Three expert organisations are to scrutinise how well the Cabinet Office's new code aimed at resetting the relationships between government departments and their arm's-length bodies is working out in practice.
There are currently more than 460 ALBs operating in the UK, with the semi-independent agencies responsible for some £250bn a year in public spending.
But MPs on the Public Accounts Committee last year warned that relationships between ALBs and their host departments were often confused, with limited sharing of expertise and organisations sometimes working at cross-purposes or subject to heavy-handed control. They urged the Cabinet Office to take "meaningful steps to strengthen oversight" of ALBs.
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In a bid to address those shortcomings, ministers last week unveiled a new "Code of Good Practice" – drawn up in consultation with 17 departments and agencies – touting four "common principles" which the Cabinet Office hopes will allow staff in departments and agencies to gain a better understanding of their respective strengths.
The code says the purpose of any ALB should be "clear and well understood", with agencies given the "the autonomy to deliver effectively" and departments providing "an appropriate overview" of the ALB's work.
The code has now been given a warm response by both the Public Chairs Forum and the Association of Chief Executives, two umbrella organisations representing the public sector heads of ALBs.
In a joint statement, the PCF and ACE said: "We are particularly encouraged by the emphasis on ‘effective partnership’ and oversight that is proportionate to the potential risks and is balanced against the benefits of autonomy for the ALB.
"The principles provide a great opportunity to improve the ability of the centre and their ALBs to achieve the government’s overall objectives through collaborative working and greater shared understanding of each other’s purpose, skills and expertise."
The two organisations also revealed that they would be teaming up with the Institute for Government (IfG) think tank to test the relevance of the new code, saying they were "keen to see these principles put into practice within departments and ALBs".
The PCF and ACE added: "We will be conducting research in partnership with the Institute for Government to survey where both ALBs and departments currently judge their relationship with respect to the core principles of the Code, to then be reassessed in 9-12 months time. The study is being conducted with the support of Cabinet Office, but is independent of government."
CSW approached the PCF and ACE for further detail on the precise terms of the study and whether its findings will be published. The organisations had yet to respond at the time of publication.
The IfG itself has been pushing for changes to the way departments and agencies interact for a number of years. Its 2010 report "Read Before Burning" said ALBs – often pilloried as "quangos" – were "a vital part of the state" and called on ministers to focus on more than the "simple 'numbers game'" of seeking to slash agencies.
"We found examples of both ‘micro-management’ of ALBs and institutional neglect," the IfG's report warned. "While micro-management creates administrative burdens in terms of reporting, neglect can result in ALBs being less in touch with government’s policy objectives and leaves sponsor departments less able to manage risk and performance.
"Where apparent, both imbalances contributed to low-trust institutional relationships, and sometimes led to downward spirals of institutional conflict."