Most western governments have set up many arms-length organizations to perform certain functions, but only the Brits have come up with a consistent name for them — Quangos: Quasi-autonomous non-governmental organizations. Governments love them because they can use them to accomplish their goals without taking responsibility for the outcome … and most of these Quangos are only theoretically accountable to the government that set them up:
High performing systems depend on accountability. Without it, they descend into mediocrity, error and delay, or become lost in busy-work and diversions that bear little relation to their goal.
How that accountability is applied can vary. In the private sector accountability is applied by the markets: failure to produce a product consumers want, at a price they are willing to pay will result in market exit. In the school system, the inspectorate holds schools to account, with failing schools branded inadequate and head teachers replaced. And a politician who fails to keep the electorate satisfied will be voted out of office. But while the methods may vary, the certainty of regular, consistently applied consequences for failure is an essential component of success.
It is therefore astonishing that, as Policy Exchange’s report, Mapping the Quangos painstakingly documents, the British State has chosen to outsource so much of the business of government into over 300 arm’s-length bodies with minimal accountability. These entities, collectively, have extensive powers to regulate the lives of businesses and individuals and spend hundreds of billions of pounds a year, yet they face no market discipline, no accountability at the ballot box and minimal consequences for failure. What accountability methods that do exist are weak, toothless and rarely used.
Ministers do, it is true, retain the power to issue guidance — or even to dismiss a failing quango chief. Yet the first is a weak reed, that in most cases quangos must only “take account of” rather than obey, and the latter perceived as a nuclear option, such that the political blowback is seldom worth the candle.
The result has been a public sector that has increasingly lost its way. £700 million for “fish discos” at our new nuclear power station, a hundred thousand homes blocked for “nutrient neutrality”, an ever growing flurry of paperwork that smothers our high streets and financial services. Regulation increases steadily without consideration for the cost to business — or the impact on frontline public services.
