Why the new Number 10 structure is flawed

By Nick Pearce

As a former head of the Number 10 Policy Unit, I have been reading about the recent reorganisation of David Cameron’s operations there with some interest. I always thought it was a mistake for the incoming Prime Minister to denude himself of a strong Policy Unit, as Cameron, despite the appointment of a small number of talented individuals, did last year. So it doesn’t surprise me that he has sought to rectify that mistake – one which allowed Andrew Lansley’s NHS reforms to get through Number 10 without anything like sufficient challenge – by strengthening his policy operation.

Under Labour, the Policy Unit was a powerful team, as it was when Lord (Bernard) Donoghue first created it. At various times, it included some truly outstanding people, not least former heads like David Miliband, Andrew Adonis and Geoff Mulgan. When I ran it, there were about a dozen members, each shadowing one or two departments and providing the Prime Minister with policy advice on issues which fell within their areas of responsibilities. They were politically experienced policy experts with strong values.

We worked closely and well with the PM’s excellent Private Office, headed up by his PPS James Bowler and, of course, Downing Street’s first ever Permanent Secretary, Jeremy Heywood. In addition, we could rely on a 40-strong Prime Minister’s Strategy Unit (PMSU) to do long-term thinking on policy issues, whether departmental or cross-cutting, as well as the advice of the Cabinet Office’s Economic and Domestic Affairs Secretariat.

At the same time, we were knitted in to the PM’s wider political operation, enjoying good relations with the Political Office and with colleagues running political strategy, government relations and communications. Despite all of the Labour government’s problems in its last years, the backroom operations worked as well as could have been expected, in my view.

Cameron’s new structure preserves some of the best features of this operation. On the official side, Jeremy Heywood remains Whitehall’s biggest beast, as the Economist rightly noted in an accurate (if mildy fawning) piece recently. While he is still at Number 10, his pre-eminence will be uncontested. It is no accident that he was once Tony Blair’s ‘favourite civil servant’, became indispensable to Gordon Brown, and is now central to the Cameron team. His intellect, instinctive radicalism and Stakhanovite work-rate guarantee his position. Overall, the Private Office remains a very strong team. The same is true of the key political players, like Steve Hilton, and Cameron’s new Director of Political Strategy, Andrew Cooper. They are political big-hitters.

But Cameron has made two big mistakes in his restructuring. The first is to appoint lots of civil servants into Policy Unit jobs. People like Paul Kirby may well share some of the Prime Minister’s basic value orientations, but they are not political appointees capable of combining policy knowledge with political nous, party links and a commitment to a broader political project. Their careers will not depend on whether a Coalition or Conservative government is re-elected. They will not be able to attend party conferences or write political speeches for the Prime Minister. One consequence of this is that we can expect some more politically naïve decisions to make it through Number 10.

The second mistake is a related one, the dispersal of the strategy function, previously housed together in the PMSU, across Number 10 and the Cabinet Office. These days, a good policy operation in Number 10 relies on a dedicated strategy function: individual members of the Policy Unit are simply too caught-up in day-to-day events to be able to spend time doing the deep research and analysis needed for serious strategic thinking. This will become ever-more pressing as the Coalition delivers on the bulk of its agreement and starts looking forward systematically to the 2014 Spending Review and the next Parliament.

Moreover, a good Number 10 strategy function is also good for Whitehall: it helps the Prime Minister provide clear direction and purpose to the whole government machine. At its best, the old PMSU worked jointly on white papers and strategic policy reviews with departments, helping improve policymaking across the piece. It didn’t just wait for policy to come into Number 10 from elsewhere in Whitehall: it actively helped shape it.

The upshot of all this? Cameron has some big chiefs and quite a few Indians, but not enough in between. And he hasn’t got enough politics or strategy in his policy operation. When you’re running a government – and a Coalition at that – those are significant gaps.

Nick Pearce is the Director of IPPR, where this blog was originally published.