Official Report (Hansard)

Session: 2007/2008

Date: 21 May 2008

COMMITTEE FOR 
FINANCE AND PERSONNEL

OFFICIAL REPORT
(Hansard)

Public-Sector Jobs Location

21 May 2008

Members present for all or part of the proceedings: 
Mr Mitchel McLaughlin (Chairperson) 
Mr Roy Beggs 
Dr Stephen Farry 
Mr Simon Hamilton 
Ms Jennifer McCann 
Mr Adrian McQuillan 
Mr Peter Weir

Witnesses: 
Sir George Bain ) Review of the Policy on Public-Sector Jobs Location

The Chairperson (Mr McLaughlin):

I welcome Sir George Bain, the chairperson of the review of the policy on public-sector jobs location. I apologise for the slight delay — the Committee has just held a detailed discussion on another matter, some of which Sir George sat through, so I thank him for his patience.

I remind Committee members and people in the public gallery that Hansard is reporting this evidence session. Please turn off any mobile phones, which interfere significantly with the audio-recording equipment.

Members have been provided with the terms of reference of the review; the papers that were submitted last week by Ralph Garden, head of facilities and estates at the Scottish Parliament; and an extract from the report of the Organisation for Economic Co-operation and Development (OECD) on the Irish Government’s relocation policy, which Simon Hamilton brought to our attention.

I invite Sir George Bain to detail the review process and its emerging findings.

Sir George Bain (Review of the Policy on Public-Sector Jobs Location):

Thank you, Chairman. Members will recall from my previous visit to the Committee that, after trying to boil down the lengthy terms of reference, my colleagues and I concluded that the overall objective of the review was to recommend a distribution of public-sector employment to the Committee and to the Assembly that would best enhance the sustainable social and economic development of Northern Ireland.

Five subordinate objectives were set under that primary one, the first of which was service delivery. If one travels around Northern Ireland, as the panel has, one will often get the impression that the main purpose of a public-sector job is to provide public employment. The review panel regards the main purpose of a public-sector job as providing a public service. Although there are secondary objectives, we are extremely cautious about recommending anything that would lead to deterioration in levels of public service.

The second subordinate objective was to reach a position whereby we could recommend a distribution of employment that improves operational effectiveness and efficiency, etc.

Much of the relevant literature stresses the possibility of achieving better regionally balanced economic growth through the way in which public-sector employment is distributed. One has only to glance at the cranes on Belfast’s skyline to see that it is obvious that the city is booming. However, most people would argue that a new Northern Ireland would be better balanced if there were several other centres of growth and development. That is the third subordinate objective.

The fourth subordinate objective is related to the third, but is still distinct, and concerns regeneration and targeting social need. As Committee members know, there is a Northern Ireland index of social deprivation, which is organised by ward. Placing public-sector jobs in those areas could help to target social need and eliminate some of the deprivation. Committee members may wish to discuss that matter further. The evidence suggests that we should not be too hopeful — that issue is distinct from regional economic growth. We can, perhaps, return to that topic later.

The final subordinate objective is sustainability, which is closely related to the Committee’s earlier discussion on building control. Every morning and every evening, many public servants pass one another on motorways and highways as they travel to and from work, because their work addresses lie some distance from their residential addresses. The relocation of public-sector employment, together with an increase in the use of new technologies that would enable individuals to work from home, could reduce the carbon footprint and improve work/life balance, because people would spend less time commuting.

Since our last session, we have been busy — as the Committee would expect — because time is passing. We have met as a team every 10 days, and, more importantly, much work has been conducted between our formal meetings. We have gathered a large amount of information and examined relevant literature — with marvellous support from the Northern Ireland Statistics and Research Agency (NISRA) — on the distribution of public-sector employment and labour-market deprivation measures. I believe that Ralph Garden came before the Committee recently; we met him too, and we considered the Scottish experience most relevant to Northern Ireland. However, we also examined models in England, Wales and the Republic, as well as further afield — although we concentrated on these islands.

Since our previous appearance before the Committee, we have held 12 meetings across Northern Ireland. As members will appreciate, choosing those 12 locations was a political exercise in itself. Eventually, we selected NISRA’s travel-to-work areas, because we consider that a useful and objective concept. However, when we examined the map, we concluded that County Down was under-represented, and, therefore, we organised a meeting in Downpatrick. Relocation was widely discussed — approximately 250 people attended — and members will not be surprised to learn that, without exception, everyone wanted more public-sector jobs in their location. More usefully, we held valuable discussions about the infrastructure that could support public-sector jobs in those particular areas.

Furthermore, we arranged meetings with all the permanent secretaries of the Civil Service and the heads of one or two agencies to discuss which sections of their empires might be dispersed from Belfast. The last such meeting takes place this afternoon. We still hope to report by the summer and supply the Committee with findings to consider around that time.

As Ralph Garden may have highlighted to the Committee, the arguments for relocation — in other words, the theoretical economic literature — and the evidence and experience of other jurisdictions is both positive and negative. President Harry Truman’s desire for a one-handed economist is particularly relevant to this case — on one hand there are positives; on the other there are negatives. There are arguments for and against relocation, and the topic should not be handled with grand and dramatic gestures; it should be approached with prudent, careful consideration that results in careful recommendations.

As a lapsed economist, I believe that there is need for caution about cost-benefit analyses. Evaluating such exercises — incorporating relocation, training, new builds, and so on — will be reasonably easy. It will be more difficult to quantify and cost, with any degree of precision, the benefits of greater regional economic growth, targeting social need, etc.

My conclusion is that such an exercise will require great political will on the part of Members of the Assembly and the Executive. To some extent, it will require elected Members and Ministers to create a vision of the type of place that they want the new Northern Ireland to be. If the plan were to kill this project off, one of the quickest ways to do that would be to start demanding very detailed cost-benefit studies. We have not yet formulated our recommendations, but I believe that they will — or should — be considered as a series of pilot projects aimed at testing the utility of the exercise.

We are mindful of the regional development strategy. Although we have not decided where the jobs should be located, we are clear that the best way of implementing the policy is not to distribute jobs proportionally based on the working-age population, thereby having 10 jobs in one location and 20 jobs in another. Clearly, the decisions about which nodes or hubs the jobs should be clustered around will be controversial, but we think that some sort of clustering is absolutely necessary. Phasing will also be necessary. It is easy to propose the relocation of public-sector jobs but, in many cases, that involves relocating public-sector employees, and that is a completely different matter.

As I have said already, it is currently very difficult to make definitive recommendations about the relocation of public-sector jobs based on what is indicated by academic or theoretical arguments, or by the experience in Scotland and Wales. I hope that our recommendations will be regarded as pilot projects that have specific objectives. For example, if there were a recommendation that 1,000 jobs should go to location X, the objective for making that recommendation should be clear, whether it is to achieve better service delivery, efficiency and effectiveness; better regional balance; to target economic and social needs; or to ensure sustainability.

The objectives must be specified and the project should be assessed within an appropriate time frame — for example, five years. In common with the assessment that was carried out in Scotland — about which, I imagine, Mr Garden informed the Committee — it should examine whether the project has achieved its objectives. If it has not, the assessment should consider why that was, and examine how the project can be improved. Any future relocation of jobs should be based on such an assessment.

The creation of new public-sector bodies is an obvious way of creating opportunities for the relocation of jobs. Other services that could be relocated are those that involve operational functions that do not require being close to Ministers, and those that would enhance public-service delivery by being located closer to the customer. The utilisation of technological developments that would promote working from home, or remotely, has great scope — several case studies from other jurisdictions have shown that the whole nature of work is revolutionised. That may seem too strong a word, but considering the dramatic changes that will take place over the next 20 years, I do not believe that it is.

It is all very well to suggest the relocation of public-sector jobs, but it is important to consider the infrastructure that is available in different locations — for example, the availability of office accommodation or housing. We can discuss that issue further if members wish.

Once we decide on the recommendations — which parts of the public service might be relocated and where those might go — we face several implementation problems.

First, it is very clear from the experience of the Republic — and I would be very surprised if the same does not happen here — that huge industrial-relations and human-resources questions arise in the handling of these matters. The largest group of people who were represented at the public meeting in Belfast were not from Belfast, but from Bangor. The question that preoccupied those people was, of course, whether the Department of Education would be relocated from Rathgael House. I use Bangor as an example, but that type of issue will arise wherever the relocation happens.

Secondly, as everyone is only too aware, account must be taken of section 75 considerations — rural-proofing, and so on. One of the major factors that we will stress will be the need to establish an implementation team that is composed of champions of the measures — that is assuming that the Assembly and the Executive will run with the broad thrust of the proposals, if not necessarily with specific recommendations. There must be the political will to make the programme happen.

There is clearly a Belfast-centred mindset. I must stress that such a focus is not unique to Belfast or Northern Ireland. If one travels to Canada, one would find a Toronto or Montreal mindset. Likewise, in England — certainly in the area where I lived for eight years — there is a London mindset. In some quarters, though not all, the natural assumption is that the capital city is the best location for any organisation, and there are some very good reasons for making that assumption. However, if the objective of relocation is partly to stop Belfast from overheating, it is important to establish a team to watch over and guide the process. Such a team should be composed of champions — people who want to be involved in a relocation programme and believe that it can be successful, as distinct from people who are, perhaps, reluctant to be involved or — even if they are in favour of relocation — view the process as very difficult, if not impossible.

Chairman, that is an update on our work to date, but we hope to produce a final report for the Committee’s consideration during the summer.

The Chairperson:

Thank you very much for that update. A substantial amount of work is clearly being done on this complex and difficult issue, and I congratulate you and your team on that. I am sure that you are getting plenty of advice from all sorts of people.

Sir George Bain:

We are not short of advice. The trouble is that it varies, depending on who is offering it

The Chairperson:

And depending on where those people live.

Mr Hamilton:

I may offer yet more advice. Thank you for that update, which, as always, was very useful. My initial perspective on the relocation of public-sector jobs was that relocation would bring obvious benefits — and you mentioned some of the potential impacts on the environment, social need, economic growth, and so forth. On the face of it, it is all good. However, if we look in more detail at some of the relocation programmes that have been carried out elsewhere, it becomes clear that the issue is not as simple as it seems — nor should it be.

I was interested in your comments about public service being at the heart of this matter, and about the need to deliver public services in the best and most efficient way possible. The Committee has heard evidence from witnesses from the South and from Scotland, and the picture that they painted was of a costly process that is fraught with difficulty, and of reticence on the part of employees and unions. As was mentioned earlier, the recent OECD report addresses the relocation of public-sector jobs in the South, and it mentions that some 90% of staff were unwilling to move. Moreover, there is a consequential loss of knowledge and expertise from those Departments.

From a public-service perspective, if the public sector is not perfect but is functioning pretty well, is the relocation process is worth undertaking at all? A relocation programme may have nice noble objectives, but it may disrupt the public service so much that it is not worthwhile embarking on. In that respect, I have changed my views on the matter, so I may not be a candidate for the post of champion.

When you carried out a cost-benefit analysis, did you examine the cost to the area from which the jobs will be removed? If, for example, 1,000 jobs are moved from the Stormont Estate to Downpatrick, what would be the cost to the local economy in the Stormont area?

I am sorry for hogging the opportunity to ask questions, Chairperson. From what you are saying, Sir George, do I detect that you have found — as the Committee found during some of its evidence sessions — that the shifting of entire Departments, or departmental headquarters, is extremely difficult and not something, based on your emerging findings, that you are, ultimately, likely to recommend?

Sir George Bain:

The effect that taking 1,000 jobs out of Belfast would have on the local economy has to be taken into account. The Minister of Finance and Personnel, Peter Robinson, mentioned that Belfast was becoming overheated, with firms coming across the Atlantic and creating jobs. Companies from the Republic have also established themselves in Belfast and have created jobs in the financial-services sector. It would be foolish to pull jobs out of Belfast if that would create a major economic problem in the city. At the moment, there is an assumption that the Belfast metropolitan area is expanding so rapidly that that would not be a problem, but it is an empirical question.

We have not ruled out the relocation of entire Departments. It is quite clear that that is a major question. I think that I am correct in saying that the Republic is the only country that has even considered that possibility. As the Committee is well aware, that has not happened in the Republic, but at least the possibility has been discussed — it has not even been considered elsewhere.

From our work, we have found that people who are involved in policy need to be close to the appropriate Minister. Regardless of party or outlook, a Minister would become extremely nervous if their senior policy people were not within arm’s reach, ready to answer questions. We certainly take that point on board.

Our initial thinking is that there is a tendency to define “policy” too widely — the people who are supposed to be engaged in policy represent a wide spectrum of people. At first glance, one might think that they do not have to be based here at Stormont or in the centre of Belfast. Furthermore, it is not always the senior people who make policy decisions. Members of the Committee probably have experiences of young civil servants answering Assembly questions. Those people are often in relatively junior positions, compared to the permanent secretaries, and so on. The nature of policy needs to be defined.

There are also certain types of policies that do not have to be formulated at Stormont, such as those that apply only to specific, self-contained areas. Policy issues might only periodically arise, and people could quite easily drive to Belfast in such instances. In fact, due to technological advances such as teleconferencing and videoconferencing, travelling to Belfast in such instances may not be necessary in the future. We have not ruled that possibility out, but there is no doubt that that is a step beyond our current capabilities.

The easiest method of relocating public-sector jobs would be via the creation of new institutions. We want the system to succeed, so there is no use in considering the most difficult cases. The commission for victims and survivors was mentioned recently — as I understand it, that is a completely new institution. A decision has to be taken on where that commission will be based. It might be based in Belfast, but wherever it is based, that is a relatively easy decision to make.

The same could be said about some of the review of public administration (RPA) bodies. Quite often, one hears reference to the education and skills authority (ESA), which will be a new institution. However, as the Committee appreciates only too well, that body will largely be formed from institutions that already exist. Therefore, if one goes to Omagh and asks where the ESA should be based, it is not surprising that responses will consist of only a few words.

Consideration must also be given to the operational area of an existing Department. Due to the 2010 transfer arrangements, leases may be up for review. For example, people might look to the Department of Education because of structural changes. The age of the workforce should also be given consideration. A workforce might be made up of older people, which means that that organisation will face retirements and turnover of staff.

Sir Michael Lyons, one of my colleagues from the Independent Review of the Fire Service, advised against making any big, dramatic moves. His second piece of advice was that even a short distance can be a long one. Both pieces of advice seemed good. Of course, the third piece of advice was that we should consider moving an entire Department, or a major section of one.

Mr Weir:

Thank you, Sir George. It would, perhaps, be remiss of me not to mention that some colleagues consider the victims’ commission an attempt to create further public-sector jobs — the commission itself, that is, rather than its staff.

Sir George Bain:

I could not possibly comment. [Laughter.]

Mr Weir:

It is right that a finessed approach, rather than that of a broad brush, be taken. A grand gesture may grab headlines, but, from a practical point of view, it may not help. I suspect that I approach the issue from a similar angle to that of my colleague Mr Hamilton. Rather than being a champion, I may be closer to the relegation zone with respect to some of the potential changes.

I wish to address several points. First, the approach that your review has taken has, at times, been a bone of contention for many of us who represent areas outside Belfast, but that are close to the city, because there is a tendency for some in Government to lump such areas together as “greater Belfast”. There is a feeling that that can distort figures to a certain degree. Although it should not be an overriding concern, one potential benefit of any re-examination of the location of jobs is the environmental considerations of those who live in satellite areas — from where they commute to Belfast for work — and the strain that that places on the road network. Can you outline whether you adopted a separate approach to areas that surround Belfast, which might be 10, 15, 20 or 25 miles outside the city, where there is concern about the shortage of public-sector jobs? When those areas are banded with Belfast, they appear to be part of a disproportionate glut of public-sector jobs.

Secondly, you mentioned the range of examples that are close to hand, particularly Scotland and the Republic of Ireland. Those examples are not unrealistic, neither from the Committee’s point of view, nor your own. Although to consider them is, obviously, useful, a few issues arise from that. Someone once said that although a wise person learns from his or her mistakes, an even wiser person learns from somebody else’s mistakes. Without being in any way rude about other jurisdictions, can you describe any lessons that you have learnt from mistakes that have been made in relocations elsewhere that could be applied — perhaps avoided would be a better way to put it — in Northern Ireland?

Thirdly, although to draw lessons from the Republic of Ireland and Scotland is useful, do direct comparisons have a certain level of limitation? In almost any jurisdiction, a short distance can appear to be a long one, particularly in an area such as Northern Ireland. By the same token, Northern Ireland, compared with almost any of the other regions that have been mentioned, is a much more geographically compact area. With the best will in the world, there are various locations in the jurisdictions of Scotland and the Republic of Ireland, for example, where locations are so far apart that read-across comparisons are limited.

Sir George Bain:

You have raised three or four points, Peter. First, on the relegation point, it is, obviously, for review panels such as the one that I chair to propose changes, and for politicians to make decisions on them. Ultimately, that will be your decision. However, I hope that there will not be any relegation. It is a difficult matter.

Mr Weir:

That was a facetious remark on my part.

Sir George Bain:

Any political question is difficult.

I have been here for only 11 years, but I understand that this issue has been debated for at least 20 or 30 years. I would welcome the introduction of pilot schemes to determine whether measures could work. Those pilot schemes would probably cost money, but if they did not work, it would not be the end of the world. I hope that something useful could come out of that.

I shall deal with your points about environmental considerations and the geographical compactness of Northern Ireland together, because they are closely related. The biggest difficulty in comparing Northern Ireland with the Republic, England, and even Scotland, is our geographical compactness, or what we now call the “hometown effect”.

Almost everywhere in Northern Ireland is commutable, if people are prepared to make the trip. Individuals may prefer to commute rather than to uproot their family, pull their kids out of a particular school, and force their partner quit his or her job, etc. The Northern Ireland Statistics and Research Agency have produced a table that shows Civil Service commuting figures. Those figures relate only to Civil Service jobs, rather than the public service at large. The table’s format is similar those on travel maps that show a list of towns down one side and across the top, setting out the distances between locations. NISRA’s table shows civil servants’ work and residential addresses. It indicates, for example, the number of people who commute from Derry/Londonderry to Belfast, which is 200-odd.

We do not know whether those people commute daily; they may have brothers, sisters, etc, with whom they stay, having made the initial commute. However, people in Derry often talk about the 6.00 am bus to Belfast, which is full of commuters. The various flows of commuters can also be calculated from the NISRA table, as well as the journey distances and things of that nature, excluding, unfortunately, journey times.

As you mentioned, Peter, findings depend on which definition of Belfast is used. For example, the Belfast metropolitan area plan extends to Lisburn and elsewhere. Lisburn-to-Belfast commuters know only too well how long it takes to reach Belfast city centre, let alone Stormont, at the wrong time of the day. The NISRA data is broken down into small units and indicates, for example, the number of people who normally commute from Lisburn to Belfast. We are carefully assessing all of that data.

I mentioned the hometown effect and, indeed, it is unclear who would move and who would not. Therefore, there is a big question regarding sustainability. For example, let us assume that 100 jobs are transferred from Belfast to Cookstown and that 100 people who work Belfast are on the waiting list for a return to Cookstown. If those people take up the jobs in Cookstown, the amount of commuting would be reduced.

However, let us assume a different scenario that could arise if jobs were moved to Cookstown. People from Belfast whose jobs are relocated may decide to commute to Cookstown, rather than move there, to avoid upsetting their children’s education, for example. Those people may start to commute from Belfast to Cookstown. Such a situation would merely replace one set of commuting with another. There would not necessarily be an associated net positive balance in respect of carbon footprints, lifestyles, and so on.

If jobs in the benefits agencies in England, for example, were moved from London to Newcastle-Upon-Tyne, people would be unwilling to make that commute. Therefore, 1,000 new jobs would be created in Newcastle, or 500 people would transfer from London. That is completely different to the scenario in Northern Ireland. Geographical compactness is one of the biggest factors that limit our ability to draw comparable evidence from neighbouring jurisdictions. That is a critical point.

I will not run through all of the lessons that have been learned. Mr Garden has probably already informed you of some of those. As I said earlier, one of the lessons already emerging from the Republic, even though the Government there has not gone far down the relocation route, is that one must not underestimate the industrial-relations problems.

The Scottish Parliament’s experience has taught us that we must specify the exact objectives that we are trying to achieve and that we must not underestimate the need for training and the need for a skilled labour force, etc. In some of the Scottish examples — and this is also true of one or two of the Northern Ireland examples, because, as members are aware, a few attempts have been made in the past to relocate jobs here — people underestimated the proportion of the skilled labour force that had to transfer, or, equally, if they were not going to transfer, the amount of time that it would take to train new staff. One example concerned benefits and pensions, which involves staff dealing with some very complex issues, and it takes 12 to 18 months for a person to get his or her mind around them and be able to provide sound advice. That lesson emerged loud and clear.

Members are aware of the Scottish examples, and I hope that we will learn from those, and not make some of those mistakes. However, Scotland has come almost full circle. Perhaps that is why Mr Hamilton said that he might be beginning to shift his view. The Scottish Parliament started off with the view that value for money did not matter, and it was determined to relocate public-sector jobs. Now, it is being more conservative and saying that the first thing to think about is the cost.

Perhaps that is the result of the Scottish Government having been a bit too gung-ho in the first instance, because they started out dramatically and then found that they had to pull back. That is why I hope that, whatever we come up with, our approach will be more measured and calculated, although we will have the advantage of being able to draw on the Scottish experience.

Mr Weir:

It may be premature, but it might be helpful if you were to give the Committee some indication of the level of specificity of your final report. You will establish the broad principles under which any relocation should operate, and you will make a range of recommendations. The most likely scenario is that you will recommend, for the sake of argument, that Government should consider shifting one of their Departments —

Sir George Bain:

Move X to Y.

Mr Weir:

Yes. Will you make specific recommendations — for example, that the Department of Agriculture and Rural Development should move elsewhere? Will you name specific Departments, or parts thereof, as suitable for relocation, or will you simply establish particular principles that the Executive must implement, and they will decide which Departments to move?

Let us suppose that you are going to be specific. You mentioned a hypothetical relocation to Cookstown and suggested that, although a certain amount of staff would relocate and would be able to cut their travel, the original situation might simply be replicated. The staff profile among Northern Ireland Civil Service bodies will differ according to locality, and, consequently, moving each body will have a different impact. Rathgael House in North Down is one good example where civil servants who lived in Belfast sought transfers closer to home, possibly because they had to care for elderly relatives or children. The consequent impact at Rathgael House may be greater than in other cases. If there is to be specificity, have you examined the individual impacts of relocation on the work profile of any Departments or branches?

Sir George Bain:

I am not sure whether I mentioned it when I met the Committee previously, but my response to that question stems from the Finance Minister’s answer to my question about whether he wanted general principles or specificity. He wanted specificity, because, to some extent, general principles already had been established through the RPA framework.

I have deliberately not mentioned specific examples, but instead have used alphabetical designations, such as X moving to Y. If we fail to mention the Xs — which are Department sections or new agencies — we would be ducking the issue. Consequently, we will definitely wish to specify those, and that is one reason why we are meeting permanent secretaries. One cannot sit in a vacuum and state that a Department or a part thereof is to be relocated without talking to the people who actually run the show.

As for wider place considerations, ideally, we will wish to be specific; however, given the timescale, it is conceivable that the detailed analysis that would be required in order to be 100% certain might not be possible. We might be able to say that there are two places to which X might be relocated, and that, therefore, greater consideration is required.

My function in such enquiries is to attempt to clear up as many initial questions as possible. We will aim to be as specific as possible, but, given the timescale, we may not achieve that completely.

Mr Weir:

Adopting your X-to-Y terminology, has consideration been given to situations in which split-decision recommendations are reached? For example, if 150 people are working in branch F in location X, might you recommend that half of those people should move to location Y?

Sir George Bain:

That could easily be the case, or, equally, the other way round. On a prima facie level, some services should be distributed — it makes no sense to have them all in one place. It is apparent that co-location and one-stop shopping feature largely in contemporary thinking, and we wish to build on that.

Equally, when one talks to a permanent secretary, the message — although he or she is not usually quite so blunt — is almost that, if functions are kept together, a branch can go anywhere. For a range of reasons, that function might have been spread among three or four buildings in Belfast, never mind further afield, and, because of the nature of the work, that might give rise to a range of dysfunctional aspects. Decisions could go either way, but there is no reason why functions must be located in one place.

The Chairperson:

For members’ information, Sir George has another appointment.

Sir George Bain:

I do, but do not worry.

Mr Weir:

Chairman, I am glad that you said that after I asked my questions.

The Chairperson:

I wish that I had said that before Peter got involved. [Laughter.]

Sir George, could you indicate how much time you have?

Sir George Bain:

If possible, I would prefer to leave at 12.15 pm.

Dr Farry:

Where is your next meeting located?

Mr Weir:

Location Y. [Laughter.]

The Chairperson:

Co-location comes to mind.

Ms J McCann:

You will have noted that Peter Weir and Simon Hamilton are sat at the opposite side of the table from me — and I am largely on the opposite side of the argument from them. I am in favour of relocating public-sector jobs, and I believe that that will create more efficient services because they will be more localised and closer to people in the community. Furthermore, such measures will complement other Government priorities, such as tackling poverty and social and economic disadvantage, and creating a more balanced approach to regional economic growth.

Public-sector job relocation will also be beneficial to the environment and in improving equality of opportunity for section 75 groups, particularly women, many of whom have hit the promotion ceiling in Civil Service and other public-sector jobs. Women who have children or who are carers are often unable to travel, and, perhaps, that affects their prospects for promotion. For those equality reasons, job relocation will create a more equal society.

Workplace 2010 has not been mentioned. Many buildings — mostly in greater Belfast — that are occupied by the Civil Service and other public-sector organisations are due for refurbishment. What implications does Workplace 2010 have for public-sector job relocations? Will it restrict relocation?

Sir George Bain:

First, I urge caution on the matters of poverty and targeting social need. I make that point separately to my earlier one about regional economic growth. The example that is always cited, and it may not be representative, is that of the former gasworks site in south Belfast. As members are well aware, that site was redeveloped in 1997, which is when I arrived in Northern Ireland. The idea, at least in part, was that that redevelopment would help to regenerate the Markets and Donegall Pass areas. The evidence is that it has not helped at all in that respect. The degree of employment in that development that has been taken up by local people in those two areas mentioned is insignificant.

The Chairperson:

They have also lost all their parking spaces.

Sir George Bain:

I had not realised that they also had that negative effect to contend with.

One has to be careful about expecting great effects on poverty from relocation. I stress that that is a separate issue from endeavouring to regenerate a whole area, such as the outlying areas of Northern Ireland.

Secondly, section 75 provisions of the Northern Ireland Act 1998, which tackle ceilings on the employment of women and that type of discrimination, are entirely justified. That is a tricky question to deal with. Once one begins to deal with the quantity aspect of employment, people quickly start talking about quality. The problem with moving small areas of employment out of Belfast is that one could create a ghetto in which there would be only one or two levels of employment. Any high-flyer — perhaps a woman who is employed in that section who had great aspirations and the ability to pursue them — would quickly bump into a ceiling unless she was prepared to travel back to Belfast. That is one reason why people sometimes argue that whole Departments should be transferred — the full range of jobs is then available.

When transferring jobs, we must try to create a cluster in which there is a coherent career structure — or, at least, part of a coherent career structure. In such a cluster, one might not be able to make it from clerk or administrative assistant to permanent secretary without moving location, but at least one could move two or three steps up the hierarchy.

The third point, about Workplace 2010, came up quickly in our deliberations, not least because one of the key people staffing the review is knowledgeable about that area, and colleagues wanted to know to what extent Workplace 2010 would constrain our recommendations or ability to recommend. The answer is that it did not constrain us. Most of the arrangements under Workplace 2010 for the lease of new buildings or construction are pretty flexible. No one is entering into a 25-year unbreakable lease, which would mean that a decision had been taken that an agency or Department would be locked into location X.

I do not pretend to be an expert on Workplace 2010, nor am I. However, colleagues who are knowledgeable about it quickly picked up on that element. We understand that Workplace 2010 will not greatly constrain our ability to make recommendations.

However, we have taken evidence that suggests that the lack of speculative building outside Belfast may represent a real constraint. Perhaps “lack” is too strong a word, but the tendency to engage in speculative building outside Belfast is much reduced. In Belfast, developers throw up buildings and wait for people to occupy them — we can see that from looking around Belfast. However, that happens to a much lesser extent outside Belfast. Therefore, when the decision is taken to relocate 1,000 jobs to X, the question immediately arises whether there is a building in X to which 1,000 people can be located — or whether there is a building that can be quickly converted for that purpose.

Those difficulties are not insuperable, especially if relocation is phased. However, in Belfast — I speak largely out of ignorance, but probably correctly — if one decided to move a large number of workers today, one might have two or three options. They might not all be desirable, but at least there is a choice.

The review panel received a very good presentation during a recent visit to Strabane, after which the chair of the local chamber of commerce and the chief executive of the local council took us to view a vacant shirt factory, which they wanted to redevelop quickly as office accommodation. Without commenting on its suitability or otherwise, that demonstrated the level of good thinking on the part of local politicians and administrators. They knew that if jobs were to come to the area, they would need accommodation. They felt that if George Bain and his colleagues were wondering where jobs could be relocated, they would show us. That type of thinking was quite helpful.

Ms J McCann:

We have been talking about relocation in a regional sense, but there are parts of north and west Belfast in which public-service jobs have never been located. Has that been taken into consideration? This is not just about what is happening outside Belfast — there are pockets of deprivation and disadvantage in Belfast as well.

Sir George Bain:

Indeed. I am a little shaky on the statistics, but 17 or 18 of the top 20 wards on the social deprivation index are in Belfast. If the main objective is to target social need — in quite a narrow and focused way, and concentrating on a series of areas such as the Markets or Donegall Pass — one might argue that Belfast has the largest claim of all, or certainly a very strong one. That is why I caution against thinking of this exercise as the main policy method for dealing with that issue.

I do not pretend to be an expert, but I will use a real incident, rather than a hypothetical situation. My view may be that of a pompous academic, but bearing in mind that many public-sector jobs have educational requirements that would not be possessed by most people in the Markets or Donegall Pass, it was perhaps not surprising that people did not take up jobs in the Civil Service, for example, when the gasworks site was redeveloped. On the other hand, there are hotels on that site that provide cleaning jobs and other jobs that, in another context, might be only too readily available to people in those areas, but were not taken up.

I am little cautious about specifically stating that we should locate certain jobs in west Belfast or the Fountain area of Derry. That is distinct from asking how to make progress in the north-west as a whole. That is particularly important because we know that deprivation comes about mostly as a result of a lack of aspiration, role models and education. People keep telling me that the last person to pass the 11-plus in Sandy Row did so 11 years ago, and other similar anecdotes. There seems to be a problem that is so intractable that plunking jobs in those areas is not the best way of dealing with the situation.

Ms J McCann:

There is also a lack of opportunity for many people.

Sir George Bain:

That is true in some cases.

The Chairperson:

A strategic response is required. There is no magic bullet.

Sir George Bain:

It requires an arsenal of weapons. We have to fire a great deal of ammunition at the problem in order to begin to deal with it.

Dr Farry:

Sir George, you made a point about the lack of office accommodation outside Belfast. To what extent, rightly or wrongly, are developers in Northern Ireland holding off on building such accommodation because they want a big public-sector anchor tenant to kick-start their projects and give confidence to others to follow suit?

Sir George Bain:

I do not know the answer to that, except to say that if we examine the situation the other way round, there is no doubt that an anchor public-sector tenant would quickly attract a developer. Unlike public servants; private developers are rarely in the business of public service.

Dr Farry:

You made a point about the potential for Belfast to overheat. I can see why that point has been made, because our gross value added (GVA) is well above the UK average, as are other indicators. Equally, other people have said that Belfast, either as a city or as a subregion, has not yet reached sufficient critical mass to compete on the wider European and international stage. For example, Belfast does not have the same degree of public-transport infrastructure — the trams and trains — as other cities. Perhaps that works both ways.

Perhaps Belfast should be treated as a capital region, as opposed to a capital city. Would the optimal solution be to move a lot of the back-room Civil Service jobs to sites that are on slightly cheaper land? That would take into account the sustainability issues on the fringes of the capital region, and would also afford policy-makers the flexibility of being within commutable distance of politicians, whether in Stormont or elsewhere. In a sense, the commute would then be limited to the senior or relevant policy-makers at any particular time.

At the start of your presentation, you said that your primary consideration was the efficiency of the delivery of public services. Ironically, we have probably addressed all the other issues — including regional development and sustainability, which are important factors — apart from that one. Does the location of public-sector jobs affect the delivery of efficient services to the public? Bearing in mind the stage that we have reached with telecommuting via the Internet and telephones, does the location of such jobs really matter?

Sir George Bain:

I will first address the question about the level of public service. To be clear, I was not suggesting that the main objective was necessarily to enhance public services; my point was that the bottom line was that the quality of public services must not be diminished. Politicians have to deal with constituents who are concerned about bin collections and other matters, and — thinking as taxpayers — that seemed to be an obvious starting point for our panel.

Whether it is necessary to increase or decrease public services depends on the service. Some types of public services may be enhanced by placing the services closer to those who receive them. Other public services could be decreased, and, as a result, could be enhanced by being centralised. All instances must be considered on a case-by-case basis; no generalisations about the potential for decentralisation or centralisation to enhance public services should be made.

The point that you made about Belfast is important. Any capital city, whether in Northern Ireland or elsewhere, is perhaps regarded with suspicion by people in other districts. However, Belfast is the capital, and should, at the very least, be first among equals. Furthermore, it should have the trappings of a capital city. That is not simply for the sake of Belfast, but for the sake of Northern Ireland as a whole. That point was well made.

The whole issue should be viewed in perspective. I said at a previous Committee meeting that we do not have the time to conduct an audit of the entire public sector. Such an audit could conclude with our saying that a large number of public-sector jobs should be transferred out of Belfast. However, even if that were desirable — which is debatable — it is impossible.

The types of recommendations that we will make, especially considering the need for prudence, caution, and so on, will be, for example, that a significant number of jobs should be transferred out of Belfast. However, that will not be the type of number that will suddenly significantly denude Belfast of public-sector jobs. I hope that people are not worried about that.

You made a crucial point about infrastructure and, in particular, public-transport infrastructure, which is outside our control. Although politicians have control of that issue, it would have to be addressed over a long period. When we went to Downpatrick, for example, the issue of public transport was raised a number of times. I am sure that, as politicians, you will be only too familiar with that. We were told that Invest Northern Ireland has not yet been able to arrange a visit to Downpatrick — at least over the past number of years — for a prospective inward investor who may be prepared to locate economic activity there. Time and again, the issue of public transport was raised.

That experience is repeated in many other areas. As members of the Committee will know only too well, there appear to be no plans to increase the rail infrastructure, with the possible exception, I gather, of the planned airport links. There are, of course, plans to improve road infrastructure in certain areas, but even that is a long-term process, which will take a while to accomplish, for all the obvious reasons. The relocation exercise is presumably going to take place within a much shorter timescale, particularly in so far as it relates to the Review of Public Administration, etc, so there is a real tension; there is no question about that, and it is a major problem.

Mr Beggs:

The relocation of public-sector jobs is not a cost-free option. At the very least, there will be an initial set-up cost, and the Scottish example has shown potential savings of £33,000, with costs ranging to £46,000 per job. I assume that no Department would want such additional burdens, given the tightness of the Budget. In the Republic of Ireland, we have been told, no resettlement costs were paid to civil servants who were forced to relocate. Can you confirm that there would be resettlement costs in Northern Ireland if existing jobs were relocated?

Sir George Bain:

I cannot confirm or otherwise. There are mobile civil servants and non-mobile civil servants. I think that I am correct in saying that if there were relocation of non-mobile civil servants who were prepared to move, it probably would be highly likely that there would be resettlement costs. However, that is speculation; I do not know. The extent to which there are resettlement costs will depend on the extent to which the unions are able to negotiate for them. I cannot, in my ignorance, comment in detail on the case of the Republic, but certainly, speaking as someone who used to work in industrial relations, I would be very surprised if the unions did not have views about resettlement costs. However, that would be a point for negotiation.

Mr Beggs:

You mentioned the Belfast travel-to-work area. I do not like the outworking of that particular definition in my constituency, because Larne and Carrickfergus would be lumped into the highest Civil Service job density when the Belfast travel-to-work area is used. However, when broken down according to council area, we actually have the lowest Civil Service job density. How can those two issues be balanced, particularly if the wider definition is used, which includes Larne and Carrickfergus along with the high density of jobs in Belfast city centre, even though there are effectively no Civil Service jobs in those areas? Do you accept that if that travel-to-work area is applied to the wider geographical area, it neglects a number of carbon-footprint and other such implications? Essentially, in Larne and Carrick, there is a social security office, a jobs and benefits office, a Housing Executive office, and the council offices. Of course, the process of implementing the RPA must be taken into account.

Sir George Bain:

First, in respect of the travel-to-work area, there is no single definition that is all-embracing. Secondly, the review panel believes that the travel-to-work area, particularly with respect to commuting patterns, is the single most useful definition. The third point, which I hope will put your mind at rest, is that we almost certainly will be publishing, as an appendix to the report, the data by district council area as well, and where there is a different conclusion on the basis of the district council areas, we would want to examine that very carefully. I can assure you that that point has been raised. We want to stick by travel-to-work areas for what I consider good reasons, but I take the point that you have mentioned, and, when the report is published, you can turn to the appendix and examine the sections that are relevant to Carrickfergus.

The Chairperson:

Thank you, Sir George, for staying longer than you had planned to, but the questions and the answers have been very helpful to us indeed. Thank you very much.

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