Cutting the size of government is now the only game in town — at least, for those who would like to prevent taxes rising to the point that there becomes little point in working or saving. Unless spending is put on a sharply declining path, the UK faces a decade of persistent deficits, stagnant growth and a steady loss of leadership to other, better founded economies across the globe.

Yet one part of government appears immune from the new reality. As The Times reported on Saturday, quangos — those strange, shadowy, secretive parts of British public life — are growing much faster than the rest of government. The most influential quangos, those with actual executive powers, such as the regional development agencies, employ an average of 500 people each, and each of those people spends £370,000 in public money on average each year.

The Times also reported that Liam Byrne, the reforming Labour minister who is now in charge of public spending policy, has written to all his colleagues asking them to review the quangos under their aegis. David Cameron is speaking about the reform of quangos to the independent think-tank Reform today. Quangos are being pulled out of their twilight zone and into the daylight, and not before time.

Most organisations can be held to account, however imperfectly. The revelations over MPs’ expenses rightly provoked public outrage, but at least MPs (and governments) can be voted out. Companies must answer to their shareholders. Charities must keep to their original foundation and purpose.

Mechanisms of accountability exist, but not for quangos. This is supposed to be their unique advantage, that they are completely independent organisations free from political or commercial interest. In practice, they are a law unto themselves. This might be an nitpicking constitutional point were it not for their cost — £35 billion to taxpayers last year, which amounts to £1,400 for every family in the country. That is far too much to be taken on trust.

The debate would be different if quangos were effective. Unfortunately quangos have been responsible for some of the biggest failures in our politics. The Qualifications and Curriculum Authority has done nothing to arrest the steady decline in the integrity of academic examinations. Despite the apparent efforts of the Serious Organised Crime Agency and the National Policing Improvement Agency, we still lack a coherent effort against serious crime. It is widely understood that the NHS suffers from over-regulation, leading to a painful lack of innovation and creativity among its managers. A cat’s cradle of regulatory quangos — four, including those responsible for social care — are part of the problem.

What is needed is not so much a review of these organisations but a radical change in their nature. The quango experiment can be put in the dustbin of history. Each of the 790 current quangos can then be turned into a properly accountable body — either part of government (accountable to Parliament and voters) or part of society (answerable to trustees or shareholders).

Take the Higher Education Funding Council for England, responsible for how much money universities should get. This is a fundamentally political question. It should be taken back in-house, into a government department, so that ministers are fully accountable for its decisions. Others can become part of local democracy, either as part of councils or through new local elections.

Or take the major museums and artistic bodies such as the British Museum or the National Gallery. The artistic integrity of these institutions means that they should be right outside government, as fully independent charities. Government can still write them a cheque if it wants.

Some bodies clearly need to sink or swim in the market: if police forces want to buy the services of the National Policing Improvement Agency, let them. A final few — such as the Competition Commission — can become economic regulators, responsible for the functioning of particular markets.

These changes can be part of the wider reforming agenda of the next government (of whatever stripe). They would help the money-saving drive because their budgets will come under proper pressure for the first time. And they would help to reinvigorate Parliament. Quangos reduce MPs to glorified lobbyists, cut out of the running of large parts of government. Ending quangos will put MPs back in the loop and, in the process, restore some of their authority.

Andrew Haldenby is director of the independent think-tank Reform (www.reform.co.uk)

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