[Originally posted on Liberal Democrat Voice, 13/01/11]
Quangos – Quasi-autonomous non-governmental organisations – occupy a strange place in the British political landscape. They tend to proliferate because governments can’t resist seeing new commissions for this or advisory panels for that as essential, while rarely deciding that existing bodies have outlived their usefulness. Yet, the term “quango” inhabits the same discursive space as “bureaucracy”. There is an engrained association with waste, inefficiency, red tape and pointless interfering. In many people’s minds, and frequently in political rhetoric, “quango = bad” by definition. (For a discussion of a similar equation regarding bureaucracy, see here on my blog.) So, the story goes, quangos need to be treated with suspicion and reined in whenever possible.
It is now conventional for reforming governments in the UK to assume power aiming to prune the number of quangos. Both Thatcher and Blair made statements to that effect. The evocative phrase ‘bonfire of the quangos’, coined in Mrs Thatcher’s time, has emerged as shorthand for this aspiration. But these are not new concerns. You can find discussions from the 1940s expressing concerns about the proliferation and powers of various non-departmental public bodies.
The Coalition government is no different. One of its first moves was for the Cabinet Office to undertake a cross-departmental review of quangos. The review concluded that of 901 quangos examined, some 192 could be abolished, 118 merged, and 171 needed reform. Forty organisations were still under review in December. The legislation embodying those conclusions – the Public Bodies Reform Bill – is wending its way through Parliament at the moment.
Should we be concerned about this review? In my view the answer is yes. But concern should be about the approach to policy making apparent at the heart of government as much as it is about the desirability or otherwise of quangos. The issues have been exposed in the recent scathing report by the Public Administration Select Committee (PASC). There are at least five reasons for concern.
Clarity, or the lack of it
The Government offered no clear position on the main focus of its review. The tests it proposed for determining whether a quango performed a useful function and should continue were vague and lacked coherence. The Government maintained to the PASC that the key purpose of the review was improving accountability by bringing properly public functions under direct control by Ministers. Saving money was at best a secondary concern. It was fairly simple for the PASC to identify statements, by the Prime Minister and others, that contradict this. It is also contradicted by the review criteria the government included in the Public Bodies Reform Bill, which made reference to the economy, efficiency and effectiveness of a quango’s operation. And that is without explicit consideration of the Coalition Agreement which states quite clearly, under the heading deficit reduction, that “we will reduce the number and cost of quangos”. Yet, the Cabinet Office can offer no estimates of the likely cost implications of the review.
The PASC’s examination of the process led to the conclusion that the review was conducted in a haphazard fashion, in undue haste, without a robust and transparent methodology or sufficient central guidance from the Cabinet Office to ensure an even handed – or even vaguely rational – approach. The results – in terms of the sharply contrasting futures for similar bodies – have little coherence. At times they appear little more than the product of caprice.
The Government engaged in almost no structured consultation about the functions or effectiveness of quangos during the review. The Government gave the impression that this was considered largely unnecessary because the decision making was rooted in principle and the application of objective tests. It was, therefore, doubly unfortunate that the principles and tests employed were so badly constructed.
Recently Alan Johnson has, rightly, been criticised in the press for not knowing National Insurance rates off the top of his head – seemingly a basic requirement of his role. Yet, the lack of detailed engagement demonstrated by the Cabinet Office Minister, Francis Maude, in his responses to the PASC is equally striking. The vagueness of some answers was worrying. The more specific answers could be contradictory.
The Government’s professed aim for this review is to increase accountability. This is problematic for three reasons. First, to equate accountability with Ministerial accountability to Parliament is an extremely impoverished approach. Accountability to stakeholders can take multiple forms. Of course, no Liberal Democrat, grounded in community politics and engagement, would think otherwise. Quangos have Chief Executives and Boards who are visible and engaged in diverse ways with the communities they serve. Second, the idea that quangos are not already highly accountable to ministers is erroneous, although different Departments sponsor and oversee quangos in different ways. Third, there are strong arguments that accountability will be reduced as a result because quangos will become just one part of a larger departmental remit. Their activities will be buried in layers of hierarchy, lower profile and more remote from Ministers.
Concentration of power
Although the Government focused on increasing accountability to Parliament as the driver for this review, the Public Bodies Reform Bill as originally drafted tells a rather different story. It is a familiar story of the Executive seeking to assume power at the expense of the legislature. The Bill is primarily enabling. As originally formulated it was geared around so-called Henry VIII provisions that allow Ministers to use secondary legislation to amend primary legislation. This has caused considerable consternation among those who value due process and scrutiny. Many quangos were set up through primary legislation following sustained debate. Parliament had to be content that they had purpose and value. The proposal that such bodies could be abolished by Ministerial fiat shows a disregard for the democratic process that is at odds with the rhetoric. In order to move things forward the Government has been obliged to water down its proposals so as to allow greater scrutiny of Ministerial action.
The PASC raise many other issues worth closer examination. But that is sufficient to make the point. It couldn’t say so in quite such blunt terms, but we can infer that the PASC considered this a hopeless mess. The quality of thinking behind the review is highly suspect. It exposes a rather high-handed, amateurish and casual approach to policy making. Given these are major changes to the machinery of government that should be a concern to everyone. And it is not what we need if we seek a coherent and effective public sector.