Quangos – still undemocratic after all

Significant new research on quangos is published today by the Local Government Association (LGA) and reported in today’s Daily Telegraph as further evidence that quangos are ‘unrepresentative, closed to scrutiny and offer bad value’.

The LGA report examines eleven quangos which have close connections to the work of local government, ranging from the Environment Agency to the Regional Development Agencies (RDAs) and the mammoth new Homes and Community Agency (HCA). While these eleven bodies (or 19 if we count the RDAs as separate organisations) represent a fraction of the 790 Non-Departmental Public Bodies (NDPB) currently in operation, they account for around one quarter of their spending. The budget of the HCA alone clocks in at 10 per cent of all NDPB expenditure.

Focusing on what amounts to a spoonful of the agencies to be found in this alphabet soup of ‘government by acronym’, the LGA assesses the quangos against its own three principles of public service – value for money, accountability and openness. It does so using a ‘report card’ method in which each of the principles are examined using four quantitative and two qualitative criteria.

Thus, value for money is assessed using criteria such as ‘increase in grant in aid 2007-11, compared to increase in overall public spending’, the ‘percentage of the quango’s workforce earning in excess of £100,000’ and ‘whether the quango duplicates central or local government’. Each quango is scored on a report card and the scores translated into the increasingly familiar ‘traffic light’ system of red (serious problem), amber (cause for concern) and green (satisfactory).

The LGA’s criteria for assessing accountability and openness have much in common with those developed by Democratic Audit, which first exposed the serious lack of accountability, transparency and openness in the UK’s expansive quango state in a report published back in 1994. Seasoned quango-spotters might therefore wonder whether the LGA report tells us anything new - it does.

A variety of steps have been taken over the past 15 years to ensure that quangos operate in a more accountable and transparent manner - partly in response to the Audit’s findings. The LGA report quite appropriately notes that much has changed since the mid-1990s – hence there are rather more green ‘lights’ than one might anticipate, especially in the ‘openness’ category - while also stressing there is still a long way to go.

At the same time, while quangos often appear immortal, despite perpetual calls for metaphorical bonfires, the quango state is actually remarkably fluid. Unelected agencies are regularly merged, splintered, renamed and re-branded – and keeping track requires constant, painstaking research.

The research is detailed and thorough and the LGA have committed to publish their full data set relating to these eleven quangos on their website – which is likely to be of considerable interest to researchers at Democratic Audit and elsewhere.

There will be obvious scope for others to add to these data by seeking the equivalent information from the remaining 770 or so NDPBs. And why stop there? If anyone would consider funding the exercise, it would be invaluable to have such data for the 5,300 local quangos and 2,300 local partnerships and zone boards which the Public Administration Select Committee identified in 2001.

There are, of course, questions to be raised about the LGAs’ approach. The attempt to measure quangos on ‘value for money’ criteria carries obvious risks in a climate in which the search for public expenditure cuts has begun in earnest and, methodologically, it is here that we find the report’s obvious Achilles’ heel.

For example, the report notes that quangos have a higher proportion of staff earning £100,000 plus than in local government. Leaving aside the fact that senior local government salaries are among the highest in the public sector as a whole, is it really appropriate to use senior salaries as a measure of ‘value for money’? Rather, isn’t it a social justice concern that public money is used to pay senior executives up to 20 times more than the lowest paid member of staff in their organisation?

Likewise, should we really be concerned that the budget of the Environment Agency has increased at a faster rate than the public sector average? As the LGA notes, this increase reflects large-scale investment in managing flood risks. Surely the real issue here is the lack of direct democratic control over this expenditure, not the rate of increase?

The LGA’s report also highlights a wider danger. The report stresses that the most fundamental concern about the accountability of quangos is that they are unelected. Yet, using report cards to assess accountability actually relegates concerns about the unelected nature of quangos – defining them as one of six criteria.

This approach reflects a broader shift in contemporary notions of democratic accountability - as ‘representative democracy’ becomes increasingly displaced by what John Keane calls ‘monitory democracy’. Keane argues that political practices have become less subject to challenges arising from party politics and elections and more subject to challenge via the measures used by a myriad of regulatory bodies and independent organisations to ‘monitor’ democratic processes. Democratic Audit itself is a prime example of this shift – although we have always argued that the steady erosion of representative democracy is at the very heart of the flaws in our political system.

The quango state is merely one facet of that much wider malaise – but we must always come back to its source. The title of the LGA’s report asks: ‘who’s in charge?’ This is neither the question which the report seeks to answer nor is it the right one to ask. It is relatively easy to find out who runs the quango state.

The questions we should be asking our quangocrats, regardless of how much they are paid, were outlined by Tony Benn long ago: ‘What power have you got? Where did you get if from? In whose interests do you exercise it? To whom are you accountable? And how can we get rid of you?’ And as Tony Benn also reminded us: ‘if you cannot get rid of the people who govern you, you do not live in a democratic system’.