HC Deb 26 February 1969 vol 778 cc1719-27
The Prime Minister (Mr. Harold Wilson)

With permission. Mr. Speaker, I wish to make a statement.

On 16th January last year, as part of my statement in the House on public expenditure, I said that Government Departments will, under the guidance of the Treasury, plan their staffing so that over the year 1968–69 there is no further net increase in the number of civil servants as a whole."—[OFFICIAL REPORT, 16th January, 1968; Vol. 743, c. 1591.] In fulfilment of this announcement the Treasury took as the estimated figure for the beginning of the financial year 1968–69 474,200, being the estimated number of non-industrial civil servants, excluding Post Office staff, who would be in post on 1st April last year.

This was the figure subsequently published on 28th March in the Financial Secretary's memorandum accompanying the 1968–69 Estimates, and it was adopted as the ceiling to be enforced by achieving reductions wherever these could be made within individual departments. I gave the House an interim report on this matter in the debate on Fulton on 21st November last. The net effect of some slight changes in classification means that, on a comparable basis, the ceiling which was set should now be expressed as 472,800. I can say now that the total of the departmental ceilings for non-industrial manpower for 1st April this year has been held at 472,800, thus fulfilling the target which we set last year.

In the event the actual realised figure in employment last April—470,550—fell short of the estimate, and, therefore, the 1968–69 ceiling. I cannot at this stage forecast the actual figure for 1st April, 1969, but the House will wish to know that the latest figure, for 1st February, is 470,300, which is not only below the ceiling we set but is very slightly below the actual figure for 1st April, 1968. For the first 10 months, therefore, of the financial year covered by my statement, the number of non-industrial civil servants has been held steady and indeed very slightly reduced.

Now, turning to the year beginning 1st April, 1969, the gross figures will be complicated by the fact that, with the consequences of the Post Office Bill now be-bore the House, about 15,000 non-industrial members of the Post Office staff will be employed in the new Department for National Savings and the Ministry of Post and Telecommunications, and will, in future, therefore, be included in the Civil Service non-industrial manpower figures.

Clearly, this transfer within the public service does not affect the totals. On a comparable basis, taking the starting figure this coming April of 472,800, ceilings which are being set for the non-industrial Civil Service, excluding the former Post Office staffs I have referred to, at 1st April, 1970, add up to 481,500, an increase of 8,700 or about 1.8 per cent. over the year.

I would have preferred to be able to tell the House that we could hold the line in absolute terms for the coming year. The screening and cutting down which has kept the total from rising in the year now ending has been continued on the estimates submitted for the year ahead, and, as a result, the increase is considerably less than the total of the figures put forward by Departments as what they regard as their minimum requirement on the basis of the work that has to be done.

What ever arguments we may have had, or may have, about individual policies, the House will be aware of the effect on the public service of demographic and other changes outside the control of individual Governments, unrelated to policy changes of any kind. At the same time, policies accepted by the House as a whole have involved in the past year—and will involve in the future—additional manpower.

For example, within the increase of 8,700 in manpower ceiling which I have mentioned, more manpower will have to be provided for in the Department of Employment and Productivity, about 700 in fact, in the Factory Inspectorate, the placing work of the employment services, the progressive implementation of the Industrial Training Act, the work of the rapidly expanding Government training centre programme and, most recently, the planning and development of the policies outlined in the White Paper on industrial relations—in particular, the creation and staffing of the Commission on Industrial Relations.

Similarly, there is to be provision for an additional 1,100 for the improved manning of the prison services, and about 250 for immigration work. Examples of other tasks for which additional staff will be required are the Board of Trade's work on exports and the Ministry of Transport's work on the road programme. Against these there is an offsetting reduction in the Ministry of Defence, estimated at 450.

For these and other reasons it has not been easy to hold the increase down to the figure I have quoted, and, while the progressive implementation of the Fulton Report will help to ensure the maximum economy and effectiveness in the use of manpower, in the early years, including the coming year, the establishment of machinery to ensure this, to improve personnel management and virtually to double the Civil Service central training programme, for which right hon. and hon. Members have frequently called, will involve some increase in the Civil Service Department itself and in the relevant sections of individual departments.

The House is aware of the reviews of Civil Service manning, now well advanced in their work, such as those under the leadership of Sir Robert Bellinger. These were designed mainly for the longer term and although we hope progressively to receive economy reports from Sir Robert and his colleagues, no allowance has been made for this in the figures I have given for the coming year.

Sir E. Boyle

Without in any way wanting to minimise the real efforts made in a number of Departments, may I ask whether the prospective increase of 8,700 by April, 1970, is not a rather high figure? Is the right hon. Gentleman aware that many hon. Members feel, for example, that the Industrial Training Act was supposed to place the main responsibility on industry rather than on the Civil Service? Can the right hon. Gentleman say what work is being done in the Civil Service Department to see that the most continuing attention is paid to organisation and method in Government Departments, bearing in mind the constant need for management efficiency?

The Prime Minister

The right hon. Member has a most distinguished record in this regard as a member of the Fulton Committee, and we all understand his deep concern about these problems. He has queried the increase of 8,700, which I regret. I have given the House indications of the reasons why it is necessary to appoint more, and that excludes the remainder I mentioned—demographic reasons, which the right hon. Gentleman will understand better than most, such as school population, the increased number of retirement pensioners, the number of those now becoming available for supplementary benefit and the rest. All these add up to the total.

I am sure that, when the right hon. Gentleman has had a chance to study this complicated statement, if he has any suggestions as to where there can be reductions within the figures I have mentioned, the House would wish to discuss them.

The right hon. Gentleman also asked about the Civil Service Department and the general implementation of Fulton. He welcomed the fact that we are virtually doubling the central training programme this year. We would have liked to go further and faster—[HON. MEMBERS: "We wish you would."] The right hon. Gentleman, to whom I am replying, asked about the implementation of the Fulton Report, which he signed. As I was saying, we would like to have gone further and faster in improving Civil Service management. We have a long-term plan for Civil Service economists, as the right hon. Gentleman knows, but we have not been able to go ahead with it because of the need for economy this year.

Mr. Maxwell

I warmly congratulate my right hon. Friend on achieving that which he set out to do. I recognise that the increased numbers are for services which are much needed and which will be much more cost effective, but may I ask my right hon. Friend to consider inviting civil servants to suggest to him how economies may be made in Departments and sections which have long lost their purpose but appear to be quite impossible of being axed?

The Prime Minister

They have every opportunity to co-operate in the much greater area of consultation which is now available following the Fulton Report, because all that has been done in the implementation of Fulton is done in the closest consultation over the Civil Service as a whole and locally. I agree that some of the increases which I have mentioned will be highly cost-effective, for example, in terms of industrial training, the Government training centres, and many other matters that I have mentioned. But we are not content to leave economy to the Civil Service Department or to the consultations. We have appointed this high-powered committee of industrialists to go through the Civil Service and do exactly the job which my hon. Friend has in mind.

Mr. Onslow

Can the right hon. Gentleman say how the figures have been affected by the inability to recruit up to establishment and whether the total cost of the Civil Service since 1964 has risen by about £120 million a year?

The Prime Minister

I dealt with the question of recruitment in the debate on the Fulton Report. It is not affected by what I am saying. I am referring to the departmental ceilings fixed for April. It is not clear whether we shall be able to recruit up to the ceilings. It will be clear from the figures that I have given that, in April of last year, recruitment fell short of the ceilings which were set. I have assumed in my statement that there will be no falling short through recruitment.

On the hon. Gentleman's other question, he will have a chance to debate those points on the Estimates, which set out the figures year by year.

Mr. Thorpe

While the Government are to be congratulated on seeing that there has been no net increase, does not the Prime Minister's statement mean that, by 1970, the Civil Service will have started to increase in an upward direction again? Is that not depressing?

May I ask the right hon. Gentleman how long these distinguished industrialists will take to complete their inquiries? Does he not think that there is a case for independent efficiency audits in each Ministry comparable to that which has been tried out with success in the Port of London Authority?

The Prime Minister

The right hon. Gentleman will know what is being done in the matter of efficiency audits, but I hope that he will not under-rate the high-powered inquiry being conducted under the general direction of Sir Robert Bellinger and a number of other independent industrialists, who can recommend the calling in of any particular audit.

With regard to the increase of 8,700 next year—1.8 per cent.—I have indicated the reasons why additional recruitment is required. It is open to the right hon. Gentleman or anyone else to attack these figures. They are fair game. However, many recommendations of right hon. and hon. Gentlemen opposite would involve much bigger increases.

Mr. Dempsey

Even though it means an increase in the number of Civil Service employees, will my right hon. Friend see to it that an additional allocation of factory inspectors is allowed for Scotland to enable them to promote and enforce fire prevention practices in our factories and workshops in view of the recent dreadful tragedy in Glasgow?

The Prime Minister

My hon. Friend has made a very strong case. I would not like to answer particular questions about where, geographically or functionally, additional factory inspectors will be appointed. But my hon. Friend's argument is one which has been pressed very often in this House for increasing the number of factory inspectors, which we are doing.

Mr. Ogden

Is it not as misleading to apply a simple numbers game to the Civil Service as it is to the police? Should not the only criterion be, have we the skilled qualified manpower to perform the task which the House puts on the Civil Service?

The Prime Minister

That is a fair question. As I explained during the debate on the Fulton Report, I believe that the recommendations of Fulton will, over a period of years, involve considerable economies in the Civil Service through better management and training. However, during the interim period, while that is starting, we are having to face a slight increase in staffs in the Departments without getting the corresponding economies which will result from their employment.

Mr. Frederic Harris

May we have comparable figures for local government officers and an estimate of the large number of employees in industry who are doing the work which would normally be done by civil servants?

The Prime Minister

The hon. Gentleman's point about local government employees is a separate question. Last year, when I announced the Civil Service target figures, we instituted new controls on local government expenditure, though I notice that the Conservative Party has been pressing for increased expenditure from the central Government to the local authorities, which means the employment of far more local authority staff as well as an increase in taxation. I have often found that when there has been a cut in the number of civil servants, for example, by the party opposite, there was a corresponding and greater increase in non-productive employment in private enterprise establishments doing the same job.

Mr. Strauss

When considering the cuts in staff, will my right hon. Friend bear in mind that the shortage of staff is frequently a major cause of delay and inefficiency?

The Prime Minister

My right hon. Friend is right. I get as many questions about delays in the delivery of letters to Members of Parliament and in meeting applications from the public for supplementary benefit as I do about increases in the size of the Civil Service. The House has laid a job on the Civil Service.

Mr. Onslow

Too much.

The Prime Minister

The hon. Member says, "Too much", but I do not think that he opposes the increases that I have mentioned today.

Over the years, the House has laid duties on the Civil Service, many of which are totally non-controversial. If there is an increase in the birth rate in one year, automatically there will be an increase in the number of public servants in respect of education four or five years later. A similar situation arises with an increase in the number of old-age pensioners.

Captain W. Elliot

In recent years, the proportion of civil servants in the Defence Departments has increased dramatically compared with the number of uniformed men in the Services. Taking that into account plus the fact that there have been slashes in service manpower during the past year or two, is it not surprising that the reduction in the number of civil servants has been only 406?

The Prime Minister

I should have thought that the hon. and gallant Gentleman would have welcomed this reduction, which has been a continuous one, in the Civil Service manpower of the Defence Departments since 1964. It is true that the ratio of non-uniformed persons—"non-effectives", if I may call them that—to uniformed members of the defence Services increased during the 1950s.

Mr. Woodburn

Can my right hon. Friend say what has been the increase in the number of civil servants required to correct evasions and avoidances of Income Tax and Surtax in slick ways?

The Prime Minister

Under successive Governments, I know that there have been increases here. I remember, for example, that in the 1960 Finance Act we had to act quickly to deal with evasion. The right hon. Member for Birmingham, Handsworth (Sir E. Boyle) was involved in the operation. He himself evaluated the evasion as being at about the rate of £100 million a year in lost revenue. There has been a continuous increase in appointments for this kind of work.

Several Hon. Members rose——

Mr. Speaker

Order. Mr. Peter Shore. Statement.