The Cabinet Office has updated its guidance on the creation of new arm’s length bodies and emphasised that the processes being outlined will apply to new organisations – thought to number at least 20 – required as part of the Brexit process.
A new version of the government’s Public Bodies Handbook, published yesterday, includes a revised approvals process and a departmental guide on executive agencies.
The approvals briefing updates a five-year-old document, and outlines a 12-stage process starting with departmental policy teams and culminating with sign-off from the Cabinet Office and HM Treasury required for the creation of a new arm's length body.
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Perhaps in light of the government’s Cameron-era “bonfire of the quangos” drive, the document is clear that the creation of new ALBs is not to be encouraged.
“It is government policy that new arm’s-length bodies should only be set up as a last resort, when consideration of all other delivery mechanisms have been exhausted,” it says.
“Approval for setting up a new ALB must be sought formally from Cabinet Office ministers and the chief secretary to the Treasury before any decision, or announcement, about any new ALB is made.”
In July last year, Cabinet Office minister Chris Skidmore told Civil Service World that he expected more than 20 new public bodies would be required to handle repatriated responsibilities that would result from the UK’s decision to leave the European Union.
Skidmore also said he expected that any new bodies would tie in with a Conservative Party manifesto pledge to locate civil servants away from central London.
The updated approvals-process guidance does not indicate the likely number of new ALBs, but clearly states that “new entities being created as a consequence of the United Kingdom exiting the EU will also need to follow this approval process”.
“Policy teams should engage with their departmental central EU exit teams when developing such proposals,” it says.
Under the guidance, the point at which the intention to create a new ALB is made public comes at the end of the process – at stage 11 of 12 – suggesting that work on the new bodies Skidmore was referring to could potentially be well advanced, even though no formal announcements have been made.
The first seven stages of the ALB-creation process are purely departmental and involve evaluation, testing and review. After a further review and business-case approval by departments’ central ALB teams, the Cabinet Office becomes involved. The final three stages cover Cabinet Office approval and assurance.
The anticipated creation of new public bodies to be based outside of London has aroused interest in parts of the UK that are keen to attract higher-value jobs to their areas.
Last month, the City of Wolverhampton directly referred to the Brexit-related quango drive as part of the business case for using public funds to underpin the development of high-specification office space.