Rewiring the state: Starmer takes on British bureaucracy

A major speech on reform of the civil service unveiled a shake-up of NHS governance but gave almost no details of any other concrete changes to how government works

The Prime Minister’s speech on Thursday on “the fundamental reform of the British state” had been heavily previewed by Downing Street. This would be a major event and a milestone towards the government’s ambition—crusade, almost—to make the institutions of the state more efficient and effective, which would lead to them enabling economic growth and better public services. The Labour Party manifesto for last year’s general election had dwelt on this at some length, arguing that “to rebuild Britain, we need to change how Britain is governed”. The answer, in Sir Keir Starmer’s view, is “a new approach: mission-driven government”. (More on that later.)

There is widespread agreement that the civil service needs substantial, radical and perhaps fundamental reform, and it has rarely been such a high-profile subject. Dominic Cummings, Boris Johnson’s former Chief Adviser, will tell anyone who listens that the very architecture of the British state must be torn down: he blogs voluminously and vehemently on the subject, and should not be dismissed. A more mainstream complaint, typified this week in The Spectator by former education minister Lord Nash, is that the civil service must be more business-like and commercially minded. True insofar as it goes, but a subset of the wider issue.

Re-wiring the British state

Last December, with Simon Case finally departing on grounds of ill health, Starmer appointed a new Cabinet Secretary, Sir Chris Wormald. Unveiling the appointment, which struck many as cautiously conventional, the Prime Minister said that Wormald’s task was “nothing less than the complete re-wiring of the British state to deliver bold and ambitious long-term reform”. It remains an open question whether this “complete re-wiring” is best entrusted to a man who had spent 33 years in the civil service, the last 12 as a permanent secretary, and has never worked outside Whitehall.

A few days after Wormald’s appointment, Starmer raised hackles within government with a strangely provocative speech on his Plan for Change, which he predicted “will land on desks across Whitehall with the heavy thud of a gauntlet being thrown down”. Perhaps searching for a memorable phrase and finding one memorable for its peculiarity, he warned civil servants, “I don’t think there’s a swamp to be drained here, but I do think too many people in Whitehall are comfortable in the tepid bath of managed decline”. He then wrote to those same civil servants to say that his “appreciation of your service to this country has only grown” since he became Prime Minister.

From my time as director of public prosecutions, I know first-hand just how fortunate this country is to have a Civil Service that is admired across the world. I saw it every day; I depended on it every day; I was proud to be a part of it every day.

Starmer is not good at mood music. He is seized by fits of boldness which go too far, panics at the inevitable backlash and retreats to a technocratic comfort zone, trying to reassure all around him that nothing has changed. But it is now more than eight months since the government took office, and more than three months since the new Cabinet Secretary was appointed. It has long been time for a much clearer sense of what concrete steps the government intends to take to “re-wire” the British state.

Before Thursday’s speech, Starmer rolled the pitch—as now seems to be absolutely standard practice, rendering set-piece speeches themselves so devoid of novelty as to be almost pointless—with an article in The Daily Telegraph. He argued that “people want a state that will take care of the big questions, not a bigger state that asks more from them”, adding that the state “need[s] to be operating at maximum efficiency and strength”. He was careful to distinguish between individual civil servants (good) and “the system they’re stuck in” (bad) and said that “this Government will take responsibility, roll up our sleeves and make the reforms needed”. Exactly what those reforms are is the central question.

The chosen venue for the Prime Minister’s speech (described slightly primly as “remarks” in the Downing Street press release) was Reckitt Benckiser Health Care in Hull, where the first bottle of Dettol was produced in 1933 (the transcript of Starmer’s speech says 1833 but let us not stumble on details). He set the scene in his idiosyncratic, weird, disjointed prose which sometimes reads like a Frankenstein’s monster of a speech assembled from a variety of sources.

That is the test of our times. The goal of my Plan for Change. National security for national renewal. And look—we are making a start, we’re already delivering on this, securing the future though our Plan for Change on the priorities that matter to you and to working people across the country.

A theme which the government has emphasised, not unreasonably, is that, in straitened economic circumstances and as a precursor to deeper institutional reform, it is important to ensure that public money is spent wisely and efficiently. That is an issue of both process and structure.

Every pound spent, every regulation, every decision must deliver for working people. And I don’t just mean efficiency, although doing what you’re doing you’ll know how important efficiency is. I mean something else, it’s allowing the state to operate at max power, reforming it so it’s closer to communities, tearing down the walls in Westminster, inviting the British people in as partners in business of change.

This is certainly the rhetoric of dramatic change, with “walls being torn down” (perhaps to facilitate re-wiring?). Starmer’s reference to making the state “closer to communities” presumably alludes to the government’s plans for regional devolution, on which the Deputy Prime Minister, Angela Rayner, presented a White Paper in December. But we have also long been promised radical change at the centre of government, within the high walls of Whitehall, so what did the Prime Minister promise?

Technology

We are currently in a world of strange duality, anxious that we are about to be made redundant or worse by technology while also hoping in a rather ill-defined way that it will have a transformative and beneficial effect on everything we do. Starmer leaned very much towards the latter tendency in his speech, claiming that “the digital reform of government” can deliver “£45 billion savings in efficiency”. That is a substantial sum, even if taken across government as a whole; for comparison, the Ministry of Defence’s annual budget in 2023/24 was £54 billion.

Artificial intelligence is also expected to be a game-changing capability and, in the Prime Minister’s words, “a golden opportunity”.

We are going to get the best of best on AI working across government. I’m going to send teams into every government department with a clear mission from me to make the state more innovative and efficient.

How will it achieve this? Briefing to the media which did not materialise as specific announcements in the speech revealed that the civil service’s mantra should be “No person’s substantive time should be spent on a task where digital or AI can do it better, quicker and to the same high quality and standard”. That is self-evidently true and to argue the opposite would be insanity. But it is devoid of detail. It is easy to feel sympathy for Dave Penman, General Secretary of civil service trades union the FDA, when he said it is:

right that the prime minister sets out an ambitious agenda for transforming public services with digital and AI tools, but… many civil servants will be looking for the substance and feeling that, once again, the prime minister is using the language of blame rather than transformation.

Peter Kyle, Science, Innovation and Technology Secretary, gave slightly clearer indications when he was interviewed by Sky News. He said that “more than half or about half of all transactions is carried out by government or analogue”, and cited as examples the DVLA opening 45,000 envelopes each day and HMRC answering 100,000 telephone calls. “This is not the way we should be doing government,” he argued. “This is not the way we should be running a country in the 2020s.” One real, measurable way in which artificial intelligence could add to efficiency is in reducing the amount of time members of the public have to wait to speak to government agencies. It is hard to see that representing a saving of £45 billion a year but it is a sensible step towards the deployment of technology in pursuit of efficiency.

Regulation and deregulation

With a zeal almost unique among Labour governments, Sir Keir Starmer has talked of the need to reduce the regulatory burden on the British economy. While he was careful to accept the blame for this trend on behalf of politicians rather than seek to blame civil servants, he condemned the growth of regulation and non-departmental and arm’s-length bodies which he sees as causing needless delay and inefficiency not only in growth and development but in thee execution of government policy.

Over a number of years, politicians chose to hide behind a vast array of quangos, arms length bodies and regulators, you name it. A sort of cottage industry of checkers and blockers, using taxpayer money to stop the government delivering on taxpayer priorities.

This is striking language, a tone which would hardly seem out of place from a Conservative front-bencher or a right-wing think tank. He particularly railed against what he portrayed as absurdly bureaucratic obstacles to house-building, highlighting an office conversion in Bingley in Yorkshire which would see 139 homes built but has been delayed because a regulator was not properly consulted about the destructive potential of cricket balls. (The full story is here.)

To overcome this tendency towards stasis, Starmer promised to “stop the legal challenges that stop building, cut statutory consultees who can veto government activity, hack back the thicket of red tape that stop us getting things done”. To reassure his audience that he is no slash-and-burn, race-to-the-bottom free market fundamentalist, he added “there’s no need to compromise on things like building standards… we can have the best of both”. That is an optimistic view not necessarily born out by history.

The Prime Minister turned to similarly absurd and unhelpful regulations on enterprise, and unveiled a target: compliance costs for businesses will be reduced by 25 per cent. “That’s less red tape, more delivery, renewing our country with growth.” That is an ambitious benchmark. Exactly how it is to be met is unclear. I said in City A.M. in January that I was deeply sceptical about the real commitment of the government to deregulation when it came to taking action: Starmer has now at least put a number on the dartboard.

There has been a drumbeat of intimations and briefings from Whitehall that the number of quangos will be substantially reduced. The Conservative/Liberal Democrat coalition of 2010-15 cut the total from around 600 to 295, but the overall spending by those bodies dramatically increased. Labour will merge the Payment Systems Regulator into the Financial Conduct Authority, a net loss of one, but has in fact created more than 20 new quangos since taking office last July, including Great British Energy and Skills England, with more like the Fair Work Agency and the Independent Football Regulator, still to come.

The National Health Service

The most striking, and certainly the most concrete, announcement the Prime Minister made was that NHS England, the non-departmental body which oversees the day-to-day operation of the National Health Service on behalf of the Department of Health and Social Care, will be abolished and its functions taken into the DHSC. As I wrote recently, this had been in the wind for some time: the Health and Social Care Secretary, Wes Streeting, was believed to want more direct control over the NHS, and the resignation at the end of February of NHS England’s Chief Executive, Amanda Pritchard, was followed by the appointment as an interim successor of Sir Jim Mackey explicitly with “a remit to radically reshape how NHS England and DHSC work together”.

Starmer presented the abolition of NHS England in two ways: firstly as a kind of abdication of responsibility by ministers, saying “I don’t see why decision about £200 billion of taxpayer money on something as fundamental to our security as the NHS should be taken by an arms-length body”; and secondly as needlessly wasteful administration, arguing that he “can’t in all honesty explain to British people why we should spend their money on two layers of bureaucracy”. This move will “bring management of the NHS back into democratic control” and result in “less bureaucracy with more money for nurses, an NHS refocused on cutting waiting times at your hospital”.

There is a degree of truth and sense in this. Ministers are entitled to seek a greater degree of control over the NHS, although at the same time it is reasonable to wonder why, for example, we regard the operational independence of the police as inherently virtuous, yet regard a similar system of detachment for the health service as being beyond “democratic control”. As I said in my essay on Pritchard’s departure, however, the Prime Minister and the Health Secretary know how central to their electoral fortunes improving the NHS will be and what a priority it is for voters, so there is nothing improper or irregular about wanting to be able to direct policy. To implement the change formally, however, will require legislation, as the position and status of NHS England (formally the National Health Service Commissioning Board) is enshrined in the provisions of the Health and Social Care Act 2012. It is rumoured that such amending legislation may be contained in the King’s Speech for the next session of Parliament later in the year.

The effect of the merger between NHS England and the DHSC is expected to be a reduction in headcount at both organisations of about 50 per cent; NHS England has 14,400 employees and the Department of Health 3,500, so a total of around 9,000 jobs will be cut. Given that the civil service as a whole in 2024 numbered 515,085, this is not a significant reduction in itself—less than two per cent—and it should not be considered primarily as a contribution to shrinking the size of the state. The government has been describing NHS England as “the world’s largest quango” to emphasise its decisive action, and is its being portrayed as a dramatic structural change.

This is labouring a point slightly: it is responsible for an enormous amount of expenditure, certainly, but that money would be spent anyway if NHS England did not exist. It would also be churlish to point out that last September Streeting told the Labour Party conference in Liverpool that a top-down reorganisation of the NHS was the “last thing” he wanted to do. But it is important to note the cost as well as the opportunity of this kind of change. As Sarah Woolnough, Chief Executive of the King’s Fund, remarked:

Structural change comes with significant opportunity cost, with staff who would otherwise be spending their time trying to improve productivity, ensure safety and get the best outcomes for patients, now worrying about whether they will have a job.

More important are the cost savings, as those are one of the arguments advanced by the Prime Minister. The government claims the rationalisation will save up to £500 million a year, which is certainly a substantial sum of money. To put it in context, however, the additional day-to-day spending on health announced by the Chancellor of the Exchequer, Rachel Reeves, in the Budget in October 2024 was £25.7 billion in this year and next; NHS England’s spending for 2025/26 is set to be £192 billion. While every little helps, £500 million looks more modest in that context.

Mission-driven government

I mentioned at the beginning that Labour’s manifesto referred to a new approach to the business of administration, “mission-driven government”. We were told before the election that there would be five “mission boards” corresponding to the government’s five missions, that the Prime Minister would chair these and that they would be cross-cutting, bringing together ministers, officials and experts from outside. They were billed as the “biggest Whitehall shake-up in decades”.

Then mission boards have been the dampest of damp squibs. Starmer, in a fit of realism when confronted with the prime ministerial schedule, decided he would not, after all, chair the bodies but that the task would go to the relevant departmental minister; Pat McFadden, Chancellor of the Duchy of Lancaster and the Prime Minister’s right hand in Whitehall, is deputy chair of each of them. The Growth Mission Board has met under Rachel Reeves’s chairmanship and Ed Miliband, Energy Security and Net Zero Secretary, has convened the Energy Mission Board. In October it was reported that Starmer was conducting “stock takes” on the areas covered by the five missions, but the whole notion of mission boards has ended up looking like an underwhelming variation of cabinet committees; indeed, last month a written answer from the Department for Health and Social Care said explicitly “Mission Boards are Cabinet Committees”.

It is legitimate to wonder how emblematic of the government’s approach to Whitehall reform mission boards are. They were trumpeted before the election as a radical departure and an essential innovation, a new way of working which would transform the business of government. They were then subject to a series of retreats into minimalist caution, behind a studied veil of silence. They have now turned out to be the most superficial of veneers on absolutely standards bureaucratic practice.

What have we learned?

Sir Keir Starmer’s speech would have been worthwhile and interesting if it had been ostensibly and solely about structural changes to the National Health Service. The scrapping of NHS England and its reabsorption by the Department of Health and Social Care, while in a sense merely a restoration of the status quo before the Health and Social Care Act 2012, is a significant change of policy and institutional architecture, though it is very far from being a silver bullet to address the NHS’s challenges. For Whitehall watchers, however, and those interested in healthcare policy, it is worthy of note.

As a landmark statement on “re-wiring the British state”, however, the Prime Minister’s speech was woefully inadequate. It contained some optimistic nods towards technology, some good intentions (already belied by actions) about non-departmental and regulatory bodies and some targets which seem alarmingly difficult to measure in any sensible way. Moreover it had to be read alongside media briefings, interviews and other small snippets of information like an exercise in the philology of an ancient language. An email sent to officials on Monday from the Prime Minister but also bearing Wormald’s name talked about a “more agile, mission-focused and more productive” civil service, and was seen to tee up Starmer’s speech on Thursday: yet there was virtually no follow-through.

Anyone who can say with confidence and precision how the civil service will look different by the time of the next election, how big it will be, what the profile of civil servants will look like, how they will be recruited and retained, what jobs they will do, what tasks will be carried out directly from Whitehall, how regional devolution will have developed and what the regulatory landscape will look like has a degree of insight I clearly lack. The Prime Minister and his colleagues have so far, eight months on from the election, failed to provide any kind of blueprint for the state they want to manage. Whether that arises from conceptual failings, a lack of imagination or an inability to communicate effectively is unclear; worryingly, it may be a mixture of all three. The government has placed a heavy reliance on transformation within Whitehall to “unlock” economic growth and efficiency. They will have to do much, much better than this empty formulation.