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The development of what was initially referred to as New Public Management and New Forms of Governance has created dilemmas for modern states. From the perspective of NPM, the hiving-off of tasks to independent agencies and private bodies is a mechanism for more efficient and effective government. It allows managers to develop organizations and policies which are'fit for purpose'and more suited to the needs of consumers, rather than producers, of public goods. On the other hand, the constraints on politicians are political and not purely administrative. They often have to respond to ad hoc political pressures and they may have longterm strategic goals in terms of public goods. Consequently, politicians want to maintain some control over policy outcomes. This dilemma creates a tension between administrative autonomy and political control. To some degree this tension is resolved in federal or highly devolved political systems, where both political and administrative authority are delegated to the locality. However, in highly centralized systems such as that in Britain, there is considerable tension between the desire to delegate and the political imperatives, which reinforces the need to control. This chapter examines how these dilemmas have manifested themselves in the context of the highly centralized British political system and the impact of the present Labour government's reform programme.