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Cameron unveils plans to privatise… nearly everything


8:55 am - February 21st 2011

by Sunny Hundal    


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David Cameron has written an article for the Daily Telegraph today, which the paper has promoted as a news story.

The paper reports that Cameron “promises public sector revolution” by ending the “state’s monopoly” over public sector work. It looks to me like, on paper at least, the privatisation of pretty much every public service except national defence. Even policing and the fire service!

Cameron himself states:

We will create a new presumption – backed up by new rights for public service users and a new system of independent adjudication – that public services should be open to a range of providers competing to offer a better service. Of course there are some areas – such as national security or the judiciary – where this wouldn’t make sense. But everywhere else should be open to diversity; open to everyone who gets and values the importance of our public service ethos. This is a transformation: instead of having to justify why it makes sense to introduce competition in some public services – as we are now doing with schools and in the NHS – the state will have to justify why it should ever operate a monopoly.

This is vital to give meaning to another key principle: choice. Wherever possible we will increase it, whether it’s patients having the freedom to choose which hospital they get treated in or parents having a genuine choice over their child’s school.

He adds that this is not about destabilising “the public services that people rely on”, but actually about “ensuring they are as good as they can be”.


Illustration by @McGogglegoo

There’a little meat on those bones yet, which makes it impossible to know what this actually means in practice.

Any open talk of privatising police services, the NHS or all schools would instantly face massive public opposition. As it is, the Free Schools plan is proceeding so slowly the impact it is likely to have by five years time is likely to be minimal.

This actually feels like an attempt by Cameron to avoid emphasis on the ‘cuts’ and push the media narrative towards ‘public service reform’, which is traditionally much safer public opinion territory.

He needs a shift in focus because the incessant talk about cuts is hurting his opinion polls. So this is an attempt to change the record, most likely.

And it’s unlikely Labour will let them push this without making a sound. Ed Miliband has been continually attacking the “experiment in right-wing ideology” with NHS privatisation.

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About the author
Sunny Hundal is editor of LC. Also: on Twitter, at Pickled Politics and Guardian CIF.
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Reader comments


Between new labour sell off and Cameron we should be just like the beloved USA, I mean why not ask Blair if he can ask Gaddafi’s to come over and take over the running of the police force. Labour has sod all to say about sell off and the use of the NHS.

I was a long time user of the NHS and private work has long gone on in the NHS consultants who do nothing but private work hiring NHS nurses doing work for private patients at the cost of NHS. I myself once had to be moved to another hospital because a doctor demanded the ward for his private work. Blair used private hospitals all the time to do work, he also sent work to Spain.

NHS dental work was another great idea from Blair.

2. Mike Killingworth

This may simply be rhetoric to cheer up the base. One area, however, where it might be more than that, is new programme delivery, such as localisation or welfare reform where the Civil Service may struggle to deliver what ministers want (a system that ensures they take all the credit and none of the blame) – private sector consultants such as McKinseys, who won’t have to live with the consequences, may be more fit for purpose.

It is not immediately clear to me why shadow ministers shouldn’t just keep their heads down. If it can be done, it’ll be jolly useful to them when they get back in office.

There is a big difference between selling off the silver – aka, privatisation, and putting out a contract to supply a service to anyone who displays the competence to do the job.

Setting aside ideology, as long as the service is still provided free at the point of use, is there really any practical reason why the person doing the work *has* to be a civil servant?

I’d rather a bit less ideology, and a bit more practical reality in the provision of tax-payer funded services. Sometimes that will mean a state-managed provider is best, and sometimes that will mean a privately owned contractor is best.

Just get the best service for the best price – regardless of who does it. Sod the ideology.

“is there really any practical reason why the person doing the work *has* to be a civil servant?”

Yes, if you are a charity and win a contract, you’ll be spending the next 10 years defending yourself against morons on the internet who think because you’ve won such a contract you are no longer a charity.

Privatisation has worked so well so far. Astronomical prices, toothless regulators, appalling service and huge state subsidies for pretty much everything. You name it and Britian seems to have the worst and most expensive. Water was privatised supposedly to replace the Victorian infrastructure quickly, still not happening. The power companies are a virtual cartel. Railways are an utter disaster, labyrinthine rules on tickets, fares that cost a fortune and colossal subsidies from the taxpayer when the companies promised the opposite and a babel of lawyers to apportion blame. Bus companies are making an absolute fortune, a couple of years ago I returned to the city where I lived when I was young and a bus journey that used to cost 6p at the end of the 70s cost me £1.80 in a bus that looked like it had last been cleaned in the 70s. Even BT, which really was crap, if kept as a single entity with decent management installed could have delivered the ultra speed broadband to all areas that this country desperately needs. Pretty much everything has been a giant ripoff. The bits of the welfare system that Brown privatised under FND were a disaster, performing half as well as the Jobcentres but Cameron has managed the feat of slagging off FND while hiring the same companies to deliver Smith’s mad fantasy but with even less competition.

Privatisation was supposed to drive up service and lower prices, it has done the opposite, why should this be any different? It is simply a cover for the destruction of the state, national standards and democratic accountability. Rich areas will be able to buy services from companies like A4E and Crapita who the government will supply with free unemployed labour while poor communities without facilities or the money to procure them will be told their squalor and lack of facilities are their own fault for not “volunteering”. I don’t think the Tories will be happy until Britain is Europe’s Somalia, an anarchy with the rich living in luxury surrounded by armed guards.

“Slippery”, “devious”, “untrustworthy” – just some of the words used about David Cameron by people who worked with him at Carlton. Haven’t managed to find out why he was nicknamed Satan

Many years ago I taught in a school whose motto was almost the same as Cameron’s “as good as they can be”. On the surface what this meant was nicely decorated public areas, good statistics in that there were very few pupil exclusions [temporary or permanent] and if a visitor was taken around the corridors on a visit very few students placed outside the doors or in the ‘naughty area’. In reality it meant that teaching staff were forbidden to place pupils outside doors or in the ‘naughty area’ so had to contain bad behaviour within the classroom to the detriment of other students. The ultimate sanction for bad behaviour: the classroom teacher giving an after school detention for bad behaviour thus losing precious time him/herself. The resulting high turn over of teaching staff was put down to lack of committment on the part of those staff. There were always other teaching staff eager to join in the bold dream of the Head in this wonderful looking school, even if they did only last a couple of terms…. I went onto another, much messier looking school, with much better discipline policies and students who seemed to feel more secure and certainly kept its teaching staff far longer. Eventually, having racked up a few honours, the Head of the first school moved on.

Mr Cameron reminds me of the head of that original school. Shuffle as much of our public services off onto the private sector which will result in shiny ‘visible surfaces’ and then when there are any problems penalise/blame for lack of committment those at the ‘chalk face’ or equivalent in these cases. When they give up in despair, there will be other mugs to believe the self advertisiment of the ‘jobs’ offered by the head/Mr Cameron and so it will continue until there is another head/Government to sort out yet another mess….

Yes and we know what happens for example when we bring in private cleaners,MRSA goes up so does death. This has more to do with the break up of the NHS then anything else.

This is absolutely not just “rhetoric to cheer up the base”, it is an attempt to introduce “compulsory competitive tendering” into the NHS, schools, national public services.

The last Tory government handed over hospital cleaning and school dinners to the private sector. Now hospitals are dirty and the dinners awful. This will extend that “reform” to operations, education, social care, jobfinding.

the last government’s privatisation of hospital cleanning mostly aided one man – Lord Ashcroft. This run of privatisation will also enrich Tory funders.

And for all Cameron’s talk of “openness” and “the grassroots” the effect in these areas will be the opposite. Privatised services will be exempt from the Freedom of Information Act, inspection by councillors and the like will be blocked by “commercial in confidence”. In some circumstances they also remove services from the Human Rights Act. And as for grassroots, the winners will be massive transnational firms with HQ’s in London, or Copenhagen, a million miles away from the local parents, patients or serivce users.

Ah yes, the old weasel word “choice”. Funnily enough I’m under the impression that if you offered no choice at all about which hospital people were sent too, but all were of the highest calibre no one would be much fussed. Same for schools too I’d wager.

Firstly just as privatising things is “right wing ideology”, keeping them in the public sector is “left wing ideology”. It was only a few years a go that everyone was moaning that no one held any ideological positions any more, complaining about it just because the other side’s ideology happens to be on top at the minute is short sighted and sour grapes.

Secondly, those complaining about past privatisations, (beyond the way in which they were sold off which a subject in itself), should remember that there was no golden age in which these public services were run well and efficiently. British Rail was hated and mocked for rank incompetence, the chronic underinvestment of our water and sewerage system happened under public ownership. There can be downsides to privatisation but there tend to be upsides as well.

This will end up like everything else that David Cameron and this Coalition tries to change : A Diabolical Mess and something completely different to what they made us believe it to be.

Cameron is a danger to society, big or small. This is Shock Doctrine in action. We’ve seen how well privatisation worked last time!! Soon we’ll be yearning for the halcyon days of Thatcher’s Tories. If the people of the Middle East can overthrow long entrenched dictators, surely we can demand our government stand down. Isn’t that how democracy works? Or do we have to wait passively until the next election that they decide?

“(beyond the way in which they were sold off which a subject in itself)”

The main issue is that the current lot have given no indication they have thought about it, or how to do it properly. Instead they’ll be selling off the lucrative parts at low prices to their mates in the city, and leaving the non profitable bits to be run by under-funded charities using donations to subsidise the service.

This had to be a resigning issue for at least a few Lib Dems, surely.

@4 Planeshift

Winning a contract…earning money….paying employees….sounds very much like a *business* to me, not a charity.

@5 Schmidt

BT, water, electricity….have all been privatised and all work pretty well. Prices after inflation actually have come down, though increased taxes have pushed them up – especialyl in the case of electricity.

I suppose we could go back to the good old days where govt ran everything though, and the services were almost universally crap.

“Prices after inflation actually have come down, though increased taxes have pushed them up – especialyl in the case of electricity. ”

Not quite true. Prices in the case of electricity and gas went down following the introduction of competition, not privatisation, (it was only in the late 90s that consumers could switch suppliers), and have subsequently risen through shortages of supply, not taxation.

10:

British Rail was mocked in the press, perhaps, but I think you will find that any sort of retrospective look at the BR of the late 80s – early 90s, will find that it was a genuinely efficient, well run organisation by people of all ideologies.

What it did lack was long-term vision, which was due to the way its budgets were set annually so forward planning was virtually impossible. If it had been given the sweeping 5 year budgets now enjoyed by Network Rail, and the huge subsidies enjoyed by the Train Operating Companies (which are usually spent on ‘shiny stations’ and huge shareholder profits), I think we would have seen a very different rail network.

Using BR as an example FOR any sort of privatisation is really quite unwise, as it has been completely vindicated by history.

Well British gas are doing well massive profits made through the cold spell, yes hundreds freeze to death and they make a profits.

Typical conservatives. Anything they or the cronies can’t own they destroy.

The ownership society destroys democracy. Put every thing in private hands, which in reality means a few wealthy corporations. Then deregulate so that these said owners have no accountability, and you have destroyed democracy.

Can’t see much difference between the tory owners ,and the Arab dictators which are being removed in the middle east. They both want total power, and total obedience.

Typical conservatives. Anything they or the cronies can’t own they destroy.

The ownership society destroys democracy. Put every thing in private hands, which in reality means a few wealthy corporations. Then deregulate so that these said owners have no accountability, and you have destroyed democracy.

Can’t see much difference between the tory owners ,and the Arab dictators which are being removed in the middle east. They both want total power, and total obedience. Everytime a tory says he does not want the govt involved, what he really means is…… he does not want the people involved.

15. Tyler Winning a contract…earning money….paying employees….sounds very much like a *business* to me, not a charity.

So your definition of a charity doesn’t include any group with paid employees then? So Christian Aid, RSPCA, Oxfam, Woodland Trust, Arthritis Care, all these are not charities – even though the Charities Commission says they are. Because they’ve got so big (and presumably more effective) and are national rather than local, they have to have people to do things like, produce a newsletter, campaign and fundraise, keep memberships up to date, increase membership, buy in goods and services, organise CRB checks, get insurance for buildings, staff, events, and so on. All these can be done by volunteers then?

There are very specific rules as to who can be considered a charity, and having paid staff, or not, isn’t one of them. I just can’t see how the likes of Oxfam could be as successful if it was a small charity in Oxford raising a few bob at a local bring & buy fete.

“small charity in Oxford raising a few bob at a local bring & buy fete.”

Which even if they were, would make them a business according to tyler as that would be generating income through commercial activity.

Cameron, the lying piece of shit who did not put this in his manifesto… “Of course, there are some areas – like national security services or the judiciary – where this wouldn’t make sense. But everywhere else should be open to real diversity.”

No, we cant sell off the military industrial complex because too many tories make a nice living off that part of the welfare state.

This is not happening on its own. In America corporate backed governors are destroying unions power in various states in the Mid West. Teachers unions are being destroyed, but not police unions because they backed the governors. They did not say in their manifestos that they would do this, and on the back of huge donations from people like the Koch brothers they want the destruction of the public sector. This is a global elite initiative to take their nations back to the 19 th century. Once you destroy the public sector you destroy the trade union movement because many private firms will not have union workers in their companies. You then destroy the Labour movement, and the Labour party.

Cameron is now showing in full glory what we always knew, that far from a middle of the road tory is a far right wing thug who wants to destroy the labour movement. Big call now for the Lie Dems. Are they going to back this destruction with pity comments about how this a new govt and so nothing in their manifestos matters?

“Even policing and the fire service!”

Quick question. What’s the matter with tax money being used to hire a private company to provide the fire service?

This is, after all, the major part of the system in Denmark. Seems to work well: so what’s wrong with it?

Fuck of tim and your global elite ownersip bullshit.

We all know what this is really all about. Power. and the power of the wealthy global elites to own and control every aspect of our lives.

This is welfare for the rich, just like the bank bail outs. Socialism to protect the rich and capitalism for the poor. Nobodies interested in your speak your weight Adam Smith clap trap.

There is a big difference between selling off the silver – aka, privatisation, and putting out a contract to supply a service to anyone who displays the competence to do the job.

Setting aside ideology, as long as the service is still provided free at the point of use, is there really any practical reason why the person doing the work *has* to be a civil servant?

I’d rather a bit less ideology, and a bit more practical reality in the provision of tax-payer funded services. Sometimes that will mean a state-managed provider is best, and sometimes that will mean a privately owned contractor is best.

Just get the best service for the best price – regardless of who does it. Sod the ideology.

It’d be great to see some responses to this to clarify what the pros and cons of these policies actually are.

From looking at what happens in other west European countries – where hospitals are often autonomous institutions, owned by businesses or charities, and schools are private institutions selling education services to the state – it’s not immediately self-evident that privatisation per se inevitably leads to public concern about the poor quality of delivered public services – much less to public outrage about privatisation.

Indeed, in many cases, independent surveys return comparisons indicating that autonomous institutions or privately owned businesses supplying public services to government under contracts produce better outcomes than public ownership. Beyond the self-proclaimed “left”, “Privatisation” has long ceased to invoke a Palovian reflex by conveying the prospect of horrors that it once did.

I suspect that Cameron’s real agenda is to pass responsibility for public services to local councils, social enterprises, charities and local volunteers or whatever in order to cut public spending – along with taxes downstream when the deficit problem has abated – and to be able to say in response to particular complaints about public services that these are no longer the responsibility of central government. The government will no longer be accountable and relating PQs in the House of Commons will be struck down.

In future, failed public services will be the fault of local councils and charities or due to lack of local initiatives and volunteering etc. Basically, we are returning to the notions of laissez-faire which prevailed in the 19th century.

Sally has it spot on by saying this will, if allowed to pass unhindered, destroy the labour movement. At a time when other nations are rising up and saying enough is enough the Conservative government in our country is determined to take us back to the ’80s. Not the 1980s, though that would be bad enough – the 1880s. Charity provision of schools? Tax-dodgin’ Tesco running hospitals? McFire Brigade offering you fries as they stop your house burning down? All coming soon to a council near you.
This government must be stopped.

I’m sure these private companies will be as accountable to the public as the government. They’ll most certainly sign up to FOI requests and I’m sure these private companies will be happy for us to inspect their books line by line. I’m sure they’ll be even more open than the government, because all these private companies who run things are all more accountable and open than any public service, right?

Because when we made NHS cleaning private, it all worked so well. And private security companies are so much more nice and friendly than our state-funded police, right?!

I’m sure these friendly, happy private services will treat everyone equally. They’ll treat a rich, healthy man just as well as me: a poor, very sick man. There’s no doubt about this, right?! And they’ll make a profit on it, too!

*sigh*

I want to leave this country and society. It is making me even more sick than I already am. The UK is on a fast race to the bottom, where only profit matters, and the vulnerable and weak can fuck off. That’s the type of society we now live in. This race to the bottom means people like me are left behind and seen as nothing but a “scrounger” or a “drain on society”. I don’t make a profit, but it’s ok. Our government will bring in private euthanasia centres so those of us like me who need Morphine and an O2 tank and generate no profit can be “helped” in a dignified way. And, hey presto, I’ll finally have made someone a profit!

@28: “At a time when other nations are rising up and saying enough is enough the Conservative government in our country is determined to take us back to the ’80s. Not the 1980s, though that would be bad enough – the 1880s.”

Quoting the Institute for Fiscal Studies:

“During Margaret Thatcher’s premiership public spending grew in real terms by an average of 1.1% a year, while during John Major’s premiership it grew by an average of 2.4% a year.”
http://www.ifs.org.uk/bns/05ebn2.pdf

Denmark has been confirmed as the OECD’s highest-tax country, followed by Sweden.
http://www.oecdobserver.org/cp/4/databank%20revenue.jpg

By reports, Denmark’s Gini co-efficient shows it to have the least inequality of post-tax income distribution among countries for which income distribution data are available :
http://en.wikipedia.org/wiki/List_of_countries_by_income_equality

Strangely, according to Eurostat data, Denmark is not therefore languishing as an impoverished failed-state or even in the lengthening queue applying for EU bailouts, indeed, it comes out as one of the most affluent countries in the EU even if it isn’t in the Eurozone. By other assessments, it also appears that Denmark is the ‘happiest place on earth’:
http://news.bbc.co.uk/1/hi/5224306.stm

@30

Not sure what your point is, Bob? Public spending may have increased by the odd percentage point under Maggie’n’John but don’t pretend they didn’t cripple the country. To the extent that we are only just catching up with other European countries in terms of health outcomes etc (the gains that will be swiftly reversed now the government has dropped targets..).
Not to mention the record unemployment, record inflation, black wednesday (I do wonder just quite how the Cons got a reputation for being good with the economy), greed being synonymous with success…

“What’s the matter with tax money being used to hire a private company to provide the fire service?”

I don’t have an objection in principle, but in practice I can see several:

1. The tendering process is notorious for being open to corruption, nepotism and other factors that often mean the best people for the job are not used.
2. Very often the people who need the service are those who don’t decide who wins the contract – it’s made by a bureaucrat elsewhere.
3. Similarly, the service specifications and payment systems are often poorly designed and create bad incentives. For example it isn’t difficult to imagine a fire service being paid by the amount of fires they put out – not by the fire prevention work that takes place.
4. Only profitable services will be bid for, which means the rest of service will suffer. (the public sector often uses profits from some services to subsidise others). In the case of the fire service, it will be urban areas that get taken over. Expensive rural services will be cut.
5. In practice, terms and conditions of front line staff are undermined when private companies get taken over.

Tim Worstall: “Quick question. What’s the matter with tax money being used to hire a private company to provide the fire service? This is, after all, the major part of the system in Denmark. Seems to work well: so what’s wrong with it?”

I’m sure in Denmark the private sector fire service market is regulated in some reasonably sensible manner, likely according to a long established system evolved over many years.

In the UK I’m sure we would naturally ask the respected top brass of the leading corporations expected to bid for the contracts to draw up a voluntary self-regulation agreement in a spirit of friendly partnership and public service.

The commercial sector in this country has a long history of running giant joyful rings around government officials (local and national) to extract unreasonably large profits from the taxpayer; I would expect this idea to result in the same trend writ even larger – and indeed, that’s probably why the idea is so popular with centre-right politicians and their commercial sector donors (and future employers).

@31: “Not sure what your point is, Bob?”

IMO it’s usually helpful to document the facts and the detail – especially for those with strident claims about Mrs T’s spending cuts.

Lawson, as chancellor, screwed up the economy, which is why we experienced an unsustainable boom at the end of the 1980s bringing resurgent inflation with the previous house-price bubble.

John Major, his successor as chancellor, took us into the European Exchange Rate Mechansim (ERM) in October 1990 cheered on by the Labour front bench at the time, including John Smith and Gordon Brown. Black Wednesday in September 1992 was the outcome of joining the ERM when Britain’s inflation got out of control.

The late Alan Walters, Mr’s T’s personal economic adviser, had warned her about the downside risks of setting Britain up to the join the ERM. His diagnosis and warnings were substantive and valid but he was ignored. After all, he was one of those academic chappies.

Demonisation of the Tories is rather infantile and certainly unhelpful in illuminating which government policies were failing.

@33: “The commercial sector in this country has a long history of running giant joyful rings around government officials (local and national) to extract unreasonably large profits . . ”

The commercial sector doesn’t run rings just around public sector employees. Try this:

“The Financial Services Authority has hit Barclays with a record 7.7 million pound fine for mis-selling two income investment products to more than 12,000 clients who lost money during the financial crisis.” [January 2011]
http://uk.reuters.com/article/idUKLNE70H03B20110118

The important lesson is that we need to get away from the mantra:

private, profit motivated sector = good

public, public service motivation = bad

Or versa versa.

Planeshift,

Thanks for a sensible comment amongst the knee-jerk and sallyisms…

Your objections seem sensible enough, so lets have a look at them:

1. The tendering process is notorious for being open to corruption, nepotism and other factors that often mean the best people for the job are not used.

Indeed – which is why government tendering should be open and accountable, and decided at the most local level. I’d also like to advocate my normal suggestion about a maximum proportion of income derived from government contracts to avoid creating private quasi-monopolies.

2. Very often the people who need the service are those who don’t decide who wins the contract – it’s made by a bureaucrat elsewhere.

I think this may be where the localism agenda steps in (and also the NHS and school reforms where it is effectively consumer choice). This concern is in effect one of the key government issues behind the changes – the civil service do have a monopoly of choice (read the article and this becomes clear).

3. Similarly, the service specifications and payment systems are often poorly designed and create bad incentives. For example it isn’t difficult to imagine a fire service being paid by the amount of fires they put out – not by the fire prevention work that takes place.

I seriously hope no-one is stupid enough to pay by work done for a service which is not normally needed but has to be available… But I think you are envisaging single providers here (perhaps on the line of the company, whose name escapes me, who runs Walsall’s Education for them), when Mr Cameron is envisaging multiple providers in an area – and has not (unlike Tim W) actually advocated we do this with the fire service.

4. Only profitable services will be bid for, which means the rest of service will suffer. (the public sector often uses profits from some services to subsidise others). In the case of the fire service, it will be urban areas that get taken over. Expensive rural services will be cut.

But since government pays for them one way or the other I don’t see how this works – I think you’re forgetting that government still has the commissioning role and can still provide the service itself if no-one else will. Which is pretty much my definition of the role of government – the agency to ensure things are available when needed, but not necessarily also the agency which provides them. Incidentally, surely government should not be making any profits on its services – that is taxation imposed on service users? If a service needs subsidy, it should be taxed fairly (i.e. from all the population according to their means).

5. In practice, terms and conditions of front line staff are undermined when private companies get taken over.

I can possibly accept this, but for the complaint to be valid you have to prove that does not mean that terms and conditions of staff in government services are actually too generous and are therefore costing us too much. A difficult one to convince someone like me (who has worked in government, private and self-employed sectors) about I fear…

I appreciate Tim’s introduction of the fire service may have distracted your argument away from what Mr Cameron said, but I think in effect that your main objections are as follows:

That decisions will be made remotely by unaccountable civil servants – exactly what these measures are meant to change.

That only profitable services will be provided – which ignores the role of government…

That staff may suffer – which, bluntly, assumes that public-sector employees are entitled to a cosy life at the expense of those producing the taxes that pay them (although to be fair, is not a groundless accusation in some areas).

Hi Watchman,

“government tendering should be open and accountable, and decided at the most local level”

Generally agree, but it is worth noting that this will increase costs, because you get fewer economies of scale if you have lots of small tenders.

“But since government pays for them one way or the other I don’t see how this works – I think you’re forgetting that government still has the commissioning role and can still provide the service itself if no-one else will. Which is pretty much my definition of the role of government – the agency to ensure things are available when needed, but not necessarily also the agency which provides them.”

Two problems:

1. What happens when the successful contractor spots a loophole in the terms which enables them to reduce the service provided / charge for services / deny people access to services? c.f. the American health insurance industry.

2. What happens when a contractor wins a contract by submitting the lowest bid, but then finds that it can’t run the service at a profit? Does government just let them provide an inadequate service, let it collapse, or step in and give more money?

In other words, where is the consumer protection in these reforms?

“I can possibly accept this, but for the complaint to be valid you have to prove that does not mean that terms and conditions of staff in government services are actually too generous and are therefore costing us too much.”

Hospital cleaners is the classic example – since these services were privatised, wages were squeezed to enable the contractors to make a profit, quality of cleaning was reduced and the state ended up paying out more in tax credits to top up cleaners’ wages, and in dealing with increased infections.

1. What happens when the successful contractor spots a loophole in the terms which enables them to reduce the service provided / charge for services / deny people access to services? c.f. the American health insurance industry.

Then government closes the loophole. The American health insurance industry really isn’t a good comparison in general, as it’s not a service funded by the government for the public good, which the outsourced services being discussed still would be.

2. What happens when a contractor wins a contract by submitting the lowest bid, but then finds that it can’t run the service at a profit? Does government just let them provide an inadequate service, let it collapse, or step in and give more money?

That’s a good question, and I think points to a need for bidders to prove and keep financial reserves to cover the provision of the service if it proves unacceptably expensive.

Watcman troll “Thanks for a sensible comment amongst the knee-jerk and sallyisms…”

It must suck being you having the constant smell of tory shit wafting in your face from your constant tory and corporate bottom sniffing.

And the sell off of hospital cleaners was a complete fuck up. As greedy corporations undercut each other and had to employ increasingly illegal immigrants to work for ever lower pay. The result? A bunch of contract cleaners who had no link with the hospitals.

No surprise the infection rates shot up over the last 20 years.

The paper reports that Cameron “promises public sector revolution” by ending the “state’s monopoly” over public sector work. It looks to me like, on paper at least, the privatisation of pretty much every public service except national defence.

Obviously, Sunny does not believe that a government-owned body can ever give as good a deal as a private company. Otherwise he would not expect that private companies would always win the contract in preference to state-owned organisations.

Nice to see he’s using his dead son as PR for this as well, how classy of him. I hope he suffers a stroke that leaves him cabbaged.

42. Iagreewithsally

He used his dead disabled son to assure the public he could be trusted with the NHS too.

What kind of person could use their dead son to con people? Is he a sociopath?

43. Chaise Guevara

“What kind of person could use their dead son to con people? Is he a sociopath?”

I kinda think this is a Catch-22 for politicians. Given that the tabloids will make sure everyone knows about your personal tragedy, you have two options: bring it up, in which case you’re milking the loss of your child and are thus a callous bastard; or don’t mention it, in which case you don’t care about the loss of your child and are a callous bastard.

It’s a bit like how politicians are blamed for sticking to their principles (because They Are Out Of Touch With Society), but if they re-examine the evidence and change their minds, that gets lambasted too (because it’s An Embarrassing U-Turn).

44. Iagreewithsally

But he didn’t just mention it, he exploited it to convince the country that he was different to the other NHS hating tories. He gave the impression it had a special place in his heart because they had looked after his son so well.

He was lying, again.

If it makes you feel better, I’m a Tory and I don’t like this idea.

I mean the fact that I, ULTIMO TIGER, VISCOUNT TIGER OF JOSHIFANS AND PURORESUFAN is agreeing with you should make you feel better by default.

No, I think Kamikaze Dave is out to either destroy his party or his country. The SDR for example, trying to privatise the forests, wasting money on HS2 that could be used to reopen old lines like the Woodhead route, increasing the aid budget while cutting stuff at home, sucking up to the EU, opposing AV even though it’s better than FPTP.

What none of the Libertarian lunatic fringe have ever answered to me is what happens when charity and volunteer organisations don’t step in to help those who can’t afford private healthcare etc?

Ed Miliband has had all day to react against this ..and so far all ive heard is silence ….pathetic …

@40 There is precedent that the government of the day will fudge the figures to make the private option appear to be considerably better on paper than it will ultimately turn out to be. This happened a lot with PFI.

48. George McLean

Tim Worstall @ 24: “Quick question. What’s the matter with tax money being used to hire a private company to provide the fire service? This is, after all, the major part of the system in Denmark. Seems to work well: so what’s wrong with it?”

Does the Danish private fire brigade receive any state or local authority subsidy? If yes, how much a proportion of its income? Who funds the minor part of the service and why? If that is state- or local authority- run, how do its terms and conditions compare with the private brigade?


Reactions: Twitter, blogs
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  58. Lynsey McGough

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  62. Amy Long

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  88. Andrew Molyneux

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  89. UNISON East Midlands

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  93. How Cameron’s Big Society 3.0 (corporate welfare edition) could be checked | Liberal Conspiracy

    […] But this is the worst idea of them all. David Cameron announced earlier this week was all about public services being opened up to be run by the private sector. Or, as Sunny called it, a plan to privatise nearly everything. […]

  94. NORBET

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