well in the past?; Have they been proved right?. Are they able to address the sort of things needed for the future? We need to identify these people - and I am not being critical of the person here. That will happen in places like this. There are two areas that need immediate attention... identify these people with the insight and capacity to get it 'righter', and address the need to educate those coming up with the skills and capacity to use skills and ideas in ways that are 'future-proof'. That last point is not a difficult one to address. Alas, it is a shame that todays education system is so poorly informed by those who also do not understand the key to future proofing our next generations potential...

    1. Anonymous Coward
      Anonymous Coward

      Re: We've seen it before, and the danger is, we'll see it again

      You clearlt have not seen the near impossibility of actually implementing any sort of change in the Civil Service, regardless if it is a good idea or not.

      Months of backwards and forwards discussions, paperwork, random decisions of management, ministers and directors all attempting to make an "announcement" to justify their empire/artifical temporary cost saving/lack of delivery elsewhere.

      The civil servents good and bad are not in a position to progress efffectively as the governance model does not really allow change. Thats why outsourcing always looks good to uk.gov as building something new is the only way of making things appear to change.

      1. KeithR

        Re: We've seen it before, and the danger is, we'll see it again

        "You clearly have not seen the near impossibility of actually implementing any sort of change in the Civil Service"

        You, my friend, are talking utter crap.

  19. Sprezz

    I worked at a large government department in the late '80s early '90s. I was an external consultant managed by in house staff working with a team of in house programmers. They were all as good as anything in the private sector. The productivity was phenomenal - the head of the team was a polymath genius who could turn his formidable brain to anything. The Civil Servants I worked with were dedicated and knew their business. As an external consultant I was used primarily for skills transfer and SWAT. (The Minister wants a system to do X - it must be running in two weeks. Make it so).

    After an external 3rd party took over the contract I would receive impassioned calls/emails from users. "Can we please employ you directly? We are being quoted 10 times as much as you charge with lead times that are 10 times longer". Of course we couldn't help as we were prevented from taking business directly.

    I retain massive respect for the teams I worked with and am mortified by how my old department has been gutted to suit political ends. I still have the tie I was presented with as part of the team. I wouldn't wear it though - it wasn't the most publicly popular department.

    So anybody saying "The Civil Service didn't have the resources 15 years ago" - maybe not - they were gutted 25 years ago to satisfy a political agenda.

  20. EnviableOne Bronze badge
    Stop

    Outsource no out of control

    The issue is doing outsourcing the right way, the problem the civil service had is it just wrote a blank cheque and did not retain its own C level it staff to monitor if the objectives were running and authorise the spending and delivery. Outsourcing works, but contracts need managed and you need to keep some internal resource in the area, to sanity check what the outsourcer is telling you.

    1. KeithR

      Re: Outsource no out of control

      "Outsourcing works"

      It has NEVER worked. EVER.

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