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The governance of public bodies in times of austerity

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  • Heald, David
  • Steel, David

Abstract

Private sector governance arrangements have been imported into UK public bodies under the influence of New Public Management reforms. This paper draws on a cohort study of 14 public bodies to assess the appropriateness of this practice and the impact of fiscal austerity during the study period of 2010–16. Based on multiple sources, including interviews with Chairs and Chief Executives, it shows that, though similar to private corporate Boards in appearance, public Boards are often excluded from the strategy role. They are also vulnerable to the elastic definition of policy over which Ministers assert dominance, thereby blurring accountability. It demonstrates the tension between vertical accountability to government principals and horizontal accountability to stakeholders. During the study window, public bodies were abolished, broken up, merged, reconfigured or taken back into core government, as the UK Government imposed austerity measures to reduce the size of the fiscal deficit and to diminish government roles in delivery, financing and regulation of public services. Surviving public bodies in the study suffered deep budget cuts and less autonomy from central control. These findings are interpreted as evidence of the re-territorialisation of the UK public sector, with accruals accounting and accounting consolidation practices playing a facilitating role.

Suggested Citation

  • Heald, David & Steel, David, 2018. "The governance of public bodies in times of austerity," The British Accounting Review, Elsevier, vol. 50(2), pages 149-160.
    • Handle: RePEc:eee:bracre:v:50:y:2018:i:2:p:149-160
    DOI: 10.1016/j.bar.2017.11.001
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    References listed on IDEAS

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    1. Enrico Bracci & Christopher Humphrey & Jodie Moll & Ileana Steccolini, 2015. "Public sector accounting, accountability and austerity: more than balancing the books?," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 28(6), pages 878-908, August.
    2. David Heald & David Steel, 2015. "Making the governance of public bodies work: chair-chief executive relationships in practice," Public Money & Management, Taylor & Francis Journals, vol. 35(4), pages 257-264, July.
    3. Christopher Hood, 2007. "What happens when transparency meets blame-avoidance?," Public Management Review, Taylor & Francis Journals, vol. 9(2), pages 191-210, June.
    4. Kurunmaki, Liisa & Mennicken, Andrea & Miller, Peter, 2016. "Quantifying, economising, and marketising: democratising the social sphere?," LSE Research Online Documents on Economics 67549, London School of Economics and Political Science, LSE Library.
    5. David Heald & George Georgiou, 2000. "Consolidation principles and practices for the UK government sector," Accounting and Business Research, Taylor & Francis Journals, vol. 30(2), pages 153-167.
    6. Matthew Flinders & Chris Skelcher, 2012. "Shrinking the quango state: five challenges in reforming quangos," Public Money & Management, Taylor & Francis Journals, vol. 32(5), pages 327-334, September.
    7. David Heald & Ron Hodges, 2015. "Will “austerity” be a critical juncture in European public sector financial reporting?," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 28(6), pages 993-1015, August.
    8. Irvine Lapsley, 2009. "New Public Management: The Cruellest Invention of the Human Spirit?1," Abacus, Accounting Foundation, University of Sydney, vol. 45(1), pages 1-21, March.
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    4. Silvia Fresneda & Nuria Reguera & Fernando Casas, 2021. "De-agentification Process in Spanish Regional Governments," Hacienda Pública Española / Review of Public Economics, IEF, vol. 236(1), pages 39-64, March.

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