Getting the efficiency message in Morse code

Monday, November 16, 2009

At a time when government is counting out the loose change from the back of the Cabinet Office sofa and spending is being examined afresh for value, Amyas Morse wants a new efficiency regime of "follow my lead" at the National Audit Office. He explains his thinking to Dean Carroll

Gone are the days when a stream of luxury all-expenses-paid trips abroad were enjoyed by an auditor general – former National Audit Office (NAO) chief Sir John Bourn's excesses were just about the first to emerge in the sorry saga on government expenses – and the new comptroller describes himself as "a fairly miserable chap as far as entertaining is concerned".

"We will carry on doing international work, but I personally will be primarily focused on what we do here in the UK and building relationships with government," says Morse. "When I am not working I like to be at home actually. All my expenses are visible to the chairman of the NAO, but there have not been very many since I started here in the summer to be quite honest."

Having previously worked as commercial director at the Ministry of Defence after a career with PricewaterhouseCoopers, Morse has diverse senior management experience in both government and the business world. Although he is not about to join the tide of those advocating a move towards private sector specialists running big public sector projects, Morse feels there is room for greater business focus.

"A bit of thinking needs to be done over how you plumb in people from the private sector so that they are effective in the public sector," he admits. "It's a good thing to have managers moving between the private and public sectors. People tend to have deeper specialisms in the private sector and become generalists late on, if at all, because they don't have the civil service structure where you are expected to move around and develop a broad set of experiences. It doesn't mean that they have better skills, they just develop differently and can bring a different contribution."

As to his own organisation, Morse has started to look for significant savings and reacts positively to the suggestion that the NAO might one day merge with fellow regulator the Audit Commission. It would certainly be one way to create greater value and encourage joined-up working across government agencies.

"We are looking for ways to be more efficient. We cannot be in a good position to act as a spending watchdog if we don't put ourselves through the same discipline," he explains. "That was one of the first things I initiated. We are going to work more closely with the Audit Commission – we have to develop synergy. It is possible that there will come a day when you say 'well, what is the point of having these two organisations – it's a bit ridiculous, why don't we move on'.

"There would be a lot of sensitivity about it and equally, we might not reach that day – so long as we are converging where we need to. I will be content if we are achieving efficiencies and even sharing services, without taking that giant leap. Everything is conceivable – such a decision could only be made on the merits of doing so, but nothing is forever."

His candour is unusual, given that high-profile regulators normally prefer the safety and due process of official reports to make their views known. It is perhaps consistent with his open- door policy that extends to all NAO staff.

"We are not about silos – it's a consensual, collaborative approach," he explains. "There are a group of highly-skilled professionals here and they need to feel that their views have influence. I may have the job of ultimately taking decisions, but the staff here are always entitled to say 'why did you decide that?' And I will always explain the reasoning."

Changes are most definitely on the way for the NAO. These include the possible expansion of its remit to include providing other parliamentary bodies with audit reports, rather than just the Public Accounts Committee (PAC). Morse confirms that government is currently looking at this, although he says: "I suspect it will be on an ad hoc rather than an institutional basis. Any system can always be improved and that is almost an article of faith with me.

"It would be difficult to manage a general responsibility for supporting all of the parliamentary committees, but I do hope we can do a lot more for other committees. I am actively seeking it."

He is less taken with the Tories' idea of Google government, whereby all public spending of more than £25,000, salaries of senior public servants and much more procedural information, would be placed online for citizens and small businesses to examine. Despite the potential to reduce the NAO's administrative workload, Morse identifies hurdles to overcome.

"It would be a major undertaking and with the success of government IT projects, it may be a while before it happens," he says with a laugh. "Openness is a good thing, but the only people who would look at it would be those with a special interest and it's not always the right thing that they should see it. I don't think it's axiomatic that anything that is going on in the name of the public should be completely public.

"The amount of resource needed should not be underestimated. If you put people in a position that everything they have on record is going to be immediately beamed out then people will find it difficult to have 'what if' discussions. If everything you've ever talked about can be turned into a headline, that is a pretty tough environment for government to function in. At least with Freedom of Information, you can make a reasonable case as to why it might not be appropriate to release certain things."
Since taking over at the NAO in July, Morse has already had the Private Eye treatment. But he bats away the idea that people might perceive a conflict of interests from the fact that he is now servicing the PAC with reports on MoD procurement and other government contracts that might include another old employer PricewaterhouseCoopers.

"I spent most of my life working in a professional services firm where you have to be rigorous about making sure you don't allow any conflict of interests to arise between you and your client," he says. "If you didn't do that, you would have disciplinary procedures from your professional body as well as punitive action from your employer. I take it very seriously. The idea that I still might have a conflict with something that I worked in three years ago is difficult for me to work out. I don't think it arises; people do have ethics in the private sector as well."

In July, three Whitehall bodies – the Department for Work and Pensions, HM Treasury and the MoD – saw their accounts qualified by the NAO on the same day. It suggested a negative picture of government financial management, but Morse believes this is not as serious as it appears. "It's not necessarily a sign of anything dreadful – particularly, during the financial crisis," he says. "It's not surprising that a number of departments have had a certain amount of stress testing during the economic crisis. They probably normally would be perfectly ok. I don't find that astonishing in the circumstances."

Looking ahead, the auditor general highlights work on the regularity and costs of departmental name changes and the standard of Whitehall performance data as crucial.

"Many of the machinery of government changes have no doubt got good logic behind them, but there are a great many and it's worth looking at from a value-for-money perspective. Watch this space," says Morse. "There are also a lot of challenges about data in the public sector. There isn't necessarily the information that you might hope to see to evaluate performance and efficiency. If you don't have the right information, you cannot prioritise where efforts should go." Even so, a Netherlands-style name and shame approach to public sector regulation is not on the cards as Morse feels this type of adversarial accountability "generally makes those being audited defensive and less likely to listen".

As the political debate intensifies over cuts in public expenditure, Morse and his team will continue to crunch the numbers and carefully weigh the performance of government projects and expenditure. Everyone is listening.