BIS Sheffield Proposal and Government Departments outside London

Closure of the BIS office in Sheffield

On 28 January 2016 the Department of Business, Innovation and Skills (BIS) announced plans for the closure of the St Paul’s Place office in Sheffield. The move will create a “combined central HQ and policy centre in London”. The announcement, made by the BIS Permanent Secretary Martin Donnelly, also stated that “around 6 business centres will also be established around the country”. Martin Donnelly stated that the announcement was “part of implementing our BIS 2020 strategic plans to modernise the way we work, reduce operating costs and deliver a simpler, smaller department that is more flexible and responsive to stakeholders and businesses”.

According to Civil Service World, “more than 240 staff” currently work at the Sheffield office, which focuses “on policy and corporate services for BIS”

During an Urgent Question on the closure of the Sheffield office on 29 January 2016, Louise Haigh MP said that:

It speaks to this Government’s London-centric focus and contempt for the north of England that they think a consolidated “combined central HQ and policy centre” has to be, by rights, in London rather than in Sheffield where the operating costs are cheaper and the perspective on UK investment is much broader.

Responding for the Government, Anne Soubry MP, Minister for Small Business, Industry and Enterprise, argued that:

Of the 20,000 staff paid for by BIS, only some 2,000 —about 10%—work at No. 1 Victoria Street. The vast majority are spread around the country. I pay particular tribute to the 60 who work in BIS local and provide an outstanding service not only locally, but to us working in the ministerial team at No. 1.

The Minister also said that members of staff who have been affected by the closure “have been fully briefed. Comprehensive support will be provided. Some of the staff will be able to transfer and apply for jobs in London; others will of course take voluntary redundancy”.

On 24 February 2016 a Westminster Hall debate was held on the closure of the BIS office in Sheffield. During this, Kevin Barron MP argued that the closure could result in 247 jobs losses. He also said that:

Not only will the closure be devastating for South Yorkshire; it will lead to a huge loss of expertise for the Department…The idea that they [the staff based there] can uplift and come down to work in London, even if they could afford to buy a property in London, is a very difficult thing to imagine.

During the debate Paul Blomfield MP highlighted that the Sheffield office intended for closure was a policy-making office with “a head office function”. He said that many staff based there “are senior policy staff, and they help make Government decisions”. Louise Haigh MP similarly stated that the Sheffield BIS office is “not like other local and regional offices throughout the country; they are the only headquarters outside London where policy decision making is done”.

In response, Joseph Johnson MP, Minister for Universities and Science, said:

We will not be losing the capabilities. We will be moving a number of the jobs, and some jobs will become available in London, so the policy expertise that resides in Sheffield at present will not be lost.

The Minister had earlier denied that BIS was “a London-centric Department”, adding that “Even with the movement of policy roles to London, our overall London footprint will decrease by 2020. We have, and will continue to have, many more people based outside than inside London”.

Spending Review and BIS 2020 Strategic Plan

BIS’s total budget is set to decrease by 26% in real terms across the spending review period (2015/16 to 2019/20). Its resource budget, from which most of its spending is made, is set to decrease by 17% and its capital budget is set to decrease by close to 60%. Further data are presented in the appendix of the Library’s briefing on the Spending Review and in an accompanying interactive spreadsheet.

Civil service relocation

Matthew Hancock MP, the Minister for the Cabinet Office, set out the Government’s policy on “rebalancing the Civil Service between London and the regions” in response to a Parliamentary Question on 10 February 2016. He said:

The Civil Service has a significant presence across the UK and we are considering how new government hubs, in strategic locations across the country, will help to make sure that we have an efficient and effective Civil Service at the same time as we consolidate the government estate. Currently, 18.1% of civil servants are based in London.

Any proposed relocation is done based on operational need.

The Bridge Report, 2016

On 2 February 2016 the Government published a report by the Bridge Group on social-economic diversity in the civil service’s graduate recruitment programme, the Fast Stream. The report, which had been commissioned by the Cabinet Office, found that graduate recruitment of people from poorer socio-economic backgrounds into the civil service continued to be low. One of the Bridge Report’s “Key Findings” was that the geographical focus of Fast Stream jobs in London acted as a deterrent: “research indicates that lower SEB students are less likely to move to the area”.

In response to the Bridge Report, Matthew Hancock, the Minister for the Cabinet Office, outlined plans to tackle inequality across the public sector. One of the measures he announced on 2 February 2016 included “taking graduate recruitment outside of London by establishing regional assessment centres”.

Budget 2016

The Budget 2016 contained several commitments to move civil servants out of London. It stated that the Government

is working on an ambitious strategy to move civil servants out of expensive Whitehall accommodation and into the suburbs of London, delivering substantial savings for the taxpayer. Over the next few years the numbers working in central London will reduce significantly.

The Budget also stated that the Ministry of Justice is moving jobs outside of Whitehall: “By the middle of this Parliament the Ministry of Justice will establish a major programme to create substantial centres of expertise outside the capital”. According to the Budget, this will “reduce costs, access highly skilled labour markets in the regions and contribute to the Northern Powerhouse”.

 Civil service employment by region

The following chart is from the Commons Library Briefing Paper, Civil Service Statistics. It shows how the number of civil service employees in each region has changed since 1997.

The Briefing Paper also provides a chart which shows the overall distribution of civil servants by region in March 2015.  About one fifth of all civil servants (permanent and temporary) were based in London at 31 March 2015. 12% of civil servants worked in the North West, 10% worked in the South West and 10% in Scotland.