Welcome to Quangoland: Now there is a quango for every 10,000 people in this country. Nick Cohen and Stuart Weir on the growth of unaccountable government

BRITAIN now has one quango for every 10,000 people, according to the first authoritative study of the size of the unaccountable state.

A report from the constitutional scrutiny group Democratic Audit, to be released tomorrow, details the 'phenomenal proliferation' of unelected government-appointed agencies, operating without effective parliamentary, legal and democratic control, which has taken place since the Conservatives won power in 1979 promising to cut quangos.

Fifteen years on, the strength of the quangos is beginning to rival that of elected local government in Britain, the report concludes. Already the quangocrats who are running key local services such as opted- out schools, further education, health, housing and training, outnumber the 25,000 elected councillors by more than two to one.

The report, a map of quangoland by six of Britain's leading constitutional specialists, found:

There are 5,521 quangos - about three times as many as the Government officially acknowledges. The number has been growing almost daily as schools move out of local education authority control and the Department of Health creates hundreds of Whitehall-appointed NHS hospital trusts. If government-appointed advisory bodies and Next Step agenices are included in the list, the quango count rises to 6,708.

Together they spent pounds 46.6bn in 1993 ( pounds 48.1bn at today's prices) - nearly one-third of total public spending. Even the sternest critics of the Conservative Party have assumed that the price of quangos was between a fifth and a quarter of public spending.

About 73,000 jobs are directly or indirectly in the gift of ministers.

Until this report, even definitions have been vague. The word quango (short for quasi- autonomous non-governmental organisations) was coined as a joke in the late Sixties by Anthony Barker of Essex University, one of the authors of the study, to describe bodies outside the civil service but funded by the taxpayer, appointed by ministers and, in theory, at 'arm's length' from government.

Whitehall has never officially used the term and has kept details of the numbers, powers and cost of quangos hidden. The only government list of quangos is in the Cabinet Office publication Public Bodies. It recognises 1,389 government agencies, a huge underestimate.

The discrepancy occurs because grant-maintained schools, further-education colleges and training and enterprise councils (TECs) are all omitted.

But, as the report makes clear, the government appointees in colleges, hospitals and schools are members of what Professor John Stewart of Birmingham University, another of the report's authors, describes as the 'new magistracy' - modern revivals of the early- 19th-century magistrates who ran Britain before elected councillors were created. Whatever their official job titles from Whitehall, they are members of quangos created or adapted by government, funded by government and under the direction of government.

The authors say that quangos cannot anymore be regarded as 'arm's-length' agencies. They are the 'creatures' of ministers, which enhance ministers' already wide powers to ignore Parliament and ensure that the Conservatives can tightly control areas such as Scotland and Wales where they come third or fourth in local elections.

The official failure to recognise most of the 4,723 local quangos - 'defining (quangos) out of existence,' the academics call it - enabled William Waldegrave, the minister responsible for the civil service, to claim in the House of Commons in February that the Conservatives had lived up to their 1979 election promise to cut quangos and had reduced their number from 2,167 in 1979 to 1,398 in 1993.

The reverse is the case. Spending on extra-governmental organisations (EGOs, as the academics style them) has increased by 24 per cent in real terms since the Conservatives came to power, the academics calculate.

'There has been a vast expansion of extra-government organisations wielding far greater powers over everyday life in Britain and spending far more public money than ever before,' they say.

There is no sign that the quango-isation of public life is slowing down. Urban regeneration, schools' funding, teacher training and school curriculum agencies and councils are all being set up or are in the process of being set up.

Most of Britain's 3,900 secondary schools and a significant proportion of the 19,000 primary schools are meant to opt out of local control and become grant-maintained schools under the control of the Government's Funding Agency for Schools and the Secretary of State for Education by 1996.

Vitually all the safeguards of a mature democracy are missing. At the simplest level, no quango has all its board members elected by the general public.

It is entirely up to ministers to decide whether a quango should be set up and what its relationship to Parliament should be. There is no requirement for consultation and nothing like the US Administrative Procedure Act to provide a legal framework for the creation of quangos.

Stephen Dorrell, the Treasury minister, said in July 1993 that the decision to create an executive agency was determined solely 'by our judgement in each case as to where the long-term interests of taxpayers lie'.

The same legal imprecision covers the tens of thousands of appointments to quangos. In theory, anyone can apply to the Public Appointments Unit for a job on a quango. The unit, indeed, occasionally shows a concern to encourage more women, blacks and Asians to serve in quangos. In practice, however, this picture of a civil service neutrally selecting candidates is misleading. The report shows that it is entirely up to the ruling party to decide who sits on the boards. Conservative politicians and the Conservative whips' office are the main sources of patronage.

Gwyn Jones was made chairman of the Welsh Developement Agency after meeting Peter Walker, then Secretary of State for Wales, at a Conservative fund-raising lunch in 1988. He presided over a series of scandals at the agency - pounds 1.4m was lost in questionable redundancy payments; a discharged bankrupt was appointed head of marketing. Although Mr Jones resigned, he still has a Government-appointed post as a BBC governor.

Tory dominance of quangos goes far wider. One survey of 185 NHS trust chairmen found that 62 were Conservative councillors, former Tory MPs, Conservative workers, or had other strong links with the party. In all, businessmen and women chair three-quarters of all NHS trusts.

Trusts provide just a handful of the 10,000 appointments that ministers make and renew each year. A haphazard but generally pervasive secrecy blocks questions about how CVs are collected, how the candidates are interviewed and how references are taken up. The Public Appointments Unit's list of potential candidates for quango posts is kept hidden. There are no central or local registers of who serves on quangos. Information on appointees does not reveal political affiliation.

One result is that it is very hard for the public or Parliament to check the names of appointees, their background, age, occupation, experience, qualifications, and interests.

Another is that the Government can allow favoured quangocrats to collect posts like postage stamps. The report quotes the case of Michael Griffith, a self-proclaimed 'crusty old Tory', who held the chairs of the Countryside Council for Wales, Glan Clwyd NHS Trust, and a place on the Higher Education Funding Council for Wales.

'What is significant from a democratic point of view is that there are no rules to govern this vast arena of patonage and no mechanisms of public scrutiny,' the report says.

There are numerous illustrations of the culture of unaccountability. All but 14 per cent of quangos are exempt from scrutiny by ombudsmen, the study found. Local residents can complain to the ombudsman about maladministration in schools run by the local authority and council-owned housing, but not about maladministration in the 2,668 housing associations, the 1,025 grant-maintained schools, the 577 further-education colleges, and the 164 universities.

Just 33 per cent of quangos have their finances scrutinised by the Audit Commission or the National Audit Office. No quango is obliged to release policy papers to the public. With an elected council, everyone has access to minutes, background papers and briefings. Half the quangos studied failed to keep a public register of members' interests.

And so the list goes on. Local councillors and council officials can be surcharged - that is, held personally liable - if their 'wilful misconduct' wastes public money: quangocrats cannot. Just 7 per cent of quangos are obliged to hold one or more public meetings a year. Just 2 per cent apply the Conservatives' own 'open-government code'.

Legal redress is difficult because, unlike most European countries, there is no single statute governing their conduct. The courts therefore find it hard to judge whether a quango has been 'high-handed' and few provisions by which the public can demand consultation, disclosure of information or a legal remedy for the effects of bad decisions.

The result is a system of Whitehall-appointed local government which is run by the 'unaccountable new magistracy and the much-weakened and dismembered . . . elected local authorities'.

In February, the boards of four grant-maintained school quangos in Essex decided to restructure education and create elite schools, which Teddy Taylor, the local Conservative MP, said would be 'massively damaging to able, working-class children'.

Even though 99 per cent of parents voted against the change, Mr Taylor told the Commons in February, 'it was explained that parents were entitled only to consultation. The boards are going ahead with their proposal and are presenting their plan to the Secretary of State for Education, who will decide.'

To the Government, complaints about loss of democracy are beside the point. William Waldegrave said in July 1993 that it was quality of service that mattered.

'We have strengthened the formal line of accountability by making public services directly accountable to their customers,' he said. The issue was not 'whether those who run our public services are elected but whether they are . . . consumer- responsive'.

The academics stongly dispute this justification.

'The consumer is a poor and passive shadow of the self- confident citizen of a mature democracy, who is entitled to choose who runs his or her services, to participate and be consulted in the way they are run and to know what decisions are taken in her or his name,' they conclude.

They call for a massive reform of 'over-centralised big government' in Britain.

All quangos should be reviewed to see if they could be replaced by elected bodies which would conform to modern standards of openness, they recommend. There should be a statutory right to know what quangos do and legal requirements for the agencies to consult and represent views other than those of government ministers.

Such a programme would, the academics admit, strike at the heart of what they see as Britain's secretive, unregulated and unaccountable political system. But they maintain that if you want to change quangos, you must also want to change the system which allows 'unconstrained powers' to be given to quangocrats in the first place.

'All those who recognise the need to bring order and light to the unruly and shadowy world of appointive government must also recognise that lasting reforms depend on a wider programme of constitutional renewal,' the report concludes.

'Ego Trip: Extra-governmental Organisations in the UK and their Accountability'. Edited by Stuart Weir and Wendy Hall. Democratic Audit and Charter 88 Trust, pounds 9.95. Exmouth House, 3-11 Pine Street, London EC1R OJH.

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