Friday, October 15, 2010

You know when you've been quangoed

And so the flames rise up around the quangocracy, but hardly a raging conflagration, more of a sputtering camp fire, because it has become apparent to the ministers now taking a hard look at the hated quangos that many of them actually perform useful functions. These will be redeployed into other organisations or subsumed back into government and some of the changes actually make sense - the idea of a three year review period isn't a bad one either, as it is clear that a number of the function performed by some of these bodies have actually fallen away or are no longer required.

The peculiar thing is that this is apparently being done to save money and to make accountable these unelected and apparently wildly out of control bodies. The first principle there seems distinctly dubious, as none of these supposed savings will be realised until 2012/13 at the earliest and it looks unlikely that there will be an awful lot of extra cash to drop back into the coffers. As we know, scrapping the RDAs has revealed liabilities of something north of £2 billion and there is plenty more iceberg there to be found, as will be revealed.

The HFEA is to be scrapped, even though only a small amount of the annual budget is actually paid by the government and that will be dwarfed by the costs of bringing the statutory regulatory activities back into government, with no real savings at the end of the process - restructuring between 2005 and 2009 cost £750 million. The Institute for Government has prepared an interesting report, Read Before Burning, which explains some of the issues at stake here. The vast majority of the non-departmental public bodies are tiny, with budgets of only a few thousand for secretariat duties - 80% of the quango spending is concentrated in just 15 of the 800 or so bodies and much of that tends to be grants funnelled through the organisations to others. Pieman Pickles gleefully scrapped the Audit Commission, but councils will still need auditors and the experienced personnel at that body are simply going to take their business into the private sector and increase their day rates to match the big players there, which will end up costing us taxpayers more.

If accountability is a key driver, then why are some bodies - like British Waterways - being outsourced to charity, beyond government and accountable only to the Charity Commission and their trustees? The FT rightly questions why ministers should have direct influence over the curriculum rather than leaving it to the QCA or whether bringing NHS appointments back in house will merely ensure a return to the days of outright political appointments. Sometimes, having an arms-length approach is actually the best way and it doesn't remove the accountability, hence the term 'quasi-autonomous' - they give the impression of being independent, but aren't completely on their own.

One of the worst decisions of the quango review is the imminent scrapping of Consumer Focus and Consumer Direct, plus the withdrawal of the consumer protection functions of the Office of Fair Trading. One of the key roles of the state has to be in evening up the relationship between the individual consumer and the big corporations who can ensure that the marketplace is a very inequitable playing field. I don't believe that local Trading Standards departments - which have already had cuts made , at least in part because of the existence of the advice functions of Consumer Direct - will have the capacity or the ability to provide the same weight as something like Consumer Focus. Birmingham's team have scored some great successes, not least with their imaginative use of the law to tackle cowboy clampers, which has seen one company boss sent down for two years for fraud, but even they have suffered cuts.

For example, understanding utility tariffs is a complex matter and a single utility can, when you account for different payment methods, have thirty or more tariffs available to the consumer. That level of knowledge is simply not present within the local authorities - even ones as large as Birmingham. Many will also lack the time and funding to go after the big players, so big wins like last week's £70 million victory for customers and Consumer Focus over an overcharging nPower will become things of the past.

We need to see what the government will be offering to Citizen's Advice to allow them to operate the Consumer Direct service, but it will need to be generous to ensure that there is no drop in service. The local CABs across the country make valiant attempts to offer a quality service, but there is no doubt that it is highly variable and dependent entirely on funding and the goodwill of a small number of dedicated volunteers. Without support from government, the CAB will not be able to maintain availability and quality of the advice currently available, which will disadvantage consumers as they try to access their rights. Some major cities have CABs which are nothing more than a couple of volunteers around the kitchen table.

As the increasingly-sceptical Financial Times put it,
Yet there is a sense that in our testosterone-fuelled political culture, ministers are out to shake everything up in the shortest possible time. Britain must be the only country in the world where we reorganise our institutions so often. It is a pity the coalition did not move a little more slowly and thoughtfully on the quango front.

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