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Through the Public Bodies Reform Programme, run by the Cabinet Office, departments are taking over the functions of 65 public bodies and transferring those of another three to local government. They are also abolishing more than a half of their advisory bodies to strengthen ministers' ultimate responsibility for policy decisions. Departments propose to abolish 262 bodies, by such means as mergers, transfers out of government and ceasing functions. It is also intended to secure a reduction of £2.6 billion over the spending review period 2011-12 to 2014-15 in ongoing funding for administration in public bodies. A third of this (34 per cent or £0.9 billion) comes from just two changes: the closures of the Regional Development Agencies and the education body Becta. Annual estimated savings achieved by 2014-15 are likely to continue at between £800 million and £900 million. According to the National Audit Office, however, departments' estimates of £425 million for transition costs will actually be at least £830 million. Departments will therefore need to find gross savings of around £3.5 billion. There is also concern that there is an insufficient grasp of the ongoing costs of functions transferred to other parts of government. A third of all money spent by bodies in the Programme (£20.6 billion) will be subject to greater accountability to elected politicians, but most (£43.2 billion) will remain at arms-length. Despite greater accountability being the Programme's primary intended benefit, only one of the six departments examined had proposals for a well-defined, though basic, measure of success for it
Under the Public Bodies Reform Programme the Government is reducing the number of its arm's length bodies from 904 to between 632 and 642 by the end of the current Spending Review period and will have a substantial and lasting impact. The Programme is intended to improve accountability for functions currently carried out at arm's length from Ministers. The Cabinet Office says it is on track to make £2.6 billion of administrative savings by 2015. However there are substantial reservations about the robustness of this claim. Key concerns are that: there is a risk departments are claiming savings which are actually cuts to services, when they should be including only genuine savings arising from administrative reorganisations; estimates of transition costs such as redundancy and pension costs are incomplete; the savings estimate does not fully take account of the ongoing costs to other parts of government of taking on functions being transferred from abolished bodies and some departments have wrongly included wider savings from bodies being retained, rather than just administrative savings from bodies being abolished or substantially reformed. The Cabinet Office has accepted that its savings estimate needs to be reassessed and has undertaken to 'rebase' it. Focus now needs to be on managing the Programme effectively. Departments have decided on the form of individual reorganisations themselves without clear direction from the centre, leading in some cases to inconsistent treatment of bodies with similar functions. Furthermore, departments may not be getting the best value for money from the sale or transfer of assets of bodies being abolished
Between May 2005 and June 2009, there were over 90 reorganisations to central government. This report finds that these cannot demonstrate value for money, given that most had vague objectives and that costs and benefits were not tracked. The average annual cost of reorganisations is almost £200 million, around 85 per cent of which is for the reorganisation of arms length bodies. Since 1980, 25 central government departments have been created, including 13 which no longer exist. By comparison, in the United States only two new departments have been created over the same period. Central government bodies are weak at identifying and securing the benefits they hope to gain from reorganisation. There is no standard approach for preparing and assessing business cases setting out intended benefits against expected costs. More than half of reorganisations do not compare expected costs and benefits of alternative options, so there can be no certainty that the chosen approaches are the most cost effective. Furthermore, no departments set metrics to track the benefits that should justify reorganisation - making it impossible for them to demonstrate that the eventual benefits outweigh costs. There is no requirement for bodies to disclose the costs of reorganisations after they happen - meaning the true cost of reorganisation is often hidden. The decisions to reorganise departments and arms length bodies are often taken at short notice and with inadequate understanding of what could go wrong.
Following the spending review, the Department for Business, Innovation and Skills is targeting a 27 per cent reduction, after inflation, in core resources between 2010-11 and 2014-15. However, this does not take account of a near doubling in student loan payments arising from the higher education reforms, much of which the Department expects will be repaid sometime after 2014-15. Once these are included, the Department's total spending is forecast to reduce by 6 per cent, after inflation, during the four year period. The Department is also working on a number of other reforms associated with the settlement, including attracting private investment into Royal Mail, setting up the Green Investment Bank by September 2012, and providing £1.3 billion to modernise the Post Office network. The Department has worked hard over the last 18 months to improve its financial management, and current practices have enabled it to keep its day-to-day financial management on track. However, the Department recognises that its current financial management capacity and skills will not be sufficient if it is to manage the substantial challenges ahead. It is implementing a number of change programmes aimed at integrating financial management across the department and its partner organisations. The outcomes of this are as yet unclear and the NAO has identified key areas for action. These include improving the quality of information available to support decision-making, strengthening cross-department arrangements for scrutinising investment proposals, and improving sponsorship of partner organisations.
The UK is said to have been one of the most prolific reformers of its public administration. Successive reforms have been accompanied by claims that the changes would make the world a better place by transforming the way government worked. Despite much discussion and debate over government makeovers and reforms, however, there has been remarkably little systematic evaluation of what happened to cost and performance in UK government during the last thirty years. A Government that Worked Better and Cost Less? aims to address that gap, offering a unique evaluation of UK government modernization programmes from 1980 to the present day. The book provides a distinctive framework for evaluating long-term performance in government, bringing together the 'working better' and 'costing less' dimensions, and presents detailed primary evidence within that framework. This book explores the implications of their findings for widely held ideas about public management, the questions they present, and their policy implications for a period in which pressures to make government 'work better and cost less' are unlikely to go away.
In 2010, the Government set out a new approach for local economic growth, in the White Paper Local growth: realising every place's potential. This involved the closure of the Regional Development Agencies and their replacement with new local growth organizations and funds, such as Local Enterprise Partnerships and the Regional Growth Fund. Three years on from this initial announcement, the new Local Enterprise Partnerships and Enterprise Zones are taking shape. However, Local Enterprise Partnerships are making progress at different rates. The Growing Places Fund, Enterprise Zones and the Regional Growth Fund have also been slow to create jobs and face a significant challenge to produce the number of jobs expected. The estimate of jobs to be created by Enterprise Zones by 2015 has dropped from 54,000 to between 6,000 and 18,000. There is also no plan to measure outcomes or evaluate performance comparably across the range of different local growth programmes. Departments cannot therefore show value for money across the programme of local growth initiatives or be sure about where to direct their resources. The new local programmes were not established in time to avoid a significant dip in local growth funds and jobs created. Direct central government spending on local economic growth through the initiatives fell from £1,461 million in 2010-11 to £273 million in 2012-13, but will rise to £1,714 million in 2014-15. Central government needs to plan such reorganizations more effectively, to ensure that sufficient capacity is in place both centrally and locally to oversee initiatives and that accountability is clear
Originally published in 1982, this book was the first comprehensive, critical assessment of the outcome of the controversial reorganisation of British local government outside London which took place between 1973 and 1975. The book deals with the new systems in England, Wales and Scotland, drawing upon the results of almost 100 in-depth interviews with leading members and officers from Shetland to Cornwall, from major cities to rural districts. Liaison between the tiers, the effects of corporate management, the spread of the office of chief executive, the increasing levels of partisanship and the changing face of central-local relations are examined on the basis of close observation and practical experience rather than theoretical preconceptions.
The National Audit Office report on this topic published as HC 1788, session 2010-12 (ISBN 9780102975376)
The Government review of public bodies focused on whether a body's functions were necessary, and if it thought they were, whether it had to be delivered at arm's length from Government. The review was poorly managed: no meaningful consultation; the tests used were not clearly defined; and no proper procedure for departments to follow. The Bill giving the power to bring about these changes was equally badly drafted. Now the Government faces the much larger challenge of successfully implementing these reforms. The Cabinet Office should issue clear guidance on how to manage this transition. The Committee has developed, with the National Audit Office, its own guidance which departments could use. The Government wanted to increase accountability by bringing functions previously discharged by public bodies back in to central departments, thus making ministers directly responsible for the decisions taken. But stakeholders and civil society play an important role providing challenge and criticism to public bodies on a day to day basis and it is easiest for them to perform this role when they have a clearly identified body to engage with, not a homogenous central department. There is a way to meet both demands: set these bodies up as executive agencies. There is a need for a simplified system for public bodies so that it is clear to everyone who is responsible for what, and how much input it is right for the Government to have. The review represents a missed opportunity to reassess what functions public bodies are needed to perform.
This review focuses on advancing the performance-management vision of the Comptroller General of the Republic of Chile (Contraloría General de la Republica, CGR) with a view to enhance the relevance and positive impact of its work on accountability ...