Truss hints at quango cuts in Spending Review in attack on 'vested interests'

Written by Beckie Smith on 20 March 2019 in News

Setting out her vision for the upcoming Spending Review, Truss said the Treasury would “prioritise ruthlessly”

Chief secretary to the Treasury Liz Truss and chancellor Philip Hammond

Government arm’s-length bodies could be in the firing line in the upcoming Spending Review, chief secretary to the Treasury Liz Truss has said.

In a speech setting out her vision for the Spending Review, Truss said the Treasury would made decisions on how to allocate money based on public priorities, not those of “vested interests” – including quangos.

Truss said the government had reduced the number of quangos from 561 in 2013 to 305 in 2017 following a “bonfire of the quangos” under former prime minister David Cameron.


However, the number is likely to have risen since that point as the government has had to establish several ALBs – thought to number at least 20 – as part of the Brexit process. Guidance issued by the Cabinet Office last year said that quangos should be set up “only be set up as a last resort, when consideration of all other delivery mechanisms have been exhausted”.

In her speech yesterday, Truss said the government was right to have cut down on the bodies in recent years.

“Across the board there were hundreds of opaque organisations with ill-defined aims demanding public money for their latest pet project, erecting barriers and piles of bureaucracy and admin.

“But it is still the case that the administration budget of these bodies costs us £2.5bn. And that too many hard-working public servants and business people are spending their time filling in forms and applying for grants."

She said funding allocations for the next three years would be determined according to the services people most valued in what she branded the “People’s Spending Review”. Core public services such as the police, education, roads, defence and the NHS would take priority, she said.

“There is a growing blob of lobbyists, corporations, quangos and professional bodies who ask again and again for government favours – arguing that they are the exception, that their cause deserves special treatment,” she said.

“But if we gave in to all their demands, what would we squeeze out? And should they be taking money from those on relatively low earnings, who could be spending it on a new car, a holiday, or a treat for their children?”

Truss also reiterated comments made by chancellor Philip Hammond in last week’s Spring Statement, when he said the Spending Review would focus on ensuring value for money.

Hammond used his speech to confirm the review would cover a three-year period and that the process would begin before the Summer Recess. “And it will maximise value for taxpayers’ money in public services with a renewed focus on delivering high-quality outcomes,” he said.

Truss said the government would “prioritise ruthlessly” to achieve this, and also indicated funding would go to “less sexy project” including improving local transport.

And she also said it would consider investing in long-term policies, the effects of which may not become apparent for many years, giving the example of the Department for Education’s early-intervention phonics scheme.

“The benefits [of that scheme] will be felt most in 10-20 years’ time, when these children are entering the world of work and starting their own families… This is exactly the sort of long-term policy the government should be supporting,” Truss said.

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Beckie Smith
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Beckie Smith is a reporter for CSW who tweets Beckie__Smith.

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Submitted on 21 March, 2019 - 08:04
The single most important political and economic event in the last 70 years that adversely affects trading conditions for the business community in the UK, and elsewhere, is a no-deal Brexit. Indeed, the business community is partly responsible for this disastrous outcome, because they have been found out colluding with big government surreptitiously, to undermine the national interest. This has contributed to a lack of trust in big business because conversations relating to Brexit with the political elite are being conducted in secret, behind closed doors, with the commercial interests of business put first, ahead of the wants, needs and expectations of citizens – one of the reasons why Boris Johnson, the former Foreign Secretary, was prompted to utter the words “f**k business”. In the last Parliament, there used to be a forum bringing together senior politicians and industry leaders to discuss the most pressing needs of the economy – it was called the Business Advisory Group. This body was disbanded by Theresa May immediately upon entering 10 Downing Street because: (a) It had been high-jacked by big business who were using it to contrive situations which would, in effect, shield them from having to ‘feel the heat’ of competitive market forces. (b) Big businesses were exploiting the special relationship with government to construct regulatory moats, secure public spending to serve their own narrow business interests, or bend specific rules to their will and in the process, stifle competition. Another reason for doing so was that the Business Advisory Group only served to facilitate clandestine political engagement between the governing elite and big business, with no room for the voice of the unrepresented many, like small and medium-sized enterprises to be heard. In so doing, the Prime Minister sent out a strong signal that she will look upon SMEs much more favourably, when deciding how to spend public funds – because they offer flexibility & adaptability, original thinking & niche expertise, bring long-term commitment and exhibit a sense of patriotic responsibility towards British workers in a way others have not. After all, SMEs are the lifeblood of the UK economy and should rightly be given equal access to publicly-funded contracts which have hitherto, been monopolised by the Select Few. It is considered a necessary evil in well-functioning democracies for big business to lobby agencies of the State to try to skew the rules of the game in their favour – which they achieve through clandestine political engagement. Defence Contractors are accomplished practitioners in the art of clandestine political engagement, also referred to as behind-the-scenes lobbying. Instead of employing talented engineers, problem-solvers, innovators and doers, they prefer to engage expensive parliamentary lobbyists so that they can deploy these people to swing the decision on down-selection, by circumventing MoD’s weak competition process – where it matters most, in the corridors of power using arguments that have nothing whatsoever to do with the qualities of the equipment being offered! Which would explain why the Defence Industry has failed so miserably to deliver equipment to the Armed Forces which is fit for purpose, adequately sustained in-service and constitutes value for money through-life, for as long as anyone can remember. It should be noted that the big players in the UK Defence Industry, the Select Few, don’t even bother to submit written evidence to parliamentary inquiries into Defence Procurement (an issue which has a profound impact upon their business prospects), because they consider secret, “back channel” access to the Executive a much more effective way of continuing to influence policy – with the objective of keeping it skewed in their favour. This is, as good as any other reason, to drain the swamp! @JagPatel3

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