The Launch of the Welsh Research Unit on Governance and Leadership

First of all may I wish your research unit every success. You’ll have no shortage of work, because these are exciting times for Wales – especially for students of politics and governance.

Today I’d like to talk about the National Assembly’s third term – and along the way point up some differences between the changes we are making and the position in Westminster and Whitehall. The last seven years have witnessed a revolution – both in the way we are governed and in Welsh people’s perception of themselves.

During the last decade the political landscape of Wales has been transformed. We won the devolution referendum in 1997 by the skin of our teeth – yet today our National Assembly is an established fact of life.

The latest survey carried out for the Electoral Commission shows that people agree by a margin of 4 to 1 that devolution has improved the way Wales is run – a massive turnaround from that hairbreadth majority in the 1997 Referendum.

As was said ten years ago, devolution is a process, not an event – and it has certainly been an eventful process!

The Assembly’s powers are growing fast. The new Government of Wales Act means that after next May’s elections, Assembly Members will be taking up an expanding range of responsibilities. Our current corporate body status will be replaced with a new structure – with a legal separation between the legislature on the one hand and the executive or government body on the other, and the Assembly will also get further legislative powers.

There is a new sense of optimism in Wales – an optimism that’s based on a renewed cultural identity and strong economic growth and growing prosperity – and it is reflected in our cultural life and engagement in sport, as well as in our political life.

This growing confidence reflects our changing economy. I don’t minimise the challenges that globalisation poses for industries and businesses – but all the evidence is that Wales is rising to those challenges and remaking its economic life.

The third Assembly term must carry forward these improvements – and also maximise the gain devolution brings to the way we deliver public services. One big difference made by the reforms of the last decade is that with devolved government, we can take full advantage of our relatively small size as a country. Being small means we can and should be more flexible. It means we can emulate the economic and social success of other small countries and regions – Sweden, Finland, Galicia and Catalonia – but in our own unique way. As a small, smart country with an increasingly efficient and agile public sector, we can respond more swiftly and effectively to local needs.

So in devolved Wales, we’ve developed an approach to governance that’s new to British politics. In the past, services were delivered by individual government departments and agencies, each working to different, sometimes competing agendas. This often led to inconsistent policy delivery, frequent duplication and a wasteful lack of co-ordination.

There’s been a great deal of debate about this in Whitehall. The Labour Government reform programme, laid out by Sir Richard Wilson, the then head of the Civil Service in 1997, had five main priorities:
Greater Leadership
Better business planning
Performance management
More openness to new and outside ides, i.e. innovation,
More diversity at all levels of the civil service

It would be an interesting to study to what extent these priorities have been achieved in Whitehall – but in the Assembly Government I believe we are delivering.

As we have found out in Wales, it is hard enough to join-up different departments within a single portfolio, let alone across government departments. In Whitehall, with much larger government departments, it’s harder still. Whitehall’s problems contrast with our more manageable scale of government in Wales, and the integrating policy tools we have developed within the Assembly Government, such as the Wales Spatial Plan. This is also the rationale that lies behind the recent Beecham review, with its emphasis on collaborative working across government and the public sector – again, a distinctive Welsh response.

In the real world, few policy areas fall neatly within one portfolio –so a joined-up approach is vital, as we have shown with our work on regeneration, such as the Heads of the Valleys programme.

Again, in Whitehall the culture is one of frequent change among Ministers (for example, the Department of Work and Pensions has had over five Secretaries of State since 1997; and at junior Minister level there have been seven Energy Ministers since 1997 – as Malcolm Wickes, the current Energy Minister, pointed out this shows the UK government’s commitment to renewables!) This has often led to a great number of often abrupt policy changes, often because of changes in Minister. This can cause huge upheavals in Whitehall departments – and can in turn affect performance. Policy-making, and not service delivery, then becomes the focus of attention.

By contrast, here in Cardiff Bay there’s been greater continuity – as well as a different policy and governance context, set out in our approach, ‘Making the Connections’ and the Beecham review. Since 1999, there have been massive changes in the civil service in Wales. Prior to devolution the former Welsh Office was an executive arm of Whitehall, with little or no policy-making capacity. Most legislation, with a few discrete exceptions, was essentially made in Whitehall.

The first stage in the post-devolution development of the Welsh Public Service was to create a new policy-making capacity in government and in civil society, where none had previously existed. I think it is true to say that there are few areas in which we have powers or responsibilities, where there has not been substantial progress in policy making and extension of the powers at our disposal.

For example, within my portfolio during the last year alone, we’ve developed a new economic development strategic framework, ‘Wales: A Vibrant Economy’. Two pieces of UK legislation, the Railways Act 2005 and the Transport Wales Act 2006 have conferred major powers in terms of transport policy and delivery, and as a result, the first ever Wales Transport Strategy has been published for consultation.

But while there have been significant changes since 1999, we still have a long way to go – because, now we’ve got a robust policy foundation in place, the second stage of the process is increasingly delivery of our policy priorities. I have consistently stressed that accountability is key:
That, whether in the public or private sectors, transparent and accountable decision-making makes for better decisions and better government And that services should be customer- or citizen-focused.

In our radical reform agenda we are doing just that – and I very deliberately see my new department of Enterprise, Innovation & Networks as a model for the new ‘Welsh Public Service’.

The merger of the former ASPBs such as the WDA and Wales Tourist Board has allowed us, on the principle that ‘Form Follows Function’, to create an organisation that emphasises the needs of customer-focused service delivery, with the goals of ensuring high quality services and value for money.

Devolution and our public sector reforms have provided the opportunity for us to concentrate on delivery. We are creating a department that is performance driven, with clearer processes for measuring service delivery (for example, published Key Performance Indicators, international benchmarking, etc.) And to help drive that performance, we have appointed a senior management team that is multi-talented – with a mix of new and existing, public and private sector.

I intend to create an enterprising, innovative ‘can-do’ culture within my department, with a real openness to new ideas and new ways of doing business. And we are continuing to develop the process of delegation of decision-making and budget-holding within the organisation. It’s clear that the most successful organisations, whether in the public, private or indeed voluntary sectors, are those where decision-making is delegated to the lowest, most appropriate level, and also where staff or employees feel the most empowered.

To drive these reforms, we need a change in culture – an enterprising and innovative culture with a new type of Welsh public servant,
where the emphasis is on leadership and management,
where creative, problem-solving skills are key and where the priority is on performance management and delivery.

We also need a greater diversity of personnel – to reflect the diversity of Wales today. The recent merger of the Quangos with my department has brought a new influx of people and new blood, especially at senior management level, with people from the private and voluntary sectors as well as other public sector backgrounds. And in my department, as across the Assembly Government, we also now have many more women in senior executive positions. (35 per cent for the Assembly Government as a whole).

I am also pleased to say that the ASPB merger was achieved with the full involvement of staff and their union representatives. The new model means we can gain synergy with other government programmes – for example, by my department working with the Department of Education, Lifelong Learning and Skills (DELLS) in developing the skill mix that’s demanded by innovative businesses.

We are also committed to devolving policy-making and service delivery to parts of Wales other than Cardiff. We are establishing Assembly Government offices in Merthyr Tydfil, Aberystwyth and Llandudno Junction. For example, the new Enterprise function within my department will in the future be delivered on an all-Wales basis from the new Llandudno Junction office.

The merger has also produced both efficiency savings and effectiveness improvements, and it has enabled a sharpened policy and strategy capability – because, for the first time, all the policy levers are brought together into the department’s integrated Business Plan. It was also clear from the 100 or so meetings that I had with business prior to the ASPB merger across the length and breadth of Wales, that there was a need for independent policy advice. As a result I established a new Ministerial Advisory Group, (chaired by Richard Parry Jones, CTO and Senior Vice President of the Ford Motor Company,) and a Tourism Advisory Panel to provide me and the Assembly Government with high-level, independent expert, strategic advice as well as challenge to our policies and service delivery.

We have also established a Joint Advisory Group on skills which reports to Jane Davidson and myself, which underpins our integrated approach to skills development. This quality advice means that Ministers are not wholly dependent on the civil service for advice, and again they provide an element of external challenge. In conclusion, I believe the new system we are creating is more responsive and democratic, more transparent and accountable. And while that might entail more discomfort for myself as Minister and for the civil service, it means a better service for the citizens of Wales.

Change is the only constant: Citizens and companies – and, of course other parts of civil society such as our universities – have got to respond to the threats and opportunities unleashed by globalisation. So I am determined that the Welsh public service never becomes a cosy retreat from these changes. Government and other public servants must respond and adapt too – what may have been common practice and acceptable ten years ago may be redundant practice today.

Devolution has proved to be a key factor in our economic success – and it is also helping us design public services that suit our needs as well.

Systems of government are judged by what they deliver as well as by their intrinsic constitutional merit.

From this standpoint, I believe our evolving democracy is serving our country well.

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