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Executive Agencies tend to be required to comply with a standard of service set by the sponsoring department. They also have to meet public service and service delivery agreements set by the Treasury. Most are required to make an annual report and are reviewed every five years quinquennial review. This review considers the future of the agency against proposals for its abolition, privatisation or the contracting-out of its functions. These are wide-ranging and varied bodies such as NHS trusts, learning and skills councils and advisory bodies, which normally spend funding allocated by departments.

Their boards are appointed by Ministers, in line with the Code of Practice from the Office of the Commissioner for Public Appointments. This requires that, amongst other things, board members are appointed on merit and are subject to independent assessment. Guides Issue Brief. Although this divide is better described as a spectrum, the idea of sectors is found across a variety of perspectives, including dichotomous legal rules, different management norms and practices, and socially-assigned significance Rainey and Bozeman Under this tradition, public organizations are run by leaders elected through popular and open elections and individuals who answer through the chain of command to such leaders who owe a duty to promote the public interest at large, while private organizations are run by directors who are put in place by a vote of shareholders, members, or existing board members, and who owe a fiduciary duty to further the narrow interests of the organization Moe and Gilmour Public entities reflect community or majoritarian values, while private entities express the views of their narrower constituencies Moulton and Eckerd The narrower agendas of private organizations allow a space for pluralistic dialogue and preference-fulfillment unattainable through majority-take-all elections Tocqueville Because they are accountable to the electorate, public entities have a more legitimate claim to coerce non-consenting parties, and therefore can pass laws and collect tax revenue; private entities have power only over those who consent to their rule, and must rely on consensual receipts of funding whether commercial or donative revenue.

A corollary of public accountability is that public entities can be abolished at will by the electorate, while private organizations typically enjoy perpetual life, at least while solvent, until their managers choose to close down the enterprise M. Lee Public entities are commonly given designations such as departments, cities, and authorities, while private entities are called corporations, trusts, and nonprofit organizations.

Table 1 highlights a few of the salient differences, somewhat simplified, of governing structure between public and private organizations in the United States:. Some of these characteristics hold as a matter of definition, while others are simply perceived tendencies of each type of organization. While scholars have long questioned whether the tidy divide between public and private has ever been empirical reality, the complexities of modern society increasingly call it into question.

This is particularly true given the rise of quasi-governmental, quasi-private organizations that do not fall neatly into either the public or private realm. These organizations have been called hybrid organizations, quasi-autonomous non-governmental organizations Quangos , gray sector organizations, or, as we will refer to them, Quasi-Governmental Organizations QGOs. QGOs are extremely difficult to define van Thiel ; Cole Definitional difficulties are compounded by transnational differences in legal regimes, social history, and cultural traditions, but even scholars focused on the American experience have failed to reach a consensus.

Future efforts to define QGOs should first identify the characteristics that are being considered, and specify which characteristics qualify as public or private as we have attempted to do in Table 1. However, difficulties with definitions should not distract from the significant conceptual puzzle that QGOs pose. Without intending to define QGO for all purposes, we focus on a particular type of QGO: one that mixes a private legal status that is, incorporated as a nonprofit corporation with public governance i.

The relationship between the government and private organizations specifically nonprofit organizations 1 has been modeled by several scholars, who have noted the varying levels of cooperation or adverseness that can exist between the sectors Coston ; Najam ; Young ; Salamon Brody For the most part, however, this and other literatures presume a distinctness between government and nonprofit. In the normal situation, boards of for-profit organizations are picked by shareholders or owners, and nonprofit boards are elected by any members or the existing board.

Government appointments to private organizations are a departure from the normal course of things in the United States today, although hundreds of years ago the practice was more common. The relationship between appointment of personnel and control has long been studied by political scientists in the realm of public administration Lewis ; Wood and Waterman ; Scher Granted, particularly for nonprofit boards, the board does not always have the level of control contemplated by the law, and decisionmaking for the organization is driven by factors well beyond a boardroom vote McClusky It is worth remembering that, even outside of the QGO context, the government asserts some measure of control over the governance of private organizations.

It requires that organizations be governed by boards in the first place, prescribes fiduciary duties for these directors to consider when acting, and, through the courts, can even remove directors for perceived misbehavior. It can also require certain board qualifications for organizations with which it contracts Guo ; LeRoux Moreover, private organizations can choose to elect government officials whether past or present to their boards. The government official might bring influence or insight that is desired by the organization Hillman Why might creators choose to structure a new enterprise as a QGO instead of a more traditional form?

More specifically, why would the creators choose to create a nonprofit organization with government-affiliated directors, instead of a purely private nonprofit organization or an independent, nominally-public organization? Broadly speaking, QGOs provide a balance of government influence and independence that may be desirable for political or legal reasons. Similarly, the QGO could specify the details of a joint venture between different public bodies, such as different units of local government. This view of the QGO as the embodiment of a complex agreement is consistent with the construct of the corporate form as simply a complex network of contractual agreements.

Government and Market Failure.


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Some have pointed to QGOs as a way of overcoming instances where both traditional government forms and the market fail to produce goods at a socially optimal level Becker BIDs are a good example of this. Business districts desire, and are willing to pay for, additional services, but to obtain the optimal level of service they need to overcome collective action problems market failure and elected officials focused on different political preferences government failure. By combining elements of both the public and private, BIDs allow businesses to overcome these hurdles to arrange heightened services for the district.

Although this rationale might explain some QGO structural elements, additional theoretical or empirical work is needed to explain why a nominally-private form is needed to overcome the various failures. A QGO with less government control might also be indicated when a measure of independence from traditional government is desired.

This might be the motivation when, for example, leaders believe a plan should be dictated by those with some specialized expertise, or when there is concern for the interests of a political minority. Depending on its composition, a pseudo-private form could potentially be more independent than even an insulated public body. For example, an organization governed by a board with a majority of directors who are not subject to governmental appointment or removal would be theoretically more distant from local government, in terms of control, than an independent commission.

Further, even holding political and legal constraints constant, leaders of a nominally private organization may perceive themselves as less constrained by public will than those with a nominally public entity.

The Politics of Quasi-Government

Whether the private form actually leads to autonomous decisionmaking is not certain. For example, nationally, the vast majority of BIDs claim to have independence in setting policy, the level of their services, and level of revenue, Becker , but a recent study of quasi-autonomous organizations in Canada showed a significant degree of political influence in funding decisions Mehiriz Another aspect of independence is the degree of commitment to a project. Government funding can be discontinued in future funding cycles, and public departments can be abolished, but transfer of ownership of public property to a legally private institution may be irreversible.

Commitment is often disfavored in public administration because it interferes with popular sovereignty and the ability of the electorate to undo mistakes made by their leaders. However, commitment may be needed before private partners will be willing to invest in a particular project. Thus, perhaps without some assurance that a project will not be abandoned or reversed upon a change in political leadership, it may be difficult to obtain the investment of monetary, intellectual, or other resources in an endeavor.

This assurance cannot always be provided by contract, and a QGO might be structured such that the organization has a life of its own that cannot be easily undone solely by the actions of municipal government. Selection of Rules. The use of QGO can be a way of picking which legal rules will apply.

Public entities often have to comply with laws concerning public meetings and access to records, conflict of interest rules, personal financial disclosures, whistleblower protections, and personnel policies. There are commonly rules providing for judicial review of agency decisions. And governmental entities must comply with federal and state constitutional rules that prohibit certain actions, such as discrimination or censorship.

At the same time, public entities and their officers often enjoy immunity from lawsuit. Private entities are bound by different requirements. The use of a QGO rather than a purely public form could be a way of opting out or at least attempting to opt out of the myriad legal requirements that constrain public administrators. Facilitating trust. The government gets the best of both worlds: benefiting from the warm glow that people feel towards the nonprofit sector while still maintaining some measure of electoral accountability for the organization.

This assumes that people will trust an organization based on the type of legal status chosen during incorporation rather than how independent an organization is from the government based on other metrics, such as presence of government officials on the board or extent of government contracting. This runs counter to some evidence which suggests that people may not know the legal status of the organizations with which they interact Handy et al.

However, at the same time, people may be more knowledgeable about the legal form than about other information such as board of directors or degree of government funding Horne, Johnson, and Van Slyke Further research is needed into the level of information that people have about quasi-governmental entities and how that influences their perception of them.

Limiting Debt Liability. Nonprofit board governance is overwhelmingly criticized by scholars and practitioners, who claim that boards regularly fail to live up to their legal or ethical obligations. Boyd ; Brody ; D. Inattentive or incompetent board members are common targets of complaint.

One might attempt to remedy this problem by eliminating the self-perpetuating board, and instead vest appointment in an outside body to perform a sort of quality control.

quangos | Paul Cairney: Politics & Public Policy

For this to work, the political body must be viewed as superior to appointing directors than alternative means of appointment. A similar — and marginally more plausible — explanation is that government appointment will lead to more representative board members. Nonprofit board members are often recruited for their connections or their fundraising capacity, which often excludes large segments of the community from having a seat on the board Guo and Saxton Since local political institutions have been forged through the electoral process, they may reflect a more diverse range of perspectives than nonprofit boards.

Indeed, Salamon pointed to government involvement as a means to remedy philanthropic paternalism Salamon , and some evidence suggests increased government funding leads to more representative boards LeRoux Further study is needed to determine whether government-appointed directors are, in fact, more representative or competent than directors appointed through other means. To ground our analysis, we analyze the structure of several organizations from the Greater Cleveland area.

The Cleveland metropolitan area has a rich history of using PPPs in innovative ways to solve pressing problems, making it an ideal environment for studying the development of QGOs. We took a convenience sample of five organizations in the Cleveland area that appeared to possess characteristics that fell within our definition of QGOs of interest. SIDs have the unique capability as nonprofits to collect assessments from property owners within their assigned district for use in safety and sanitation initiatives as well as capital projects.

Though the business owners in the district must vote to incorporate the SID, once it has been passed, all business owners in the district must pay the assessment, which is based on property value, front footage, and the benefits the business will receive from being part of the SID. The District is governed by a board of directors, which must include a person appointed by the legislative authority of each participating political subdivision, and the municipal executive of each municipal corporation.

Ohio Rev. Moreover, SID assessment plans must be approved by the legislative authority of the relevant political subdivisions before they can be implemented. Using funds collected in the form of assessments, these organizations provide services to the area that are of the type also provided by government safety, sanitation, capital improvements. We chose one SID in Cleveland. The assessment funds are used mostly for safety and sanitation within the district, but they can also be used on capital projects for the improvement of the district. Code Chs. Originally only Cuyahoga County could create this type of corporation, but the power was extended to other large counties in The statute authorizing the creation of the Land Bank expressly reserves the right to the County to dissolve the organization Ohio Rev.

Code chs. The Board of Directors of the Cuyahoga County Land Reutilization Corporation consists of the County Treasurer, two county commissioners, one representative from the largest municipality in the county, one representative from another township, and the remaining members selected by the county officials on the board. Overall, politics is often about telling a story about handling government or crises well, not actually controlling events and outcomes, and no single elected government can oversee a 10, 20, or year plan to reform the state in the scale we witnessed.

Still, we can now see fundamental differences when we compare the UK state with that of the s. Examples include:.


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In this account, post-war developments were based on the idea of state planning and central control over the economy and most public services, while post developments were driven by the belief that such planning had failed. Although prompted by the Conservative government of , the Labour government from reinforced most measures and privatised more services than Thatcher would have envisaged.

It also extended the idea of limiting central government ministerial intervention in the economy by introducing Bank of England independence making it primarily responsible for interest rates and strategies to manage inflation. As in Scotland , the UK Government has experimented with many forms of accountability based on one of these two stories of central government:. Yet, generally seem incompatible with, or overshadowed by, 1. Ministers think that the public expects Westminster-style accountability, so they try these other measures but also:.

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In groups we can discuss these major reforms and the extent to which they were driven by a grand plan or a series of unfortunate events. We can discuss accountability and try to explain how and why ministers intervene in some areas but not others. Since we focused on the two basic stories of lack of control in week 2 , this week we can zoom in to discuss specific measures to demonstrate success in government or produce the appearance of control.

What examples spring to mind? Leave a comment. Tagged as British politics , civil service reforms , economic crisis , economic policy , privatisation , quangos , UK Government , UK policy , UK politics and policy. These posts introduce you to key concepts in the study of public policy. They are all designed to turn a complex policymaking world into something simple enough to understand.

Some of them focus on small parts of the system.