ABSTRACT

Margaret Thatcher hated what the civil service stood for. This extract from her memoirs shows why. She considered public-sector employment a necessary evil and was determined to reduce its burden on the state. Civil servants were specially targeted. On Thatcher’s analysis, they did not create wealth but reduced it. They took far too long to make decisions, their training inclining them to weigh all evidence carefully. Senior civil servants were a powerful element of the establishment elite, against whom Thatcher was waging jihad anyway. They had jobs for life, dispensing lordly advice and securely shielded from the economic consequences of their proposals. So attractive and responsible was the life of a senior civil servant that a disproportionate number of the ablest university-trained minds opted to join it rather than take their chances in the rough and tumble of commerce and private industry. Civil servants were also the permanent professionals. They had an

impressive record of persuading ministers, who mostly stayed in a particular office for only a couple of years or so anyway, that specific government policies were ill-advised. All of their training disposed

them against ‘conviction politics’ and in favour of smooth administration along broadly consensual lines. They took pride in even-handedly serving both Labour and Conservative administrations. It was easy for someone of Thatcher’s background to conclude that these superior, unelected beings needed bringing into the real world. It is not surprising that her favourite television programme in the early 1980s was Yes, Minister, a brilliantly witty situation-comedy that turned on the relationship between a malleable, spineless minister and an effortlessly superior civil service mandarin. The title was itself an irony: the programme invariably ended with the civil servant apparently agreeing – ‘Yes, Minister’ – when he had in fact manipulated the minister into accepting the approved civil service view. In the normal course of events, Margaret Thatcher did not ‘do’ humour. In offering a genuine tribute to the all-round usefulness of her deputy, William Whitelaw, she asserted: ‘I think that everyone should have a Willie’ – and had to have the unintended joke explained to her. But she understood the point of Yes, Minister and was determined to do something about it. Attempts to change the ethic of the civil service were by no means

new. Both Harold Wilson and Edward Heath in the 1960s and early 1970s had tried to inject a more managerial tone. Heath, indeed, had produced a portentously phrased White Paper, The Reorganisation of Central Government, created a Central Policy Review Staff and looked forward to reducing manpower in the civil service.2 Heath, however, attempted to reform from the inside. He was rapidly ensnared, diverted by other priorities and was anyway prime minister for less than four years. The Wilson and Callaghan Labour governments conducted an extensive review of central administration, which resulted in the reduction of 35,000 administrative posts and savings of almost £140 million. Characteristically, however, Thatcher’s assault was more tenacious.

She came to office having, apparently, given far less thought and preparation to the machinery of government than had Heath. However, unlike him, she instinctively preferred working with ‘outsiders’ from the business world rather than establishment insiders. Her long period in office gave her the time to overcome resistance to change and enabled her policies to take root. Thatcher’s civil service policies were grounded in instinct not

detailed research into the issues. As Peter Hennessy put it, ‘In 1979 Mrs Thatcher had more a gut-feeling than a game-plan.’3 She was sure that Britain was overburdened by excessive administration and red tape. Almost three-quarters of a million civil servants cost every citizen

£3 a week. The service needed the brisk discipline of the market to eliminate waste and to achieve stated objectives. A leaner and fitter civil service would also give the Conservative Party ample scope for election-winning tax cuts. On coming to office, Thatcher announced a freeze on all new civil service appointments.4 Then she looked for outsiders from the world of business to effect the necessary changes. John Hoskyns fitted the bill and served as head of the Policy Unit from 1979 to 1982. He had been an army officer before making a fortune in the computer business during the mid-1970s. He distrusted civil servants and trade unionists equally. His influential policy document Stepping Stones (1977) had identified the unions as the prime obstacles to getting Britain moving again. Civil servants were too often pessimistic and cynical, distrustful of, and unsympathetic to, new ideas. He also considered it a bad sign that the civil service unions were doing their best to block change. When examining ways of improving Britain’s trading performance, Hoskyns was not surprised to find that ‘few, if any, civil servants believe that the country can be saved’.5 Thatcher herself recalled her dismay at the defeatism of a senior civil servant in the 1970s who argued that the height of realistic British ambition should be the ‘orderly management of decline’. Derek Rayner, the managing director of Marks and Spencer, was

seconded part-time to set up an Efficiency Unit. His task, in Thatcher’s characteristic words, was to eliminate ‘the waste and ineffectiveness of government’6 and to encourage civil servants to think more constructively. It was Rayner who introduced senior civil servants to the paraphernalia of efficiency audits and management targets. Both he and Thatcher fervently believed in transferring the business ethic into the heart of government administration. In Thatcher’s words, ‘We were both convinced of the need to bring some of the attitudes of business into government. We neither of us conceived just how difficult this would prove.’ Rayner’s strategy was not overly confrontational. He had experience

of the workings of Whitehall and drew from it a subtler understanding than his political mistress of its strengths as well as its weaknesses. He identified civil servants amenable to the managerial culture and used them to work with, rather than against, the administrative grain. His unit reported that Whitehall could save as much as £70 million a year and operate with a much smaller permanent establishment. By 1983, the civil service had lost 100,000 jobs. By 1987, efficiency savings were calculated to have reached £1 billion.7 During Thatcher’s period as prime minister, the number of civil servants declined by 22.5 per cent, from 732,000 to 567,000.8