Business, Innovation and Skills

June 11, 2009 1:44 PM

Among the parlour games played at Downing Street last week (musical chairs, pin the blame on the Musical chairs donkey, smash the Brown pinata, etc), pass the parcel was the one most emphatically won by Peter Mandelson. Every time the music stopped, the good Baron was holding the parcel, a wry smile on his face.

The prizes at every stage were generous: titles, prestige, influence. But at the heart of the parcel, the biggest prize, sat a new department; 'BIS', the Department for Business, Innovation and Skills. This new fiefdom, sprawling across SW1 and the Government's policy agenda, is a suitable home for the man who is now Labour's most powerful minister (including the prime one). The old shack, concentrated mainly on regulating business, just didn't cut the mustard for the UK's new 'First Secretary of State and President of the Council'.

The product of a merger between BERR (the Department for Business) and DIUS (the Department for Innovation, Universities and Skills), BIS will - just like its predecessors - "build Britain’s capabilities to compete in the global economy".

To this end, BIS will "design tailored policies for sectors of the UK economy that represent
key future strengths and where government policy can add to the
dynamics of the market"
and "invest in the development of a higher education system committed to
widening participation, equipping people with the skills and knowledge
to compete in a global economy and securing and enhancing Britain's
existing world class research base"
, along with 11 other simple aims.

It is, in short, a monster department, a hybrid of two significant ministries that were only created themselves back in 2007 (at a cost of £7 million). Moreover, it is a department with so many responsibilities that its focus is unclear; business, further education, trade?

Universities and FE are probably the greatest losers out of this merger, being quite clearly made subservient to Government's business agenda. Indeed this machinery of government change was less a merger, and more - as in actual business - a takeover. Mandelson's old business department (BERR), itself of disputable value, has absorbed the fairly lacklustre department responsible for universities and science funding, confirming to the Government's many critics within the University sector, that it has long seen them as just a laboratory for future business ideas. Never before have the commentators on the Times Higher Education Supplement website sounded so vitriolic.

Considering the importance of our university and science research sectors, it's disheartening to see them treated like bargaining chips in the political machinations that have kept Gordon Brown in No. 10. But the problems with this take over, carried out so glibly by the Government, go beyond its relegation of further education.

Such machinery of government changes are fundamentally bad for scrutiny and accountability, and ultimately for good governance. Occasionally there are good reasons to abolish a department, create one or merge two, but such occasions are rare. As the Public Administration Committee found in its report on this issue, Governments use the power too readily, for purely political reasons, failing to acknowledge the impact they have. It's not just financial cost - although this re-branding exercise will cost taxpayers up to £3 million - but rather the impact on the House of Commons; Committees have to be abolished and reformed, MPs have to reorientate themselves. In this particular case, MPs sitting on the BERR select committee, just two years into the job, probably beginning to get to grips with the department and impose some proper scrutiny, are now faced with a new beast, larger and more complex. The DIUS select committee has been abolished.

Constitutionally too, BIS poses some problems. Lord Mandelson, who was not elected and does not sit in the Commons, is now responsible for one of the biggest departments in Government. It will be at the centre of the Government's interventions in the economy, single market and education, but MPs will not be able to hold to him to account. He also sits on top of a departmental hierarchy that boasts 10 ministers, (the Treasury only has 4), many of whom are members of the Lords (see here). As the Government supposedly leads us into a new era of transparency and accountability, of reform and renewal, BIS embodies a very expensive and retrograde step.  

But along with Downing Street's decision to withhold the details of the inquiry into Shalid Malik's indiscretions, BIS really sums up the approach that is being crafted. Talk the talk but don't walk the walk; do anything to preserve power, even at the expense of good governance; give power to those with political skill, marginalise those that don't. Unfortunately it's us that lose out from this strategy: taxpayers, students, businesses. Let's hope that the 'other place' (the Lords) is up to the challenge of keeping a close eye on the new Department for Business, Innovation and Skills. 

Among the parlour games played at Downing Street last week (musical chairs, pin the blame on the Musical chairs donkey, smash the Brown pinata, etc), pass the parcel was the one most emphatically won by Peter Mandelson. Every time the music stopped, the good Baron was holding the parcel, a wry smile on his face.

The prizes at every stage were generous: titles, prestige, influence. But at the heart of the parcel, the biggest prize, sat a new department; 'BIS', the Department for Business, Innovation and Skills. This new fiefdom, sprawling across SW1 and the Government's policy agenda, is a suitable home for the man who is now Labour's most powerful minister (including the prime one). The old shack, concentrated mainly on regulating business, just didn't cut the mustard for the UK's new 'First Secretary of State and President of the Council'.

The product of a merger between BERR (the Department for Business) and DIUS (the Department for Innovation, Universities and Skills), BIS will - just like its predecessors - "build Britain’s capabilities to compete in the global economy".

To this end, BIS will "design tailored policies for sectors of the UK economy that represent
key future strengths and where government policy can add to the
dynamics of the market"
and "invest in the development of a higher education system committed to
widening participation, equipping people with the skills and knowledge
to compete in a global economy and securing and enhancing Britain's
existing world class research base"
, along with 11 other simple aims.

It is, in short, a monster department, a hybrid of two significant ministries that were only created themselves back in 2007 (at a cost of £7 million). Moreover, it is a department with so many responsibilities that its focus is unclear; business, further education, trade?

Universities and FE are probably the greatest losers out of this merger, being quite clearly made subservient to Government's business agenda. Indeed this machinery of government change was less a merger, and more - as in actual business - a takeover. Mandelson's old business department (BERR), itself of disputable value, has absorbed the fairly lacklustre department responsible for universities and science funding, confirming to the Government's many critics within the University sector, that it has long seen them as just a laboratory for future business ideas. Never before have the commentators on the Times Higher Education Supplement website sounded so vitriolic.

Considering the importance of our university and science research sectors, it's disheartening to see them treated like bargaining chips in the political machinations that have kept Gordon Brown in No. 10. But the problems with this take over, carried out so glibly by the Government, go beyond its relegation of further education.

Such machinery of government changes are fundamentally bad for scrutiny and accountability, and ultimately for good governance. Occasionally there are good reasons to abolish a department, create one or merge two, but such occasions are rare. As the Public Administration Committee found in its report on this issue, Governments use the power too readily, for purely political reasons, failing to acknowledge the impact they have. It's not just financial cost - although this re-branding exercise will cost taxpayers up to £3 million - but rather the impact on the House of Commons; Committees have to be abolished and reformed, MPs have to reorientate themselves. In this particular case, MPs sitting on the BERR select committee, just two years into the job, probably beginning to get to grips with the department and impose some proper scrutiny, are now faced with a new beast, larger and more complex. The DIUS select committee has been abolished.

Constitutionally too, BIS poses some problems. Lord Mandelson, who was not elected and does not sit in the Commons, is now responsible for one of the biggest departments in Government. It will be at the centre of the Government's interventions in the economy, single market and education, but MPs will not be able to hold to him to account. He also sits on top of a departmental hierarchy that boasts 10 ministers, (the Treasury only has 4), many of whom are members of the Lords (see here). As the Government supposedly leads us into a new era of transparency and accountability, of reform and renewal, BIS embodies a very expensive and retrograde step.  

But along with Downing Street's decision to withhold the details of the inquiry into Shalid Malik's indiscretions, BIS really sums up the approach that is being crafted. Talk the talk but don't walk the walk; do anything to preserve power, even at the expense of good governance; give power to those with political skill, marginalise those that don't. Unfortunately it's us that lose out from this strategy: taxpayers, students, businesses. Let's hope that the 'other place' (the Lords) is up to the challenge of keeping a close eye on the new Department for Business, Innovation and Skills. 

Latest Blogs:

TaxPayers' Alliance Icon

The sugar tax and the public finances

6:00 AM 05, Dec 2016 Harry Fairhead

TaxPayers' Alliance Icon

Working for the taxman

6:00 AM 26, Nov 2016 Harry Fairhead

TaxPayers' Alliance Icon

Further thoughts on the Autumn Statement

4:56 PM 24, Nov 2016 James Price

TaxPayers' Alliance Icon

Have we had too much austerity?

10:57 AM 23, Nov 2016 Alex Wild