The state according to the people who run it
Our interviews with public sector leaders
To inform our report, we spoke to more than 40 senior public sector figures from England, Scotland, Wales and Northern Ireland, and to senior representatives from the business community who engage with the public sector on economic development. It is important to recognise that each interviewee is expressing their own, individual opinion and their views are not necessarily shared by Deloitte or by Reform
1. 2020 has seen government and public services deliver for the country.
2. Leaders want to retain the agility they found in the pandemic but sense a drift back to normality.
3. Unwinding government’s economic intervention is a looming challenge.
4. The public sector estate and ways of working may change but leaders are yet to decide how.
5. Civil Service reform plans are welcome but require fundamental change in Whitehall.
6. The future is data-driven but government needs to build consent and capability
7. Exiting the EU is a chance to rethink the UK’s place in the world but officials urge businesses to be ready.
8. Levelling up is right for the UK but it needs definition and devolution to drive delivery.
9. Levelling up and a green recovery won’t happen without investment in skills.
10. Macro choices for the NHS and social care still lie ahead.
11. Diversity and legitimacy are front of mind for police leaders.
12. Local government faces a perfect storm of heightened demand and reduced income.
1. 2020 has seen government and public services deliver for the country
One consistent theme across our interviews with public sector leaders this year was the tireless work done by government and public services as they responded to the COVID-19 pandemic.
Leaders told us how their organisations shifted to remote working with little disruption, and they played their part in the national response with boldness, innovation, collaboration and hard work.
2. Leaders want to retain the agility they found in the pandemic but sense a drift back to normality
As the COVID-19 pandemic landed in March 2020, the UK’s governments and public services expedited decision making, broadened risk appetites and eased regulations in order to act at pace and scale.
Public Sector leaders now want to retain that agility – but many believe the sector is likely to drift back to normality unless its leaders intervene. That’s why some told us they are reviewing lessons learned during the pandemic in a bid to lock-in new ways of working.
Others said they hope to see government more widely learn lessons from the pandemic, not just in its ways of working, but in its policymaking.
In local government, chief executives also told us that dealing with the pandemic has improved their relationships with the voluntary sector and they aim to maintain those partnerships going forward.
3. Unwinding government’s economic intervention is a looming challenge
On 11 March 2020, COVID-19 was officially designated as a pandemic by the World Health Organisation. That same day, Chancellor Rishi Sunak gave his first Budget and set out the government’s initial raft of emergency measures to support the economy.
No-one we interviewed for The State of the State questioned the scale of the government’s economic intervention. But inevitably, many have begun to consider how the government will successfully scale back its support over the months to come.
In the local public services, leaders expressed concerns about the future funding for their organisations given the new pressure on the public finances.
4. The public sector estate and ways of working may change but leaders are yet to decide how
As the COVID-19 lockdown began in March 2020, departments and agencies across the public sector successfully managed a transition to remote working. Public bodies are now exploring what form of remote working could be here to stay – along with the longer-term implications for their office needs and ways of working.
However, while the pandemic remains live and expectations on returning to work keep changing, leaders are reluctant to form a permanent view.
In the UK’s central governments, officials are considering both the cost savings of reduced office space and the access to wider pools of talent that new ways of working could bring. In local government, executives are inevitably attuned to the impact on city centres if their employees remain at home. Overall, our research found that leaders vary in their appetites for remote working in the long term but the most developed thinking is focusing on how best to use time in person as part of a blended model.
5. Civil Service reform plans are welcome but require fundamental change in Whitehall
Early this summer, Cabinet Office Minister Michael Gove gave a speech on his vision for the Civil Service. He argued that Whitehall needs to be better skilled in the use of data, civil servants should build expertise by staying in role longer, and more officials should work outside London.
Our interviews suggest that senior civil servants agree with those proposals. However, some acknowledged that meaningful change will require a fundamental cultural shift in the government machine.
Several officials also told us that government’s COVID-19 response shined a spotlight on a lack of interoperability between departments, and moving people between departments to support resource gaps is more difficult than it should be. Collaboration and departmental boundaries came up in many of our conversations, with officials recognising that silo working in government remains a concern.
6. The future is data-driven but government needs to build consent and capability
Our interviews with public sector leaders raised two issues that prevent government from making full use of data. The first is data literacy among officials, which has for some time been recognised as an area for development. The second is sharing data. While one senior figure told us that data is not sufficiently shared between departments – let alone between other parts of the public sector – another cautioned that legal obstacles to sharing were put in place for good reasons. The interviewee went on to argue that a move towards more data sharing must go hand in hand with building consent between agencies and, most importantly of all, the public.
7. Exiting the EU is a chance to rethink the UK’s place in the world but officials urge businesses to be ready
Leaving the EU has dominated the bandwidth of officials and ministers in all parts of the UK since 2016. Once COVID-19 hit, that bandwidth was strained further as many were redeployed to work full time on the government’s response. Senior civil servants told us that progress on exiting the EU slowed as a result, although core negotiation and transition work went on.
Several acknowledged that COVID-19 has stretched the bandwidth of businesses as well – and they aired concerns about business preparedness for EU exit.
Officials acknowledge that EU Exit has added to a sense of uncertainty at a difficult moment for the UK and one senior civil servant argued that the economic impact of EU Exit and COVID-19 will ultimately intertwine. Either way, many see it as an opportunity to rethink the UK’s economy and place in the world.
8. Levelling up is right for the UK but it needs definition and devolution to drive delivery
Our research found that the government’s levelling up strategy is widely seen as the right approach for a more equal and prosperous country. However, the leaders we interviewed want to see clearer plans for what it means and how it will be delivered.
Several interviewees questioned whether the UK has the right governance and institutional landscape to drive local, inclusive growth. The Chief Executive of a Local Enterprise Partnership called for a reaffirmation that LEPs will remain the convenors of the public and private sectors while a Director from a combined authority called for a more mature and less transactional relationship with government to help drive economic growth. Importantly, one council chief executive called for regional plans that genuinely join up efforts across sectors and provide a leadership-led, cohesive vision.
Ultimately, our interviews concluded that the public sector backs levelling up but believes definition and devolution are needed for its delivery.
9. Levelling up and a green recovery won’t happen without investment in skills
Across the public sector, leaders told us that the skills system needs greater and more consistent investment, and should to be better connected to businesses, to economic needs and to the levelling up agenda. They argued that education providers, employers and government need to work together to make sure the UK has the skills it needs for economic recovery and levelling up.
Some interviewees linked skills to the government’s ambition for a green recovery. The director of a Non-Departmental Public Body, for example, argued that a green skills pipeline is needed while a Further Education leader said that training should be planned for professionals who can update homes to meet net zero requirements.
10. Macro choices for the NHS and social care still lie ahead
The NHS response to the COVID-19 pandemic was extraordinary and rightly celebrated across the UK. NHS leaders told us about the incredible work in their trusts and agencies to build capacity and cope with demand, accelerating progress on digital technology along the way.
Some NHS interviewees told us that substantial amounts of healthcare services were suspended to adjust capacity for COVID-19 while others argued that has been overstated.
Looking beyond the pandemic, health leaders were keen to remind us that the UK’s health and care system remains unsustainable and political leadership is needed to make some major choices. One argued that a macro decision needs to be made on how social care is funded and integrated operationally while another said that choices need to be made about the scope of the NHS.
11. Diversity and legitimacy are front of mind for police leaders
Police leaders told us how patterns of demand on their forces shifted as the COVID-19 pandemic began. As the UK went into lockdown, the nightime economy dwindled and the public stayed at home – which saw many types of offence plummet – but at the same time, officers were called upon to police lockdown rules. Our police interviewees spoke with pride about how their officers dealt with difficult circumstances, such as attending COVID-19 deaths, largely without widespread public recognition.
Beyond the pandemic, police leaders face a range of complex and profound challenges. Front of mind for our interviewees was the Black Lives Matter movement that had undoubtedly put a spotlight on issues of diversity. They shared concerns about the need for greater diversity in their forces, and recognised the role that diversity plays in creating the public consent that underpins policing in the UK. One Chief Constable said that the challenge of recruiting black people to his force had become an issue of police legitimacy.
Police interviewees also told us that they are anticipating financial limitations in the years ahead. As forces recruit the 20,000 new officers announced by the government, one Chief Constable told us that he may need to deploy officers in roles previously held by civilians because government funding has prioritised officer numbers. Another senior source argued that officers are one part of the wider machinery of policing.
Our interviewees went on to talk about the tension between the visibility of community policing – bobbies on the beat – and the need to deal with less visible forms of crime including domestic violence and the online dimension that accompanies a substantial number of crimes now reported. One told us that his force struggled to retain cyber security professionals whose skills can attract higher salaries in the private sector.
12. Local government faces a perfect storm of heightened demand and reduced income
Across all local public services, leaders are expecting a difficult year ahead. Dealing with the COVID-19 pandemic pushed up demand for services and that demand is expected to continue rising as the full impact of lockdown becomes apparent on mental health, drug and alcohol use and child safeguarding, all against the backdrop of a recession.
Council executives told us that increased demand was only one side of the financial equation because they had lost millions in income from services like car parks during lockdown. They warned that the next financial year could see multiple councils in financial failure, and some are already assessing what services they could reduce to basic standards. One council chief executive described the environment as a ‘perfect storm’.
Leaders from other local services – especially policing – also expressed concern that cuts in local government could increase demands on them.