Policy Exchange – How It Works

I recently became aware that I had written the words Policy Exchange more times in my blogs than I thought would have been average.  So I set about trying to find out how Policy Exchange works and set out my personal thoughts on said observation.  I will not be quoting the names of any companies/businesses unless it is a direct lift from another document, you will have to fill in the gaps yourselves.


Policy Exchange is a neoconservative orientated think-tank with close ties to David Cameron.  It was launched in April 2002 by two former Asda executives Francis Maude and Archie Norman with Nicholas Boles as its founding director.  It is part of the Stockholm Network  a working group of European market-oriented think-tanks.

In 2011 Tim Montgomerie (founder and editor of the website ConservativeHome.com) wrote, ‘the old rightwing thinktanks weren’t particularly helpful to the Tory modernisers and so they built their own. Policy Exchange helped Michael Gove develop his schools agenda. The Centre for Social Justice gave Iain Duncan Smith his poverty-fighting plans.’  In 2012 he described the two think-tanks as having ‘been the most influential centre right think tank of the last decade.’

Already we are seeing some current, prominent names.


This is what their website says they do “As an educational charity our mission is to develop and promote new policy ideas which deliver better public services, a stronger society and a more dynamic economy. The authority and credibility of our research is our greatest asset. Our research is independent and evidence-based and we share our ideas with policy makers from all sides of the political spectrum

They then go on to say this “The authority and credibility of our research is our greatest asset. Our research is independent and evidence-based and we share our ideas with policy makers from all sides of the political spectrum.  Our research is strictly empirical and we do not take commissions. This allows us to be completely independent and make workable policy recommendations.”

And this is where my problems all begin.

  • Charitable Status

Registering as a charity can provide numerous tax breaks for think-tanks. Charities do not normally have to pay corporation tax, capital gains tax, or stamp duty, and gifts to charities are free of inheritance tax. They can also pay significantly reduced business rates (e.g. council tax) on the buildings they occupy.  They are also immune to requests made under the Freedom of Information Act 2000.

Why do they need charitable status?  Are they really so pious that they actually believe that they are better-educating the British public?

  • Where does their money come from?

Like all charities, they receive a large proportion of their income in the form of charitable donations.  Don’t get me going on the tax benefits of charitable donations, that’s a whole new arguement for another day.  Policy Exchange are particularly reluctant to disclose the identities of their donors  George Monbiot wrote a very interesting article on Think Tank Funding last year which you will find here.  However, I have come across a 70 page report from only last year entitled The Cold War On British Muslims.  Don’t be put off by the title, follow the link, download the report and take a gander at pages 53-60, too lengthy to reproduce here.  These pages contain the identities of some of Policy Exchanges donors, private and corporate.

They include

Colin Barrow, a millionaire Hedge Fund Manager.  He is known to have funded both Policy Exchange and Localis. I still don’t know what a Hedge Fund is never mind how to manage it, but maybe this is why government don’t want to tackle the real problem – financiers, bankers, hedge fund managers.

The City of London Corporation

Westminster City Council

Lord Ashcroft, who has also donated large sums to the Conservative Party.  Ashcroft was approached by Francis Maude for financial support in early 2003.  After meeting Michael Gove for lunch in the House of Lords, Ashcroft agreed and was subsequently invited to join the think-tank‘s board – an offer he declined. It would appear from this incident that individuals who donate large sums are typically invited to join the board of trustees.

Perhaps other wealthy members of Policy Exchange’s Board are also donors?

The identity of a number of other individual donors to Policy Exchange is known because their support is acknowledged in Policy Exchange publications.  These include John Nash, the chairman of the private healthcare company Care UK, and Henry Pitman, an old Etonian and founder of Tribal Group plc.  Henry Pitman‘s Tribal Group makes its money by providing outsourced public services and giving what it calls ‘advice and change management support‘ to the public sector.   In its 2010 accounts Tribal reported that 90% of its £202 million revenue was generated from the UK public sector.  The company commented that: ‗We see major opportunities to grow the business as the NHS accelerates the pace of reform to meet rising demand in a sustained period of funding constraints.‘  In February 2011 it announced that it had signed an agreement to ‘to assist the UK Government further in the delivery of efficiency savings‘

Another private company which stands to make substantial sums from the public sector reforms long advocated by Policy Exchange is Care UK, whose chairman John Nash was personally thanked in the same report as Tribal Group‘s Henry Pitman. Like Tribal Group, John Nash‘s Care UK makes the bulk of its money through outsourced public services. It is optimistic about the future of UK public policy and noted in its 2009 accounts that ‘public sector commissioners are increasingly turning to the independent sector to drive efficiency and reform.‘  John Nash is also a Tory donor and in November 2009 donated £21,000 to Andrew Lansley, who was the Secretary of State for Health

Another questionable source of funds for Policy Exchange‘s health research is Merck, one of the world‘s largest pharmaceutical companies which in May 2009 gave £17,500 to Policy Exchange to support research into drugs pricing.  I thought that was the responsibility of N.I.C.E

So, as you can see, the waters of public reform have once again become murky.  Before we leave this section I have a few thoughts of my own about ‘Charitable Status’  If you have read other of my blogs you will know that I hold reservations about senior Police Officers (amongst others) accepting the gift of a dinner at a Policy Exchange event.  Chief Constable Smith is invited to attend a dinner at Policy Exchange, or a restaurant of their choosing.  Mr Smith accepts the invitation, attends the dinner and subsequently registers this dinner in his Force’s Hospitality Register.  We know this much happens because Hospitality Registers are published documents and such events have been recorded therein.  If Chief Constable Smith wanted to attend a normal seminar on Policing for example he or his Force would have to pay for his attendance.  Why does no-one raise an eyebrow when Mr Smith is invited out to dinner by a Registered Charity with a political agenda?

Finally, let us return to the paragraph above which I have reproduced in red, particularly this bit  Our research is strictly empirical and we do not take commissions. This allows us to be
completely independent and make workable policy recommendations.

In their own Financial Statements Policy Exchange state that the object of their charity is

The non-partisan advancement of education of the public in the economic, social and political sciences and their effect on public policy and the policy making process in the UK and the promotion and publication of objective research.

If that’s not bad enough, they go on to say that their income falls into one of 3 categories;

  1. Unrestricted Funds – these are available for use at the discretion of the Trustees in the furtherance of the charitable objectives of the Charity.
  2. Designated Funds. – If part of an Unrestricted Fund is earmarked for a particular project it may be designated as a separate fund …….blah blah blah
  3. Restricted Funds – are funds subject to specific restricted conditions imposed by donors of those funds, such as donations given to the charity for specific research programmes and/or projects.

It’s number 3 that bothers me.  How does that co-exist with “We do not take commissions” and “this allows us to be completely independent”?  It seems to me that we can’t believe a single word of the psycho-babble on PX’s website, as the truth is obviously hidden elsewhere.

I’m sick and tired of sitting on the fence, think tanks such as Policy Exchange, and they are not the only think tank, don’t do anything to help educate me as a member of the public.  They do influence political policy, but that’s not what their charitable status states that they are about.  They have already been subject of one Charity Commission investigation about their funding and whether their charitable status was appropriate.

Maybe it’s time for the Federation or one of the Health Service Unions to take the matter up with the Charity Commission again.  I for one don’t think that what’s happening is correct on any level.

Lord Z makes donation to Policy Exchange and/or Conservative Party>>>>>>>>>>>>Policy Exchange produce a report promoting privatisation of xxxxxxxxxxxxxxx>>>>>>>>>>>>Goverenment debates and a reform Bill drawn up recommending privatisation of xxxxxxxxxxxx.>>>>>>>>>>>>>Privatisation of xxxxxxxxxxxxxxx is put in place by ConDems or whoever>>>>>>>>>>>>Lord Z sits back and rakes in the profits as his company bids for, and is awarded, contract for xxxxxxxxxxxxxxxxx.  Fact or Fiction?  Is this how it is to be from now on?

If you agree with this message PLEASE pass it on to anyone else who has an interest in the perils of privatisation and think tanks.  Not for me, I don’t get, nor want,. a penny out of it, but to try and get this crazy helter skelter to grind to a halt.

It may be useful to read my previous blog on Think Tanks here


6 thoughts on “Policy Exchange – How It Works

  1. Pingback: Westminster City Council is a donor to Policy Exchange | The Big Picture

  2. Pingback: The ‘Hidden’ Curse of Privatisation | The Big Picture

  3. Policy Exchange’s idea of “research” tends to be little more than a literature review (frequently referencing its own publications) accompanied by the occasional commissioned opinion poll.
    Unsurprisingly their conclusions always concur with future Consevative policy

  4. Of equal interest are the list of Trustees! You can find them by looking up their accounts to the Charity Commision.

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