Patrick King is a Senior Researcher at the think tank Reform.
The Prime Minister has promised “nothing less than a complete re-wiring of the British State”, a task that has confounded successive governments. Perhaps because 60% of public money is now spent via quangos: run not by democratically elected and accountable ministers but by an unelected, largely anonymous set of bureaucrats.
While the bonfire of the quangos’ initiated in 2010 led to a reduction in the number of public bodies, it did not fundamentally change the way these bodies are held accountable or improve the grip ministers have over them. And the reduction in numbers is being reversed, with growth in the last few years of the Conservative government set to continue into the current one.
As our report ‘Quangocracy’ revealed, only around 250 people in departments are responsible for holding to account bodies that spend billions of pounds and together employ around 390,000 people.
Shockingly, departments like the Ministry of Defence and the Ministry of Justice – whose public bodies design and manufacture nuclear warheads, provide equipment and support to the British military, and run our court system – each have fewer than ten staff in their central sponsorship teams, which are supposed to act as the ‘golden thread’ between a department’s priorities and the work carried out by public bodies.
Like other parts of Whitehall, sponsorship also suffers from a surfeit of generalists over subject matter experts. One official commented on the “absolute amateurness” that runs through public bodies, adding “There’s no technical expertise … the Government should be pretty ashamed of itself”. The chief executive of a public body meanwhile said their budget had always been signed off at a “very junior level” and that regular meetings with the department meant “once a quarter”.
It’s no wonder getting a clear view of public bodies’ performance is almost impossible when we’re relying on ad-hoc interventions by generalists in their twenties and thirties – typically with no management experience of their own – to understand whether complex regulators, inspectorates and other bodies are effective. The time spent just on public appointments, ensuring full boards of directors are in place, means that hands-on performance management is often secondary to filling out vast amounts of paperwork and admin.
The Government says that new public bodies should be created “only as a last resort”. However, as senior officials told us in interviews, this couldn’t be further from the truth. The Cabinet Office’s ‘tests’ for new public bodies are said to be “completely meaningless”, and are regularly retrofitted around decisions to set up new public bodies that have already been taken. One told us they’d “never been aware” of a public body that had reached the approval stage and been rejected.
Rather than building capability in Whitehall, ministers often see public bodies as a useful political signal that an issue is being dealt with. Likewise, independent reviews and commissions – from the Grenfell Inquiry to the COVID inquiry – see new public bodies as an answer to challenges that do not have a clear solution.
As one official told us, there’s never been a “line in the sand” moment where we’ve worked out what public bodies are actually for. Ad-hoc decisions are continuing under this government, through setting up bodies that will eventually manage the rail network, help deliver net zero and regulate football. And they took place even under the 2010 government, through the creation of NHS England (once dubbed “the world’s biggest quango”), the OBR and Office for Tax Simplification – all from an administration which explicitly viewed many quangos as bureaucratic and wasteful.
Until we cut back the number of public bodies and give Ministerial departments the tools they need to properly grip ‘Whitehall’s wild west’, the hundreds of bodies that already exist could drift further out of view of departments and the public.
This would not just be a failure of governance: it would be an act of negligence that paves the way for future scandals, like the billions of pounds of overspend on HS2, which the National Audit Office found were directly downstream of governance failures in HS2 Ltd and the Department for Transport. Or the damning report into the Care Quality Commission, which found that the health regulator didn’t have the required expertise to assess the safety of healthcare – in other words, to do its job.
Already, senior officials report a culture in which quangos believe “they can do whatever they want”, with independence used a used as a “convenient excuse” by departments and public bodies to avoid accountability. Perversely, some even employ large teams of public affairs staff to lobby for favourable political decisions.
Take a recent advert for the British Business Bank, a public body which promises an £100,000 budget to commission “Government Reputation Research” from YouGov and refers to securing “positive outcomes” for the Bank at “fiscal announcements. Or an ad for the Natural History Museum, another quango, which lists a key responsibility as “increasing our sphere of influence to inform actions and policy in government”.
Sunlight is the best disinfectant.
We shouldn’t just rely on bureaucratic process to promote higher standards of accountability. Parliament should play a much more active role, and take a greater interest in the outcomes of public body reviews: calling relevant officials and permanent secretaries to answer for their performance.
Equally, departments should publish an annual list of their public bodies, which clearly names the minister responsible for each, describes its function, and links to the body’s most recent review.
If the new Government is serious about the declining capabilities of the State, it should secure a baseline of accountability for public bodies. And recognise that, without a rationalisation of those that already exist, any expansion in the Quango State is likely to do more harm than good.
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