Quangos: The Unseen Government of the UK

[Marmora Man]

Libertarians Unite!

Small government, strong defence, low taxes.

In this weekend's Sunday Times, the Tax Payers Alliance launched the full list of the UK?s quango industry, a detailed run-down of the staff and cost of the 1,162 bodies, boards and agencies that make up Britain?s Unseen Government. It is now five years since the Parliamentary Select Committee on Public Administration recommended that the Government publish such a list, a recommendation that the Government has failed to fulfil. In the absence of an official list, the TPA has compiled one instead, providing the public with the most comprehensive information available on the organisations that increasingly spend their money and influence their lives without democratic oversight.

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The report is the first in a series of papers on the Structure of British Government and the problems caused by?its?bewildering scale, staggering range of activities and chaotic duplication.

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The full report can be read here.

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The key findings of the report are:

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There are 1,162 quangos in the UK, running at a total cost to the taxpayer of ?64 billion, equivalent to ?2,550 per household.

Even under the Cabinet Office?s restrictive definition of quangos, the cost of these bodies has risen 50% in the last ten years. UK quangos now employ an army of almost 700,000 bureaucrats.

Even the Government itself does not know the full extent of the unaccountable quango industry, which ranges from the massive e.g. Job Centre Plus (Staff: 70,042, Cost: ?3.5 billion) the Courts Service (Staff: 19,986, Cost: ?704.8 million); to the bizarre e.g. the British Potato Council (Staff: 49); the West Northants Development Corporation (Staff: 34, Cost: ?15.3 million)

When the total number of quangos is added to the other government subsidiaries such as local authorities and NHS trusts, the total number of organisations controlled by the UK Government rises to 2,063, costing the taxpayer ?257 billion and employing over 5.1 million people.

Wider Context: UK Government - impossible to manage

Over the past hundred years Britain has witnessed a relentless increase in?the size of government. Politicians have steadily taken responsibility and authority away from civil society, establishing a presence in every aspect of British life. Government today spends 45.1 per cent of Britain?s GDP, employs nearly 20 per cent of the UK workforce and regulates or provides almost every service available to UK citizens.

Too large: Government employs just under 6 million people and has an annual expenditure of almost ?600 billion. Twenty senior ministers and around 500,000 civil servants oversee 1,162 public bodies, 365 NHS Trusts, 469 Local Authorities, 60 police forces (140,500 officers) and countless other local and regional spending bodies. No-one could effectively manage such an organisation, and as such British government suffers from terrible inefficiencies, waste, and ultimately depreciation in the quality of services provided.

Too diverse: Effective management requires an in-depth knowledge of the sector in which the organisation operates, its customers and processes. Yet the breadth of government today makes this impossible. No Minister, or anyone else, could have sufficient knowledge to agree the vision, objectives, plans and budgets for any department of government; their interests are just too diverse. For example, the predecessor to today?s Department of Business, Enterprise and Regulatory Reform (BERR), the Department of Trade and Industry, in 2006-07 managed an expenditure of ?23 billion, 244,000 staff (there are only four FTSE companies larger) and 68 subsidiary public bodies ? advising on everything from employment, architectural design to chemical weapons, not to mention the activities of two major British corporations, Royal Mail and Remploy. Astonishingly, the DTI still only constituted a small unit of government, accounting for only 3% of total staff and 4% of total expenditure.

Monopoly services: Free from the threat of customer loss or bankruptcy, monopolies remove the basic tools of management ? the need to innovate, improve and reduce costs. The services government provides ? education and health in particular ? exist as monopolies, presenting the majority of tax payers with little choice and ever sinking standards.

Judge on the outcomes ? Failing public services

The inadequacies of our current structure of government are clear when the quality of services is considered.

Education: Four out of ten pupils in state education now leave school without the minimum standards in English and Maths that the QCA deems necessary for ?Life, Learning and Work?. After 11 years of schooling, at a total cost of ?75,000, the state system fails to provide individuals with the means necessary to succeed, trapping them in poverty and dependency. Year on year, British educational standards fall in comparison to other wealthy countries.

Healthcare: The standard of care provided by the National Health Service is now ranked 16 in a comparison of 19 peer countries. In 2004 alone, 17,157 deaths amenable to healthcare occurred in the NHS, which would have been avoided in Britain matched the performance of European peers. Levels of hospital-acquired infections are among the highest in Europe and waiting times continue to force people abroad for treatment.

Welfare: The complex system of tax credits, allowances and income support has created a welfare trap, while at the same time necessitating a large and costly bureaucracy to administer it.

Nothing but fundamental structural reform can reverse the trend of declining standards in our public services. Government is poorly designed to deliver the services which people deserve, and after a decade of spending, money alone is clearly not the answer. The principles of reform

1. To give the public a higher quality and wider choice of services at a greatly reduced cost, and most importantly, return control over their lives:

2. Politicians, advised by a small, informed team of civil servants, should set high level policy. This is the area where they can make a real contribution, freeing them from day to day management responsibilities.

3. Civil society, employing experienced management, should execute that policy.

[macroban]

Is Mamora Man's employment at least partially funded by a quango?

[SeanMacGabhann]

MM - you recently asked what it was about lefties that made them worried about right wing policies

You've just answered the question for me..

who published the report again? "Tax Payers Alliance " - well, let's not question THAT source

Whilst never once defining what qualifies as a "quango", yet painting every man-jack one of them as A Bad Thing, that is the most self-serving garbage I've read in a while. Sorry MM

That's presented as a bad thing with no justification - do YOU want to go back 100 years? When walking the streets of London or pretty much any damn town was a darn sight more dangerous than it is now? Do you really think government (the general concept, not THIS mob) is a self-evident bad thing? You can't list any progress made by government in the last 100 years? Of course you can but it woul deflate too much of your argument to do so

You don't think, that rather than quangos, it is in fact big-business, with it's constant threats to leave the country if it is made to pay the same (or lower) tax-levels than you and me is more of a thread to democracy? It's contsant siren calls to "listen to me, here's a few bob, can I have a knighthood and favourable legislation?"

I make no claims for modern governments efficiencies, but to hand over the running of the above categories to private companies (the aim of this lot) is one that I will fight to the end

And speaking of fighting, what;s with this "strong defence" mantra - we seem to be spending a hell of a lot more on attack than defence at the moment. So, some gobshite terrorists attacked us an succeeded a couple of years ago - not the first and not the last time in the last few hundred years is it - but we reacted as if we had never HEARD of such a thing

Let's address the Public service failings listed above:

Education - 4 in 10 without minimum standards. Want to roll that back 100 years before government became too big and see what the figure was then? Want to declare what the minimum standard even was back then? (and if any woman bothers defending this, bear in mind you didn't even have the vote 100 years ago)

Healthcare: of those 15 countries above us, who are they and how big are their governments? DO we need more or less to deliver on that score?

Welfare: No question an unwieldy and inconsistent system in place - I doubt this lot have any answers mind you.

Let's cut through the crap - what is wanted by the TPA is nothing more than "I'm alright jack, screw you" philosophy. A dog-eat-dog world. Well.. dogs fight dirty - so if it ever comes about...

Jesus if I ever calm down I might even make a proper argument out of this...

[lozzyloz]

I'm all for efficiency and cost effectiveness but surely 700k people in employment is a good thing and the majority of these Quango's provide an important service which would never be funded commercially.

[Asset]

macroban Wrote:

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> Is Mamora Man's employment at least partially

> funded by a quango?

nah, just the Tory party

[SeanMacGabhann]

Truthfully I think MarmoraMan is definitely more libertarian than Tory

[Asset]

ok, how about tory

[macroban]

>>macroban Wrote:

>>-------------------------------------------------------

>> Is Mamora Man's employment at least partially

>> funded by a quango?

> nah, just the Tory party

PCT?

[Marmora Man]

macroban Wrote:

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> Is Mamora Man's employment at least partially

> funded by a quango?

Absolutely not - I work for a private company, created 12 years ago in someone's spare room.

[lozzyloz]

You're LTJ Bukem's sound engineer?

[SeanMacGabhann]

actual, not-internet-shorthand, laugh out loud, loz >:D

[Marmora Man]

lozzyloz Wrote:

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> I'm all for efficiency and cost effectiveness but

> surely 700k people in employment is a good thing

> and the majority of these Quango's provide an

> important service which would never be funded

> commercially.

Muddled thinking Lozzy - people on the government payroll are a cost. I don't doubt that the government must employ some people to direct its business but its purpose must not be simply to give them a salary - they should generate value (in the broadest sense - not strictly financial).

[Marmora Man]

SeanMacGabhann Wrote:

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> MM - you recently asked what it was about lefties

> that made them worried about right wing policies

>

> You've just answered the question for me..

>

>

> Jesus if I ever calm down I might even make a

> proper argument out of this...

Sean - you have misread my argument. I don't doubt that things are better today than they were 100 years ago. I am not proposing a return to government expenditure of 5% of GDP. My point is that government is too big and that by trying to manage almost everything it fails to do anything very well. I question the thinking that believes government must "do something". There was an effective healthcare service before the NHS, there was an effective education service before Rab Butler's act in 1944.

Question - do you think the country will really miss or suffer if the British Potato Council or the West Northants Development Corporation were to be disbanded? If you agree we could lose them without worrying perhaps there are grounds for reviewing further the need for other such organisations? I may wish to go further than you would - but surely we can agree there is scope for action that would reduce government costs - why perhaps it could fund a 10p tax band without recourse to borrowing.

This is just a taster of a reply - I'm waiting to test opinions and arguments more fully - its time to have a good political thread again.

Remember I'm not a right wing bastard - I'm a libertarian. By instinct I want the minimum of state interference in peoples lives, but I do accept that there needs to be assistance for those that are unable to help themselves for whatever reason.

PS: The strong defence bit is a personal "thing" - an ex service man I am frustrated that this government thinks it can deploy military personnel unthinkingly as a kind of international moral police force / fire brigade yet at the same time leave them underfunded and ill equipped. The latest ideas of reviving the Royal Tournament and making attacks on military personnel in uniform an aggravated offence are just petty and, almost, face saving gestures.

[spadetownboy]

zzzzzzzzzz...........

[dc]

Marmora Man Wrote:

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> Question - do you think the country will really miss or suffer if the British Potato Council or the West Northants Development Corporation were to be disbanded?

The British Potato Council is one of a number of 'Levy Boards'. It's an industry organisation paid for entirely by producers and wholesale purchasers of potatoes. So, no, we wouldn't suffer if it went but, as none of our taxes are being used to pay for it anyway, we're not suffering now are we? The British potato industry just might be a little bit miffed I suppose.

As for the West Northants Devt Corporation - I know nothing about it. I assume it is basically a Planning Authority covering a number of Council areas in the same way the London Docklands Development Corporation used to be. Usually they are set up for a particular purpose (often regeneration and economic development) with a limited shelf-life as was the case with the LDDC.

If the best the 'Taxpayers Alliance' can come up with is distorting the truth by encouraging people to think: 'I can't believe my taxes are being spent on (pause for quick chortle) The British Potato Council' when they plainly aren't, well..... it's just a bit crap really.

[SeanMacGabhann]

Indeed dc, indeed

MM - I don't think I did misunderstand your post. It's all very chucklesome (to some) to pick on potato boards and whatnot, but the general thrust of the argument is much wider, and for me, quite scary

Indeed you even undermine your whole point by saying how important defence is to you - yet for many people we could save near trillions by scaling the whole operation back.

I don't want (and that's too weak a phrase to fully express how I feel) a much tinier government, with a low tax rate and all of the "services" "managed" by private companies. Private companies with shareholders. And a captive market. Where those companies merge and become a monopoly. With shareholders to feed.

Running a country IS a big operation - why shy away from that? And a country this big can certainly afford it (even if the burden is too much on the less well off at the moment)

Let's just say you achieve your libertarian aims - and you have a 10p tax rate with a smaller government. How exactly will your life be better?

[Marmora Man]

dc Wrote:

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>

> The British Potato Council is one of a number of

> 'Levy Boards'. It's an industry organisation paid

> for entirely by producers and wholesale purchasers

> of potatoes. So, no, we wouldn't suffer if it went

> but, as none of our taxes are being used to pay

> for it anyway, we're not suffering now are we? The

> British potato industry just might be a little bit

> miffed I suppose.

If potato producers are required to pay a levy - that is a cost to them. In the same way that staff, seed, harvesting etc is a cost. When they sell their potatoes they recover those costs + their margin. So ultimately the Potato Board Levy comes thru' as a tax on potato consumers.

As for Northants Development Corporation - how many layers of government do we need? Every unnecessary councillor is a tax on everyone.

[Marmora Man]

SeanMacGabhann Wrote:

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Indeed you even undermine your whole point by

> saying how important defence is to you - yet for

> many people we could save near trillions by

> scaling the whole operation back.

Not Trillions - Defence Budget approx ?40billion pa, so 25 years would equate to ?1 Trillion. I'm not suggesting it be expanded or that, de facto, defence spending is a necessary good. However, if the Gov't persists in engaging in unnecessary wars it should fund the troops properly.

10 years ago I proposed the privatisation / outssourcing of the Armed Forces. I may still have a copy of the paper, if so I'll PM it to you.

The strong defence phrase was also an ironic historical reference to Tory aims of the 19th century

>

> I don't want (and that's too weak a phrase to

> fully express how I feel) a much tinier

> government, with a low tax rate and all of the

> "services" "managed" by private companies. Private

> companies with shareholders. And a captive market.

> Where those companies merge and become a monopoly.

> With shareholders to feed.

>

Again - that's not what I'm suggesting - there are more than two alternatives - it is not big government versus private greedy corporations (and by the way - the assumption that business / shareholders are a bad thing may be as weak an argument as you claim mine is for smaller government). Before healthcare in this country was nationalised in 1948 every village, town and city had a range of provision that encompassed the local GP and nurse, charitable hospitals, locally funded hospitals, privately funded hospitals. The creation of Saturday Clubs pre-dated the creation of BUPA to allow people to provide an insurance for health costs.

Similarly education - church schools, charitable schools, bursaries - all managed to provide an education service with minimal government input.

> Running a country IS a big operation - why shy

> away from that? And a country this big can

> certainly afford it (even if the burden is too

> much on the less well off at the moment)

Since 1945 the concept of the State running much of life has been tested to detruction and, in my view failed. Where are the successes of central planning and control?

Powerful state = weak individuals. Powerful individuals = weak state. A powerfulstate introduces ID cards, monitors your every movement on CCTV, wants to monitor every e-mail and keystroke on your PC, tells you how many apples to eat each week, how many units of alcohol are allowed, tells your child what to study at school, rations your access to healthcare and education. I could go on.

Why do many on the left assume central state / government decisions are better than a mass of individual decisions, that individuals cannot be relied upon to "do the right thing" and will become self interested brutes? This is at the same time both a pretty disappointing set of beliefs and rank hypocrisy - since it implies "they" know better then "them". I don't seek to make decisions for you and I don't wish others to make decisions for me - unless I have chosen to approach them for advice or help.

My position is that we should not accept blindly that State provision is best - we should constantly question whether we are getting value for money. We do that every day when we make decisions about personal spending on all types of goods. Tax is another form of spending - are we getting value for money - would be do better with a high cost, low quality or a lower cost / same quality - or best of all - lower cost / higher quaity service?

Some level of goverment control and spending is necessary - I contend that we should reduce it to a minimum.

> Let's just say you achieve your libertarian aims -

> and you have a 10p tax rate with a smaller

> government. How exactly will your life be better?

Everyone will have more money in their pocket to do with as they wish. An individual may choose to reduce their working hours and devote the spare time to good works, fishing, running a scout troop or just sitting and thinking. They might choose to spend the extra money on art, books, fine wine - they may donate it to a charity, they might save until they have enough to endow a college, they might just p*** it up against the wall - their choice.

That, to my mind equates to greater freedom - with greater freedom everyone benefits. We've had this argument before. Government management and spending is inherently inefficient, individual spending is more efficient.

Edited for emphasis.

[macroban]

Outsourcing armed forces = mercenaries?

[david_carnell]

Goodness. This is almost impossible not to fisk but I'll try. SeanMcG has eloquently expressed many of my opinions already but I think I'd like to make a few points.

The good ol' British Potato Board always takes a battering on these sorts of arguments as an example of govt. spending gone mad. As dc and Sean pointed out it is industry funded and no more a tax on potato consumers than the CBI is for businesses.

On defence, I'm not convinced we need to spend more but we certainly need to spend better. Both Labour and Tories have committed catastrophic procurement errors in the past (Apaches, SA80s, Tornados etc etc) and this certainly needs to be more effective. As an ex-forces chap, MM, you'll know this is often due to competing needs of the different services as much as incompetent senior officers and civil servants. Not to mention the disaster that is BAESystems (although I could have a whole other thread on this). Private armies are already used extensively by both the MoD and the private sector to carry out tasks that the army don't have the manpower for. They are rather unaccountable, however, and very expensive. Wiki "BlackWater scandal" for examples of how it all goes horribly wrong.

I know what you mean when you say that the state should not dictate to people what is best for them but I think on matters such as healthcare and education many people are not (and I'm desperately trying not to use the word intelligent) "forward-thinking" enough to always make the best decisions for themselves. Why should I bother to invest in private healthcare when I'm young and healthy? The reason the state provides these servies through taxation is to ensure that everyone is cared for regardless of their own shortcomings. The same applies to the state pension and free education. It is not a perfect system by any means but I don't think a pre-1945 model of healthcare would be pertinent today.

I agree entirely that govt. spending should be held to account and I think Select Committees and bodies like the NAO do this effectively. Govt does have shareholders - they're known as voters. If you think govt wastes your money you can vote them out. In a fair market the libertarian tells us to choose another supplier but I have doubts as to whether "fair" markets will truly exist. Look at the examples of privatisation that took place in the 80s and 90s and ask whether we're really getting better value for money? It is a mixed bag at best. The most recent example found that the opening up of the postal market had had no noticeable effect on the quality of service but had raised prices.

Health and education are not goods to be bought and sold by the private sector like commodities. They are intrinsic human needs and as such, I believe, cannot be provided on a for-profit basis. There is improvement needed, without doubt, but the day MegaCorp run my local hospital or school is the day I move to Venezuela Sweden.

[DaveR]

MM, I reckon it's just you and me on this one. Your basic point is echoed by Jamie Whyte in the Times today - here

The key point is, as you say, that education and healthcare were not invented by government - these are things that people want and will organise for themselves in any event. Many other bodies (quangos in particular) do things that nobody wants or needs, and do them inefficiently because the first rule for any individual or organisation that is not dependent on customers is to ensure it's own survival i.e. never attempt to fix the problem you are supposed to be fixing, because then you are out of a job.

It comes back to the 4 types of expenditure:

(i) I spend my money on myself - say buying a car. I will make sure I get the best quality car for the lowest price.

(ii) I spend someone else's money on myself - say buying a company car. Who cares about price - ?500 extra for metallic paint - no problem!

(iii) I spend my money on someone else - say buying my mother-in-law a car. Who cares about quality - ?100 for a 10 year old Lada Riva - perfect.

(iv) I spend someone else's money on someone else - I'm a civil servant buying cars. Quality, price, whatever - I'm never going to see the car, and next year I'll be buying tanks or pencils or heart monitors.

All public spending is, by definition, type (iv).

[david_carnell]

Do I want my children's schooling to be run by the lowest bidder in a dutch-auction?

Do I want my hospital to be staffed by those on the lowest wages to reduce overheads?

Should these areas be run "for-profit" or should we accept that is almost impossible and merely look for the best service and try to reduce inefficiencies as sensibly as possible?

To get back on topic somewhat - QUANGOs - who says no one wants them and they provide no service. Not to you perhaps. But to someone. I don't benefit from meals-on-wheels but my council tax goes towards them. I don't object to this but believe it to be socially beneficial that I help old people not starve-to-death.

[Marmora Man]

david_carnell Wrote:

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> Health and education are not goods to be bought

> and sold by the private sector like commodities.

> They are intrinsic human needs and as such, I

> believe, cannot be provided on a for-profit basis.

> There is improvement needed, without doubt, but

> the day MegaCorp run my local hospital or school

> is the day I move to Venezuela Sweden.

Why are they not commodities to be bought or sold. What is the intrinsic property that they have that makes them something that should not be traded?

For the not so "forward thinking" there should and must be a system that provides but most people can think, plan and calculate what is best for them.

Health and education are, in any case, already traded - Eton, Harrow, the private nursery down the road, etc are all providing education in return for fees. The majority of the schools concerned do not make a profit - many are charities (tho' this may change) dedicated to the provision of schooling. Funds in excess of costs are used to invest in other education activity. Ditto health - I can use a private GP, a private hospital - in these cases some are doing it for profit, others are doing it in not for profit way.

I am not proposing Mad Max style anarchy - merely a slightly smaller government.

Two other points - I believe it is in Sweden that parents can opt to use state funds to create their own private schools -taking the actual management, but not funding, of education away from the State. Effectively parents trading with the state for education.

Instead of the Potato Board as a whipping boy - where do you stand on the Government Hospitality Advisory Committee on the Purchase of Wine? (Apart perhaps from wanting to join the tasting panel?)

[Marmora Man]

DaveR Wrote:

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> MM, I reckon it's just you and me on this one.

> Your basic point is echoed by Jamie Whyte in the

> Times today - here

>

Thanks - I haven't seen the Times today. Nice to know I'm not totally alone in my campaign.

[Marmora Man]

macroban Wrote:

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> Outsourcing armed forces = mercenaries?

The basic premise was that the State should pay to maintain a standing Army, Navy and Air Force at a decent level of equipment and training. In the event the State wishes to deploy the troops the Chiefs of Staff would estimte the cost and inform Ministers. MInsiters ould then decide whether they could afford the cost.

I'll see if there's a way to post the paper on this site - but I thinks its about 20 + pages so needs to be a link of some kind.