Everybody is talking about cutting the number of quangos, organisations set up by the government. Unlike companies like Woolworths, which can go bust if not enough people have any use for what they’re doing, once a quango is created it will exist forever until a minister or civil servant decides to shrink or abolish it. And unlike a company, we pay for its services through taxes whether we want to or not, whether or not we find it useful.
There has never been a better time for cutting wasteful spending on quangos than right now. In this financial climate, companies all over the world are having to tighten their belts, and us taxpayers understand that government should do the same.
But saying that is the easy part. The hard part is doing the hard thinking about which quangos are worth keeping, and which should go. What is needed is a sort of ‘Dragons’ Den’ for quangos, in which each can be grilled in turn by a sceptical panel about whether what they do is actually worth doing.
So, in that spirit, here are some suggestions for what the dragons might ask.
The first question is: what is the purpose of your organisation? For some, such as the Crown Prosecution Service, the Police, the Olympic Delivery Authority, and some regulators, the answer is clear. But many are fuzzy about what they exist to do. This is sometimes because their purpose was badly defined in the first place, sometimes because of mission creep, and sometimes due to empire building over time.
Organisations without a clear purpose are likely to get bloated. The Higher Education Funding Council for England (HEFCE) says it exists to promote and fund “high-quality, cost-effective teaching and research, meeting the diverse needs of students, the economy and society.” With such an all-embracing remit, it is not surprising that it spends nearly £7 billion a year.
Once a quango knows its purpose, it then needs to systematically ask whether each of its departments contribute to it, and abolish those that don’t.
The next question is: do any other organisations do basically the same job? Duplicating tasks wastes money. Do we need both an ‘England Marketing Advisory Board’ and ‘Visit Britain’? Do we need ‘Working Ventures UK’, ‘The UK Commission for Employment and Skills’, and ‘The Learning and Skills Council’? The Taxpayers’ Alliance estimates that the water industry in England is monitored by no less than three different organisations.
The next question is: what is the best way to fulfil the purpose of the organisation? Because so many quangos have been created and grown up over the last nearly two decade-long period of growth, there has often been money to spare. And because there has been money to spare, all too often nobody has done any hard thinking about the best kind of organisation to fulfil that purpose. Would it better be done by a charity? A not-for-profit company? Or even a for-profit company, perhaps owned by the government, with revenues which contribute to reducing the tax burden?
In some cases, we need to ask – should it be an organisation at all? For example, the School Food Trust exists to “help all stakeholders ensure that young people eat better food at school.” A worthy goal, without doubt. But does it take 83 staff and £15 million to do it? Surely making kids eat better food in school just requires the cost of the better food and the political will to make it happen?
The next question is: if it does need to be an organisation, does it need to pay its employees so much? Over a hundred quango board members or executives earn over £100,000 per year, sixty-eight over £200,000 a year, and five over £300,000 a year.
Many quangos are started by politicians in reaction to passing media campaigns. Once the furore passes, the quango is forgotten, but it goes on sucking up taxpayers’ money. If the current uproar about quangos is to be of lasting use, politicians cannot just bloviate about them and move on. They must do the hard thinking about which to cut.