The TaxPayers' Alliance - Better Government

New Research: EU regulation increasing at record rate

Against the background of worsening economic conditions and businesses struggling to remain solvent, the TaxPayers' Alliance (TPA) today publishes a detailed study of the severe burden placed on business by EU regulations. The report reveals the true scale of EU regulations, and uncovers the fact that the pace of regulation is increasing at a record rate, with thousands of new regulations introduced each year. As well as over-regulation from Brussels, though, the report also studies the contribution made to the regulatory burden by "gold plating" in Whitehall, with civil servants and Ministers adding extra rules, greater complexity and unnecessary sanctions to regulations passed down from Brussels. With the UK's regulatory burden costing British business £150 billion a year, the report proposes three simple, practical ways to reduce the problem and therefore help British business to weather the economic storm. To read the full report, click here (PDF).

Key Findings

• There are currently 16,980 EU acts in force. Between 1998 and 2007 there has been a net gain of 9,415 EU laws.   
• In 2007, 3,010 EU laws became UK law, while only 993 EU regulations were repealed - a net gain of 2,017 extra laws. 
• The rate of new EU laws has increased to a record speed, with a net gain of over 2,000 new laws in each of the last two years, compared to an annual average net gain of only 942 new laws between 1998 and 2007. Almost half of the extra 9,415 EU laws created in the last ten years have been introduced in 2006 and 2007. Despite EU rhetoric about reducing regulation, it is growing at a record rate.
• Whitehall also adds to the burden: at least 770 pages of UK Statutory Instruments will be needed to enact the 76 Directives passed by the EU in 2007.  Assuming this as an average per year, then EU directives alone have necessitated over 7,700 pages of UK law since 1997.
• Despite the enormous amount of EU legislation, UK gold-plating and poor enforcement practices exaggerate the burden of regulation.

Recommendations for change

• The European Union (Transparency) Bill would force Ministers to declare to Parliament which new laws are derived from EU laws. This would increase awareness of the sheer scale of the EU's regulatory machine and make it impossible for the Government or Whitehall to smuggle through their own unpopular policies in the guise of EU requirements.
• Regulatory sunset clauses would ensure that all regulation expires after a certain time period, unless Parliament voted to renew it. This would cut out regulatory dead wood and avoid unnecessary regulations lingering on after they have become useless or counter-productive.
• More powerful Parliamentary scrutiny of EU legislation. British Parliamentary scrutiny of EU laws is extremely weak and ineffective, particularly when compared to the successful, stronger powers of other countries such as the Danish Parliament. The UK should adopt the Danish system of  a Parliamentary committee with the power to scrutinise every single EU law.

Download the report here (PDF).

Ben Farrugia, a Policy Analyst at the TaxPayers’ Alliance, said:

“Regulations are an enormous burden to business, particularly in a time of financial hardship. The EU’s addiction to regulating and Whitehall’s compulsive gold-plating have added billions to business costs in recent years. Both the legislative process which has created this regulatory tangle and Britain’s relationship with the EU needs a serious rethink.”

Regional Development Agencies: £15 billion thrown away

• Detailed analysis of regional economic performance shows no improvement - and even a slowing - in regional performance since RDAs were created.
• Since 1999 these failed quangos cost taxpayers £15 billion, nearly £600 for every household - money that has effectively been thrown away.
• The money saved by abolishing RDAs would be enough to cut Corporation Tax on small companies by 4p.

New research from the TaxPayers' Alliance (TPA) demonstrates conclusively that the Regional Development Agencies (RDAs) have contributed nothing to the economic development of England's regions. Detailed and comprehensive analysis of regional economic development over the last fifteen years shows that in almost every measure their allotted regions performed better in the seven years before the Agencies were established than in the years since they were set up. The £15.3 billion spent on RDAs since 1999 has been wasted, and the report lays out a clear alternative to these massive quangos that would provide a genuine motor for regional development.

For the full report click Download structure_of_government_3_the_case_for_abolishing_rdas_e.pdf (PDF).

KEY FINDINGS:

RDAs have failed on their three key aims:

• Employment – growth in the number of jobs and the number of people in work, has slowed since RDAs were set up in 1999. Between 1995 and 2000 the number of jobs in England increased by 9.5 per cent, while between 2000 and 2005 it increased by 3 per cent. From 1992 to 1999 employment rose by 0.3 percentage points a year. From 1999 to 2006 that rate has dropped to just 0.1 percentage points.
• Economic Growth - apart from London and the South East, England’s regions grew faster in the seven years before RDAs were introduced than in the seven years after, in both per head and total output terms. The rate of business creation has not significantly increased since 1999.
• Regional equality – in economic output, the relative contribution of the seven regions besides London and the South East has dropped from 64 per cent in 1992 to 52 per cent in 2006. The gap between the richest and poorest regions has grown over the past decade, not diminished. Local inequality within the regions has got worse, too.

RDAs are riddled with waste and excess:

• The report features a full RDA rich list detailing the 39 top earners raking over £100,000 each in England's Regional Development Agencies.
• Examples of waste within RDAs abound; extravagant trips to the south of France, ludicrous taxi expenses and lavish one day conferences are all commonplace. James Braithwaite, Chairman of SEEDA, spent £53,803 on transport in 2006-07. Yorkshire Forward spent £20,000 sending staff to a Film Festival in Dubai in 2006.

There is a simple, effective alternative: Cut taxes on small businesses

Abolishing the Regional Development Agencies would have no negative impact on the regions, given the RDAs' failure since 1999. Their 2009-10 budget of £2.19 billion could then be used to pay for a 4p cut in the Small Business Rate of Corporation Tax - from 22 per cent to 18 per cent. Reducing tax on small businesses would create new jobs, boost existing businesses, make life easier for people starting business and give the regions an economic leg-up: exactly what the RDAs were meant to do and have failed to achieve.

Ben Farrugia, Policy Analyst at the TaxPayers’ Alliance, said:

“Regional Development Agencies have failed in their core mission to narrow the gap between the economic performance of England’s regions. At a time when businesses are increasingly over-regulated and over-taxed, RDAs have become a symbol of wasteful bureaucratic excess. They should be abolished before the Government hands them even greater powers.”

Download the full report (PDF).

GOVERNMENT MANAGEMENT SERIOUSLY FLAWED, REVEALS SURVEY OF FTSE 100 CHIEF EXECUTIVES

A survey by the TaxPayers’ Alliance (TPA) of the UK’s 100 top business leaders has revealed that Government management practices fall far short of the minimum they believe is necessary to effectively manage large organisations.

Download the full report here (PDF)

The survey, which asked the Chief Executives of all FTSE 100 companies to specify the experience and term of tenure necessary to do a good job, received responses from 32 CEOs whose companies have a combined turnover of £370 billion and employ 1.8 million people. The skills, experience and stable management recommended by Britain’s most successful business leaders contrast sharply with the current reality of unmanageable departments, inexperience and constant reshuffling found in Westminster and Whitehall. The report lays out ways to learn from successful businesses to improve the value for money and quality of service received by taxpayers.

The full report, which can be found here, contains full details of the survey and detailed analysis of the reality in government as well as the TPA’s recommendations for fundamental change.

Key Findings

The Chief Executives highlighted three essential qualities for good senior management, which contrast sharply with the current situation in UK Government:

• Chief Executives recommend: Experience of senior management.
  
  But in Government: None of the current Cabinet have any experience of managing a large business. Only 1 in 7 MPs has any management experience at all.
• Chief Executives recommend: At least 5 years in the post, to adequately get to grips with the task in hand.
  
  But in Government: The average appointment for a Secretary of State is 2 years, for a senior civil servant 2 years and 8 months, and for a minister just 1 year and 8 months.
• Chief Executives recommend: Experience of the sector the organisation works in.
  
  But in Government: Departments are so vast and varied it is impossible to be properly experienced in their sector. For example, the Department of Culture, Media and Sport has 63 subsidiaries covering everything from heritage sites to the 2012 Olympics.

Ben Farrugia, Policy Analyst at the TaxPayers’ Alliance, said:

“Comparison with the most successful business leaders in the country reveals that the people running public services lack appropriate experience, have near impossible tasks to do and are never in their job for long enough to engage properly with their departments. Whitehall is malfunctioning in a way that no business could ever contemplate, and it is ordinary families who have to foot the bill and suffer the consequence of struggling services.”

Download the full report here (PDF)

CRIME COSTS £15 BILLION A YEAR

• FULL COST OF CRIME BREAKDOWN FOR 39 POLICE FORCES IN ENGLAND, WALES AND NORTHERN IRELAND
• CRIME COSTS ALMOST £275 PER HEAD OF POPULATION
• HIGHEST COST OF CRIME IS IN NOTTINGHAMSHIRE - FULL LEAGUE TABLE PUBLISHED

With crime levels top of the list of voters’ concerns, this paper (PDF), for the first time, details the cost of recorded crime per person in each of the police force areas in England, Wales and Northern Ireland in 2007, the latest year for which data is available.

The Cost of Crime report uses crime data from each police force – gathered using the Freedom of Information Act – and compares the number of different crimes in each police force area in England, Wales and Northern Ireland with the Home Office estimates of the cost of each type of crime to produce a clear and accessible picture of the true impact of recorded crime around the country. Using local population figures, the TaxPayers' Alliance have produced a league table of police forces ranked by the cost of crime per head of population, allowing local citizens to assess the performance of their local police and compare it with other parts of the country.

The full report, including full breakdowns for each police force, analysis and comparative league tables, can be found here (PDF).

KEY FINDINGS

• Recorded crime in England, Wales and Northern Ireland cost nearly £15 billion in 2007, equivalent to nearly £275 for every person.
• Violence against the person, including murder and serious assault, was responsible for the highest economic and social costs, at around £155 per person.
• Residents of Nottinghamshire suffered from the highest cost of crime, at £390 per person.  It was closely followed by London, at £388 per person.  Humberside had the third highest cost at £380 per person. A full table is provided in the report.
• Many, predominantly rural, areas saw a far lower cost of crime.  Crime cost £130 per resident in North Yorkshire, £186 per resident in Dyfed Powys and £194 per resident in Surrey.

Matthew Sinclair, Policy Analyst at the TaxPayers' Alliance, said:

"Every one of us pays a steep price for high crime rates, particularly those living in urban areas.  Whether we have been victims of crime, are afraid to go out at night or are just paying ever more to protect and insure ourselves and our property, crime has significant economic, emotional and social costs for us all.  The problem is that politicians in Whitehall insist on micro-managing the police. If the Government give people the information and the power to tailor their local police force to their local needs, we will be able to drive crime levels down and improve the lives of millions.”

**UPDATE**

Lincoln's Freedom of Information request was sent to an inactive e-mail address which delayed getting a response.  Those figures have now been supplied.  We've run the calculations and the figures are the following:

Total cost of crime: £152.4 million
Cost of crime per person: £222.13
Cost of crime per person rank: 34

Nottinghamshire Police contacted the press telling them that there were errors in the figures they had sent to us.  They didn't bother to send us the correction but we rang them to find out what was going on and now have the new figures.  They are significantly lower than the original numbers that we were supplied.

Here are Nottingham's revised figures:

Total cost of crime: £375.4 million
Cost of crime per person: £355.70
Cost of crime per person rank: 8

This clearly affects the rankings of other forces.  E.g. London moves up to 1.

Just to again make it absolutely clear.  Nottingham did not find a flaw in our calculations.  They corrected a mistake on their own part in sending us flawed figures in response to a Freedom of Information Act request.  Here's the headline in the Nottingham Evening Post:

"NOTTS POLICE ADMIT ERROR IN COST OF CRIME STUDY"

Quangos: The Unseen Government of the UK

The most comprehensive picture ever of the UK’s 1,162 Quangos

The TaxPayers’ Alliance (TPA) presents the full list of the UK’s vast quango industry, a detailed run-down of the staff and cost of the 1,162 bodies, boards and agencies that make up Britain’s Unseen Government. It is now five years since the Parliamentary Select Committee on Public Administration recommended that the Government publish such a list, a recommendation that the Government has failed to fulfil. In the absence of an official list, the TPA has compiled one instead, providing the public with the most comprehensive information available on the organisations that increasingly spend their money and influence their lives without democratic oversight. The report can be found here (PDF).

Key Findings:

• There are 1,162 quangos in the UK, running at a total cost to the taxpayer of £64 billion, equivalent to £2,550 per household.
• Even under the Cabinet Office’s restrictive definition of quangos, the cost of these bodies has risen 50% in the last ten years.
• UK quangos now employ an army of almost 700,000 bureaucrats.
• Even the Government itself does not know the full extent of the unaccountable quango industry, which range from the massive e.g. Job Centre Plus (Staff: 70,042, Cost: £3.5 billion) and the Courts Service (Staff: 19,986, Cost: £704.8 million); to the bizarre e.g. the British Potato Council (Staff: 49); or the West Northants Development Corporation (Staff: 34, Cost: £15.3 million)
• When the total number of quangos is added to the other government subsidiaries such as local authorities and NHS trusts, the total number of organisations controlled by the UK Government rises to 2,063, costing the taxpayer £257 billion and employing over 5.1 million people.

Ben Farrugia, author of the report and Policy Analyst at the TaxPayers’ Alliance, said:

“Government in the UK is now so large, diverse and complex that it is impossible for anyone to manage effectively, let alone by Ministers with no prior experience of management and little in-depth understanding of the work carried out by their departments. Government today tries to do too much, and consequently fails; the structure of government needs to change if we hope to see better value and significant improvements in our public services.”

The full report provides a full list of the quangos along with individual data on staff numbers, taxpayer funding and expenditure as well as national totals and can be found here (PDF).

Public Sector Strikes

Strikes are back in the news, with industrial action in the past week by oil refinery workers and school teachers. As a result, there is growing public concern at the cost of these strikes and the interruption to vital services.

New TaxPayers’ Alliance research reveals that workers in the public sector go on strike far more than their private sector counterparts:

• Over the last five years public sector workers have gone on strike for over 20 times as many days on average as workers in the private sector (see Table 2).
• Over the last twelve months public sector workers have gone on strike for 895,000 working days, more than 100 times as many days on average as workers in the private sector (see Table 1).
• This is despite public sector workers being paid more and being far more likely to enjoy benefits such as a final salary pension scheme.

Mike Denham, former Treasury economist and TaxPayers’ Alliance expert,said:

“Public sector workers have learned from past cave-ins that this government is willing to compromise taxpayers’ interests in the face of strikes. They know that politicians are far too ready to spend our money to avoid political embarrassment. And with the public sector four times more unionised than the private, strikes have increased sharply, leaving ordinary taxpayers facing untold inconvenience and expense, as well as the prospect of even higher taxes to buy off the strikes.”

Download the full report (PDF)

The Cost of Crime in London

A new study by the TaxPayers’ Alliance has discovered that the cost of crime in London in 2006-07 was a staggering £3 billion, equivalent to £400 for every person in London. Using Home Office calculations to take into account the economic and social cost of various types of crime, TPA researchers were able to provide an in-depth breakdown of the cost of different types of crime borough-by-borough.

Using the estimated costs of different types of crime gives an appropriate weighting to crimes such as violent or sexual offences that are more serious and more worrying to the public than petty theft from a shop.

The report reveals a wide inequality in the cost of crime among different boroughs, ranging from Westminster (£154.8m, or £620 per capita) and Islington (£109m, or £590 per head) to Harrow (£50m, or £235 per head) and Richmond (£39, or £215 per head).

Download the full report (PDF)

Matthew Sinclair, Policy Analyst at the TaxPayers’ Alliance, said:

"Ordinary Londoners, particularly those in the poorest boroughs, pay the price for high crime rates every day. Whether we have been victims of crime, are afraid to go out at night or are just paying ever more to protect and insure ourselves, crime has big economic, emotional and human costs for us all. We urgently need politicians to end the excuses, show real civic leadership and enable the police to take action and replicate the radical reductions in crime seen in other cities such as New York."

Matthew Elliott, Chief Executive of the TaxPayers’ Alliance, said:

“Crime is set to be the big issue in the Mayoral elections. Londoners are looking for a Mayor who will tackle the crime epidemic in the Capital. The Government should devolve full powers over the Metropolitan Police to City Hall so whoever is Mayor after May 1st has the power to sort out this menace.”

MAJOR STUDY ON THE NHS REVEALS OVER 17,000 UNNECESSARY DEATHS A YEAR

Download the full report here (PDF).

• A statistical analysis of World Health Organisation data reveals that the poor performance of the NHS is causing 17,157 deaths per year
• £34 billion of extra spending under Brown has made no difference to UK mortality

Using data from the World Health Organisation and statistical techniques pioneered in the British Medical Journal, the TaxPayers’ Alliance has produced a major report on NHS performance since the 1980s.

Wasting Lives: A statistical analysis of NHS performance in a European context since 1981, analyses data from the WHO to estimate the number of deaths that could plausibly have been averted by the NHS since the 1980s.  The measure used is known as “mortality amenable to healthcare”.  The calculations compare the UK performance to that of Germany, France, the Netherlands and Spain.

• If the UK were to achieve the same level of “mortality amenable to healthcare” as the average of the other European countries studied, there would have been 17,157 fewer deaths in 2004, the most recent year for which data is available. 
• This is equivalent to over five times the total number of deaths in road accidents and over two and a half times the number of deaths related to alcohol in 2004.
• Steady improvements in mortality rates, relative to European peers, have been made at almost exactly the same rate throughout the Thatcher, Major and Blair governments despite huge increases in spending from 1999 to date.  There can no longer be any doubt that the Government’s extra NHS spending has completely failed to deliver results.
• If NHS spending had continued to increase relative to European peers at its pre-1999 rate £34.3 billion – £1,350 per household – less would have been spent between 1999 and 2004.  In 2004 alone, £9.8 billion less would have been spent, 9.7 per cent of total spending in that year.  This extra money has largely been wasted.

Matthew Sinclair, author of the report and a Policy Analyst at the TaxPayers’ Alliance, said:

“Thousands are dying every year thanks to Britain’s health service not delivering the standards people expect and receive in other European countries.  Billions of pounds have been thrown at the NHS but the additional spending has made no discernable difference to the long-term pattern of falling mortality.  This is a colossal waste of lives and money.  We need to learn lessons from European countries with healthcare systems that don’t suffer from political management, monopolistic provision and centralisation.”

Professor Karol Sikora, Medical Director of CancerPartnersUK, steering group member of Doctors for Reform and author of the foreword to the report, said:

“The NHS should not be a religion, with its structure set in tablets of stone.  We face a choice between a modern, consumer driven service for all or a decaying, bureaucratic system which only those with their own resources manage to escape.  Politicians need to read this report carefully and determine the optimal strategy they can put to a well informed public.  Those that capture the best way forward will carry the British voter with them.”

Beyond the Dome: Government projects £23 billion over budget

The TaxPayers' Alliance today reveals for the first time the scale of cost overruns in public sector capital procurement projects.  We have investigated the official record of over 300 schemes, including roads, hospitals, science facilities, IT systems, art galleries and defence systems, which have been completed since the start of 2005 or are ongoing.  We then compared the initial cost estimates with the final outturns or latest estimates for each one.

THE pUBLIC Art Gallery in Sandwell - £30m over budget

There have been a number of high-profile public sector building and defence projects that have finished years late and many times over-budget.  The Euro-fighter, the Dome, and the Scottish Parliament, to name but a few, have repeatedly hit the headlines. 

The research presented today represents the first systematic attempt to evaluate the official record of public sector capital projects, both large and small, over the last two years.  The figures are quite startling:

• The total net overrun for the 305 projects was over £23 billion above initial estimates.  This is the equivalent of over £900 for every household in Britain.

• The average overrun was 33.7 per cent.

• 14 projects overran by more than the Millennium Dome.

• 57 per cent of projects overran, compared with only 14 per cent that came in under-budget.

• The worst two departments for overruns were the Department of Health and the Department for Culture, Media and Sport:

• Projects under the responsibility of the Department for Culture, Media and Sport were 286 per cent over-budget on average.

• Projects run by the Department of Health were £13.9 billion over-budget.

• By contrast, the best department was the Department for Work and Pensions.  Projects under its responsibility were 28 per cent under-budget on average.

• The worst regions for overruns were London and national (i.e. projects not allocated to any region):

• Projects in London were 132 per cent over-budget on average, primarily due to the Olympic Games, which are currently almost £7 billion over-budget.

• National projects were £11.5 billion over-budget, largely due to the NHS NPfIT, currently £10.1 billion over-budget, but given that the total size of national projects was larger, the average percentage overrun was lower.

• The worst region outside London was the West Midlands, where projects were 45 per cent over-budget on average.

• The best region was the South West, where projects were 10 per cent over-budget on average.

Based on this extensive analysis, the TaxPayers' Alliance now has a new “Law of Capital Procurement”, which states that public sector capital projects can be expected to overrun by at least a third.  We will be applying this “law” to all new capital projects announced by national and local government, to give taxpayers a realistic estimate of how much the proposal will really cost.

Barts & The London Hospital - £380m over budget

Matthew Sinclair, Policy Analyst at the TaxPayers’ Alliance, said:

“These figures expose a consistent pattern of poor project management in the public sector.  Taxpayers are footing the bill for the failure of politicians and civil servants to manage large projects effectively.  This inadequate record stems from a failure to properly specify what is desired from a project before the project begins, underestimating costs to get the project approved and paying over the odds in an attempt to solve the problem.”

Andrew Allum, Chairman of the TaxPayers' Alliance, said:

“It’s astounding that the Government is currently overseeing more than a dozen Domes.  Having had first-hand experience of public sector capital projects, it’s clear that the politicians and civil servants in charge lack the management experience and subject knowledge to run them effectively.  The Government needs to reduce the enormous scale of overruns to give taxpayers better value for money.”

Astute Class Submarines - £1bn over budget

Download Beyond the Dome (PDF)

For the accompanying regional notes:

Download Beyond the Dome: East Midlands (PDF)

Download Beyond the Dome: East of England (PDF)

Download Beyond the Dome: London (PDF)

Download Beyond the Dome: North East (PDF)

Download Beyond the Dome: North West (PDF)

Download Beyond the Dome: South East (PDF)

Download Beyond the Dome: South West (PDF)

Download Beyond the Dome: West Midlands (PDF)

Download Beyond the Dome: Yorkshire (PDF)

The TaxPayers' Alliance Guide to the New Cabinet

We take a brief look at the new Cabinet, and show that its members either have a long history of failures or lack the qualifications for their new positions.

Download the TaxPayers' Alliance Guide to the New Cabinet (PDF)