The Adam Smith Institute
The Adam Smith Institute is the UK's leading innovator of free-market policies. Named after the great Scottish economist and author of The Wealth of Nations, its guiding principles are free markets and a free society. It researches practical ways to inject choice and competition into public services, extend personal freedom, reduce taxes, prune back regulation, and cut government waste.

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Damned statisticians
By Dr Eamonn Butler

You can make the public sector look a lot smaller if you just define its activities as 'private'. For example, when the UK Chancellor Gordon Brown got private consortia to put up the cash to build new state hospitals, he did just that. And he fought a long battle with the Office of National Statistics (headed by a man with the unfortunate name of Cook, as in books) to make them accept this sleight-of-hand.

Now the ONS is getting its own back. For a few years now, the government has encouraged 'city academies'. These take state-supported students, but are sponsored and run independently by philanthropic investors. When one, in Middlesborough, got into financial difficulties with £1.5m debts, the government bailed it out.

Whereupon the ONS said that if the government was going to underwrite the debts of city academies, they could no longer be considered independent and had to be re-classified as - well, quangos, basically, like the ONS itself. So out goes the city academies' independence, in come all the rules and regulations that government the finance and operation of public bodies.

Of course, that would kill a pet policy stone dead, so the government will find some way round it. But isn't it bizarre that the government statistics nerds apparently have the power to turn private into public at the stroke of a definition?



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Adam Smith (1723-1790)
Adam Smith was the great Scottish philosopher and economist best known for "The Wealth of Nations", his pioneering book on free trade and market economics.

A wide selection of material about Adam Smith is now available on the Adam Smith website. This includes the full text of his two major works, The Theory of Moral Sentiments and The Wealth of Nations.