Coalition Watch - edition 1

16.08.10

 

Welcome to the Public Law & Regulation team's first Coalition Watch.

Why have we introduced this fortnightly alert series? Firstly, because the Coalition says that its changes are important. And we agree. Even if it did no more than carry through the policies already announced, it would have delivered a programme that was hugely ambitious for the first term of any government.

Secondly, because the pace of change will accelerate through the autumn as the Coalition publishes the results of its spending review and introduces its full programme of legislation.

Thirdly, because David Cameron says that the Coalition is not just responding to the financial crisis, but making a serious attempt at permanent change to the nature of the state and its relations with civil society. Whether or not he means it (we can give him the benefit of the doubt), and whether or not he can deliver in practice, a project with that expressed vision is clearly one to 'watch'.

In each alert we will summarise the major developments from the previous two weeks and comment on the key changes. Our interest is confined to the structure of the state and the way it relates to the rest of us - in the constitution, through the machinery of government, and by the process of regulation.

Whether the Coalition proves to be lasting or temporary, and whether its programme for government runs into the sand or achieves exactly what it proposes, we intend to follow its progress.

In doing so, we hope this will allow you to stay on top of all the changes that matter.

We will also, in our own way, judge the Coalition against its own programme. As of now, this is what it says it will do in its structural reform plans. We will measure its progress against the targets it has set for itself.

And for the record... a disclaimer... while we have a genuine interest in the mechanics of government and how it works, we have none at all in party politics. So, where we comment on events, we simply call it as we see it. The views expressed are solely those of the authors.

This (bumper!) first edition of Coalition Watch is a selection of highlights of the story so far.

The Public Law & Regulation team.

1 Constitutional Change

Devolution and sovereignty

  1. Devolution - England
    A Commission is to be established by November 2010 to consider the 'West Lothian Question' - whether or not Scottish, Welsh and Northern Irish MPs should continue to vote on matters relating to England when English MPs have no equivalent vote on the same matters arising in the other parts of the United Kingdom.
  2. Devolution - Scotland, Wales
    The Coalition plans to oversee a referendum on further Welsh Devolution by the end of March 2011. Subject to its outcome, the Coalition plans establish a process for the Welsh Assembly based on the Calman Commission. In relation to Scotland, the Coalition plans to introduce a Scotland Bill to start the process of implementing the proposals of the Calman Commission on Scottish devolution.
  3. Devolution - Northern Ireland
    The Coalition plans to examine the changing of the corporate tax rate in Northern Ireland with a view to bringing Northern Ireland 'back into the mainstream of UK politics'. A Government paper on this is due to be published in October 2010.
  4. Sovereignty Bill
    While the Coalition Programme included an intention to examine the case for a United Kingdom Sovereignty Bill, the government subsequently appears not to have made any public statements on the matter.

    Nevertheless, a private member's United Kingdom Sovereignty Bill has been introduced by Christopher Chope (MP for Christchurch). This Bill has had its first reading in the House of Commons, but the Second Reading is not scheduled until March 2011.

Our comment:

It is perhaps unsurprising that devolution and sovereignty are not at the forefront of the Coalition agenda.

Nonetheless, the Coalition has announced clear plans for sensible adjustments to the devolved settlements, and set seemingly realistic deadlines for carrying them out.

It has to be hoped that the Commission on the West Lothian Question is not merely an exercise in kicking the matter into the long grass, but will deliver sensible proposals that are implemented quickly. It is now more than 30 years since Tam Dalyell first posed the famous question, and more than a decade since it has been a live issue in UK politics. Even at the usually glacial pace of constitutional reform, an answer is long overdue. The current position is unsustainable.

In relation to sovereignty, the Coalition Programme says no more than that the Coalition will "examine the case for a United Kingdom Sovereignty Bill to make it clear that ultimate authority remains with Parliament". It could be suggested that such a Bill would be more for political display than legal effect. The Bill would surely create a paradox. If Parliament really is sovereign, why does it need to pass a law saying so?

Voting reform

  1. Referendum on alternative voting system
    The Coalition has introduced the Parliamentary Voting System and Constituencies Bill.

    This Bill sets the date for a referendum on an alternative voting system for 5 May 2011. In place of the current 'first past the post' voting system, the alternative voting system would enable voters to rank candidates in order of preference. Voters' first choices would be counted in an attempt to find a candidate with an overall majority. If this is not possible, the candidate with the fewest votes is eliminated and their votes redistributed to other candidates (using voters' preferences). The process is repeated until a candidate with an overall majority is found.

    The Parliamentary Voting System and Constituencies Bill is scheduled to have its Second Reading in the House of Commons at the beginning of September 2010.

  2. Fixed term Parliaments
    Alongside the Parliamentary Voting System and Constituencies Bill, the Coalition has also introduced the Fixed term Parliaments Bill. It intends that this will become law by July 2011.

    This Bill provides for general elections to occur every five years on the first Thursday in May (with the next general election on 7 May 2015). This removes the power of the Prime Minister to call an election at will (when expedient to do so for the current government).

    The Bill provides for the early dissolution of Parliament in only two circumstances: where a two thirds majority of the House of Commons has passed a motion to do so or where a motion of no confidence has been passed in the Government (with a normal majority).

  3. Review of constituency boundaries
    The Parliamentary Voting System and Constituencies Bill will establish boundary reviews to create more equally sized constituencies.

Our comment:

The Coalition has made genuine progress in its attempts to reform the parliamentary system and give the electorate, via a referendum, a chance to choose a different method of electing its MPs. Of course, the speed at which the Parliamentary Voting System and Constituencies Bill and the Fixed term Parliaments Bill have been introduced shows how important the issue of voting reform is to the Coalition itself. It will be interesting to see, assuming the Parliamentary Voting System and Constituencies Bill becomes law, how the Coalition will be affected once its constituent parts divide to support the opposing sides in the referendum.

The Fixed Term Parliaments Bill is welcome in its further codification of the electoral process, and for taking out of the hands of the sitting Prime Minister the right to call an election at the moment which he or she finds most politically convenient.

The provisions of the Bill limiting the early dissolution of Parliament (to a two thirds majority of the Commons or vote of no-confidence) may be necessary in order to make it of more than just declaratory effect. However, there should be no confusion as to the status of these limitations. They do not entrench the fixed term of parliament, but merely create a procedure for early dissolution. In principle, that procedure could be changed by amending the Fixed Term Parliaments Act via an ordinary Act of Parliament (requiring only a majority of the House of Commons). Whether such a process becomes so politically unacceptable as to render it impossible in practice - creating a kind of entrenchment by convention - remains to be seen.

Parliamentary reform

  1. House of Commons Reform - Back Bench Business Committee established
    The Coalition has overseen the establishment of a Back Bench Business Committee in the House of Commons, as recommended by the Wright Committee. The Committee will have the ability to schedule business in the Commons Chamber and in Westminster Hall on days, or parts of days, set aside for non-government business.

    The Coalition intends to present proposals for the implementation of the remaining recommendations of the Wright Committee by December 2010. These include recommendations on the business of the House and the presenting of petitions to the House.

  2. House of Commons Reform - reduction in the number of MPs
    The Parliamentary Voting System and Constituencies Bill will reduce the size of the Commons from 650 to 600 MPs.

  3. House of Lords Reform - Coalition reform proposals
    The Coalition has established a committee to bring forward draft legislative proposals for a wholly or mainly elected House of Lords. Election would take place on the basis of proportional representation. The Coalition plans that the committee shall introduce legislation to effect these changes by November 2011.

    In the meantime, a private member's House of Lords Reform Bill has been introduced by Lord Steel of Aikwood. This Bill does not provide for the election of members of the House of Lords, but changes how the members are appointed and makes provision for members giving up their membership of the House in certain circumstances.

Our comment:

House of Lords reform has been on the political agenda for so long that it would have been a notable omission from the Coalition Programme. While the Coalition has not made this an urgent policy for its programme, the plan to introduce legislation by the end of 2011 is quite an ambitious one.

There are two reasons why the plans may not lead to fundamental change any time soon:

  • The end of 2011 is a deadline that may slip; not a controversial suggestion considering the period of time for which the issue has been discussed.
  • Even if legislation is passed, the Coalition proposition of a 'grandfathering system' for current peers means that the composition would gradually change over a period of several more years. Depending upon your point of view, as to the election or appointment of the Second Chamber, this may or may not be a good thing.

It is hoped that the private member's House of Lords Reform Bill gets some parliamentary time and is passed. Irrespective of whether further reform takes place, the Bill makes a number of improvements on the current arrangements, and would do irrespective of whether or not the House of Lords becomes and elected Chamber.

Human rights & civil liberties

  1. Freedom Bill
    The Coalition has launched a public consultation on views as to laws and regulations which should be repealed. Following the consultation, some of these laws and regulations may be repealed in the Freedom Bill.

    In addition, the Coalition intends that the Freedom Bill will adopt the protections of the Scottish model for the DNA database, outlaw fingerprinting of children at school without parental permission, further regulate CCTV and restore rights to non-violent protest.

    The Coalition aims to pass the Freedom Bill by November 2011.

  2. Identity Documents Bill
    Through the Identity Documents Bill, to be introduced by December 2010, the Coalition aims to scrap ID cards and the National Identity Register and halt work on having fingerprints on passports. The Coalition has already stopped all administrative work on these programmes.

  3. Extradition and counter-terrorism legislation
    Before September 2011, the Coalition will review the operation of the Extradition Act 2003 and the US/UK extradition treaty. By November 2010, the coalition also intends to review counter-terrorism legislation, including Control Orders, and the Regulation of Investigatory Powers Act 2000. Also, to publish proposals for the storage of internet and e-mail records. These may lead to the introduction of further legislation.

  4. ContactPoint
    The Department for Education made moves to decommission the controversial children's database ContactPoint on 6 August 2010.

  5. Freedom of Information
    By November 2011, the Coalition aims to amend the Freedom of Information Act 2000 to cover more organisations and support cross-government measures to provide greater transparency.

  6. UK Bill of Rights
    The Coalition aims to establish a Commission to investigate the creation of a UK Bill of Rights (at some point in 2011).

    A private member's Rights Bill has been introduced by Philip Hollobone (Conservative MP for Kettering). This Bill would repeal the Human Rights Act 1998. The Second Reading of the Bill is not planned until May 2011.

Our comment:

When the Coalition came to power, it made it a key part of its agenda to reverse what it regarded as the authoritarian state and the erosion of civil liberties which it said had occurred under the previous government.

Certainly, few people would regard the last decade as a glorious chapter in the UK civil libertarian tradition. So it is welcome that the Coalition plans a comprehensive review of laws affecting civil liberties. Many of these proposals are at an early stage and we shall have to wait and see if the Coalition sees them through. In particular, it remains to be seen whether the 'Your Freedom' consultation is anything more than an exercise in window dressing. We hope that our scepticism is misplaced.

The Coalition's start has at least been positive in some respects, and it has taken the chance to alight on some easy wins. Few voices have been raised to lament the passing of ID cards or the ContactPoint database - 'Big State' solutions to problems for which a more proportionate and focused response is surely warranted.

While a Commission is to be established to look into a UK Bill of Rights, it is welcome that this is no longer being seen as synonymous to the repeal of the Human Rights Act 1998. The Coalition may wish to build on the UK's obligations under the European Convention on Human Rights, incorporated into domestic law by the Human Rights Act. But, while the UK remains a signatory to that Convention - and none of the main parties have suggested it should not be - repealing the Human Rights Act would be a pointless and retrograde step.

The above analysis was written by Chris Warburton in Wragge & Co's Public Law & Regulation team.

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2 Managing the Machinery

'Quangos'

  1. Significant abolitions to date include:
    1. The Audit Commission
      Perhaps the most surprising abolition so far of an arm's length body. The Audit Commission (not to be confused with the National Audit Office which is responsible for central government) has the statutory responsibility for auditing and inspecting the accounts of local government and a large number of NHS bodies.

      According to the Coalition the audit function of the Commission is to be transferred to the private sector, and supplemented with arrangements for greater local democratic accountability of the bodies currently overseen by the Commission.
    2. The Infrastructure Planning Commission (IPC)
      News that IPC was to be abolished broke even before the nascent organisation received its first formal applications for development consent.

      Planning consent responsibility for major infrastructure projects will not be returned to local authorities. A Major Infrastructure Unit will be created within the Planning Inspectorate, with Ministers ultimately taking major infrastructure development decisions.

    3. Various NHS arm's length bodies
      The number of health arm's length bodies will be cut from 18 to 8-10. Organisations facing the chop include the Alcohol Education and Research Council, the Appointments Commission, the Health Protection Agency, the National Patent Safety Agency, and the National Treatment Agency for Substance Misuse. Many of their functions will be transferred to the Secretary of State as part of the new Public Health Service.

      The Coalition is also consulting on a proposal to abandon a new body that is currently in its set up phase - the Office of the Healthcare Professions Adjudicator - before it has even had the chance to exercise any of its powers. The consultation closes on 11 October 2010.

    4. The Financial Services Authority (FSA)
      The FSA's responsibilities for regulating the financial services industry will betransferred to the Bank of England under the remit of a new Prudential Regulatory Authority (PRA) and a new Consumer Protection and Markets Authority (CPMA).

      The PRA will be solely responsible for the day-to-day prudential supervision of financial institutions, while the CMPA will have responsibility for the conduct of all financial services firms providing services to customers.

      The Coalition is currently consulting on the detail of its proposals. The consultation closes on 18 October 2010.

    5. The UK Film Council
      The British Film Institute remains as a conduit for public and Lottery support for film making.

    6. The Museums, Libraries and Archives Council

    7. The Qualifications and Curriculum Development Agency (QCDA)
      The QCDA's qualifications and curriculum work has already ceased, providing an £8 million budget saving. Transfer plans will be made for its work on national tests and examination administration.

    8. The General Teaching Council for England

  2. Notable mergers include:
    1. UK Sport and Sport England
      The organisations with responsibility for elite and grassroots sport will be merged in advance of the 2012 Olympic Games.

    2. The Gambling Commission and the National Lottery Commission

  3. The Government has also created the following new quango:
    1. Office of Budget Responsibility (OBR)
      The OBR was formed almost immediately upon the Government taking office to make an independent assessment of the public finances and the economy for each Budget and Pre-Budget Report.

Our comment:

The abolition of numerous arm's length bodies - sometimes dubbed the 'bonfire of the quangos' - has been presented as a central plank of the Coalition's proposals for budgetary restraint.

While the justification in terms of cost savings may be clear, the proliferation of quangos under the previous government was part of a drive for decentralisation and their abolition will entail a significant restructuring of the state. Many of the functions carried out by quangos are important and need to continue. For instance, the protection of public health is no less necessary for the abolition of the Health Protection Agency; the functions have to revert to central government. The bonfire of the quangos could readily turn into a strongly centralising measure.

Nonetheless, the Coalition's seriousness of intent in this area is clear and patently driven by more than fiscal retrenchment. When the Coalition announces the abolition of a small and popular quangos such as the UK Film Council (annual budget of £15 million) - in the certain knowledge that it will be strongly criticised by influential people in a position to make themselves heard - it is obvious that the drivers are political as well as financial.

Moreover, given the real need for public sector financial discipline, few would have predicted that one of the quangos to be axed would be the Audit Commission - commonly referred to by journalists as the 'spending watchdog' for local government and the NHS. This clearly does not mean that the Coalition has no plans to ensure value for money in these parts of the public sector; the opposite is obviously the case. But it does mean that it is serious about doing things in a very different way.

Much criticism of quangos has focused on their perceived lack of accountability (though one person's lack of accountability is another's independence of party politics). But the Coalition proposes a Public Bodies (Reform) Bill for the autumn legislative programme, which will not only give ministers the power to abolish and merge quangos, but also reform how they are operated. The Bill will be a significant one to watch.

In this context, some may have been surprised that one of the first actions of the Coalition was the creation of a new quango - the Office of Budget Responsibility. However, with a direct influence on budgetary policy, and a streamlined structure - a three member Commission supported by a small secretariat - this new quango takes a significantly different form to those created under the previous administration.

Regional and Local Government

  1. Abandonment of regional government structures and strategies:
    1. Abolition of the Regional Development Agencies (RDAs)
      The RDAs will be abolished by March 2012. Their functions will either be discontinued or transferred to Local Enterprise Partnerships (LEPs) established by local authorities acting in co-operation with each other. A White Paper is expected to be published in the autumn and make provision for transfer arrangements. Local authorities have been asked to state their interest in forming LEPs by September 2010.

      Because of the unique administrative structure in London, the London Development Agency's functions will be discontinued or transferred to the Greater London Authority.

    2. Closure of the Government Offices for the Regions
      The timetable for transfer of the functions of the Government Offices for the Regions has yet to be set, but it seems likely that most of the functions performed by the civil servants employed in these offices will revert to Whitehall.

    3. Ending of funding for Regional Leaders' Boards

  2. Strengthening of local government
    1. Localism Bill
      The Coalition plans to introduce a Localism Bill with the aim of decentralising power as far as possible, giving councils a general power of competence, giving communities the power to save local facilities threatened with closure and the right to bid to take over local state-run services. The Localism Bill would also give residents the power to instigate local referendums on any local issue and to veto excessive council tax increases. The Coalition aims to pass the Localism Bill by November 2011.

    2. Local Government Bill
      The Local Government Bill passed Report Stage at the end of July. This Bill gives effect to the Coalition's commitment to put a stop to existing proposals for the restructuring of councils in Norfolk, Suffolk and Devon (as proposed by the previous administration).

    3. Power for local authorities to sell energy from renewables back into the National Grid
      The Government has ended the ban on local authorities selling energy generated from renewable sources back into the National Grid. This opens an important potential revenue stream for local authorities and is aimed at unlocking the potential for local energy solutions.

Our comment:

The Coalition has effectively abolished the regional tier of government in England. At one stage, the previous administration had high hopes for transforming the government of the English regions by devolving power to democratically elected assemblies along the lines of that in Wales. But, having failed to carry the policy in a referendum in the north east in 2004, its intentions dissolved. English regionalism was left with nothing but the RDAs, the Government Offices and a few largely insignificant appendages. It had little underpinning in the form of public knowledge or support, and shallow roots that have been easily pulled up.

Nonetheless, there is little doubt that the current changes are politically driven. Regionalism is a concept much loved by the European Commission, and therefore not much loved by many in the Coalition. And the RDAs are being abolished in spite of general support for their work within the regional business communities, and recent research by PricewaterhouseCoopers suggesting that their investments represent good value for money. It is questionable whether the new LEPs, for which the budget will be significantly lower than that which has been available to the RDAs, can hope to have a similar impact.

Ultimately, whether this amounts to a recentralisation of power in Whitehall, or to something more positive, will depend greatly on the role of local authorities. The rhetoric of the Coalition points to a new emphasis on localism in place of regional government. But, is this just convenient cover, or a genuine attempt to devolve powers to the lowest level? And, if the latter, can councils be given the powers, and adapt the capability, to step into the role? The proposed Localism Bill is, in principle, one of the more interesting and important of the many draft pieces of legislation shortly to be introduced into Parliament.

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3 Regulation

Reducing regulation

  1. Reducing Regulation Committee
    The Business Secretary has formed the new 'Reducing Regulation Committee' to 'bring an end to the excessive regulation that is stifling business growth'.

  2. One-in One-out
    The Coalition has announced a comprehensive package of measures to support its drive to tackle unnecessary government interference and red tape. From 1 September 2010, a new One-in, One-out system will begin. When Ministers seek to introduce new regulations which impose costs on business or the third sector, they will have to identify current regulations with an equivalent value (in terms of compliance cost) that can be removed.

  3. Your Freedom
    At the start of July, the Deputy Prime Minister launched 'Your Freedom' to encourage people to nominate laws or regulations they want to see scrapped.

    In a similar vein, the Communities and Local Government (CLG) Secretary has published a list of secondary legislation that his department intends to revoke and appealed to council staff to suggest which other CLG-sponsored statutory guidance, secondary legislation or regulations should be removed.

    The Department for Culture, Media and Sport has asked the Central Council of Physical Recreation to conduct a review aimed at cutting the red-tape and bureaucracy that hits sports clubs and holds back participation. The review will look at a number of areas, including: licensing regulations and planning rules.

  4. Academies
    The Department for Education is promoting the conversion of more schools to Academies. Academies are publicly funded independent schools, free from local authority control. Other freedoms include setting their own pay and conditions for staff, freedom from following the National Curriculum, and the ability to change the lengths of their terms and school days.

Our comment:

All new governments - at least since Harold Wilson's 1947 'bonfire of controls' - have tended to make promises to reduce regulation and liberate private enterprise. Few, if any, have been successful. However sincere the intentions, the business of being in government has a way of leading ministers down the path of regulation. It is doubtful that any minister was ever asked by a journalist when he or she was 'going to start doing less' about something.

So there is no need to doubt the sincerity of the Coalition when it says that it wants to reduce the regulatory burden, nor the desirability of its doing so. There is surely a great deal that can be done to reduce the day to day burden of compliance with the law for business and the third sector. Significant opportunities exist to slim down and clarify the mass of primary and secondary legislation on the statute book. But can the government successfully address its own regulating tendency?

The One-in One-out system sounds, on its face, an overly crude approach, and it seems doubtful that any 'Star Chamber' of the type being proposed can be effective. What is really needed is a culture change at the heart of government - something that is much more difficult to achieve than the creation of committees and rules. The outcome of the Coalition's Spending Review, which will require all departments to find substantial savings from their current budgets (see below), might yet be a more powerful promoter of deregulation than any of these proposed approaches. It will be worth watching how the Coalition performs in this area.

Reorganisation of regulation

  1. Health regulation
    As part of a major suite of reform proposals, the Department of Health has published five consultation papers following the publication of its White Paper 'Equity and Excellence, Liberating the NHS' in July. The deadline for responses to each consultation is 11 October 2010. The links to each paper are provided below:
    1. 'A report on arm's length bodies'
      This reviews the number of health quangos and proposes the abolition of several.

    2. 'Liberating the NHS: Regulating Health Providers'
      This seeks to extend the role of Monitor as an independent economic regulator for all healthcare providers in England and Wales.

    3. 'Liberating the NHS: Increasing democratic legitimacy in health'
      This sets out proposals to strengthen the role of local government in health.

    4. 'Liberating the NHS: commissioning for patients'
      This seeks views on the proposed arrangements for GP commissioning, replacing the existing role of Primary Care Trusts.

    5. 'Transparency in outcomes - a framework for the NHS'
      This aims to establish a new framework for the NHS with a set of national outcome goals spanning effectiveness, patient experience, and safety.

  2. Financial regulation
    The Coalition will legislate to put financial regulation back into the hands of the Bank of England under the proposed Financial Reform Bill.

    It has launched a consultation called 'A new approach to financial regulation: judgement, focus and stability', which closes on 18 October 2010.

  3. Airport regulation
    An Airport Economic Regulation Bill will be introduced to change the framework for the regulation of airports by the Civil Aviation Authority (CAA). Among other things it will ensure that the CAA has a principal objective that is focused on passengers and will introduce a licensing regime for airports that brings the CAA regime into line with that which is common to other economic regulators.

  4. Energy regulation
    The Department for Energy and Climate Change is consulting on the future role of the energy regulator Ofgem, through a 'call for evidence'. This consultation closes on 24 September 2010.

  5. Licensing
    Responsibility for the Licensing Act 2003, except in relation to regulated entertainment, will transfer from the Secretary of State for Culture, Media and Sport to the Home Secretary.

Our comment:

The Coalition appears to have a commitment to the basic principles of independent regulation, as established in UK law over the last 25 years. Regulators, barring the special case of the Financial Services Authority, appear largely immune from the cull that is affecting the mass of quangos.

But, the Coalition has shown that its policies are going to be tailored to each sector. Hence in some areas, such as health, there are proposals for significant expansion of the remits of the existing regulators. In others there are proposals for suitable adjustments, either to strengthen the regulator or bring its role up-to-date - e.g. the CAA. And in others there may be some trimming to the remit of the regulator, while leaving its central role and independence untouched - probably Ofgem and, in due course, Ofcom.

The devil is therefore in the detail, and it will be important to scrutinise carefully the legislative proposals when they are made later in this parliamentary session.

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4 Money and everything else

Spending

  1. Spending review
    This Coalition's Spending Review is the most significant of any government in recent times, preparing the way for austerity-style cuts in departmental expenditure. Every government department except the Department for Health and the Department for International Development has been asked to indicate how it could make budgetary savings of 25% or 40% if requested. The 25% figure is regarded as a base scenario for all non-protected departments.

    The Spending Review is due to be concluded on 20 October 2010. In the meantime, there is a public consultation on the best ways for government to save money.

  2. Civil Service Redundancies
    The Minister for the Cabinet Office has announced that he will begin the process of introducing legislation as soon as possible to cap the amount of redundancy payments made to civil servants to bring them in line with the best practice in the private sector.

  3. Building Schools for the Future
    The Department for Education has been reviewing the Building Schools for the Future programme since the election. It concluded (with several embarrassing errors in its initial announcements) that all local authority schemes that have not reached financial close would not go ahead.

  4. COINS
    COINS is the 'Combined Online Information System', a massive government database of financial data on the spending of departments and public bodies. The Coalition has released the recent historic data as the first instalment of what it plans as a significant move towards greater financial transparency across the whole of government.

  5. Efficiency and Reform Group
    The Office of Government Commerce and the procurement agency Buying Solutions have been moved to the Cabinet Office and merged into the Efficiency and Reform Group (ERG). The role of ERG will be to manage all cross-governmental functions and ensure that they are carried out efficiently.

  6. Government marketing and advertising freeze
    The Coalition has placed a freeze on all new government advertising campaigns unless they have first been approved by the ERG.

  7. Lobbying
    Communities and Local Government will launch a consultation to update the Local Authority Publicity Code, which guards against campaigning with public funds. It will include stronger guidance to stop public funds from being spent on private lobbying contractors to persuade the public or government to take a particular view on specific policies.

Our comment:

The most important date for Coalition watchers in the autumn calendar is 20 October 2010, scheduled as the day when the outcome of the Coalition's first Spending Review is to be announced. This will without question be hugely significant for the future of this government, and possibly for the future of UK government generally.

While it has always been easy to speak of public sector inefficiencies, locating and addressing them has been a different story. And for any government department to find 25% savings in its budget will require a degree of cost cutting that cannot be achieved by efficiencies alone. Put simply, the outcome of the Spending Review will almost certainly lead to government departments needing to do much less than they currently do. But where exactly the axe will fall, what programmes will be cut and what saved, and what implications this will have for the public sector as a whole are huge questions about which current speculation would be unhelpful.

What can be said with certainty is that the cuts will mean a large programme of civil service redundancies. The last government attempted to reach agreement with the trade unions on the revision of existing civil service redundancy terms, which are - at least by private sector standards - very generous. But, having failed to get an agreement with the PCS, it found itself the subject of a judicial review in which its decisions were quashed.

The judgment in the judicial review was given on the day immediately before the Coalition took office, so that if the PCS felt any sense of victory it must have been extremely short lived. The Coalition now proposes to side step the problem with new legislation that would revise the redundancy terms without the need for trade union agreement, and to set those terms at a level even more restrictive than that intended by the last government. Large scale civil service redundancies will not take place until the government has, by this means, substantially reduced their cost to the taxpayer.

Privatisations

Royal Mail

The Coalition proposes to introduce a Postal Services Bill which will provide for an injection of private sector capital into Royal Mail - in effect, a part-privatisation.

In the meantime, the Business Secretary has asked Richard Hooper to update a report written for the previous government on the future of the universal postal service in the UK.

Our comment:

The government has, these days, little left to privatise, aside from its shareholdings in major banks acquired during the credit crunch, the sale of which is far from imminent. However, there are still some assets that it will look to get off its books - either to raise capital or to shift debt away from government accounts. HM Treasury drew up a list for the last government of about 15 potential privatisations, and we can expect the Coalition to take a disposal programme forward as its predecessor in government would certainly have done.

The problems at Royal Mail are, however, unique and the solutions may have to be similarly creative.

The 'Big Society'

  1. National Citizen Service
    The Coalition has announced plans for 16-year-olds voluntarily to take part in pilot schemes for a new National Citizen Service during summer 2011.

  2. The Big Society Bank
    There is to be a 'Big Society Bank', recycling money from dormant bank accounts and making it available to third sector organisations in the hope of leveraging additional private sector capital.

  3. Free schools
    The Coalition moved quickly to legislate for a rapid expansion in the number of academies, introducing a Bill which has already received Royal Assent and become the Academies Act 2010.

    This is part of the Department for Education's drive to facilitate a range of 'free schools' that can be set up by parents, teachers or charities in response to local demand.

Our comments:

Was the 'big society' just an election slogan? Perhaps. However, far from abandoning it after the election, the Coalition has if anything scaled up the rhetoric. It would perhaps be harsh to point out that it can hardly stand any attempt at legal definition. But, true as this is, it may also risk missing the point. When the Coalition talks about a big society it appears to mean those things that involve public or quasi-public functions being carried out at the level of local communities and not delivered to individuals by central government or quangos. If so, it is an idea that is related to the changes to the constitution, machinery of government and regulations which we are looking at elsewhere in Coalition Watch. It is also, put bluntly, a policy that may be rendered more significant by the financial disciplines which the Coalition Spending Review proposes to adopt. If the State ceases to provide because it ceases to spend, activities which are governmental in nature at the present time may simply have to be performed elsewhere.

These issues slide seamlessly into the classic public law questions of what functions are 'public' in nature and whether the protections of the Human Rights Act apply to activities carried out by non-governmental bodies.

So, for the moment, we use the heading 'big society' to mean anything that involves a devolution of power or responsibility for what appear to be 'public' functions to a level below that of local government. We will look in future editions of Coalition Watch at whether the government's changes in this area have any real significance.

The above analysis was written by Ravi Randhawa, associate in Wragge & Co's Public Law & Regulation team.

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5 Outstanding/Omissions:

All governments have to be judged not just by what they do, but by what they fail to do.

In each edition of Coalition Watch we propose, as a footnote, to end by drawing attention to one of the things that the Coalition has not done, or shows no sign of doing, at the time of writing.

In this edition the theme is... relocation.

In March 2004, Sir Michael Lyons, at the request of the then Chancellor and Deputy Prime Minister, was asked to review the options for relocating public sector jobs out of London and the South East.

In his detailed and closely argued report he concluded that it would be both feasible and desirable, as a first step, to move 20,000 government jobs north of the M25. There would be an undeniable cost saving to the public purse - £2 billion over the first 15 years - and real economic benefits to those areas of the country where they were most needed.

HM Treasury approved the report and drew up a detailed plan to move the (strikingly precise) number of 20,028 public employees to the regions by 2010. However, there can often be a huge gulf between intention and delivery. The last government failed to deliver on that commitment.

Nonetheless, both the Lyons Report and the plan to implement it continue to reside on the Treasury website and can be found online.

The Coalition programme is of course concerned not just to save money and reduce the deficit. But the fact is that the Coalition does intend to save money at every level of government, and that this is its number one priority. And yet, if it has any plans to relocate government jobs from Whitehall, it is keeping them quiet.

In truth, Sir Michael Lyons merely found the evidence to prove something that was already obvious. As the Coalition freely abolishes regionally-based quangos, taking some of their functions back into government departments in London, its silence on relocations is one omission that gets harder to ignore.

The above analysis was written by John Cooper, partner in Wragge & Co's Public Law & Regulation team.

If there is anything you would like us to cover in future editions of Coalition Watch or wish to comment on from this edition, please feel free to email the team at publiclawandregulation@wragge.com - we welcome your comments.

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Key Contact

John Cooper, partner, +44 (0)870 730 2878, john_cooper@wragge.com

This analysis may contain information of general interest about current legal issues, but does not give legal advice.