Public bodies reform

Policy

“The landscape for public bodies needs radical reform to increase transparency and accountability, to cut out duplication of activity, and to discontinue activities which are simply no longer needed.”
- Francis Maude, Minister for the Cabinet Office, Written Ministerial Statement, 14 October 2010.

The Government’s presumption is that if a public function is needed then it should be undertaken by a body that is democratically accountable at either national or local level. A body should only exist at arm’s length from Government if it meets one of three tests:

• Does it perform a technical function?
• Do its activities require political impartiality?
• Does it need to act independently to establish facts?

Over 900 bodies were subject to a cross-government review undertaken by all departments in Spring/Summer 2010. This included all Non-Departmental Public Bodies, along with a number of Non-Ministerial Departments and public corporations.

The Minister for the Cabinet Office announced the outcome of that review on 14 October 2010. Updated proposals published on 15 December confirm that approximately 500 public bodies will be reformed to some degree - with 199 abolished and a further 120 merged. Once all reforms have been implemented, the total number of public bodies will have reduced by more than 250.

On 16 March 2011, the Minister for the Cabinet Office announced estimated administrative savings over the Spending Review period of a £2.6 billion. Including programme and capital spending, spending through public bodies will have reduced by an estimated £11 billion a year by 2014-15 which represents a cumulative £30 billion reduction over the Spending Review period.

• Public bodies reform – proposals for change (pdf, 592kb)
• Government response to the Public Administration Select Committee Report (pdf, 277kb)
• Written Ministerial Statement: Public Bodies Review Programme (pdf, 59kb)
• Written Ministerial Statement - Public Bodies Act 2011 (pdf, 97kb)

Legislation

There are a number of public bodies and functions that were set up in statute and require legislative change for reform. The Public Bodies Act has not enacted the changes per se, but as enabling legislation it contains the necessary order-making powers to allow Ministers to make specific changes through a Ministerial order, a type of secondary legislation. These orders will amend the primary legislation in which the relevant public body was established.

The Public Bodies Act sets out the Parliamentary procedure for an order to be made. A Minister is required to lay a draft order, along with an explanatory document, in relation to one or more bodies listed in the Act’s schedules. The draft order is then subject to Parliamentary scrutiny which can include the application of an ‘enhanced affirmative procedure’ which lengthens the scrutiny period and allows for a select committee to examine and make recommendations on a draft order. The draft order must be approved by both Houses of Parliament before it comes into effect, and gives legal authority for a reform to be completed.

The advantage of this procedure is that it allows the Government to make a very broad range of reforms without unnecessary delay, while also allowing Parliament to scrutinise individual reforms in detail, and ensure that the strict safeguards in the Act have been applied. Guidance for officials can be downloaded below.

The progress of how the Public Bodies Bill became an Act of Parliament can be viewed on the UK Parliament website.

There are also some other pieces of legislation that will contribute to the Public Bodies Reform:

• The Health and Social Care Bill includes plans to cut the number of health bodies to help meet the Government's commitment to cut NHS administration costs by a third, including abolishing Primary Care Trusts and Strategic Health Authorities.
• The Education Act 2011 takes forward plans to abolish the following bodies: the General Teaching Council for England, the Training and Development Agency for Schools, the School Support Staff Negotiating Body, the Qualifications and Curriculum Development Agency and the Young Person’s Learning Agency.
• The Localism Act 2011 takes forward plans to abolish the London Development Agency, the Infrastructure Planning Commission, and to abolish the Tenant Services Authority and provide for a transfer of functions to the Homes and Communities Agency.

Implementation

Our proposals set out plans to abolish 199 bodies, merge 120, and substantially reform a further 176. Reforms to individual bodies are the responsibility of sponsoring departments, in partnership with the public bodies themselves.

The Cabinet Office Public Bodies Reform Team has produced a checklist for departments (pdf, 431kb) to assist in the implementation of reforms. This checklist provides departments with high level pointers on issues they may need to address in implementing the reforms, and where appropriate to seek further advice and contacts.

The Cabinet Office Business Plan includes a commitment to publish a quarterly status check of relevant public bodies until all are confirmed as fully decommissioned, beginning in January 2011.

Legacy, triennial reviews and governance

The Cabinet Office has published guidance on the principles and processes by which departments should review their Non-Departmental Public Bodies (NDPBs) in the future. This includes processes to examine the key functions of a NDPB, how these contribute to the work of the NDPB and the sponsor department, and whether these functions are still needed. If it is decided that the functions are still needed then the review should examine whether a NDPB is the most appropriate delivery model.

The second stage of the review is to examine whether the body’s control and governance arrangements are in accordance with the recognised principles of good corporate governance.

This guidance, along with a new Code of Practice for Board Members of Public Bodies, was published by the Cabinet Office in June 2011. The list of bodies that will be reviewed in 2011/12 was confirmed by the Minister for the Cabinet Office in a Written Ministerial Statement on 15 December 2011 (pdf, 97kb).

• Triennial Review Process for Non-Departmental Public Bodies (pdf, 272kb)
• Rules on lobbying for Non-Departmental Public Bodies (pdf, 76kb)
• Code of Practice for Board Members (pdf, 102kb)
• Public bodies and appointments