RAS: Privatisation Benefits (Hansard, 25 January 1996)

The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe)
My Lords, the sale of the Recruitment and Assessment Services (RAS) will not significantly affect the public sector borrowing requirement. Privatisation will benefit RAS, freeing it to compete for business in wider markets and offering new opportunities for investment. Existing customers will benefit because, freed from public sector operational constraints, RAS will be better able to improve its services.

§ Lord Bancroft
My Lords, I am much obliged to the noble Earl for effectively confirming by his Answer that the Government's decision is explicable only in terms of ideology. That is not the Question that I asked. However, is the Minister aware of the disquiet that is being caused by the privatisation (without parliamentary process or discussion) of a main safeguard of Civil Service integrity, however hedged about by contractual conditions? Is he further aware that last year RAS recruited 100 per cent. of the administrative fast-stream entry, the future leaders of the service, and has increased its share of total Civil Service recruitment from 7 per cent. to 11 per cent.?

Earl Howe
My Lords, I very much respect what the noble Lord says. He has wide experience of these matters. We look to privatisation to provide a better service with better value for the taxpayer, consistent with the overall aim of recruiting the right people. There is enormous expertise in RAS in terms of graduate recruitment, as the noble Lord indicated, but recruitment to the fast stream of the Civil Service represents only about one-third of its business. By making that expertise available to the private sector, which RAS cannot do at the moment, we have the prospect of a broader-based business with lower unit costs and better value for customers.

Lord Campbell of Croy
My Lords, does the proposal mean that what used to be the Civil Service Commission will be on offer for sale to private firms? If so, will there be very careful scrutiny of the fitness of any prospective buyers and plenty of time allowed for a necessarily delicate and detailed process, since the commission was widely regarded as having carried out its tasks well?

Earl Howe
My Lords, I stress that I am in full agreement with the underlying theme of my noble friend's question. Recruitment to the fast stream of the Civil Service must be handled with the utmost propriety. I stress also that that principle is in no way affected by the Government's proposals for RAS. Civil servants will remain in control of all appointments. The customers of RAS—namely, government departments—will be closely involved in setting up and managing the contract. Critically, the principle of fair and open competition on merit as the basis of selection will remain entirely unchanged. There is no question of the Civil Service Commission being privatised.

§ Lord Jenkins of Hillhead
My Lords, does the Minister accept that in the 150 years since the Trevelyan-Northcote report the British Civil Service has 1123 become one of our most unique and prized national assets, and that the method of recruitment is an essential part of that tradition? Will he speak to his noble friend the Leader of the House and ensure, if this House is to discharge its proper constitutional function, that we have a full debate on this matter before there is any question of irrevocable decisions taking place? Will the Leader of the House—if I may address him directly for the moment—have consultations on this issue with party leaders and the Convener of the Cross-Benchers?

Earl Howe
My Lords, I should he happy to convey the noble Lord's remarks to my noble friend in so far as he has not already heard them, and I am sure that he has. The Government start from the premise that the administration of a recruitment service—that is to say, the operational mechanics of such a service—is not a task which needs to be undertaken by government. However, we recognise fully that appointments to the fast stream of the Civil Service represent a particularly important part of RAS's work. That is why we shall ensure that the Civil Service remains in control of the appointments to the fast stream not just through the terms of the contract with RAS, which will be tightly drawn, but by having civil servants on the panel of assessors.

§ Lord Barnett
My Lords, is the Minister aware that he has in no way replied to the noble Lord, Lord Bancroft, today or in his article in December? If there is a three-year review of RAS in process, which will not be completed until the summer, what is the point of announcing in advance what the Government propose to do? Judging from the response of the whole of the House to the request of the noble Lord, Lord Jenkins, that there be an early debate on the issue, I hope that the Leader of the House will whisper in the Minister's ear that there is to be such a debate.

Earl Howe
My Lords, I have endeavoured to answer all questions put to me this afternoon. I am sorry if noble Lords feel that I have not done so. I said also in answer to the noble Lord, Lord Jenkins of Hillhead, that we on this side of the House stand ready to listen to representations, and I am sure that we will receive them positively. My noble friend has indicated in my ear that he will be more than happy to have a debate on this subject if that is the wish of the House.

§ Lord McIntosh of Haringey
My Lords, that undertaking is of course extremely welcome. Perhaps I may declare an interest, as one who was rejected by the Civil Service Selection Board more than 40 years ago and has been profoundly grateful ever since. I should have been a rotten civil servant. Do not the assets of RAS include not just the expert staff but a capital asset in the form of the tests which have been developed over more than 50 years? Even though they may be retained in the ownership of government, how could those capital assets be used for the benefit of the people of this country if privatisation were to go ahead?

Earl Howe
My Lords, the noble Lord has himself drawn attention to a key point, which is that the assets of RAS consist not merely of the staff, to whose expertise I 1124 have referred, but to the qualifying tests and exercises. They will remain at all times the property of the Crown and in the Crown's control. That is an important control over what RAS can do, alongside the detail of the contract.

§ Lord Hunt of Tanworth
My Lords, as someone who a long time ago held the job of First Civil Service Commissioner, may I ask the Minister how the Civil Service Commissioners will ensure that a privatised body's natural wish to shave costs will not result in a lowering of standards or the degree of rigour of the tests, without themselves undertaking a degree of monitoring and second guessing which would themselves negate the whole object of the privatisation?

Earl Howe
My Lords, the strict requirement that fast stream recruitment to the Civil Service must he based on merit in fair and open competition will form the heart of the contract with RAS. Adherence to that requirement will be the subject of a periodic independent audit. If the requirement is not met, then RAS would lost the contract. I stress that standards of probity and impartiality will not be compromised.

§ Lord Campbell of Alloway
My Lords, does my noble friend accept that it is a little difficult to understand what positive advantage would accrue to the Civil Service as a result of this proposal?

Earl Howe
My Lords, the Civil Service, which is, after all, the customer in this exercise, has been consulted closely throughout. It will be involved closely in drawing up the contract and in monitoring it as it proceeds. I feel that the Civil Service will be able to control closely how RAS performs in the future.