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Bonfire of the quangos? We’re still at the kindling stage

 

Please note that this article first appeared in Public Servant magazine, and has since been published on publicservice.co.uk, and is available here.

Quangos may well be out of fashion, but new forms of delegation and hiving-off are the order of the day, say Chris Skelcher and Matthew Flinders. They warn that the coalition government still has some way to go before the long-promised ‘bonfire’ is properly alight

Governments often use the parliamentary recess to announce bad news – but there was a recent exception. Tucked away between Christmas and New Year, and almost unnoticed by the media, was the announcement of success in taming the bête noire of politicians, press and public – the quango.

The number of public bodies was reported to have been reduced by over 200, from a total of 900 when the programme of abolitions, mergers and transfers was announced in October 2010.

The politics of quangocide is rarely easy and many previous governments have discovered the flame-resistant qualities of public bodies when it comes to igniting a bonfire of the quangos.

And yet the coalition government’s approach to the quango problem has been both swift and far-reaching. Swift in the sense that more than  900 quangos were reviewed within a few  months of assuming office, and far-reaching in the scale of change that is being undertaken.

The reform ambition easily matches that of the last major attempt to reduce quango numbers – led by Sir Leo Pliatzky in the first Thatcher government – and in some ways surpasses it.

In addition, there is no doubt that the role and capacity of the Cabinet Office has been transformed in relation to the control of public bodies. It not only reflects its central role in shaping the cross-Whitehall approach to managing the review and subsequent reforms, but also its insertion as a third party into the traditional bilateral relationship between Treasury and spending departments in the new expenditure controls system. This introduces a new regime to regulate spending by public bodies, as well as departments themselves.

As a result of the public bodies review there is also an active discussion across Whitehall about how best to manage arm’s-length delivery agencies, more of which can be expected under the recently announced civil service reform plan. In line with the government’s desire to increase the accountability of public bodies, the shift is from loose to tight relationships.

Looking back at the initial phase of this research it is possible to identify three core insights. First, the public bodies reform agenda suggests that new governments can have transformative impacts on the structure of the state, and with limited disruption, even at a time of considerable organisational upheaval. Secondly, this requires strong political leadership and the ability to hit the ground running with a clear sense of what the reform agenda must deliver. Finally, in this case the coalition government was aided by the existence of a reform climate in which many departments had already begun to review and reform their arm’s-length bodies.

Although the reforms are by no means cosmetic in nature it is important to note that a large part of the claimed quango cull relates to the abolition of a large number of very small bodies. In addition, some advisory quangos have now become “committees of experts”, subject to less onerous governance requirements.

It will be important to establish whether this affects transparency, especially in the context of the civil service reform plan desire for more open policy making.

In other cases, bodies have been abolished but functions transferred. In some cases this is to executive agencies where, theoretically at least, there is a shorter arm’s-length relationship with ministers.

Other functions have been brought back into government departments, or moved out into charitable or business organisations, the new Canal and River Trust being a prime example, created from British Waterways.

Our own research indicates that concentrating on reducing the headcount of bodies misses the point. We estimate that approximately 90 per cent of the functions of those quangos that are reformed will continue in one way or another. So while change to the organisation of the public sector has been significant, there has been less change in what the sector actually does. Government will certainly do less in the future, but this is more a result of expenditure constraint than reform of public bodies.

Looking forward, the public bodies reform agenda is entering a critical phase. The new triennial reviews are about to embrace a number of larger and more salient quangos. In addition, government must rebuild relationships with those quango chairs and board members who feel bruised by their exclusion from the rapid review process.

What’s missing from the current debate is an appreciation of the similarities and synergies between the government’s civil service reform agenda and public bodies reform. At present, these initiatives appear to be running in parallel despite the fact that both are forged on a belief in alternative models of service delivery and ministerial accountability.

This is a telling point: quangos may well be out of fashion, but new forms of delegation and hiving-off are the order of the day. In the NHS, for example, one set of arm’s-length bodies, primary care trusts, are being replaced with another, clinical commissioning groups, and all overseen by a new super-quango – the NHS Commissioning Board.

The bottom line is that the coalition government’s public bodies reform agenda is the most ambitious attempt to reduce and reform the number and cost of quangos for at least a century. Pre-election rhetoric has been diluted by an element of realpolitik and has led to a mixture of abolition and reform.

Whether the government has a real appetite for abolishing quangos will only become clear as the reform agenda reaches the larger and more salient bodies during the remainder of this Parliament.

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