Independent costing of election programmes: lessons from the Netherlands

In May 2017, the Constitution Unit began a project seeking to understand how the quality of information and public discussion during election and referendum campaigns could be improved. The independent assessment of parties’ policy proposals could be one way of providing the public with high-quality, reliable information. Michela Palese outlines the debate on this topic and reports some initial findings from a research trip to the Netherlands, where such assessment of election programmes is a well-established feature of campaigns.

The Constitution Unit, with funding from the McDougall Trust, is seeking to understand how the quality of information and public discussion during election and referendum campaigns could be improved. As outlined in a previous post, we are looking at three potential approaches: directly banning false or misleading statements; promoting the availability of impartial and high-quality information; and fostering citizen deliberation. My research is currently focused on the second type. In this blog post I first outline the state of the debate on one strand of this approach – independent impact analysis of manifesto proposals – in the UK and summarise existing practice overseas. I then relate early thoughts from a research trip to the Netherlands, where an independent institute assesses the economic and financial effects of parties’ election programmes.

Manifesto budgeting in the UK

The independent assessment of electoral programmes is not a novel idea in the UK. Since 2013, the Labour Party has advocated extending the remit of the Office for Budget Responsibility (OBR) to include pre-election costing of opposition parties’ policy proposals. Labour argues this would benefit public debate by ensuring that voters were properly informed and restore public trust in politics by improving policy transparency. Some Conservatives – notably, Andrew Tyrie, the former chairman of the Treasury Select Committee – have endorsed this idea. The government, however, has rejected calls for an extension of the OBR’s remit on the grounds that that the Civil Service Code prevents it from examining opposition parties’ policies and that it should abide by the principle of political impartiality. Furthermore, Conservative MPs have argued that it is necessary to protect the credibility and independence of this relatively new institution, and that drawing the OBR into the highly politicised environment of an election would be unwise.

In evidence provided to the Treasury Select Committee in 2014, the OBR’s chair, Robert Chote,  indicated support for extending its role. In a letter to Andrew Tyrie, he said that ‘independent scrutiny of pre-election policy proposals could contribute to better policy making, to a more informed public debate, and could help facilitate coalition formation when party programmes need to be reconciled’. However, he also highlighted some issues that would need to be resolved, such as the establishment of ‘clear rules’ for parties, the availability of adequate resources, and the need for cross-party support for the change.

Both external and Treasury reviews of the OBR cautioned against expanding its role, arguing that currently the risks in terms of resources and independence could outweigh the benefits. These judgements, combined with the pressing matters surrounding Brexit, seem to have put the debate to rest for now.

Policy costings overseas

Likely as a result of the economic and financial crises, recent years have witnessed growing interest in the benefits of establishing fiscal watchdogs and in ensuring the credibility and feasibility of policy proposals through some form of pre-election costing. The Irish Department of Finance, for example, provides a facility through which parties can request the costing of individual policies. Australia has two such systems: the Charter of Budget Honesty of 1998, which allows government and the main opposition party to have their policies costed during the election period; and, since 2012, the Parliamentary Budget Office (PBO), which provides analysis of proposals’ financial effects to minor parties as well. Since 2014, Belgian political parties have been required by law to have their manifestos independently costed by the Federal Planning Bureau, though this facility has not yet been tested.

The first and best known example of a facility for pre-election policy costings is provided by the Dutch Centraal Planbureau, known in English as the Netherlands Bureau for Economic Policy Analysis (hereafter CPB). Since 1986, the CPB has analysed the economic and financial effects of policy proposals that parties present in their election programmes and published the findings in its Keuzes in Kaart (Charting Choices) report. Participation by parties is voluntary. The practice began when the three largest parties asked the CPB to assess the economic and financial effects of their proposals. Since 1986, the CPB has assessed policies for all elections except the snap 2003 election. The number of participating parties and scope of the analysis have increased significantly. For the most recent elections of 2017, the CPB assessed 1,165 policies from 11 parties. In addition, two other independent research institutes – the Netherlands Environmental Assessment Agency and the Netherlands Institute for Social Research – now assess policies for their environmental and social impacts.

The aim of my research trip was to understand better how this system works in practice and whether and how it could be adapted to the UK. I interviewed senior staff members in all three bureaus, financial spokespeople for two of the parties, and others with direct experience of how the CPB’s work affects policy-making and election discourse. These interviews supplemented analysis of CPB reports, media coverage and academic literature.

Transparency and independence

A key theme emerging from the research is the degree of openness and transparency with which the CPB approaches its work. The programme leader with whom I spoke was extremely open about what the Bureau can and cannot do, willing to reflect upon the CPB’s independence and whether this was ever questioned, and candid about how the Bureau relates to political parties. A journalist stressed the CPB’s open culture and the fact that it does not serve the government of the day – this would be seen as going against the Institute’s ‘esprit de corps’. More than one interviewee told me that the independent-mindedness of most CPB Directors has given the Bureau a strong position vis-à-vis politicians.

CPB staff are also aware of and open about the limitations of their assessments (this is also explicitly stated in their reports), saying their methods are not necessarily suited to assessing ‘revolutions’ or ‘visionary’ policies. They acknowledge the discouraging effect this may have on parties whose policies deviate too far from the Bureau’s economic and financial outlook.

Party collaboration and trust

Engaging with parties and fostering a positive and collaborative relationship is fundamental to the CPB’s work. During the costing process, participating parties are aware of the methods and tools used. They trust the CPB with the assessment of their proposals, as they know that the Bureau will keep information confidential and be as neutral as possible. Outside of the assessment period, the CPB and parties regularly keep in touch and provide feedback to one another, with the Bureau confidentially assessing specific policy proposals for parties and the parties proposing potential topics of analysis to the CPB. One interviewee told me that the CPB’s Director has a coffee or chat once a year with the leaders of all political parties, in which they discuss the election assessment and the topics to be included.

The success of the CPB’s assessment seems thus to rely on the trust parties have in its work and on their acceptance of its judgement of their programmes.

Checks and balances

I was somewhat surprised to learn that the CPB rarely, if ever, intervenes in the public debate to provide clarifications or corrections, even if its analyses are being misrepresented. Rather, the CPB relies on the media and other political parties to hold politicians to account and, if necessary, provide a correction. This approach is intended to preserve its independence and credibility as an institute of positive economic analysis.

Everyone I spoke with agreed that it was the role of the media to ensure the accuracy of politicians’ statements and disseminate the information in the CPB’s report to the general electorate. The media were generally seen as doing quite a good job in this regard.  Political parties use the CPB’s report as a reference text for picking apart and correcting their opponents’ statements. More than one interviewee, for example, mentioned a memorable exchange in the 2012 election campaign between the leaders of two of the main political parties, Mark Rutte and Diederik Samson, where Samson called Rutte a ‘liar’ for misusing the CPB’s results and corrected him by drawing upon the report.

The CPB’s indirect relationship with the electorate

All interviewees agreed that voters do not read the CPB’s costing reports. Rather, as an economist put it, this is reserved for ‘politicians, geeks, economists and journalists’. Nonetheless the CPB does significantly influence the quality of debate and information by guaranteeing that the policies proposed by parties are concrete, costed and implementable. Its work reduces the possibility of parties making false promises and disseminating misinformation during a campaign. Though they might not read the report directly, voters are alerted to potential discrepancies or incorrect claims by the media, which may influence their voting choice.

The CPB thus contributes to parties’ credibility and reliability before the electorate, the media and other politicians. It also provides a wealth of information on parties’ policies, including their effects and feasibility. Its report serves as a common reference text throughout the election campaign.

Concluding remarks

The Dutch system of policy analysis incentivises parties to present policies that are well-considered, properly costed and implementable, thus improving the credibility of parties’ programmes and reducing the likelihood of false promises. Furthermore, the detailed and impartial information gained by such costings can provide a standard, universal reference text during election campaigns and lead to more fact-based, insightful debate.

Still, speaking with some of the people who are closely involved in the CPB’s work has raised important issues to consider when assessing whether and how this model could be applied to the UK. First, maintaining the independence, neutrality and transparency of the body tasked with assessing policy proposals is key to ensuring the collaboration and trust of political parties. Dutch experience suggests that collaborative relations between the analysing body and the parties aids this. Second, the media have crucial roles in conveying the import of the analysis to the wider public, holding politicians to account and countering misleading statements. Whether the UK media would do this as effectively as their Dutch counterparts is an important question. Finally, the scope and methods of review need to be carefully considered. Effective, democratic policy-making is not necessarily well served if the process discourages innovative thinking or privileges a restricted range of criteria for policy evaluation.

About the author

Michela Palese is a Research Assistant (McDougall Fellow) at the Constitution Unit.

One thought on “Independent costing of election programmes: lessons from the Netherlands

  1. Dear Michela

    Thanks for an excellent blog: you clearly had a really interesting and productive trip! Could you explain one thing: are the CPB’s reports confidential to the parties, and published only if the party wishes to put the costing into the public domain?

    Robert Hazell
    Professor of Government and the Constitution
    The Constitution Unit
    Department of Political Science
    University College London
    29-30 Tavistock Square
    London WC1H 9QU
    Tel: +44 (0) 20 7679 9349
    https://www.ucl.ac.uk/constitution-unit/

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