A much anticipated white paper on public sector reform has been trailed by Cameron as a necessary means to break down what he describes as ‘state monopoly’.
His new head of policy at Number 10, Paul Kirby, a former KMPG consultant whose previous employer stands to earn mega bucks from privatisation, has suggested that responsibility for fixing the deficit can be transferred from the central state to the customer ‘by transferring responsibility for the cost of services via a market to purchasers of public services’. This is of course poppycock.
No contractor will take on a contract without costing into that contract a risk factor. The higher the risk the greater the cost. That should make for some interesting contract costs in areas like adult social care. Far from the responsibility transferring to the market the public sector will simply carry the costs hidden within contract payments to satisfy the needs of private contractors.
But we must as a union challenge on a much deeper level than the head of steam that will rightly build up over privatisation. Traction has already been gained by the Tories for the myth of a ‘state monopoly’ yet again aided and abetted by the ‘where’s Wally’ response from Ed Milliband. Yes. I didn’t hear him defending public services either.
There has never been any such thing as ‘state monopoly’. Taking the example of local councils, even without the days of Compulsory Competitive Tendering, many services have been provided externally – for example councils with low rates of snowfall often do not even possess the means to grit roads for themselves – it makes no sense to have expensive machinery sat in storage for most of the year.
Technology support and printing are again areas where the prohibitive costs have meant councils buy in support as and when it is needed. In any event the public services industry has themselves admitted that the market is worth at least £83 billion per annum – that’s a fair old slice of the supposed ‘state monopoly’.
The public sector directly providing services did not happen by accident. It was in response to rip off contractors and poor quality services. The public sector was, under both Thatcher and Blair, expected to act as ‘market maker’. A failed and flawed concept.
It has also been described as a market regulator – perhaps an ambitious description but the public sector has been an effective market moderator. From pay and conditions to service quality the effect of the public sector, being able to deliver for itself, has helped to curb prices when services have been purchased from external providers. It has had the ability to not only set quality standards but to return contracts to in-house provision when they have failed to deliver. It has had the flexibility to respond to changing policy dynamics – who could have foreseen twenty years ago the impact of landfill taxes and climate change on how we deal with household waste?
If we allow our public services to be fragmented into private contracts there will be no point in attempting any kind of strategic coherence over future public policy – everything from trying to tackle cancer death rates, through strategically using resources to how we tackle bins, bogs and burials will be left to disparate contracts. There will be no policy coherence and no market moderation.
Central dictat has been tried before in the form of CCT. These reforms will be much deeper and far more dangerous. It also exposes the mockery of ‘localism’ with central government dictating how local public services should be provided. If Kirby and Cameron’s flawed ideologies are allowed to gain ground we would need a revolution to bring back public services as we know them.
Anna Rose
