Justifying their existence

August 24, 2010 3:36 PM

In our book How to cut public spending we recommended getting rid of Comprehensive Area Assessments. This would leave the Audit Commission to audit accounts, so we were among those surprised to hear the news that it is to be scrapped. But the move is a good one – they have never had the robust reputation enjoyed by the National Audit Office, the other public sector auditor. As well as direct savings, many local authority staff estimate that millions more will be saved as staff can focus on their jobs as opposed to satisfying the Audit Commission. Additionally, the idea that councils pick who audits their accounts – based on competitive contracts and value for money and subject to proper accounting rules – is good for those who want to see less top-down central government control. Spending transparency will help too, as council spending over £500 becomes ever more common.

The Telegraph's Leader article today discusses the significance of Eric Pickles' decision for the rest of the quango state. The tag line reads: "Every quango should be made to justify itself to the breezily brutal Communities Secretary, Eric Pickles". And while the rhetoric of the Telegraph's editorial - "every quango should have to reapply for its job" - will irk some people, the sentiment is correct: a full-scale assessment of what the state should and shouldn't be doing is needed.

Quango bosses should go before the select committee to which they are accountable at least annually. Those outside departmental structures (e.g. agencies not on the Cabinet Office's NDPB list) should be subject to this too. They should have to account for their performance, expenditure and plans for next year's budget. This way, MPs will have genuine authority to check any quango that starts to stray beyond its remit. Of course, another positive is that MPs would play a far more significant role in determining overall departmental budgets, to some extent checking ministerial dominance.

For political anoraks, the exchanges in Select Committee hearings can be very interesting. The MPs that sit in them are usually committed, knowledgeable and robust, whatever end of the spectrum they sit. In fact, the lack of accountability is one of the biggest problems people have with quangos - subjecting them to more scrutiny by elected politicians could solve quite a few problems.

Our position is clear: there is plenty of fat left to trim. Bodies like the Carbon Trust and the School Food Trust, for example, could be scrapped. Equally important is an open approach from the Government: if a function is not needed, bin it; if a function is essential but would be performed more efficiently elsewhere then the Government need to say so.In our book How to cut public spending we recommended getting rid of Comprehensive Area Assessments. This would leave the Audit Commission to audit accounts, so we were among those surprised to hear the news that it is to be scrapped. But the move is a good one – they have never had the robust reputation enjoyed by the National Audit Office, the other public sector auditor. As well as direct savings, many local authority staff estimate that millions more will be saved as staff can focus on their jobs as opposed to satisfying the Audit Commission. Additionally, the idea that councils pick who audits their accounts – based on competitive contracts and value for money and subject to proper accounting rules – is good for those who want to see less top-down central government control. Spending transparency will help too, as council spending over £500 becomes ever more common.

The Telegraph's Leader article today discusses the significance of Eric Pickles' decision for the rest of the quango state. The tag line reads: "Every quango should be made to justify itself to the breezily brutal Communities Secretary, Eric Pickles". And while the rhetoric of the Telegraph's editorial - "every quango should have to reapply for its job" - will irk some people, the sentiment is correct: a full-scale assessment of what the state should and shouldn't be doing is needed.

Quango bosses should go before the select committee to which they are accountable at least annually. Those outside departmental structures (e.g. agencies not on the Cabinet Office's NDPB list) should be subject to this too. They should have to account for their performance, expenditure and plans for next year's budget. This way, MPs will have genuine authority to check any quango that starts to stray beyond its remit. Of course, another positive is that MPs would play a far more significant role in determining overall departmental budgets, to some extent checking ministerial dominance.

For political anoraks, the exchanges in Select Committee hearings can be very interesting. The MPs that sit in them are usually committed, knowledgeable and robust, whatever end of the spectrum they sit. In fact, the lack of accountability is one of the biggest problems people have with quangos - subjecting them to more scrutiny by elected politicians could solve quite a few problems.

Our position is clear: there is plenty of fat left to trim. Bodies like the Carbon Trust and the School Food Trust, for example, could be scrapped. Equally important is an open approach from the Government: if a function is not needed, bin it; if a function is essential but would be performed more efficiently elsewhere then the Government need to say so.

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