The Cabinet Office must drive a cross-government effort to improve the way departments manage the performance of their arm’s length bodies, according to a new report from the Public Accounts Committee.
MPs said that for too long there had been “no clear criteria” on what functions were best conducted by departments and what were better left to arm’s length bodies, while oversight arrangements appeared inconsistent in relation to potential risks.
Their report said the Cabinet Office should spearhead a new drive to share and embed best practice within departmental groups and across departmental boundaries in relation to more than 460 organisations, ranging in size from NHS England to the Gambling Commission.
Departments – not Cabinet Office – know best on agency oversight, says civil service chief John Manzoni
Departments must not ignore frontline expertise of staff in arm's-length bodies – NAO
Tidying of the quangos? New guidance to help officials sort “confusing” arm’s-length bodies
Its findings echo a recent National Audit Office report, which said the ALB landscape was "confused and incoherent", with some staff confused about how their job related to the wider aims of their host departments.
PAC chair Meg Hillier said that while the Cabinet Office described the web of ALB relationships as an “accident of history” it was not beyond improvement.
“The Cabinet Office must ensure these bodies – some of which are responsible for delivering large and vitally important swathes of public policy – are subject to consistent and effective oversight,” she said.
“That must start with government setting out clear criteria for how business is conducted, with clear lines of accountability on spending and performance.
“When the government is clear this should involve arm’s length bodies, it must do more to harness the expertise these bodies can bring to policy-making – as well as the feedback they collect on the frontline from taxpayers.
“The government cannot wash its hands of accountability simply by delegating its business and this committee will expect to see the Cabinet Office taking meaningful steps to strengthen oversight in this area."
Among the committee’s recommendations were for the Cabinet Office to build on the NAO recommendations to create a principles-based framework for overseeing ALBs, and for departments to aid public understanding by clearly setting out the accountability relationships with their ALBs.
A Cabinet Office spokesman welcomed the report, and acknowledged that it built on the recommendations of the NAO comparative study.
"Cabinet Office has taken the lead in engaging with departments across Whitehall and arms-length bodies,” he said.
“We are taking the opportunity to go further than oversight and are collectively working to redefine the relationship between departments and arm’s length bodies.
"The government will respond to this report in full in due course."