The Labour Government elected in 1997 faced similar problems in health care to those faced by the Conservative Government in schools in the early 1990s. And the policies developed for health care in the late 1990s echoed those that had been implemented for schools. This paper considers one of those common policies, namely the creation of new central inspectorates required to visit all organizations over a four-year period: the Office for Standards in Education (OFSTED) to inspect the quality of teaching in schools, and the Commission for Health Improvement (CHI) to review the implementation of the systems and processes of clinical governance in every organization in the National Health Service (NHS). At its creation, CHI was described as an OFSTED for the NHS. This paper compares these two inspectorates; describes origins of policies and institutions; considers their rhetoric and practices; describes the processes the two organizations used and considers their impacts. It argues that structural differences meant that CHI could never have been an OFSTED for the NHS; relational distance is a key aspect of inspection/regulation; and that the key to effective regulation in the case of the NHS was the relational proximity between CHI and the NHS, with the added weight of a strong performance management regime.