Q. When is an agency not an agency?
Welcome to the confused subject of armâ€™s length government.
At the launch of the Institute last year, Cabinet Secretary Sir Gus O’Donnell singled out the tangled landscape of armâ€™s length government as a suitable case for ‘IFG treatment’.
One yearâ€™s research, seminars and discussions on, we have published Read before Burning, our recommendations for sorting out this confused landscape.
A key recommendation is to untangle the current confused designation of public bodies â€“ and relate form and governance much more closely to function and the freedom the body needs to perform that function.
Although ALBs in total account for about 14% of government spending, the big money is tied up in just a few organisations â€“ and even then 75% of NDPB spending is passed on to third parties. Â If we are to get real efficiencies and better governance, we need remove the temptation to treat arm’s length government as a numbers game.
Half ALBs are small advisory bodies with no independent budget or staff. They advise, not execute.Â We think they should simply be treated as what they are – departmental advisory committees and no longer be regarded as part of arm’s length government.
For the rest, we would get rid of the confusing categories of non-Ministerial departments and executive NDPBs and replace them with three new, distinct categories:
- Constitutional bodies â€“ answerable to Parliament, not Ministers (like the NAO or Electoral Commission)
- Independent Public Interest Bodies â€“ regulators, standard setters, watchdogs â€“ which need to be protected against Ministerial interference (think Ofgem, UK Statistics Authority and the new Office for Budget Responsibility)
- Departmental Sponsored Bodies â€“ with some discretion on what they do, or needing expertise on how to do it Â â€“ but operating within departmental strategy (for example, the Arts Council and the Environment Agency)
The Government could make the change either as a big bang or over time as bodies were reviewed. But is the hassle worth it?
On paper this looks like a prime piece of bureaucratic tidymindedness â€“ and potentially an excuse to waste public money on new logos and letterheads for no real change.
But our research suggests that a big part of the ALB problem is:
- a lack of clarity on roles and responsibilities
- a lack of transparency with the public
- an inconsistent approach to managing ALBs across government â€“ which leads to tension, duplication and real inefficiency.
So there are potential real gains for Ministers, civil servants, people working in ALBs and, most importantly, the public, from a clear and common understanding of the relationship to government of different types of body.