Category Archives: Government

GK Point of View – New Downing Street

As the new Prime Minster, Liz Truss, returns to London from Scotland this afternoon, her closest advisers have already moved into No. 10 marking the end of the leadership campaign and the start of her administration.

Despite some Johnson advisers having offered to stay on under Truss, the team has been almost entirely cleared out. Demonstrating the extent to which this marks a clean start from the poor reputation and disorganisation that beset the previous political operation.

Politically experienced and close to Truss, they will quickly get used to the rabbit warren behind the world’s most famous front door. Chief among them Mark Fulbrook who was brought in to head up the leadership campaign when things got serious will be a senior respected Chief of Staff and will ensure the operation is focussed on and geared up for the next General Election. Trusted and long-standing adviser, Ruth Porter, who has been at Truss’ side throughout the campaign, will reinforce the professionalism in the top team, known for gripping issues and ensuring delivery.

The Prime Minister brings with her to No.10 the closest members of her team from the Foreign, Commonwealth and Development Office. Senior staffers will take up key roles, including Jamie Hope (Director of Policy) and Adam Jones (Political Director of Communications) working alongside Simon McGee (Director of Communications).

Other key figures in the new No.10 include Jason Stein who is understood to have responsibility for PMQs prep, John Bew remains the foreign affairs adviser, an important link into the new team of Special Advisers that will support the new Foreign Secretary over the road at King Charles Street. It remains to be seen how long Simon Case lasts, James Bowler who worked with Truss at the Department for International Trade is a leading contender for the senior civil servant role.

Whatever the pending announcements around energy, the economy and cost of living, this is a capable team who have only two short years before a General Election. They hit the ground running. Only time will tell how far the (expensive) tank of gas will take them.

For further details on the new team in Downing Street or developments at Westminster, please email Scott Dodsworth, GK Strategy scott@gkstrategy.com.

GK Point of View – Digital Strategy announced during London Tech Week

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GK Associate, Nicole Wyatt, analyses the biggest talking points from the recently published Digital Strategy.

The British Government published its new 2022 Digital Strategy to commence London Tech Week on 13^th June.

As its name suggests, London Tech Week ran across five days in the UK’s capital and brought together over 20,000 governmental and corporate leaders from around the world including a hologram-version of Ukraine’s President, Volodymyr Zelensky. Besides the Digital Strategy, other policy announcements included the UK’s digital trade agreement with Singapore (which is already coming into force), a health data strategy, and the ’Future of compute’ review.

The mere fact that London has its own tech-focused week, including thousands of fringe events, illustrates how the city (and the UK more widely) is at the centre of the broader tech ecosystem. Indeed, the UK’s tech sector raised £27.4 billion in private capital in 2021 – more than any other European country – and Boris Johnson’s government is putting a particularly strong emphasis on digital and tech policy. This is evidenced by the fact that, for example, the Department for Digital, Culture, Media and Sports (DCMS) is handling a larger number of legislative bills than any other government department.

Digital policy is also a way for the UK Government to diverge from the European Union’s regulatory framework, particularly as far as data is concerned. Just after London Tech Week, in fact, Ministers published their response to the consultation ‘Data: a new direction’, which seeks to reinvigorate the UK’s data regime to promote more competition and innovation than was possible under EU rules, especially with its General Data Protection Regulation (GDPR) – which critics regarded as excessively complex.

The Digital Strategy, itself, is an update on its 2017 predecessor. It suggests that its proposed approach to supporting and strengthening the UK’s digital economy could grow its tech sector by an additional £41.5 billion by 2025 and create a further 678,000 jobs, while making the UK a world leader in artificial intelligence (AI), semiconductor design and quantum computing.

The Strategy sets out the Government’s vision for harnessing digital transformation and building a more inclusive, competitive and innovative digital economy. It focuses on six key areas:

Digital foundations: developing the UK’s digital infrastructure and strengthening regulations around data, competition and security, to support the Government’s pro-innovation agenda.
Ideas and intellectual property: supporting the UK’s innovation ecosystem to foster growing R&D initiatives among universities and in private sector businesses.
Digital skills and talent: increasing the supply of digitally and tech-enabled workers throughout the supply chain to promote greater economic prosperity, through (among other initiatives) strengthening the digital education pipeline and attracting the best global talent.
Financing digital growth: encouraging UK capital with incentives such as tax reliefs for start-ups and businesses, which will improve the tech ecosystem to ensure that Britain remains one of the best places to start and run a digital technology business.
Spreading prosperity and levelling up: exploring how everyone from every industry can benefit from digital innovation in the UK, while also supporting the net zero agenda.
Enhancing the UK’s place in the world: influencing tech policy beyond the UK’s borders to be a trailblazer in this space, as well as collaborating through strong international partnerships.

Included in the Strategy is an annex of all of the Government’s new and ongoing initiatives to support, in practice, its strategic aims. Some of the new initiatives announced include:

Establishment of a joint UK/US Prize Challenge to accelerate the development of Privacy-Enhancing Technologies (PETs).

Creation of a Digital Skills Council, to replace the Digital Skills Partnership Board, as a form of liaison between government and industry on how to address digital skills shortages.
Review into the ‘Future of compute’ – seeking to create recommendations for improving the country’s computing capacity over the next decade.
A revised version of the UK digital identity trust framework, with a related consultation seeking views on the Government’s proposed approach.

Notably, artificial intelligence (AI) as well as other rapidly growing fields such as blockchain and quantum computing, were included but with only limited details. As many other governments are concluding, this is currently a highly unregulated space and many hotly debated discussions are taking place about if, where and how legislate. The UK is seeking to lead the way but exactly how it will do so will be revealed in an eagerly anticipated AI White Paper.

Overall, this Digital Strategy seems to be largely a recap of what the UK Government is already doing, and striving to do, across various departments in order to shift digital policy to be more pro-innovation and pro-competition. Announced at London Tech Week, the motives behind the new Strategy, just five years after the previous version was published, demonstrate the UK Government’s desire to showcase the nation as a leader in digitalisation.

GK Point of View – As Boris Johnson continues to cling on, can the Shadow Cabinet provide a convincing alternative?

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GK Intern, Jed Shashu, reflects on the Shadow Health Secretary, Wes Streeting’s response at an Institute for Government event – on how to tackle the challenges facing the Health and Social Care sector.

At a time when Boris Johnson’s premiership is characterised by failing public trust and rising inflation, the Conservatives may well struggle to rebuild their brand in time for the next General Election. Recent opinion polls show greater support for the Labour party, and coupled with the upcoming by-elections and the results of the investigation by the Committee of Privileges, this could lead to Boris Johnson’s leadership becoming untenable. The Labour Party as the next ruling party is a serious possibility, therefore the shadow cabinet’s policy recommendations, proposals, and scrutiny of the current government’s actions gain increasing importance.

However, Labour are still struggling to reveal their key policies. One example is the Shadow Secretary of State for Health and Social Care, Wes Streeting who was recently speaking at an Institute for Government event. Although highly regarded in the role, Streeting did not offer clear policy proposals for the NHS or a pre-legislative proposal for the Health and Social Care sector. Streeting instead presented vague recommendations which offered a glimpse of Labour’s health policy and proposed solutions to tackle the current issues within the Health and Social Care sector, evolving around the mantra of both undisclosed reforms and resources which are needed to produce results.

One glimpse of a Labour policy to relieve pressure on the NHS came in the form of a previously announced National Care Service to provide free personal care for older people. Streeting said that this policy, which was first announced in September 2019, could be delivered within the first term of a Labour government. Additionally, he also argued his case for an effective workforce planning strategy, to tackle workforce shortages by investing in training for junior doctors to take on more frontline roles, increasing wages of the lowest paid in the sector, and greater investment in social care staff. However, while promoting these appealing policy proposals, he fell short of laying out any form of costs or targets that Labour would incur if in government.

These recommendations, if thought out, could certainly help tackle the biggest challenges facing the NHS and adult social care sector. Training junior doctors to have the skills take on more frontline roles could help ease the strain on our health service, while helping to clear the NHS backlog and the NHS staff shortages of 110,000. Increasing wages of the lowest paid in the sector can help those struggling to deal with the rise of the cost of living. The creation of a National Care Service and investing in social care staff could, if implemented correctly, help the structural issues within social care. Structural issues that have been worsened by the £4.6 billion cut to social care budgets and the impact of the pandemic. Recent estimates suggest 1.2 million older people’s needs are going unmet, this would mean the older generation who are not receiving adequate care can receive the support they need.

Discussing the necessary funds, Streeting attacked a recent statement by Sajid Javid, the Secretary of State for Health and Social Care, who said that the NHS does not require more funding. The Shadow Health Secretary argued the government’s underfunding of the country’s health and social care sector needs to be resolved by greater investment from the Treasury to address the underlying problems the pandemic uncovered and a structural reform of the NHS. Streeting indicated he will continue to stress to Her Majesty’s Treasury that investment in Health and Social Care is vital not only for public health but can boost the UK’s economy in the long term. However, throughout the event, he maintained a certain vagueness when speaking about the necessary funds and structural reforms, missing a clear chance to take advantage of the Conservative government’s tarnished image.

Streeting said that one solution comes in the form of the life sciences sector, which he said is “critical” in aiding the NHS perform at its best. He argued that this can be achieved by investing more in the sector; as this can lead to new medicines, treatments, and technology, which in return would ensure more patients receive effective pre-emptive treatments – this is necessary to help tackle the country’s greatest health issues including cancer, obesity, and ageing.

On the future of health, Streeting said it was critical to learn the lessons from the pandemic and build up resilience to minimise the effects of a new pandemic. He believes scaling up of vaccination rollouts, the implementation of “germ games” and an annual report presented to parliament as part of regular pandemic planning are key lessons to adapt and minimise the effects of future pandemics.

The Institute for Government event did not offer clear policy proposals, and Labour will have to solidify a policy base on which it will run in the next General Election. Labour’s lack of potential proposals could be the opposition party awaiting another Conservative blunder to deliver a coup de grace, but the public will undoubtedly expect more from any ministers of a potential cabinet.

What the event did highlight was Wes Streeting’s effective communication skills, quickness, and boldness that as Labour leader, the party could win back the decisive ‘Red Wall’ constituencies. Streeting may have distanced himself from replacing Keir Starmer, but his vision for the Health and Social Care sector shows qualities that are necessary not only for a future Secretary of State but a potential Prime Minister.

Is the FCDO equipped to deal with global development and security challenges?

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GK consultants Lavinia Troiani and Sam Tankard evaluate the Foreign, Commonwealth & Development Office’s capabilities in the post-Covid era

Since the 2020 merger of the Department for International Development (DfID) and the Foreign and Commonwealth Office (FCO) into the new Foreign, Commonwealth and Development Office (FCDO), there have been questions about how this would allow the Government to deal effectively with both global development and foreign affairs challenges. With the FCDO repeatedly coming under fire for underperforming across many fronts of its vast remit, one can be led to believe that the new super-department may not be properly equipped to deal with the full range of development, diplomatic and security challenges.

Leaving aside the fact that the merger happened in the midst of the COVID-19 pandemic, which seems to have complicated some of the more practical elements of the unification, one could start looking at the fundamentally different aims of development policy and foreign policy. It could be said that development and foreign affairs are two sides of the same coin but are, in fact, two very different issues, and each requires a specific approach. Development policy is historically based on long-term decision-making and planning which, at its simplest, focuses on projects and initiatives designed to improve the lives of communities for generations to come. On the other hand, foreign policy traditionally is preoccupied with short-term crises, which need quick resolution, such as the recent and widely ridiculed Afghanistan evacuation which, incidentally, is arguably the clearest demonstration of the new department’s inability to successfully cover development and conventional foreign affairs issues at the same time.

The competing aims are generating some tangible obstacles. The machinery of government change indicates this was very much an FCO takeover of DfID which had practical difficulties of two sets of departments struggling to work harmoniously. The resulting relative deprioritisation of development, in practice, has led to former DfID staff feeling demotivated, as they are having to cut development programmes to make way for foreign affairs initiatives. The department is subsequently haemorrhaging skilled development staff, and therefore compounding the FCDO’s inability (or unwillingness) to prioritise tangible development goals.

The FCDO’s priorities can be seen in the recently published International Development Strategy. The Strategy revisits the UK’s approach to international development in light of a renewed geopolitical contest for influence and is threatening the principles of free markets, free speech, and shared technology. It focuses on aspects of investment, humanitarian assistance and green priorities. Compared to previous International Development strategies, this new strategy demonstrates a policy shift towards trade and economic relationships with developing countries as the Government looks to position the UK as outward-looking in a post-Brexit world. This consolidates the movement from the usual development projects that involve aspects such as improving health, increasing vaccines’ availability and providing clear water, whose objectives and aims are ‘on the ground’ and easily quantifiable, to a more influence and soft power-based approach, which is increasingly aligned to a conventional foreign affairs approach, rather than a development programme.

Funding remains an issue for any department. Under its UN commitment, the UK should spend 0.7% of its Gross National Income (GNI) on Overseas Development Assistance (ODA). However, due to economic pressures caused by the pandemic, the Government announced in 2021 that this value would drop to 0.5% of GNI. Whilst the Government did announce at the last Budget that by 2024-2025, the spending on ODA will go back to 0.7% of GNI, the looming risk of a recession may delay this further.

Of course, the most imminent challenge that, for some, will ‘make or break’ the FCDO is the current conflict in Ukraine. Following the FCDO’s disastrous handling of the Afghanistan withdrawal, attention will be on its response to Ukraine which not only has a tangible foreign policy element in protecting national security, but the more human element of the resultant refugee crisis. With the Home Office already facing criticism for its approach to Ukraine refugees, only time will tell how effective the far-from aligned FCDO will be in stepping up to the most significant foreign affairs and development challenge of the century so far.

For information about foreign, defence, and development policy direction get in touch with sam@gkstrategy.com or lavinia@gkstrategy.com

GK Point of View – Will Blackman on reforms to the private rented sector

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GK Associate Director, Will Blackman, takes a look at the reforms to the private rented sector contained in the Department for Levelling Up’s recent White Paper.

This week the Government finally published its long-awaited White Paper on reforms to the private rented sector with its two central proposals consisting of, first, new measures to reform landlords’ grounds for repossession and, second, initiatives intended to tackle poor quality rental properties. The White Paper has been a very long time in development and comes almost three years after the Government originally consulted on its proposed reforms.

The Government’s proposed reforms would undoubtedly see the biggest shift in the balance of rights between landlord and tenant for over three decades. However the challenge for ministers and officials has been to find the optimum balance between greater security of tenure for tenants whilst, at the same time, ensuring landlords remain able to legally take back possession of their property where they have reasonable grounds to do so.

The headline proposal in the White Paper is the abolition of Section 21, or so-called ‘no fault evictions’, where landlords can evict their tenants at two months’ notice without needing to give a reason. At present landlords ordinarily seek possession of their property in one of two ways – by serving a Section 21 notice, or by serving a Section 8 notice, which enables them to evict their tenant providing certain grounds have been met, such as rent arrears or wanting to sell the property. To compensate for the abolition of Section 21, ministers are proposing to expand the grounds set out under Section 8 so that they cover a wider range of scenarios, such as anti-social behaviour. On the surface this sounds reasonable; however many landlords argue that they only use Section 21 because the court process needed to give effect to a Section 8 notice takes too long and is too convoluted. Whilst ministers are proposing reforms to the relevant court processes, in response to such concerns, only time will tell if it will be sufficient to maintain a healthy balance in the rights between landlords and their tenants.

Other measures in the White Paper have similarly been in the pipeline for some time, particularly to address the minority of so-called ‘rogue landlords’ and to enhance tenants’ rights to challenge poor landlord practice. This includes the creation of a new ombudsman to settle disputes between landlords and tenants, and the creation of a new national landlord register. The previously announced extension of the Decent Homes Standard to the private rented sector is also intended to create a minimum acceptable standard of accommodation and to remove the sometimes significant divergence in housing quality between the social and private rented sectors. The headline-grabbing announcement of a new legal right for tenants to have a pet in their home is something that many have been calling for; however it is the proposed outlawing of landlords refusing to let their properties to benefits recipients that could worry many across the sector.

Indeed, whilst the reforms overall are finely balanced, the big unknown is whether this package of changes will have an adverse effect on investment in the private rented sector going forwards..There is little doubt that these reforms will deliver on the Government’s intention to enhance the experience of those renting in the private sector. However there is a danger that some landlords, particularly with smaller portfolios, decide that letting a property is now simply too much hassle – particularly when considered alongside other tax and regulatory measures introduced in the last decade which have made letting property less financially attractive and which could see some opting to leave the sector. The knock-on effect this could have on the supply and affordability of private renting might well be significant.

The glaring omission from the White Paper is any clarity on the previously proposed new minimum energy efficiency requirements for private rented properties. In 2020 ministers proposed introducing a minimum EPC C standard for new tenancies from 2025, and all tenancies from 2028 – but the Government has said little about the matter since then. It is this requirement that is really concerning many in the sector, as they face the prospect of large bills for upgrading their properties to the new minimum standard, which could be a particular challenge for those with older houses. Ministers will need to provide clarity on this matter soon if they are to avoid significant unintended consequences for housing supply in the coming years.

GK Insights – Perspective by Dr Iain Wilton on the Procurement Bill

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Despite its scale and economic importance, government procurement is seldom the most exciting or newsworthy subject.

It hits the headlines only rarely and, when it does, it’s usually for the wrong reasons.

During the Coalition Government, for example, public procurement briefly led the news when an independent review – led by a successful retailer, renowned for his company’s tight cost controls – found that different parts of the public sector were paying vastly differing prices for the same basic goods and services.

For example, boxes of paper were found to cost between £8 and £73 while daily car rental varied from £27 to £117 – even within the same Mondeo-sized category. The review also criticised the lack of centralised purchasing, “poor negotiation” with major suppliers and the “shocking” state of procurement data, which was “both inconsistent and hard to get at.”

Some positive progress was made, especially in rationalising government buildings, but the review’s status was soon undermined by complaints about the tax arrangements of its author, Sir Philip Green – whose own business empire, starting with BHS, gradually began to unravel.

More recently, government procurement during the Covid pandemic attracted widespread criticism, with many items of personal protective equipment (PPE) proving to be high cost but low quality. Indeed, official figures show that PPE storage costs have recently been running at around £500,000 per day – even though many of the items have passed their expiry dates.

Over the coming months, government procurement policies are likely to return to their usual low public profile while, at the same time, attracting considerable behind-the-scenes attention in Westminster, Whitehall and the UK’s business community.

The reason is simple. After a Green Paper in 2020 and an extensive consultation process early last year, the Government finally announced, in the recent Queen’s Speech (10 May 2022), that it will be introducing its long-awaited Procurement Bill.

Its main aims are two-fold. First, to demonstrate that the Government is “taking back control” by creating a new procurement system that is simpler, more transparent and more attuned to UK’s particular needs than the previous regime – based on European Union directives. Accordingly, it is intended to form part of the “Brexit dividend” that Ministers need to demonstrate in the run-up to the next general election.

Second, it aims to provide a boost to UK businesses by making it easier for smaller firms and new market entrants to compete for – and win – public sector contracts. Plans include the creation of a single digital platform for supplier registration, so that a business needs to submit its data only once – rather than repeating the process whenever it’s interested in a competing for a public sector contract.

The stakes are certainly high as, according to the Government’s announcement, public procurement amounts to approximately £300 billion per year – “around a third of all public expenditure every year” – so some exciting opportunities could be created by the new system.

No one should be under any illusions, though. Neither the opportunities nor the “dividend” is likely to delivered any time soon. Not only are other proposals from the Queen’s Speech more politically pressing but the Government is committed to providing stakeholders with a six-month notice period, between the legislation being concluded and the new system going ‘live’, in the interests of effective implementation.

As a result, the change-over is unlikely to happen until some time next year, at the earliest. Given the sums involved, however, even a modest improvement in UK government procurement could mean that it’s well worth everyone’s wait.

GK Strategy will be monitoring the Procurement Bill’s passage through both Houses of Parliament and can advise on its contents, progress and any amendments to this important legislation.