Three decades ago two American academics published a superb analysis of the way in which British government’s made finance decisions provocatively entitled “The Private Government of Public Money” (Heclo and Wildavsky, 1981). Has the Coalition accidentally given birth to the ‘Public Government of Public Money?’
The two Americans were understandably intrigued by the secrecy that surrounded UK budget processes. In America, at Federal, State and local levels the setting of public budgets – tax and spend – was (and is) a pretty open and transparent process, with battles fought out in public about what should be in and out.
In Britain by contrast there was complete secrecy in the run-up to national Budget Day – the famous ‘purdah’ descended on Whitehall and Ministers were sworn to secrecy about the negotiations going on between spending ministries and the Treasury. So secretive was the whole process that Gordon Brown was famously able to keep Tony Blair and the rest of the Cabinet in the dark about the whole package until the very last minute. Hence ‘the private government of public money’.
Even after the Budget has been unveiled to Parliament – which supposedly is supreme and has to approve it – debate was only of a very general nature and by convention no amendments to either tax of spending decisions were proposed much less voted on. Any defeat would be taken as a vote of “no confidence” in the Government and trigger an election, supposedly.
This secretive process continues to this day – at least in Westminster-Whitehall. At other levels of government – local governments and the Welsh and Northern Ireland Assemblies and in the Scottish Parliament, budget processes have become much more akin to the US (and most other advanced democracies) in nature. But in Whitehall, ‘the private government of public money’ continues – or does it?
The run-up to this Budget Day has seen apparently open dispute between, and sometimes within, the two Parties that make-up the Coalition Government. Some are suggesting (see Jon Snow’s blog) this has ‘opened-up’ the Budget process. It may indeed have prised open a corner of the ‘black box’ but it is hardly an opening up.
A really open process would be more like the Scottish Parliament runs. Draft Budgets are presented, consulted upon, debated, evidence taken, and only after substantial debate are final decisions put to the vote and taken.
Instead we have been treated to – in some cases clearly stage managed – ‘debates’ about some aspects of tax and nothing whatsoever about spending. Hardly the ‘public government of public money’ – not yet and not by a long way.
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This took me to Jon Snow’s website and I was indeed amazed at Jon being unaware of the abiding scandal at the very centre of British constitutionality – plus of course the inability of any MP to do anything about it if they also hope for any party and governmental advancement. But thanks Colin for also reminding me about the Heclo and Wildavsky great book – actually first published in 1974. Aaron Wildavsky’s subsequent “Comparative Theory of Budgetary Processes” (1975) also noted how the UK parliament “plays little part in expenditure decision-making. Supply estimates are considered and approved almost automatically”. But Wildavsky nevertheless then still held out some hope for the Programme Analysis and Review surveys (PAR) headed by the then Cabinet Office Central Policy Review Staff (CPRS) – assuming, quite mistakenly as it happens, that these would have a decisive influence on the then Treasury control systems (PESC) and that they would make sectoral and local constituency implications more explicit. I seem to remember that Wildavsky, Edmund Dell and the Public Finance Foundation retained a similar hope that some such explicit “constituency dimension” would – to borrow Shakespeare’s phrase, “give to airy nothing a local habitation and a name”. But it was not to be! Jon Snow must know that party political hegemony ensures that this remains the case.