Briefing: quango spending over time
In April 2025, the government announced that it was going to scrap the Valuation Office Agency, folding its functions into HM Revenue & Customs.[1] This followed announcements the previous month that NHS England, the ‘world’s largest quango’, and the Payment Systems Regulator would also be brought into the Department for Health and Social Care (DHSC) and the Financial Conduct Authority respectively.[2],[3] Fifteen years since the coalition government pledged a ‘bonfire of the quangos’, the current Labour government is once again considering abolishing hundreds of existing quangos[4] – even as it creates new ones.[5]
There is no single definition of a quango, however the Cabinet Office semi-regularly publishes data on what it calls ‘public’ or ‘arm’s length’ bodies (ALBs),[6] which exist outside of direct ministerial control. This currently comprises non-departmental public bodies (NDPBs), executive agencies and non-ministerial departments, although previously it has included public corporations, nationalised industries and even NHS trusts.
While the number of these bodies has been falling over time as successive governments have pledged to reduce them, that does not automatically mean that the amount of spending outside direct ministerial control has shrunk. This note goes beyond the number of ALBs and examines how the sector has evolved over the past four decades, including how many staff they employ and how much they spend.
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Key findings
- ALBs spent £343.6 billion in 2022-23, a 243 per cent increase from a decade ago in 2012-13. This was 1.38 times the total amount collected in income tax that year.[7]
- Spending by ALBs represented 29.6 per cent of public sector spending in 2022-23, more than double what it was a decade ago, when it was 13.2 per cent in 2012-13.
- As a share of the economy, ALB spending was 13.3 per cent of UK GDP in 2022-23. This represents a larger share of the economy than the financial and insurance services sector which was just 8.8 per cent of total economic output in 2023.[8]
- ALB staff has increased by 63.6 per cent since 2012-13, to 390,808 in 2022-23. This was more than two and a half times the size of HM Forces in 2023.[9]
- The rise in the number of ALB staff has occurred even as the number of ALBs fell from 561 to 304 from 2012-13 to 2022-23, and the number of NDPBs (a subset of ALBs) has been falling since 1978-79 to just 10 per cent of their original number.
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[1] HM Treasury, Valuation Office Agency scrapped in government drive to slash inefficiencies, 28 April 2025, www.gov.uk/government/news/valuation-office-agency-scrapped-in-government-drive-to-slash-inefficiencies, (accessed 1 May 2025).
[2] Streeting, W., World’s largest quango scrapped under reforms to put patients first, Department of Health and Social Care, 13 March 2025, www.gov.uk/government/news/worlds-largest-quango-scrapped-under-reforms-to-put-patients-first, (accessed 1 May 2025).
[3] Prime Minister’s Office, Regulator axed as red tape is slashed to boost growth, 11 March 2025, www.gov.uk/government/news/regulator-axed-as-red-tape-is-slashed-to-boost-growth, (accessed 1 May 2025).
[4] Crerar, P., UK ministers consider abolishing hundreds of quangos, sources say, The Guardian, 6 April 2025.
[5] Martin, D., Labour axes one quango – after creating 27, The Telegraph, 11 March 2025.
[6] Cabinet Office, Public bodies publications, 17 December 2024, www.gov.uk/government/collections/public-bodies, (accessed 1 May 2025).
[7] HM Revenue & Customs, HMRC tax receipts and National Insurance contributions for the UK (annual bulletin), 23 April 2025, www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk/hmrc-tax-receipts-and-national-insurance-contributions-for-the-uk-new-annual-bulletin, (accessed 2 May 2025).
[8] Hutton, G. et al., Financial services in the UK, House of Commons Library, 18 November 2024, p.4.
[9] Office for National Statistics, Public sector employment – December 2024, 20 March 2025, www.ons.gov.uk/fileuri=/employmentandlabourmarket/peopleinwork/publicsectorpersonnel/datasets/publicsectoremploymentreferencetable/december2024/datasets7.xlsx, (accessed 2 May 2025).