DFID merger: FCDO will not house a separate ODA department

LONDON — The U.K. development secretary shared early details of what the new Foreign, Commonwealth & Development Office will look like Monday, describing it as a “blended new organization.”

But Anne-Marie Trevelyan admitted the merger of the Department for International Development with the Foreign & Commonwealth Office was “challenging,” while DFID’s most senior civil servant Nick Dyer said it could take years to properly integrate staff.

The merger of the two departments into FCDO was announced by Boris Johnson in June, with the new organization scheduled to be operational by September. But there has been uncertainty over what FCDO will look like and fears among some in the development community that it represents a “hostile takeover” of DFID, rather than a true merger.

Speaking to the International Development Committee, a group of parliamentarians, Trevelyan provided some detail.

“The mission the PM [prime minister] has set us is absolutely a blended new organization,” she said. “That is what he wants to see … It really is not going to be the FCO with an ODA [official development assistance] department inside it.”

Despite the complexities of the U.K.’s significant ODA finances — DFID spent £11 billion (about $13 billion) in 2019, while FCO spent around £2.4 billion — there will be just one accounting office for the whole department, Trevelyan said. She added that ODA “will be the bulk of that accounting officer’s spending portfolio and therefore by definition a huge amount of focus will be spent on making sure that is spent well.”

Senior appointments are a key element that analysts are watching to understand the nature of the new department. Foreign Secretary Dominic Raab will lead FCDO. It is possible his job title will become the Foreign and Development Secretary, Trevelyan said. But she added that most organizational plans and details are still being worked out.

A letter sent on Tuesday by Raab to Tom Tugendhat, chair of the Foreign Affairs Committee, confirmed that the department will have only one secretary of state and one permanent secretary. It is not yet known who will fill the latter role, with Simon McDonald, permanent secretary of FCO, reportedly due to step down in the autumn.

Leadership for a transition team has been established, however, led by an FCO official, Nic Hailey, with a DFID official, Ben Miller, acting as his deputy, Dyer added. He said that the positions of the 30-strong team have not yet been filled, though many applicants are from DFID.

A key lesson of government machinery changes is that joint leadership is necessary, Dyer said, adding that he and FCO’s McDonald were conducting joint messaging and engagement and all-staff meetings “every single week.”

“This very much is a signal this is co-creation and this is new,” Dyer added.

But significant challenges remain. “These things are always challenging and it’s for us to make successful,” Trevelyan said. She added that a key lesson from other mergers was “it takes a while for [two departments] to embed and move forwards into a completely new culture, that’s the reality, that this won’t happen overnight.”

Dyer went further, saying his Canadian counterpart told him “actually, we are still working on culture.” The merger of the Canadian International Development Agency into the Department of Foreign Affairs and International Trade began in 2013, and a 2016 report found it would take up to a decade for CIDA employees to accept the cultural change of the move.

Core lessons from the Canadian experience, such as early and accelerated implementation of key aspects of joint working, including core training, were being taken on board in the DFID-FCO merger, Dyer added. Other lessons showed the most successful mergers were those with “strong vision and commitment,” he said.

Update, July 7: This story was updated to include new information.