If we can’t have a bonfire of the quangos, let’s have a sunset clause

by James Roberts, political director of the TaxPayers' Alliance


A superb investigation from The Times newspaper has revealed the shocking state of affairs at the Driver and Vehicle Licensing Agency (DVLA). 


Staff have been sent home on full pay yet not required to work, with hardline unions preventing a return to the office while managers boast of wasting time watching Netflix. Post has been left unopened and millions of motorists have or are still suffering delays. An absolute shambles. 


DVLA should hang their heads in shame. After all, they didn’t at the time. According to the organisation’s 2020-21 annual accounts, chief executive Julie Lennard took home between £185,000 and £190,000 during the covid pandemic, including a £10,000 to £15,000 ‘performance bonus’. This was a rise of up to £20,000 on the year before. Louise White, the DVLA Human Resources and Estates Director - and presumably therefore the person directly responsible for the workforce shambles - took home between £135,000 and £140,000, with a bonus of up to £5,000. Between them, the executive board pocketed up to £1.04m. This was up from around £960,000 the year before. 


Let’s not forget to mention the union bosses either! In this case Mark Serwotka of the Public and Commercial Services (PCS) union which represents DVLA staff, who (according to their accounts) took home £124,608 in total remuneration in 2020. And the DVLA itself employed around 20 union officials, with 15 of them spending up half their time solely on union duties.   


Together, these two groups of pompous public sector pen-pushers have badly let down the British taxpayer. This organisation is a basket case, and it’s a disgrace millions of drivers had to be affected before anyone would point that out. 


In response, the Department for Transport (DfT) said: “We take these allegations extremely seriously.” One would hope so. But for all the tough talk, what will be done? You can bet that the DVLA budget will continue to rise. Work from home practices will continue. Senior staff pay may freeze temporarily, and then likely rise again. Perhaps a more important question is: what on earth can the DfT do?  


The DVLA is one of a number of quangos - or arm’s-length bodies (ALB’s) - which operate without ministerial management yet oversee huge swaths of public policy. According to the Cabinet Office, there were 295 of them as of March 2020, employing nearly 319,000 officials at a cost of almost £224bn. This is likely an underestimate, as many public bodies are not included in the definitions preferred by Whitehall. But whatever the figure, the influence and power they have (even in relation to their supposed political masters) is beyond doubt.


The quangocracy has grown into an unwieldy mess, where organisations like the DVLA can carry on with little-to-no deference to the taxpayers who pay for them. As the National Audit Office said in a report last June: “The centre of government needs to make considerably 

more progress in understanding the risks in relation to ALBs so it can clarify the expectations and criteria for different ALB models and their oversight arrangements.” 


These issues are not new to the TaxPayers’ Alliance, and should not come as a surprise to politicians. During the coalition era in 2012, ministers like Francis Maude claimed to have made some progress with a much-vaunted ‘bonfire of the quangos’, despite later reports from the Public Accounts Committee now suggesting little has changed and the bonfire “failed to spark”. Certainly, the issues which dogged ministers a decade ago can be seen alive and well at the DVLA: opacity, limited accountability and poor value for money.      


To their credit, the government has shown a willingness to tackle this issue properly in the past. The disgraceful performance of Public Health England, obsessing over obesity but failing to prepare for the covid pandemic, rightly led then-health secretary Matt Hancock to shut them down. When quangos become so lodged into public policy, abolishing them can be the only real option. 


The uncomfortable truth is that the machinery of government is now so large that it is impossible for anyone to manage effectively. By cleaning up the state, the government should aim to streamline the quango state and drastically improve the bang for taxpayers’ buck. And the easiest way to start would be with a bold measure to ensure quangos could never get too big to shut down - namely, a sunset clause. 


Such a clause could be easily inserted via primary legislation, or required alongside the business case for any new ALB’s. Quangos would be given a definitive end date, after which parliament would be required to explicitly re-authorise the funding of the organisations - or simply let it expire. When the funds dried up, so too would the quango. 


This would completely change the dynamics of accountability and the relationship with taxpayers. No doubt some ALB’s - such as Atomic Weapons Establishment, which makes warheads for the UK nuclear deterrent - would sail through. Some, like NHS England, might use the opportunity to justify the large amounts of money they were receiving from taxpayers. And some, like the Office of the Immigration Services Commissioner or National Citizen Service, could finally be brought to a natural end - saving millions in the process. 


With the tax burden at a 70 year high and the covid crisis exposing bodies like the DVLA, age-old excuses about the oversight of the quangocracy have run out of road. Bold yet simple measures to put all arm's-length bodies on notice could begin to trim back years of government growth, and help clean up the state. If we can’t have a bonfire of the quangos, let’s have a sunset clause.  

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