Arm's-length bodies

There are a huge range of arm's-length bodies and other independent organisations operating outside direct government control but accountable to a government department. Some are known to us all, such as the Met Office and Network Rail, while others are much less well-known. Some have just a handful of staff, such as the Legal Services Board or the National Data Guardian, but others employ tens of thousands of people, such as HM Revenue and Customs or HM Prison and Probation Service.

Diverse in their nature, including museums, regulators, funding providers, national parks and advisory committees, these bodies play a crucial role in delivering public services, regulating industries, and providing expert advice across numerous sectors in the UK.

By the end of the 2022/23 financial year, there were 305 ALBs in the UK, encompassing executive agencies, non-departmental public bodies and non-ministerial departments. Recent reports state that the Labour government established a new ALB on average once a week in the six months following their election victory, with another 25 having been created by the end of 2024.

Issues and challenges

ALBs face several challenges in 2025:

• Accountability and transparency: Concerns have been raised about the accountability of some ALBs, with criticisms that they operate with insufficient oversight. The Arm’s-Length Bodies (Review) Bill, scheduled for a second reading on March 14, 2025, aims to address these issues by reviewing the functions and effectiveness of ALBs.
• Financial sustainability: Reports indicate that certain ALBs, such as NHS England, are grappling with financial challenges, including deficits and declining productivity. The National Audit Office has highlighted the need for a fundamental rethink of healthcare models to ensure sustainability.
• Evolving roles and responsibilities: The dynamic nature of public needs requires ALBs to adapt their functions and services continually. Ongoing reviews and reforms are essential to ensure they remain fit for purpose and aligned with government priorities.

Consultancy support

ALBs operate in a complex environment that requires balancing independence with accountability. They often face challenges in governance, strategy and leadership, particularly as they adapt to evolving public needs, financial pressures and regulatory changes. GGI can help ALBs enhance their effectiveness, resilience and ability to deliver on their mandates.

Here are key areas where support could be valuable:

Governance

Governance reviews and improvement plans

• Assessing governance frameworks for alignment with best practice and statutory requirements.
• Recommending improvements to enhance accountability, transparency, and decision-making.
• Supporting compliance with relevant governance frameworks.

Board effectiveness reviews

• Evaluating the performance of boards and committees, including skills audits.
• Developing tailored action plans to address gaps in board composition, processes, or engagement.
• Training for board members on governance roles, responsibilities, and strategic oversight.

Risk management and assurance frameworks

• Developing robust risk management systems that align with organisational objectives.
• Creating or refining board assurance frameworks (BAFs) to enhance oversight and mitigate risks effectively.

Strategy

Strategic planning and alignment

• Facilitating strategy development to clarify organizational priorities and objectives.
• Aligning strategies with broader government goals and stakeholder expectations.
• Scenario planning to address emerging risks and opportunities.

Performance monitoring and evaluation

• Designing Key Performance Indicators (KPIs) to track progress against strategic goals.
• Establishing mechanisms for evaluating and adapting strategies based on performance data.

Policy and regulatory adaptation

• Advising on how to respond to new policies, regulations, or legislative changes.
• Supporting ALBs to align their operational strategies with shifting public sector priorities.

Leadership

Leadership development programmes

• Delivering tailored leadership training to enhance skills in managing public sector challenges.
• Coaching for senior leaders on change management, resilience, and crisis leadership.
• Building inclusive leadership capabilities to foster diverse and equitable decision-making.

Change management

• Supporting leaders to manage organisational transformation, mergers, or restructuring.
• Enhancing communication strategies to build trust and align stakeholders during transitions.

Succession planning

• Developing frameworks to ensure leadership continuity.
• Identifying and nurturing future leaders within the organisation.

Sector-specific support

With expertise in specific sectors (e.g., healthcare, education, arts and culture), we can tailor our advice to the nuances of ALB operations in those areas. This might include:

• aligning governance practices with sector-specific regulatory requirements
• supporting the design of partnerships or collaborations with other organisations
• developing frameworks for public engagement and coproduction

By investing in these areas, ALBs can improve their governance and leadership effectiveness, align strategies with national priorities, and navigate an increasingly complex public sector landscape. This will not only enhance their performance but also help build public trust in their operations.

GGI has partnered with the British Board of Film Classification, British Library, Financial Ombudsman Service, General Medical Council, Horserace Betting Levy Board, NHS Blood and Transplant, National Institute for Health and Care Research, Natural England, OFWAT, Regulator of Social Housing and Social Work England, amongst others.

Most recently, we held a roundtable event for six of the smallest ALBs, discussing the particular challenges that they currently face, comparing their structures, benchmarking various factors such as pay, pensions and non-pay rewards, and providing a forum for their leaders to link up with other comparable bodies and forge connections.