UK: Think tanks who's hot (and who's not).

UK: Think tanks who's hot (and who's not). - As think tanks jostle for position in the post-election environment, Management Today offers a guide to eight of the major players.

by David Smith.
Last Updated: 31 Aug 2010

As think tanks jostle for position in the post-election environment, Management Today offers a guide to eight of the major players.

They exist in a narrow corner of central London, usually Westminster, close to Whitehall's corridors of power. Their food is ideas, the more the better, and they grow in stature when those ideas influence those in power.

'They' are the think tanks and right now the competition between them is intense as they jostle for influence and prestige in the wake of Labour's election victory. The change of government has meant that many of them are thinking along new lines, or at least repackaging old ones. For example, did you ever expect to hear the Adam Smith Institute praising a Labour government? In case you missed it, it has already happened.

The concept of think tanks came originally from the US, where organisations such as the Rand Corporation and the Brookings Institute have long been big players on the Washington scene. In Britain, the Heath government in 1970 set up its own in-house think tank, the Central Policy Review Staff. Margaret Thatcher effectively disbanded it when she came to power, although think tanks outside government flourished.

British think tanks are smaller than their American counterparts. Most have charitable status, sometimes do work for the government, but are not state-funded. They tend to have small, even skeleton, permanent staffs, but can call on a network of specialists and friends, many of them from the academic world, to prepare policy papers and give seminars. They survive on the basis of the money they make from these seminars and publications, grants from charitable trusts and, crucially, business sponsorships and donations. What they generally cannot do, because of their need to maintain professional impartiality and because of the terms of their charitable status, is to work to order for business.

So what can business get out of think tanks? John Blundell, director of the Institute of Economic Affairs, points out that think tanks can facilitate informal access to ministers and civil servants - sometimes far more useful than the stuffy formality of meetings in government departments.

Those think tanks most associated with the Labour government (currently the IPPR and Demos) can provide useful intelligence on government thinking, as well as highly informed political gossip. Those generally associated with the right, meanwhile, are not merely awaiting the return of a Conservative government. A change of government, having brought with it an appetite for new ideas, has invigorated the think-tank sector.

But how can you tell one think tank from another if you see a report or survey mentioned in the papers? Perhaps we can help. Following interviews with ministers, officials and MPs, as well as with the think tanks themselves, Management Today has produced an informal guide. The list is not exhaustive.

Notable absentees include the Fabian Society, more than 100 years old, Politeia, which effectively broke away from the Centre for Policy Studies and the European Policy Forum. For each of the eight think tanks chosen we have awarded marks out of 10 for influence (whether anyone cares what they say), academic rigour (whether one should trust what they say) and comprehensibility (whether anyone can understand what they say). Here, then, is our guide.

DEMOS

influence 9 academic rigour 7 comprehensibility 7

Demos is the baby of the think-tank family, having been founded only in 1993, but it recently obtained the New Labour seal of approval with the appointment of Geoff Mulgan, its director, as a part-time member of the Downing Street policy unit. Mulgan, a former academic and journalist, worked for Gordon Brown before setting up Demos. Known for occasionally whacky ideas, such as 10-year marriage contracts, and 'softer' policy ideas such as the re-branding of Britain, Demos appears to have tapped into a prevailing desire within government for broader themes rather than detailed policy. 'We are often accused of being Tony Blair's favourite think tank but we don't get any state funding,' points out Ian Christie, Demos' deputy director. 'We operate in a very competitive marketplace.'

Part of Demos' analysis of our times is that power centres are being diffused around society. Christie adds: 'Demos has always tried to be influential across all sectors. We are not obsessed with Westminster and Whitehall.' He emphasises that Demos has always been interested in business and its methods and, in particular, how such methods can be adapted for use within government and the voluntary sector. But, he adds: 'Business too has a lot to learn from government and the voluntary sector about social responsibility.' Current themes include business and the environment, corporate governance and stakeholding. Demos' view of stakeholding, he says, is very different from the corporatist version put forward by its key advocates. Its advisory board includes Sir Douglas Hague, who used to be an adviser to Margaret Thatcher, Sir Dennis Stevenson and Martin Taylor.

THE INSTITUTE FOR PUBLIC POLICY RESEARCH

influence 8 academic rigour 8 comprehensibility 8

The IPPR, set up in 1989 when Neil Kinnock was Labour leader, was seen very much as the think tank for the Kinnock/John Smith Labour party and thus now has no automatic right of way to the heart of a government led by Tony Blair. Even so, the IPPR was influential in opposition, with the reports of both the Social Justice Commission and the Commission on Public Policy and Business produced under its auspices. The latter, which brought together businessmen such as George Simpson, Bob Bauman, David Sainsbury and Christopher Harding, provided the Conservative government with a framework for competition policy.

It also demonstrated a willingness among businessmen to accept the national minimum wage and, at the launch of the relevant report in January 1997, provoked the anger of Michael Heseltine, then deputy prime minister.

Since Labour has been in government, the IPPR has been less obviously prominent than, say, Demos, but has been working furiously behind the scenes to maintain influence. Gerry Holtham, the former OECD and City economist, and now director, points to the IPPR's influence on the Government's University for Industry policy, as well as its work on London government, and the 'entrepreneurial society'.

THE INSTITUTE FOR FISCAL STUDIES

influence 7 academic rigour 9 comprehensibility 7

The IFS is not so much a think tank, more a specialist research unit on all aspects of taxation and public spending, and the acknowledged UK expert in the field for nearly 30 years (it dates back to 1969). The IFS is concerned with practical policy, not political philosophy, but its influence is huge. Gordon Brown has been keen to court its backing for his ideas about tax-benefit reform, a relationship that got off to a bad start when Andrew Dilnot, its director, was publicly critical of the Labour party's proposals for a 10% reduced rate of income tax. However Dilnot says that he and his staff have seen as much of Brown and his advisers as they have of any recent chancellor, and the IFS has also been in demand from civil servants, hungry for tax ideas.

The IFS' corporate membership includes the major clearing banks, oil companies, building societies and accountancy firms, and this provides 5%-6% of its income. It does not, however, carry out research directly sponsored by business for fear of losing its reputation for political and commercial impartiality. Many of the procedural changes introduced by Brown, notably the 'green' budget or pre-budget report, have enhanced the IFS' role as the key commentator and analyst of the Government's plans - nearly 20 years ago a committee set up under the auspices of the IFS called for such an innovation. A change of government has also brought with it a raft of new ideas on tax and spending which has brought this independent think tank to the fore.

THE CENTRE FOR POLICY STUDIES

influence 4 academic rigour 6 comprehensibility 8

The CPS played a pivotal role in the Thatcher revolution, having been established specifically to give intellectual backing to the Thatcherite breakaway from the post-war political and economic consensus in the 1970s.

Set up in 1974 on the initiative of Sir Keith Joseph, it pioneered a range of ideas, including privatisation, limiting the role of government and low taxation, which set the political agenda in the 1980s. Its director is Tessa Keswick, a former special adviser to Kenneth Clarke. David 'two brains' Willetts, MP, the former Tory minister and noted think-tank animal, is deputy chairman.

Unlike many other think tanks, the CPS is a limited company, not a registered charity. It is also, while not formally tied to the Conservative party, closely associated with what Andrew Haldenby, its director of studies, describes as 'that side of the argument'. Frank Field, the minister for welfare reform, is perhaps not a typical Labour politician, but he gave the prestigious Keith Joseph memorial lecture at the CPS earlier this year and opened with fulsome praise for the achievements of Joseph and Thatcher. 'We are about rebuilding small 'c' conservatism and you have to take account of the fact that this is a non-Conservative government,' says Haldenby. He argues that the CPS' present roles, of providing a critique of the Labour government's policies and providing the defeated Conservative opposition with ideas, are complementary. Business involvement with the CPS includes corporate membership and direct involvement through study groups and attendance at seminars and private meetings.

THE ADAM SMITH INSTITUTE

influence 4 academic rigour 7 comprehensibility 8

The ASI has, since it was founded in 1976, been a standard-bearer for free markets and competition, although its views occasionally appeared too radical even for the reforming Conservative government led by Margaret Thatcher. Its president is the permanently bow-tied Madsen Pirie, its director Eamonn Butler. The ASI, like other think tanks of the right, has had some adjustment to do since last May, but insists that it remains as relevant now as ever. It recently put together a scorecard of the Labour government's achievements so far, giving it an overall rating of 68%, with particularly high marks for Gordon Brown's Treasury and the Harriet Harman/Frank Field Department of Social Security.

'Every time there is a change of government people write us off but it is never true. Our role is not to be political or shout slogans. We are policy engineers,' says Butler. He emphasises that the ASI does not judge its strength on the number of corporate members it has, although businesses do either give general support if they believe its work is worthwhile, or become involved in specific projects.

'We are not hired guns - you cannot pay us to do something that is not on our agenda,' he says.

But insurance companies such as Legal & General, Pearl, Scottish Equitable and Scottish Amicable, have recently become involved in the ASI's welfare reform project (which looks to ways of increasing private sector provision, notably in substituting commercial insurance for state-provided National Insurance). Other areas of research interest include road pricing, in the context of the transport White Paper, capital taxes, and regulation.

THE CENTRE FOR ECONOMIC POLICY RESEARCH

influence 5 academic rigour 10 comprehensibility 5

The CEPR is different from other think tanks. While based in London, its interest and influence is rather wider, focusing particularly on international issues. Established in 1983 'to promote independent, objective analysis and public discussion of open economies and the relations between them', it is also more obviously academic than its competitors.

Senior Treasury officials, and government economists from elsewhere in Whitehall and Europe, as well as central bank officials, rather than ministers, attend its seminars. Its output can be somewhat daunting for non-economists, with economics professor Richard Portes as its president.

The CEPR has has a network of 350 research fellows and holds seminars in a variety of centres around the world including Belfast, Bonn, Barcelona, Bratislava, Brussels, Budapest, Dublin, Edinburgh, Madrid, Milan, Paris, Prague, Rome, Sofia, Stockholm and Washington, as well as London.

Current strengths include European economic and monetary union and the integration of former Eastern bloc countries into the European Union.

It offers differing levels of corporate membership which, it says, provides access to key economic insights and ideas, influence and impact on the policy community and involvement in setting the agenda for economic research.

THE SOCIAL MARKET FOUNDATION

influence 6 academic rigour 7 comprehensibility 8

The SMF, set up in 1989, was born out of the Owenite strand of Social Democratic thinking in Britain, the social market being the third way between complete adherence to free markets and socialist planning. In practice, with the absorption of the Social Democrat Party into the Liberal Democrats and the disappearance of Lord Owen from the political mainstream, it has become a think tank with a Conservative bent. Danny Finkelstein, its previous director, is now head of research at Conservative Central Office and Lord Skidelsky, its chairman, is a Conservative peer. But Rick Nye, its current director, reports a good strike rate in getting Labour ministers, MPs and advisers to SMF seminars.

'This government is very catholic in its approach and that is very exciting for any think tank,' he says. 'Our business is to try to lead public opinion, not reflect it, and to generate ideas that will come to fruition in 12 to 18 months' time.' Claimed policy 'hits' under this government include education action zones and zero tolerance.

Companies can join the SMF's business forum, for which they get access to ministers, opposition spokesmen, senior civil servants and academics.

Members include Boots, Sainsbury, Tesco, Deloitte & Touche and Shell UK.

Businesses can also sponsor individual research projects, with specialist areas including welfare reform, healthcare, public/private partnerships and the Private Finance Initiative and education. SMF contributors include David Willetts, John Gray, Lord Skidelsky, Francis Fukuyama and David Smith, the author of this piece.

THE INSTITUTE OF ECONOMIC AFFAIRS

influence 5 academic rigour 8 comprehensibility 7

The IEA, one of Britain's oldest think tanks, was founded in 1957. Its two leading lights, Lord (Ralph) Harris and Arthur Seldon, endured two decades in the political wilderness before, like the CPS, the IEA became a vehicle for the re-emphasis on markets in policy under Thatcher. During those early days it built up an impressive network of sympathetic academics and researchers and a solid library of research papers which were widely used in universities. It was responsible for popularising the likes of Friedrich von Hayek and Milton Friedman in Britain. John Blundell, its current director, denies however that the IEA should be seen as a Thatcherite think tank. 'Do you know how many mentions there were of the IEA in The Downing Street Years?' he asks. 'Not one. We see ourselves as the ordnance factory, the artillery. It is for others to work out the details of policy.'

The IEA has always placed great emphasis on its links with business.

Seven of its 12 trustees are businessmen, the remainder academics specialising in business and management. Each year it receives donations from around 200 separate businesses. Its lunches and seminars, usually held in its Lord North Street offices in Westminster, have been an important draw for most of its 40-year existence.While economics and markets have traditionally been its bread and butter, the IEA also has units specialising in health and welfare policy and the environment.

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