Plans to axe scores of quangos will not deliver significant savings or improve accountability, MPs have warned. A cross-party Commons committee carried out a review of the government’s cull of quangos and concluded the whole process was “botched”. Its chairman said the audit “was rushed and poorly handled” and missed a “Big Society” opportunity to grant greater powers to charities. The report found the legislation would give MPs excessive powers to axe more.
In October the government announced it was axing 192 of the public bodies – such as the Film Council and the Audit Commission – while 118 would be merged. The review was overseen by Cabinet Office Minister Francis Maude. Quangos – “quasi-autonomous non-governmental organisations” – are arm’s-length bodies funded by Whitehall departments but not run by them. They are advisory bodies, consumer watchdogs or organisations carrying out public services. The government reviewed 901 bodies – 679 quangos and 222 other statutory bodies.
A review of that review was carried out by the Commons public administration select committee, which found the tests used to judge the quangos were “hopelessly unclear” and had not been applied consistently. “The current approach is not going to deliver significant cost savings or result in greater accountability,” the report found. “There was no meaningful consultation, the tests the review used were not clearly defined and the Cabinet Office failed to establish a proper procedure.”
Conservative MP Bernard Jenkin, chair of the committee, said: “The whole process was rushed and poorly handled and should have been thought through a lot more. This was a fantastic opportunity to help build the Big Society and save money at the same time, but it has been botched. The government needs to rethink which functions public bodies need to perform and consider transferring some of these functions over to mutuals and charities.”
The MPs said the potential for cost savings was “probably exaggerated” in pre-election promises and reducing spending required more fundamental decisions about cutting state roles altogether. Returning direct responsibility to ministers for some roles risked undermining other forms of accountability and some issues could get lost in wider Whitehall remits, they concluded. “This will mean less effective accountability and challenge on a day-to-day basis,” they said.
A commitment by ministers to consult further was welcome, the MPs said, but demanded an assurance that decisions would be reversed if those talks found they had been wrong. The report said “badly drafted” legislation implementing the cull needed more safeguards to prevent ministers abusing wide powers to abolish and reform other bodies in future.
Among its recommendations, the committee said the legislation should be limited to the present process. It said it “contains insufficient safeguards to prevent the misuse of powers by ministers” – something which has already led to several defeats in the House of Lords.