Business Sense and Maturity Could Save Us All a Pretty Penny

A FEW years ago the Taxpayers' Alliance did a survey of government projects which were over budget.

They looked into more than 300 government-run schemes, from roads to art galleries, IT to hospitals and science facilities to defence systems, and compared how much the government thought they would cost with how much they actually did cost.

The results were pretty shocking. Most projects — 57 per cent — ran over budget. The average cost was a third more than expected. And the total net overrun was the equivalent of £900 for every household in Britain.

Why does this keep happening? I think one of the reasons is mediocre politicians. All too often, we are governed by politicians who either do not have the experience to match their responsibility or the abilities to match their power.

There are three main reasons for this. First, a lack of business background. Many politicians, especially in this government, have a background in policy or politics. Policy formation requires very different skills from project management. If you are a junior minister responsible for a few hundred million pounds, you need some sort of project management experience.

That requires the entrepreneur's skills of envisioning a successful outcome. Without that, you can neither see a project through nor recognise when things are going wrong.

Of course, it is the civil service's job to implement projects, but the ministers, however junior, sign off on them. That means they are responsible for ensuring appropriate due diligence is carried out.

After resigning as home secretary, Jacqui Smith said she had "never run a major organisation" and that if she did a good job, it was "more by luck than by any kind of development of those skills". Full marks for candour, but it is a status quo that we would do well to change.

A second reason for the extraordinary cost overruns is that ministers are often moved from portfolio to portfolio so fast they lack time to familiarise themselves with gargantuan departments. Smith also described this as "pretty dysfunctional".

A third reason is the bizarre stigma we have against older MPs. Over the past 20 years, MPs have got younger and younger. Of course, it is important for MPs to be in touch with the electorate, but this needs balance. Less experience of life and work outside politics means less experience of the society they represent. That has not led to better governance.

Older MPs with experience outside of government can contribute a great deal more than is generally accepted. This is a piece of conventional wisdom we would do well to reconsider.

This is part of a drift towards the professionalisation of politics. It is now seen more as a career. In the US it is seen as a temporary period in which to serve your country, after which you are likely to go back to your actual profession.

A fourth, related, reason is the pressure on MPs to look young and telegenic. There is survey evidence from the US that the biggest single attribute which correlated with whether any given candidate was elected was whether the electorate saw that candidate as "likeable".

Perhaps that is not surprising. But unfortunately, it seems that if we voted for politicians with better project management skills and experience, each household in Britain would be £900 better off.

Azeem Ibrahim is a research scholar at the International Security Programme, Kennedy School of Government at Harvard University, a World Fellow at Yale University and the chairman of ECM Holdings.