Patrick Birkenshaw, Ian Harden & Norman Lewis
Government by Moonlight: The Hybrid Parts of the State
Unwin Hyman 1990, 272-293.
preceding chapters will, we hope, have convinced the reader that the
relationship between public and private presupposed by orthodox accounts of the
British constitution no longer exists in the real world. We have traced in detail the complex ways in
which public and private actors and purposes are enmeshed in contemporary
However, as we explained in Chapter 1, it has not been our intention to examine corporatism as a contribution to retheorizing the nature of the state. For our purposes, it has been enough to identify ‘public actors’ in a conventional way, by focusing on those who - on any constitutional reckoning - form part of ‘government’. We have then examined the involvement of ‘non-government’ actors in the decisions and non-decisions of public actors. This approach, together with use of the familiar public law concept of delegation of powers, enabled us to bring most of what we have identified as ‘corporatism’ into the net of constitutional analysis. The combination of a critical view of constitutional expectations and a more conventional approach to the identification of constitutional actors has led us, in the preceding chapter, to propose various reforms to improve upon existing arrangements for accountability. We regard the implementation of these proposals as being necessary to ensure that existing constitutional expectations are realized in the circumstances we have described.
In this concluding chapter we examine the structure of the orthodox views in more detail and consider the ideological obstacles which such views present to implementation of the
reforms suggested in
Chapter 7. Finally, although we have not
felt it necessary for our constitutional argument to treat critically the
concept of the state, we cannot entirely neglect the longer term constitutional
future of public and private in
The old constitutional orthodoxy about public and private is based on a nineteenth-century interpretation of the seventeenth-century constitutional settlement. A fundamental presumption is that public power will be limited, not intruding too far on the market and community relationships which constitute the private sphere. In the seventeenth century, constraints on government power were not framed as limits on the ‘state’, for the concept of a distinct and unitary public power was alien to English jurisprudence and political thought.  Nor were the limits of constitutional government embodied in restrictions on Parliament, which had been the winner in the century’s political conflicts and whose victory was celebrated as the triumph of tradition and continuity over novelty. Chief Justice Coke’s ‘historical myth of the English constitution’ made Parliament the defender of the ‘ancient and excellent laws of England’: ‘the birth-right and the most ancient and best inheritance that the subjects of this realm have, for by them he enjoyeth not only his inheritance and goods in peace and quietness, but this life and his most dear country in safety’. 
limitations were placed on the Crown,
which had sought to invade this ancient birthright of the common
law. The Bill of Rights sought to
provide constitutional guarantees against what the Stuart monarchs had
attempted to do, not by limiting public power as such, but by making the
consent of Parliament a precondition for valid use of the instruments of
government which the victors claimed the Stuarts had sought to abuse. Hence the
jurisprudential concept which embodies public authority in
The seventeenth-century constitutional settlement was thus
built on the idea that the sphere of legitimate government could be delimited by reference to the traditional rights of individuals, as embodied in the common law. Public and private were equivalent to meum et tuum as between the subject and the king - a conception of the nature of public law which received its definitive form in the nineteenth-century constitutional jurisprudence of A. V. Dicey.  Since the common interest of all those subjects who counted for political purposes was represented by Parliament, constitutional limitations on the Crown in Parliament itself were wholly unnecessary. The Crown in Parliament as the embodiment of public authority was self-limiting because, after 1689, it contained its own internal ‘checks and balances’.
Only in the 1960s did the judiciary - in hesitant and confused fashion - begin to develop the common law in response to the realities of arbitrary, unconfined and unstructured discretionary power in the administrative state. In the process of doing so, they perpetuated the idea that the traditional common law rights of individuals are the focus of public law regulation of the processes of government. Individual interests not based on common law rights have received a lesser degree of judicial protection. More fundamentally, the courts have been unwilling, since the attempts by Coke, to develop the common law so as to structure the policy process in the public interest. The concept of ‘policy’ remains an unpersuasive rationalization of judicial torpor. 
It would be wrong to deny the significance of the major
expansion of judicial review of administrative action during the past quarter of a century. Old doctrines have been reworked and reapplied and new ones have been invented. In the process, some areas at least of the public sphere have been subjected to a greater degree of legal structuring than existed previously. The ‘coming of age’ of administrative law in Britain was marked by a bold judicial attempt to distinguish public from private rights and to subject the vindication of the former to a distinctive set of procedures.  Nor is it only the judiciary which has been modernizing the quaint byways of public law in Britain. It is no longer possible to marvel, for example, at the fact that most local authority expenditure on non-advanced further education is probably ultra vires, nor to point to the University Grants Committee as a constitutional monstrosity. Even non-departmental public bodies have been recognized as a distinct category within the public sphere and provided with a ‘constitution’ of sorts. 
However, the modernization of administrative law in Britain has not been premissed on any conscious re-examination of constitutional fundamentals, either by the judiciary or by government. None the less, it does imply a realization that constitutional legitimacy can no longer be based on the supposed continuance of a traditional relationship between public and private, guaranteed by the political representation of civil society in Parliament. Here, for example, is H. W. R. Wade on administrative law:
Up to about the end of the nineteenth century administrative law kept pace with the expanding powers of the state. But in the twentieth century it began to fall behind. The courts showed signs of losing confidence in their constitutional function and they hesitated to develop new rules in step with the mass of new regulatory legislation... At the same time Parliament was losing its control over ministers, so making it all the more obvious that the law was failing in its task of enforcing standards of fairness in the exercise of statutory powers. 
It is a great irony that even before the development of a legal framework appropriate to a ‘modern’ state has been completed,
the revised assumptions about public and private on which the new framework is based have themselves been fundamentally eroded.
In the 1930s, and then for the post-war period, the changing relationship between public and private was understood largely in terms of a spatial metaphor: expansion of the public sphere and a contraction of the private. ‘Public’ and ‘private’ still carried the same theoretical connotations, although the area denoted by each was different from that which the old constitutional orthodoxy had assumed. Education, housing and welfare, for example, had formerly been exclusively private matters. The state had now expanded so as to take them, partly at least, into the public sphere. This spatial interpretation was shared both by those who supported such changes and by those who opposed them.
As we have already remarked, conscious attempts at reassessing constitutional fundamentals are not a British tradition. However, it seems to us that the spatial metaphor of the ‘expanded state’ has indeed become the new constitutional orthodoxy about public and private, as in the extract from Wade quoted above. Public and private are no longer seen as territories divided by natural and agreed frontiers; ‘the state’ has expanded to occupy formerly private territory. This has consequences for the mechanisms and processes of legal accountability of government which, belatedly, are being explored; in the Justice/All Souls Review, Administrative Justice, for example, which appeared in 1988. 
Constitutional thinking has not yet really begun to absorb the changes that have taken place since 1979, nor to measure them against the new orthodoxy of the ‘expanded state’. We have referred at various points, in earlier chapters, to the rhetoric of markets and the private sector which has accompanied these changes. This rhetoric assumes that the spatial metaphor is adequate to understand the role of the state, and that the boundaries of public and private are a matter of political conflict and choice. For example, industries that were nationalized and became part of the public sector can be privatized and thus rejoin the private sphere: just as Alsace and Lorraine were part of France, were then annexed by Germany and were subsequently reabsorbed by France.
The most likely response of mainstream constitutional thought is simply to take at face value claims that the shift from private to public is being partially reversed. This would represent a continuance of the tradition of ‘intuitive realism’ in constitutional analysis in Britain: the simple intuition or apprehension of the object of inquiry.  We shall not repeat here explanations that we have offered elsewhere as to why this cannot be a satisfactory basis for identifying a constitution.  However, conclusions supposedly based on intuitive realism cannot simply be dismissed on the grounds of methodological and theoretical inadequacy; after all, enough monkeys with typewriters may produce Hamlet. We must consider, therefore, whether constitutional insouciance about public and private might be defended on grounds more relative.
It is unlikely that any significant strand of constitutional thought in Britain would seek to reinstate, in conscious and articulate fashion, the ‘natural’ boundaries of the state which the ‘old orthodoxy’ took for granted. As we have explained, within the British constitutional tradition the doctrine of Parliamentary supremacy and the absence of a bill of rights mean that there are no mechanisms for entrenching substantive limitations on the exercise of political choice. This is not the case in some other jurisdictions, and in the United States, for example, the Supreme Court interpreted the constitution in the late nineteenth and early twentieth centuries as guaranteeing certain market freedoms by way of the doctrine of ‘substantive due process.’  We feel confident that it would not be possible to construct a persuasive argument that market freedoms are an immanent expectation of the British constitution. In any event, such a theory could function only as a highly critical perspective on current processes of government. The empirical evidence which we have adduced in Chapters 3 and 4 shows, not abstention by the state from interference in a sacrosanct private sector, but more or less stable arrangements involving bargaining, persuasion, deals and trade-offs between public and private.
Our belief is that these patterns of interaction between government and private interests are, in part at least, a necessary response to the complexities of the modern world. Even if we are
wrong on this point, it remains the case that the empirical phenomena we have described do not represent a return to the relationship between public and private presupposed by the old constitutional orthodoxy. In these circumstances, it seems to us that any revived version of that theory is likely to function not as a genuinely critical conception of constitutional legitimacy, but as an ideology, concealing what it purports to criticize. Let us pursue this argument by turning once more to the question of rational responses to complexity.
There is a body of economic literature which argues that any attempt to replace or modify the market is misguided, and that free markets constitute a more rational response to problems of complexity than can state action in any form. In this view, the market represents the rationality of civil society to be set against the collective irrationality of state administrative planning. In vulgarized form, these sentiments have become part of the ideology of Thatcherism: a return to the market, to private responsibility, private provision and choice in the production and distribution of goods and services should replace state and ‘corporatist’ decision-making.
Corporatism is here identified with the interventionist state, which is seen as inefficient and also illegitimate in its authoritarian denial of market freedoms. There are echoes in this perspective of the ‘state’ form of corporatist ideology, lumped together with the command economies of eastern Europe. Corporatism has also been seen as a response to the failures of the interventionist state: a palliative to avoid the worst consequences of a lack of control, of legitimacy and of resources for rational decision-making. In this view, there is an attempt to rely on tripartite institutions to effect what government has been unable to achieve by itself; political direction of economic decisions and consent to the abridgement of market freedoms. From the perspective of believers in the market this cannot work, because tripartism is no substitute for market disciplines in ensuring rational decisions. The effect is merely to abridge freedom further by licensing elements of civil society to impinge on the natural workings of the market and thereby overreach their legitimate role.
We have tried to show that this understanding of corporatism is
too narrow, and in many ways a distortion of reality. The crux of our argument has been that forms of associative conduct, of public-private interaction, continue to flourish under Thatcherism. They have been, and are, endemic in the economic sphere and in relation to ‘welfare’ matters. There are compelling reasons why this should be so; reasons that are to be found in the complexity of modern societies, the failure of attempts at comprehensively rational planning and administration and the decline of territorial politics as a source of legitimation. What we are witnessing is not a return to autonomous markets, but the delegation of public policy functions to ‘private’ actors who are not subject to any effective forms of constitutional accountability, and activity by undeniably public actors which is similarly unaccountable. There has been no return to the old orthodoxy of a stable traditional relationship between public and private.
Nor does it seem to us that the trends we have identified are likely to be reversed. On the contrary, the growing internationalization of economic activity will continue to produce strong pressures to engage in corporatist styles of policy intervention, even in states with liberal economic traditions and governments that espouse neo-liberal economic ideologies. The argument is made with great force and clarity by the Department of Trade and Industry, discussing the advent of the single European market:
The Government are working to ensure that the single market in goods and services is achieved, and in ways beneficial to the UK... The Government want to see that industry and commerce understand and prepare for the fundamental changes in the way the European market operates which will take place between now and 1992. To that end, DTI wants to establish a closer partnership with business so that Britain’s commercial interests can be taken into account.
Over the last two years, DTI and British telecommunications manufacturers and operators have cooperated to secure agreement in Europe on the launch of a European-wide mobile communications network for the beginning of the 1990s. The European-wide market which will result gives European industry the opportunity to take a lead in mobile communications. DTI lead the UK effort necessary to bring together national governments, telecommunications operators
and manufacturing companies and to secure agreement in Europe on common technical standards. At the same time, British manufacturers are forming trans-national collaborative alliances to help break down nationalistic purchasing decisions. As 1992 approaches, Government and company efforts will need to come together in many other areas to achieve similar results. 
The calculus of economic rationality requires all governments to pursue comparative advantage for their own industries, even though some might regard the situation as a version of the prisoner’s dilemma. The methods used are likely to be increasingly subtle and invisible, depending on corporatist frameworks of the type we have described in Chapter 3, rather than direct administration or legal regulation.
Furthermore, governments which once enjoyed the luxury of public expenditure rising faster than national income as a whole are now subject - some more willingly than others - to real and unavoidable fiscal constraints. The combination of international competition and fiscal stress makes it increasingly necessary for public goals, in both economic and social fields, to be pursued through bargaining and co-operation, as well as by direct administration and the external regulation of private endeavour.
Another possible constitutional response to the challenge to the ‘new orthodoxy’ presented by contemporary developments is to regard the boundaries of public and private as a ‘political’ matter: logically separate from, and prior to, public law structuring and regulation of whatever area the government happens to choose that the state should encompass. Of course, it can hardly be denied that the relationship between public and private is, in one sense, a constitutional matter. However, every constitution leaves some matters to political choice - why should not this be one such matter in the British constitution?
If public and private are thought of as separate territories, then they can be identified by drawing lines in advance of particular decisions, policies and controversies. Government can then be bound by rules, announced in advance, which decide the area of public accountability. In this way constitutional legitimacy might
be combined with pure political choice over the extent of the public sphere.  A more perceptive form of this analysis might anticipate a shifting and uncertain border between public and private and thus a need for legal mechanisms and principles to resolve disputes at the margin, of which the first example might be R v Panel on Takeovers and Mergers ex parte Datafin. 
This sort of approach would recognize that the development of judicial principles for resolving marginal disputes was a constitutional matter, but would find difficulty in seeing why the accountability mechanisms which we outlined in Chapter 7 fell into the same category. To understand why such devices are constitutionally required, it is necessary to trace, as we have, the sharing and delegation of power by public actors. When that is done, it becomes clear that what we have called the ‘spatial metaphor’ is no longer appropriate; ‘public’ and private’ are now aspects of the structure and behaviour of all organisations. We cannot first identify a sphere of ‘public’ organizations and then ask how they should be made constitutionally accountable. That way of proceeding makes no sense because, as we have seen in Chapters 6 and 7, mechanisms of accountability themselves contribute to the organizational structures and performances which count as ‘public’ and ‘private’.
If ‘public’ and ‘private’ are dimensions of the activity of organizations then they cannot be delimited by rules announced in advance - not at any rate without crippling the ability of the organizations to respond to change in turbulent and complex environments. The claim that the extent of the public sphere is a matter for politics thus amounts to saying that government decides when it shall be accountable by accepting or refusing to acknowledge responsibility, on an ad hoc basis, in respect of particular decisions and policies.
That is often a fairly accurate description of how accountability tends to work at the present time, as Chapters 6 and 7 have abundantly illustrated. We have noted that the seventeenth century assumptions about the relationship between the state and civil society were such that it seemed unnecessary to design the constitutional framework in such a way as to make those assumptions explicit. As the empirical basis of the assumptions has disappeared, so government in Britain has been able to exercise power unconstrained by constitutional guarantees. This unconstrained power does indeed exist in the relationship
between public and private, but we cannot present this as a constitutional theory of legitimate government. Any attempt to do so ends up in the reductio ad absurdum that there is no British constitution and thus no legitimate authority at all; power comes out of the barrel of a gun. 
This does not mean that the constitution cannot leave any room for political choice in the relationship between public and private. As we have already emphasized, British constitutional arrangements currently contain no substantive provision for an irreducible private sphere. Nor have we sought to argue for an irreducible substantive core of public functions. Rather, our claims about the British constitution have focused on procedural requirements of openness and accountability. Substantive political choices cannot be left unconfined, unstructured and unchecked, and in Chapter 7 we have suggested accountability mechanisms which seem to us necessary and appropriate to perform these functions.
The question of the substantive constitutional relationship between public and private is one that we shall briefly address. However, before doing so we must consider yet another potential objection to the procedural proposals that we have already made. A possible response to the evidence we have presented in this book is to accept both that the ‘old orthodoxy’ cannot be revived and that public and private are not separate territories, but then to claim that the institutions and processes we have described contain their own solution to the problem of public accountability.
Far from believing that untrammelled market forces produce rational decisions, government itself now recognizes the need for the continuing and active use of public authority to establish and maintain ‘open’ markets. Once again, the point has been made clearly by the Department of Trade and Industry:
Open markets are the best guarantee of incentive and efficiency. Closed, insular markets kill enterprise and effort, with a consequent loss of dynamism. But open markets are not to be confused with unfettered market forces, for these can lead to closed, protected and monopolistic conditions. DTI will strive to promote open markets through the exercise of its
competition policy, through privatisation, deregulation and international trade negotiations. Regulation has sometimes limited the operation of markets in the past but it can be used, and will be used, to encourage competition and to ensure that markets work properly and enjoy the confidence of informed investors and consumers. 
It might be argued that such use of public authority can and should be guided by values and principles immanent in the concept of the market itself; that these sufficiently structure the discretion necessary for effective public action to create and maintain markets; and that to demand further public accountability is to miss the point. From this perspective, greater accountability could serve only to provide a point of entry for values and principles other than those immanent in the market, thereby reintroducing the distortions associated with planning and ‘corporatism’ which are, ex hypothesi, the very problem to be tackled. We hope that this puts the case against our view at its strongest. In constitutional terms this would amount to replacing ‘public’ and ‘private’, in the old orthodoxy, with ‘market’ and ‘political’ spheres.
The argument seems to us to be profoundly mistaken at a number of levels. As we have already shown in Chapter 5, the concept of ‘efficiency’ in its market form cannot provide any meaningful guide for public action, even action to maintain markets. Once this is recognized it is impossible to avoid (or even to bracket off) the question of choice of goals. We would not seek to deny that efficiency (in its various meanings), incentive, enterprise and effort are important matters; but they are not the only ones. To take a few random examples, public health, national security, preservation of the environment, and technological innovation are also important. Views about the relative importance of different goals differ, as do views about how best to realize desired goals. One way of reconciling such differences is through markets, another is through politics. We cannot, however, simply translate ‘markets’ and ‘politics’ into ‘private’ and ‘public’ because governments act as players in the market; as ‘meta-players’ with power to modify the rules; and as umpires, enforcing and interpreting the rules.  In other and more traditional terms, governments have executive, legislative and judicial functions. This combination of roles produces tensions
and conflicts which cannot be resolved by appeal to principles immanent in the concept of the market. The provision of a framework for the exercise of executive, legislative and judicial functions is the job of a constitution. A democratic constitution is one in which, inter alia, different views can compete through the political process - but, as we have already argued, the political process presupposes, and is not a substitute for, a constitutional framework.
The argument that the public aspects of corporatist arrangements can and should be guided by principles immanent in the concept of the market is not the same as the idea of ‘substantive due process’ which we mentioned earlier. In fact, it is a procedural claim; that a large class of public decisions should be made through processes from which those who do not possess the relevant economic power are wholly excluded. Such a claim is in constitutional terms a bold and impudent novelty, fundamentally at odds with basic constitutional principles of openness and accountability. There are, of course, good reasons for some abridgement of these principles where there is a clear countervailing public interest. Freedom of information legislation, for example, always provides for exceptions.  The point, however, is that the exceptions are a limited incursion on a basic principle of openness, not a blanket denial that the principle of openness has any relevance. It will not do, therefore, simply to allow the state to act as any other market player. On the other hand, a constitution which fails to allow any room for flexible approaches to policy delivery, and for co-operative public/private interactions, seems to us to be one that condemns government to ineffectiveness.
We are not, of course, the first to point out that pure ‘market’ and ‘state’ approaches to social and economic ordering are inadequate as rational approaches to dealing with complexity. Nor are we the first to seek to map new types of response in terms of their legal characteristics. As we have already noted, the concept of ‘associative’ activity (which seems to us to embrace much public/private interpenetration) has strong affinities with he idea of ‘reflexive law’. In this type of law, it will be remembered, groups at an intermediate level between the state and the individual have responsibility for regulating their own affairs, the state’s role being to oversee the design and functioning of the self-regulatory systems and the relationship between different systems. 
These developments cannot be self-legitimating solely by virtue of the fact that -if and when completed - hey will involve less ‘state’ control over specific outcomes than does the classic form of public administration. The first point to be made in this regard is that the growth and development of public/private interactions must be seen in the context of changes in the sphere of ‘government’ itself. From a constitutional perspective, it would be highly misleading to conceptualize changes in, for example, education as a ‘retreat’ of the state, merely because local government is being displaced from its former role as a bureaucratic provider of education. The powers of central government - both its legal authority and its practical ability to achieve its policies - have grown in the field of education, not diminished. It is trite wisdom to observe that the state is not a unitary organization, but it is important to recognize the increasing centralization of authority in Britain. Furthermore, the fact that ‘the state’ retreats from responsibility for the outcomes of policy (in terms of their effect on the welfare of individuals) enhances, rather than diminishes, the present government’s capacity to formulate and implement the kind of policies in which it is interested.
In general, the use of public/private hybrids as policy instruments has been accompanied by a willingness to use to the full the legislative and executive powers of the state; as, for example, in the enactment of the Education Reform Act, 1988, and the de facto abolition of the Training Commission/MSC in September 1988, by ministerial diktat.  Furthermore, the ‘power of the purse’ - which now belongs to government not Parliament - is used as an increasingly subtle and flexible instrument; to put pressure on recalcitrant organizations or to outflank them; to reward existing friends; to facilitate the creation of new organizational ‘partners’ for government. Thus the failure to establish a ‘modern’ framework to make accountable the budgetary powers of the state during the period of its growth now allows government in Britain to exercise ‘consumer sovereignty’ in markets and quasi-markets created by its unfettered legislative and executive powers. In a sense we are here standing on its head the problem of the ‘contract state’ as it has usually been understood.  The issue is not how government can make its
contractual partners accountable, but how government itself can be made accountable for its decisions on what it wants to buy and the price it is prepared to pay.
As we have tried to show throughout the book, this does not mean that the problem of making private actors accountable for the exercise of public authority delegated to them has disappeared. Government itself is undoubtedly concerned to present the shift away from direct bureaucratic administration and provision as a ‘rolling back’ of the state, in which power is ‘returned to the people’. ‘The people’ is supposed to consist, for these purposes, of a new Thatcherite yeomanry of ‘active citizens’ in which Everyman is a consumer, shareholder, parent and Good Samaritan. However, as we have seen in Chapter 6, there is little in the organizational forms available for public/private activity to supplement market forces, based on contract and property rights, as the basis of internal accountability.
There seems to us to be no good reason to think that there are forces immanent in the social, economic and political developments of ‘associative’ order which guarantee that it will operate - in such a way as to guarantee legitimacy. To imagine otherwise seems to us to reproduce one of the most indefensible elements of naive pluralism. As we have tried to demonstrate in this book, there is nothing in the shift from direct state administration and provision to reliance on corporatist and/or post-corporatist frameworks which guarantees that policy processes will not be factional, arbitrary and biased. ‘Reflexive’ law, like any other type of law, necessarily presupposes a constitutional framework for distinguishing between what is legitimate and illegitimate conduct.
As we have also argued, the lack of constitutional constraints on government in Britain enables it to blend its formal legislative and executive authority with the power of the purse. The result in many fields has been an increase in the power, de facto and de jure, of central government. If the break up of monolithic state bureaucratic structures is to result in processes of government which are more accountable to civil society, and more effective in responding to its needs and aspirations in a complex and changing world, it can only be within a framework of constitutional legitimacy. Our suggestions for improved mechanisms of accountability, discussed in Chapter 7, are directed towards this end.
These proposals necessarily have a limited compass. As we indicated in Chapter 1, our focus has been on relatively stable institutional arrangements for corporatist decision-making and on ways in which the exercise of public power and its delegation might be brought within the compass of constitutional accountability. However, we have also noted both more evanescent forms of public/private interaction, and manifestations of the ‘state as market player’, which may not always involve stable corporatist arrangements. The legal regulation of ex parte contacts is potentially a powerful instrument, in certain contexts, for controlling even single contacts; though many such contacts may unavoidably escape the public record, either de jure or de facto.
The more general phenomenon of the ‘state as player’ raises a number of issues about the absence of constitutional restraints on the executive power of government. The state in Britain has never received clear constitutional definition and the lack of such a definition has both a ‘quantitative’ and a ‘qualitatitive’ aspect; how much does the state do and how does it do it? The failure of constitutional theory to readdress the ‘quantitative’ aspect of traditional beliefs about public and private has, belatedly, been partially remedied. The ‘new orthodoxy’ recognizes the expanded state and, during the past quarter of a century, has made some limited progress in designing and implementing legal mechanisms of accountability. Our own view, set out in detail elsewhere, is that the new orthodoxy remains blind to a wide range of constitutionally significant phenomena besides corporatism.  However, central government still largely resists the measures that would be needed to ensure proper constitutional accountability, even over that part of the range of its activities which the new orthodoxy recognizes.
We shall do no more here than merely refer to arguments which we have made in detail elsewhere about the constitutional framework of central government.  Even the most basic requisite - freedom of information - has been introduced only at local government level, and then not as a matter of principle but (by first intention at any rate) as an instrument of political advantage. Furthermore, the parliamentary power of the purse has been rendered largely ineffective because parliamentary
financial procedures were not modernized during the period of growth of public spending. This failure now facilitates government’s use of the characteristic budgetary instruments associated with corporatist arrangements, such as contractual power, tax expenditures and loan guarantees. Although tax expenditures require legislative form and hence are subject to parliamentary approval, the secrecy surrounding preparation of the Budget, and the absence of any real parliamentary input into it, make bargaining over particular tax regimes a matter of wholly unfettered executive discretion. 
Guaranteed loans are a significant instrument of leverage, whilst at the same time largely escaping financial accountability mechanisms and imposing relatively small budgetary burdens. The discretionary nature of loan guarantees, as also of grants and interest relief subsidies (‘soft loans’), makes them eminently suitable for bargaining in Britain by a state seeking to act as a market player. In relation to government contracts, existing legal doctrine makes no concession to the notion of public interest or to the need for public accountability, either of the government or of those with whom it contracts. On the contrary, the doctrine of ‘privity’ insulates the contractual partners from external claims, and existing corporatist devices such as the Review Board for Government Contracts operate, as we have seen, in the constitutional shadows.
The constitutional problem of public and private as it presents itself today is thus a double one. First, we are faced with the continuing consequences of the failure to restructure accountability mechanisms so as to encompass the ‘quantitative’ increase in state activities. Second, the qualitative change in public/private relations, that has occurred since the demise of the world pictured by the old orthodoxy, is still not being addressed by mainstream constitutional thought. As the first failure feeds into the second, the consequence is that much of the relationship between public and private escapes the constitutional net altogether.
It is our belief that the methods we have used demonstrate that it is necessary to expand that net, in order to keep faith with the values that underpin more orthodox approaches to constitutional analysis. We hope that our proposals for reform, if implemented, would go some considerable way towards restoring the legitimacy of our processes of government. We cannot conclude, however,
without at least raising certain issues about the changing role of the state which seem to us to be of constitutional importance, but which are outside the scope of the methods of constitutional analysis that we have used in this book.
The qualitative aspect of the lack of a clear constitutional definition of public and private can now be recognized to have had serious effects in the past - especially in the relationship between government and industry, particularly the nationalized industries.  It is the qualitative aspect which is fundamental to an understanding of contemporary constitutional changes, as government ‘retreats’ from direct public administration as a way of achieving policy goals, in favour of the kinds of bargained public/private relationships that we have described.
We have argued that existing constitutional expectations impose requirements of legitimacy on these relationships. These requirements are ‘procedural’ in that, in a formal sense, they do not restrict substantive policy outcomes. However, this must immediately be subject to qualification. In the application of tests of validity such as the ‘hard-look’ standard of judicial review (or even the humble home-grown Wednesbury test), substance and procedure may be impossible to disentangle. This is only one aspect of a more general relationship between procedure and substance. A procedure which has no possible impact on the substance of a decision is usually (though not always) a worthless formality.
At one level we are unabashed by the procedural emphasis of our constitutional analysis, for we are not alone in believing that to concentrate on procedural (as opposed to either formal or substantive) legitimacy is both a necessary and desirable response to problems of complexity and change.  However, there is also another reason - and one with which we are ultimately less comfortable - for focusing on procedures:
Our model takes as its starting point the largely uncontested notion of the omnicompetence of Parliament.
When we say ‘uncontested’ we do not mean that the idea of parliamentary omnicompetence would satisfy the sociologist or political scientist, still less the natural lawyer or moral
philosopher. Rather we mean that, in so far as we have any clear constitution at all, parliamentary omnicompetence is axiomatic. 
In terms of public and private, parliamentary omnicompetence means that the substantive effects of the procedural requirements we have outlined can be outflanked by legislation. The process of legislation is itself subject to various types of procedural constraint, but it remains the case that statute can create and destroy any legal duties and powers, whether public or private. In effect, this means that there is no irreducible private sphere nor, apart from parliamentary sovereignty itself, any irreducible public sphere.
To constrain parliamentary sovereignty in the field of public and private would be to effect a major constitutional change in Britain. The most debated of such changes is the idea of an entrenched document to protect certain fundamental rights. The concept of human rights is usually taken to delimit an irreducible ‘private’ sphere within which the state must not trespass, and documents such as the European Convention of Human Rights mainly embody the traditional liberal individual freedoms. There is no doubt in our mind that the British constitution would be improved by, for example, the incorporation of the European Convention into our domestic law in order to protect individual freedoms against encroachment. However, the fact that public and private in the contemporary world are increasingly aspects of the structure and behaviour of all organizations seems to us to complicate the issues in ways which perhaps have not been sufficiently addressed by those who have advocated a bill of rights or a ‘written constitution’ for Britain.
An influential strand in thinking about human rights has emphasized social and economic security for individuals. Such rights - if recognized - might require an irreducible core public sphere, at least in the sense of needing public authority to require some degree of redistribution within a market economy. There is no necessary reason, however, why the actual task of administration should not be entrusted to ‘private’ organizations. Indeed, if the offloading process that we discussed in Chapter 4 were successful, the ‘public’ element in social and economic security might, in theory at least, amount to nothing more than an ultimate guarantee that never needed to be invoked.
However, in so far as we are discussing rights, the European Convention contains in article 6 a provision which is of considerable importance: ‘In the determination of his civil rights and obligations... everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law’. Potentially, at least, this provision might provide a basis for requiring public action to ensure that the decision-making procedures of private organizations to which public functions are delegated meet standards of fairness, natural justice and legitimate expectations. We must refer to ‘potential’ because the interpretation and application of article 6 by the Court of Human Rights has been somewhat self-restricted to date.
The implications of this extend beyond the area of welfare to encompass delegated public tasks of all kinds where decisions affect individuals. The notion of ‘regulated autonomy’, discussed in Chapter 6, might thus become a source of limits on the extent to which public functions can be carried out without fair procedure. Parliament, for example, could legislate for the provision of a particular public service through contract rather than direct administration; but to fail to provide remedies for aggrieved individuals against the contractor might be unconstitutional.
There is a further aspect of individual human rights which seems to us to confront the public/private issue directly. The idea of a right to participate in processes of government and public service (other than through voting in elections) is not included in the European Convention or its protocols. However, article 25 of the International Covenant on Civil and Political Rights provides that: ‘Every citizen shall have the right and the opportunity… without unreasonable restrictions... (c) To have access on general terms of equality to public service in his country.’ Likewise article 21, para. 2 of the Universal Declaration of Human Rights provides that: ‘Everyone has the right to equal access to public service in his country.’
The travaux préparatoires indicate that these provisions were directed at systems of entry to the civil service.  It is difficult to see why such a provision should be thought important except as an aspect of a more fundamental commitment to the democratization of public life and indeed this is the context of both article 21 of the Universal Declaration and article 25 of the Covenant. If
public functions are entrusted to ‘private’ organizations, the extent to which the resulting policy process meets democratic criteria is, as we have seen in Chapters 6 and 7, questionable in contemporary Britain. Once again, ‘regulated autonomy’ may need to impose limits on parliamentary sovereignty if the idea of individual rights against the state is not to be outflanked by contemporary developments. It would be a fine irony if British citizens were to get a bill of rights only to find that the ‘public’ authorities against which the rights might be impleaded had largely been replaced by ‘private’ bodies, which could be rendered accountable only through private law mechanisms.
1 Harden and Lewis, 1986.
2 Dyson, 1980. -
3 Quoted in Hill, 1965, Pp. 257-8.
4 ibid.; Dicey, 1939.
5 On ‘confining and structuring’ discretion, see Davis, 1971. On ‘policy’ as a excuse for judicial torpor see, e.g., Bushel! v Secretary of State for the Environment  AC 75.
6 O’Reilly v Mackman  2 AC 237.
7 The Legal Basis of Further Education: A Review by Officers from
the Department of Education and Science, the Welsh Office and the Local Authorities (DES, 1981); Education Reform Act, 1988;Harden, 1987.
8 Wade, 1988, p. 17.
9 Administrative Justice: Some Necessary Reforms (Oxford University Press, 1988). -
10 Collingwood, 1940.
11 See Harden and Lewis, 1986.
12 See, e.g., Allgyer v Louisiana 165 US 578 (1897); Lochner v New York 198 US 45 (1905); Schwartz, 1965, PP. 32-58. Lochner v New York and following cases are now ‘universally acknowledged to have been constitutionally improper’: Ely, 1980, P. 16.
13 DTI - the Department for Enterprise, Cm 278, January 1988.
14 On the rechtsstaat, in which legitimacy is based on the fact that public power is confined by pre-established rules, see Dyson, 1980; Poggi, 1978.
15  QB 815.
16 For the claim that there is no British constitution see, e.g., Ridley,
17 DTI - the Department for Enterprise, para. 1.14.
18 Zysman, 1983.
19 See Birkinshaw, 1988.
20 Teubner, 1983, and see ch. 6 above.
21 Department of Employment, Statement by the Secretary of State: the TUC and the Training Commission, DE Press Notice 205/88 (1988).
22 See, e.g., B. L. R. Smith, ‘Accountability and independence in the contract state’ in Smith and Hague, 1971.
23 Harden and-Lewis, 1986.
24 ibid., esp. chs 4 and 5; Birkinshaw, 1988.
25 On tax expenditures see, e.g., Willis and Hardwick, 1978; Armstrong Committee, 1980.
26 Prosser, 1986, and see chs 3 and 7 above.
27 See Habermas, 1979.
28 Harden and Lewis, 1986, p. 5.
29 A. Rosas, in Nordic Yearbook of Human Rights, 1989.