The British policy wonk has never been more in demand. In London alone, more than 40 think-tanks spew forth glossy tracts on everything from banning the advertising of junk food and allowing the royal princes to marry Catholics to winning the European constitution referendum and cutting single mothers' benefits. As in all crowded markets, think-tanks have had to diversify into niche markets - for local government (the New Local Government Network), healthcare (the King's Fund) and soon, if the Financial Times and ex-NS journalist John Lloyd realises his ambition, the media. And they represent every political stripe - from Compass on the left through new Labour's Institute for Public Policy Research to Civitas on the right (think every Daily Mail prejudice given intellectual ballast). Underemployed members of the intelligentsia can fill whole working days flitting between breakfast seminars, policy lunches and power drinks in think-tank land, SW1. Geoff Mulgan, the founder of Demos and former head of the 10 Downing Street Strategy Unit, says the British think-tank scene is "far healthier, more diverse and competitive than it has ever been".
Yet the think-tanks are failing in their main aim: to influence the policies of the political parties. Tony Blair is said to complain privately that new Labour think-tanks have failed to come up with policies that match his values in the way that the Institute of Economic Affairs helped Margaret Thatcher tear up the postwar consensus. Instead, Blair turns to John Birt for advice.
Aside from a few neat ideas such as baby bonds, for which both the Fabians and the IPPR claim paternity, it is hard to think of any policy for which think-tanks made the running. It is the politicians themselves who do the dreaming, with Alan Milburn calling for more paid time off, the Home Office minister Hazel Blears suggesting that local communities have a whip-round for extra policing, and Stephen Byers proposing that inefficient refuse collection companies be sacked by local referendum. And Gordon Brown is a think-tank made flesh, with his ruminations on British identity, the role of markets in society and his plans for a new lending bank for the third world. Although most of these ideas were launched through think-tank speeches, the policy wonks just provided the venue and the vol-au-vents.
The problem for most British think-tanks is money - always in short supply, it has to be spread more thinly as they proliferate. You won't hear ideas being discussed very much in think-tank offices: organising the next event, publishing the next policy paper and chasing funding must come before changing the world. To survive, most have to turn themselves into unofficial lobbyists. Corporate sponsors pay (the going rate is about £4,000) to have their chairman or chief executive at the same event as a cabinet minister - sometimes so that he has the chance for a discreet whisper, sometimes to borrow a bit of respectability.
That may sound dodgy, but no great harm is done; after all, everyone knows who's paying. Far more damaging is how corporate cash skews research agendas. The think-tanks are trapped by their paymasters into a bland managerialism, and thus become depoliticised. Corporate paymasters usually want to avoid partisan political debates. It is less easy to fund a seminar on the future of the National Health Service and the welfare state than one on the regulation of financial services or telecoms - issues that impinge directly on corporate profits. So Demos - which made huge waves in the 1990s, but now seems to have left the political sphere entirely, floating away on its own verbiage - worked with Cable & Wireless on a project about the "future of telecoms regulation". It duly concluded that Cable & Wireless's main rival, BT, should be broken up, leading to the Guardian headline: "Break up BT, says Demos. Its sponsor? C&W."
Think-tanks are more useful to funders when they can draw a discreet veil over where the money comes from. Journalists will hang up if a PR company calls about a report issued on behalf of its clients. "Company calls for deregulation" would be dismissed as corporate guff. If the same material is burnished by the name of a think-tank, however - particularly if it can be called "Blairite" - it becomes a good story for a slow news day.
My former employer, the Foreign Policy Centre (patron: Tony Blair), has accepted more than £100,000 from an unnamed Russian oligarch to establish a programme on Russian democracy. The money does not come directly; it is channelled through London PR companies presided over by a retinue of former new Labour special advisers. The PR people want to shift public sympathy away from Vladimir Putin, who is at odds with several oligarchs, and they are no doubt delighted that the project has led to a paper criticising Downing Street's closeness to the Russian president.
The biggest symptom of empty think-tank coffers is poor-quality research that owes a great deal to Google. The researchers are mostly recent graduates on low wages and the turnover is high. The Fabians' recent calls for a rewrite of Clause Four and an increase in tax were no more or less profound than a leader column in a national newspaper. Journalists have realised that much of this research sent for them to write about is wafer-thin. The torrent of coverage given to think-tank reports in the months after Labour came to power in 1997 has dwindled to a trickle. In response, the think-tanks' press releases have become increasingly desperate. "'Cop shops' need 'changing rooms' make-overs" was a recent one from the IPPR, while an impenetrable call for companies "to 'disorganise' to retain creative people" came from Demos.
The Tory think-tanks - masters of the universe under Thatcher - are in an even more precarious financial position because they are so far from power. The Adam Smith Institute - once the informal common room of Conservative Central Office - courted the new government in 1997 with seminars on "how to achieve Labour's goals". Now the government is the institute's biggest funder, paying more than £7m out of the overseas aid budget last year for advice on "public sector reform" in developing countries such as Afghanistan and Palestine.
Those that cannot perform these ideological handbrake turns remain small. Many of London's dense thicket of right-wing think-tanks are "smoke and mirrors" operations - with two or three members of staff and a website. Newcomers such as Policy Exchange and its near-ally, C Change, hold seminars with self-hating titles such as "Do the Tories tend to attract the politically reactionary and socially maladroit?". They float interesting policy proposals - such as high-value education vouchers for the poorest families - that sound remarkably new Labour in content. But they do not have the resources to research these properly, and are therefore of limited use to policy-makers. It is telling that the Tories have decided to revive their own internal research department to fill the gap. A third heavy election defeat could energise the right-wing think-tanks. ("The second half of this year will be like Labour's 1992 and 1997 rolled into one," claimed an excited researcher.) And there is plenty of ideological territory to fight over - from the socially conservative right's support for abstinence campaigns to the liberalisers' campaign to end drug prohibition. However, it is unlikely that the think-tanks will have the "research clout" to formulate policy.
The same applies to the Liberal Democrats. Their pro-market think-tank, Liberal Future, has influence - but as a meeting place for the more right-wing Lib Dems, not as a research organisation. The debate now convulsing the party (how far it should support Labour's plans for choice in public services) was brought into the open last year with the publication of The Orange Book. Some Lib Dem MPs used it to outline eye-wateringly Thatcherite policies, from privatising the Royal Mail to replacing the NHS with a health insurance scheme. But there again, it is the parliamentarians and not the policy wonks who are setting the agenda.
Good think-tanks are still vital for good politics. They bridge the gap between the rarefied circles of academia and the bite-sized proposals demanded by politicians and the media. Contemporary politicians - burdened with running departments, pacifying the media and keeping constituents happy - hardly get a chance to see their families, let alone have the time to come up with workable policies. Yet, with a few honourable exceptions, such as the IPPR's report on inheritance tax and the Foreign Policy Centre's work on Britain's public diplomacy strategy, the think-tanks have become irrelevant to the political parties.
They dream of importing into the UK the philanthropic culture of the US, which supports industrial-sized think-tanks whose huge endowments give them complete intellectual freedom. But rich individuals in Britain are never going to give the amounts needed. If we want serious, well-researched policy-making, free from corporate whim, the state will have to pay for it.
Rob Blackhurst was communications director of the Foreign Policy Centre from 2000-2005 (email@example.com)