In Defence of Quangos

Francis Maude’s much-trailed announcement of his quango cull generated plenty of large numbers: 192 quangos are to be axed and a further 118 are to be reduced to 57 by mergers. Another 171 face “substantial” reform. In total, 648 of the existing 901 bodies will remain – but almost none have been left untouched.” Nick Timmins, FT, 15 October 2010.

The Great Quango Cull has turned out to be rather less dramatic than advertised, and the reasons given have shifted from being about saving money to increasing “accountability”. But as the above figures show, even this Government’s determination to thin out the ranks of quangos seems to have stalled.

Why do we need quangos at all, and what are they?

Quango is short for “quasi-autonomous non-governmental organisation” and it is highly debatable if most of the organisations being culled are really “quangos” at all. Most of the bodies that Francis Maude have had in their sights are “non-departmental public bodies” or NDPBs. According to Leo Pliatsky, the Whitehall mandarin charged with culling these bodies by Mrs Thatcher in 1980, NDPBs are not, strictly speaking quangos but “quagos” – quasi-autonomous governmental organisations.

The truth is that we have a wide spectrum of public bodies that range from the Ministry headed by elected politicians – Ministers – through to things like the BBC, which is a public corporation and very much not under ministerial control (we hope). In between is a veritable forest of bodies, most of which are NDPBs or “agencies”, but there are many weird and wonderful sub-species.

Sometimes coverage of ‘quangos’ (I’ll continue to use the term since its so embedded in our culture it’s probably impossible to dislodge now) suggests they are a uniquely British invention. Far from it, just about every country in the world has them and especially in democracies they play a very important role.

Representative democracies that elect majority governments – either or one party or a coalition – have a former of power that is inevitably partisan. There are winners and losers, government and opposition. But, and this is a very big BUT, they rely of what some have called ‘losers consent’ – that is that those who didn’t vote for the party or parties in power obey the laws, pay their taxes and generally consent to be governed regardless of the fact that they lost.

In order for ‘losers consent’ to operate a range of public activities – tax collection, service and benefits provision, criminal justice, etc – need to have universal acceptance. All the people – regardless of their politics – need to be confident that government in some sense is ‘their’ government too.

So at the heart of democracy there is a constant tensions between the need for partisan and universalistic government – political responsiveness has to be tempered with a degree of neutrality.

That is why every democratic government has some divide between elected and permanent officials. Countries draw the line between them differently – America has far more elected officials in positions we wouldn’t dream of electing, like judges. But they all draw the line somewhere. And they all have a range of statuses for public bodies – some are much more directly under the control of elected officials and others less so, for good reason. Probably the most common to be very firmly at “arms-length” from elected politicians in modern democracies are tax collection and the armed forces. No-one wants our elected representatives deciding what taxes an individual has to pay – we got rid of that sort of corruption in the 19th century (mostly). Nor does anyone want a politicised armed forces.

There is no objective way of deciding which functions should be closer in to political control and what should be further out and more quango-like. Take two examples: the Audit Commission and the Appointments Commission.

The Audit Commission was created to deal with a very specific problem within English representative democracy. At the local level, there are quite a few local government bodies that are in effect one-party states – as the joke goes you could put up a pig with a red/blue rosette and it would get elected. Without effective electoral competition, these are in danger of becoming “rotten boroughs” and back in the 1970s we had plenty of examples of just that. But when corruption surfaced in these areas, could you have the elected Westminster government – which would inevitably be of a different party in at least some cases – coming in to sort them out? The danger of perceived or real partisan interventions from the centre was very apparent. So the last Conservative government created the Audit Commission in the really 1980s to be a neutral watchdog to prevent local corruption – and you have to say that it has largely worked. We have one of the least corrupt local government systems in the world.

The Appointments Commission arose from a slightly different, but related, problem. When government decided to “unbundle” the NHS into quasi-autonomous NHS Trusts (not unlike quangos themselves) in the early 1990s the problem quickly arose of who got to appoint their Board members, especially non-executive Directors. There were several scandals involving apparently unqualified spouses of Tory MPs getting onto NHS Trust Boards above more suitable local candidates. The Appointments Commission was created to put a stop to all that and make sure such appointments were politically neutral and on merit.

Both of the above quangos are now being abolished – but has human nature really changed in the past 20-30 years? Without an independent watchdog, who will ensure rotten boroughs are fairly dealt with? Will elected politicians once again get to decide who sits on NHS Boards, and if so will they suddenly acquire Platonic self-restraint? Or to take another example, do we really want “accountable” politicians taking detailed decisions on issues like the ethics of fertilisation and embryology?

The idea of quangos is simple – create an arms-length body that is ultimately accountable to elected politicians through its legislative mandate and other mechanisms, but which can make decisions free from the pressures of day-to-day partisan politics. When George Osborne created the Office of Budget responsibility, it was exactly these arguments he used.

Let me end with a little story. Many years ago I was told by the head of the (then) Passport Agency that he’d had a phone call from a Minister. The Minister had said that his passport was coming up for renewal and he wanted a favour. Could the Agency chief arrange for his new passport number to end with “007”? The Agency chief said, politely but very firmly “no, Minister”. It may have been a very minor corruption of the system, but as is well known “noble cause” corruption can very quickly lead to much worse. That’s one of the main reason we need quangos – so they can sometimes say “no, Minister” – even to elected politicians!

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