Acting in the public interest – a framework for analysis - ICAEW

Panel 6.2: The need for more £5 notesA small example of where intervention might have been for the greater good but in adetailed context is from 2007 when the Governor of the Bank of England commented on theshortage of £5 notes in circulation in the UK. 123 This is widely attributed to the fact that cashis now largely drawn from bank ATMs. Banks, to minimise cost, stock the ATMs with £20 and£10 notes, but the net effect is that there are relatively few £5 notes in circulation, leadingto people having to carry larger numbers of coins around then they would like. Here is aninstance where rational self-interest has led to public inconvenience.6.4 Establishing representative opinionAs noted in Chapter 5, the whole of the public may not be relevant to the issue in question.Where there is a narrow range of people with legitimate interests (for example in mostprivate companies) or the issue is a very simple, specific one, such as the example of the£5 notes above, the determination of what they want is quite easy. However, where therelevant public includes all or most of the public at large, and the issue is a more widelydrawn one of furthering the public interest in general, what they want has been shownto be quite complex and perhaps not always understood by governments and others takingpublic interest decisions.6.4.1 Expressed opinionOne of the key problems in ascertaining opinion lies in distinguishing what relevant opinionactually is from what it appears to be. Those seeking to assess what relevant public opinion iscannot know it instinctively. They must therefore seek out such opinion, which is costly and takesknowledge and effort both on the part of those seeking the opinion and those delivering it.Inevitably, therefore, the opinion on which they will be seeking to act upon will not be complete.It will be expressed opinion, rather than actual opinion, and there are potential problems with this.First, some groups and individuals are more articulate or otherwise better at getting their opinionsexpressed than others through, for example, well-organised lobbying, or the attraction of themass media to particular types of story. Some matters will unite groups of individuals withcommon economic, geographic or political interests, for example. Lobby groups will advancethe interests of those who are well funded and organised. Some issues can be, in effect, anarrow zero-sum game: a contest for gain between one group and another. At the other extreme,issues can impact very widely, beyond the group(s) involved, and be of a public interest nature.A distinction can be made between different types of groups:• common interest groups, that are wholly inward looking;• representative common interest groups, that also represent the interests of their ownmembers, but others outside of these groups may also obtain the benefits; and• surrogate common interest groups, that represent the interests of those beyond theirmembership, albeit not necessarily everyone. 124Common interest groups will tend to resist change where their members benefit from thestatus quo (for example trade unions seeking to maintain restrictive practices) and thus slowdown a society’s ability to benefit from technological and other change. It has been suggestedthat smaller groups will have disproportionate impact as they can organise themselves better,with social, as well as economic interest cohesion. 125Matters which primarily benefit lobby groups’ own members are less likely to merit publicsupport than those which primarily benefit the public at large.123Larsen, ‘King’s Call for More Fivers Catches Bankers Off Guard’.124Pleasence and Maclean, The Public Interest.125Olson, The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities, Beattie, False Economy.The relevant public’s wants41