27 August 2009

It’s seemed at times this year as if quango culling was about to become a national sport.

In many ways, this is nothing new. Over the last 30 years, both Governments and Oppositions have variously promised to slash, burn or sweep away the number of quangos, generally with little effect. Tony Blair, for instance, promised to consign them to “the dustbin of history” before creating according to some calculations, a further 700+ of them over ten years. This year things are a little different; public spending is very tight and an election is coming. For these and other reasons, the hunting season for quangos is likely to be more intense and longer lasting.

The chase began early this year with the publication of the Budget in April. As the Chancellor was putting the finishing touches to his Budget proposals, the think tank Reform was publishing a Paper questioning some of the government’s economic policy and proposing a number of measures to get Britain ‘Back to black,’ as the title of the Paper put it. Central to this was a five year plan designed to cut back public spending in the big spending depts of health, defence, welfare and education, each of which, the Paper argued, was soaking up “flash floods” of public money yet with questionable results. In education, for instance, the Paper identified a potential £5bn+ of savings to be had from cutting back on nine separate projects and bodies, the biggest of which was the Building Schools for the Future programme. “Money should be spent at a school level not on national vanity projects.”

In all, the Paper outlined four principles for reducing bureaucracy and returning education to its core purpose. First, getting rid of “costly central dictation” in areas like teaching strategies, building, IT development and school food . The Secretary of State’s July announcement dismantling the National Strategies in favour of a school –led approach to teaching literacy and numeracy is perhaps a reflection of this growing interest in decentralisation. Second, putting a stop to mission creep where bodies start off with one remit but gradually edge into other things; the Paper identifies a number of bodies at fault here. Third, getting rid of bodies that duplicate business effort. The skills system has suffered particularly from this with on some calculations over a 100 separate bodies ploughing away often dangerously close to each other’s furrow. And fourth, resolving some of the issues around student finance and HE funding, a hot topic at present and the subject of another think tank Report this time from IPPR calling for resources to be directed away from middle class students towards the most disadvantaged. An issue that will surely crop up in the forthcoming fees review.

The tally-ho was taken up a few months later by the politicians as in early July the Treasury announced a review of quangos as part of its general review of spending by public bodies.

This review is intended to take in all Whitehall depts, not just the big spenders, and feed into the Pre-Budget Report in November. In many ways this is a standard Treasury Review but in the current febrile atmosphere has assumed more epic proportions. There are three reasons for this. First, nobody least of all the government, seems to have much idea as to how many quangos there really are, something it will surely want to rectify. Part of the problem is definition. The Directory of Public Bodies, for instance, identifies four different types of quangos, others tend to opt for three: advisory bodies, bodies with executive power and watchdogs, either way the number seems to be growing. Second, it’s hard for the government to call for cuts in public spending when spending on quangos continues to rise, apparently 3% last year. And third, the Conservatives have equally taken up the cudgels.

David Cameron’s 6 July speech on quangos, which was generally well received, was notable for adopting what was termed a new ‘forensic’ approach. “We’re trying to do this differently. Instead of standing up with a long list of quangos I’m going to abolish, what we’re doing is making a real argument about what these bodies are supposed to do.” Doing the forensics is part of the Conservative tack of demonstrating that they now are the Party with the analysis and ideas, the “progressive party,” as George Osborne described them recently. In his speech, David Cameron suggested that there were anything between 790 and over a thousand quangos depending on your definition, that they were responsible for spending anything between £34bn and £60bn, and that their very existence raised serious questions about the nature of our democracy. “The problem is that too much of what government does is actually done by people that no-one can vote out, by organisations that feel no pressure to answer for what happens and in a way that is relatively unaccountable.”

The speech contained three important announcements. First, that under a Conservative government, ministers would have to shoulder responsibilities through their dept rather than expect to shunt duties off to non-elected quangos. Second, the Party would publish online all public sector salaries over £150,000; this would help prevent a situation in which currently 68 quango heads now earn more than the Prime Minister. And thirdly, that in reviewing quangos the Conservatives would adopt three litmus tests: do they provide technical advice unavailable elsewhere; are they able to make impartial decisions; are they transparent? Aspiring quangos would have to meet at least one.

The latest to join in the hunting pack has been the Centre for Policy Studies, who a couple of weeks ago published a further report on quangos, or more precisely “the eleven quangos which have the greatest impact on schools.” Their view was that their budgets have increased, “for many, their budgets have in real terms increased by between 10% and 15% a year” yet their impact hasn’t. The Report ran the runes over each and in many cases wielded the knife.

Quango chasing can be a ruthless sport but the Centre’s report noted, ‘all too often when a quango is restructured, it re-employs the same people.’ Sometimes the chase is more important politically than the kill.

© Edexcel Policy Watch 2009. Steve Besley is Head of Policy at Edexcel. Policy watch is a service intended to help busy people understand developments in the world of education. Visit Edexcel at www.edexcel.org.uk