Further to Jeff Prestridge’s column about financial services bureaucracy (FA, 30 Oct), the thing that amazes me is that Mr Prestridge seems surprised about this.
Some of us have been pointing out for years that effectively unaccountable functionaries with skewed incentives will always fail. Look at it this way – in the benefits office, the people on each side of the desk are both on benefits.
Economically, incentives matter a great deal. None of these organisations have any driving need to serve anyone well, since their incomes and advancement are not dependent on doing so. In fact quite the reverse. If they fail, the first thing they blame it on is lack of money.
What is the solution? Well, primarily I think, all these outfits need to be brought back into government so that they are under the control of the politicians we elect. That has the second benefit of making politicians actually shoulder their responsibilities. It will also mean that the sheer quantity of all these failed quangos will reduce.
Steven Farrall
Partner, Williams Farrell Woodward, Ipswich, Suffolk
