The ease of establishing quangos

March 04, 2010 11:43 AM

After the National Audit Office (NAO) criticised the inception of the Equalities and Human Rights Commission (EHRC), the Public Accounts Committee (PAC) have followed suit today.

Bungled hiring procedures meant it did not have sufficiently qualified staff in place; the body fell under 3 different departments in a matter of months; and its business strategy lacked clarity. So despite significant financial and organisational problems the implementation of EHRC as a body was rushed through:

“Problems with the start-up were exacerbated because the Commission did not delay its launch date, even though its business plan, job descriptions and the allocation of staff to roles had not been finalised.”

While the body have now admitted that their launch should have been delayed, plans for the Equalities Bill were being drafted at the same time. The bill is the pet project of Equalities minister Harriet Harman; it seems that this new flagship body was rushed through – warts an’ all – in order to support the bill when it was debated on the floor of the Commons.

But the report’s findings bring us to a broader point. The Government’s paper Smarter Government openly admitted that setting up a quango was not difficult: robust ministerial justification from its parent department is seemingly not required. The cost of setting up the EHRC was £38.8m – a huge bill – and according to the PAC the Treasury have no real process for assessing the formation of new bodies:

“HM Treasury should draw up best practice guidelines for the creation of future public sector bodies. The guidelines should highlight the common risks and the steps which should be taken to mitigate those risks, and provide benchmarks for the reasonable cost of a merger.”

So if ministers do not have to properly justify a new body and the Treasury have no guidelines for their implementation, we can begin to understand how new bodies have cropped up across the structure of Government so easily. Add to this their lack of regular accountability to the relevant select committee once in operation – along with their gradual acquisition of more functions – and the steady expanse of the quango state is no real surprise.

Our extensive surveys mapping the crawling roots of the quango state have shown that they cost the taxpayer £90 billion a year – an eye-watering sum. The fiscal crisis means that we will have to reduce spending, and our list is a good place to start. Ineffectual and unnecessary bodies should go, no matter how hard vested interests try to dig their heels in.

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