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Labour is the party of the lazy super-rich, and the public hate us for it

In his critique “Who Runs Britain”, Robert Peston calls on something called the Gini coefficient – a measure of income inequality that boils down the distribution of income in Britain into a number between zero and one. Zero corresponds to a world where all households have an identical income; and a Gini of one means all income goes to a single person. Under Thatcher, Gini soared. It dipped a bit under Gordon Brown’s stealth taxes, but was soaring again towards the final throws of the last Labour administration. Peston thinks this is an awful thing to happen under a Labour government, and, actually I am very much inclined to agree.

A critical issue for Labour is why the super-rich became super-richer, and Labour shows any motivation in stopping this socio-economic fervour.  A select group of quangocrats are earning up to £5,000 a day for part-time work on state agencies, authorities and commissions. Among them are quango ‘kings and queens’ who jump from state job to state job with the help of Government patronage. Those “non-departmental public bodies” on the Cabinet Office list total 742 across the UK. However, Wales and Scotland have devolved responsibility for some of their own which are not on the list. The Taxpayers’ Alliance, claims the figure is actually 1,162.

Cue the Public Bodies Bill. Now the QUANGO is in the sights of those debating the Public Bodies Bill in the House of Lords. A QUANGO is a Quasi-Autonomous Non-Governmental Organisation.  It is an organisation that is funded by taxpayers, but not controlled directly by central government. It is uncommon for the House of Lords to reject a piece of legislation at the second reading, and as far as possible the House of Lords will approve a statutory instrument passed in the other place.

The government reviewed 901 bodies – 679 quangos and 222 other statutory bodies. Of those 192 will be axed or their functions taken over by other bodies. The future of other bodies is still under consideration but 380 will definitely be kept.

It is argued that Labour presided over a big expansion in the public sector. When Labour came to power in 1997 there were 857 “non-departmental public bodies”. According to the Cabinet Office, that number fell to 827 in 2007 and 790 last year. But their expenditure is soaring, from £37bn in 2006-07 to £43bn last year, with the taxpayers’ contribution rising from £30.8bn to £34.5bn.The Conservatives and Lib Dems have accused it of effectively setting up a “quangocracy” – a tangle of self-aggrandising, free-spending organisations with little accountability and, in some cases, little real purpose.

Dan Lewis, the research director of the Economic Research Council think-tank, said: “The quango was a late 1990s Blairite policy solution. You give it a good name, you set up a fancy website, people are given good titles, it starts off well. And then it starts to lose its way. We need to look closely – if we are going into a nasty recession – [to check whether] they are engaging in activities which private companies are doing already or whether they are even crowding private sector activity. I hope very much that David Cameron, soon after taking office, orders that the Cabinet Office quickly restore a full annual quangos report in a clear and accountable break from the past.”

The last time peers referred a bill to a special select committee, against the wishes of the then Labour government, was in 2004 with the Constitutional Reform Bill, which created the Supreme Court and reformed the historic office of Lord Chancellor.

However, government whip Lord Taylor of Holbeach, opposing the Labour move, said the Public Bodies Bill was “not overtly complex or technical and it doesn’t seek to radically overhaul our constitution”. Labour peers’ leader Baroness Royall of Blaisdon noted that the Lords constitution committee had recently delivered a “devastating critique” of the legislation. Baroness Loyall has called on peers to back Labour’s amendment, which would refer the bill to a specially formed select committee in advance of its normal committee stage. She further said the opposition would support a further amendment, from senior Liberal Democrat peer Lord Maclennan of Rogart, that the select committee should report by the end of February to implement the purposes of the bill to maximize public consultation. Lord Maclennan has argued that their scope should not be to look at the merits of the QUANGOs, but look at the broad way how the QUANGOs could be considered.

However, clearly QUANGOs need reforming, and Labour has to distance itself from the idea knocking about that the super-rich need to get even super-richer.

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