UNISONActive is an unofficial blog produced by UNISON activists for UNISON activists. Bringing news, briefings and events from a progressive left perspective.

Thursday, 19 July 2012

The political tide is going out for Privatisation and Outsourcing

Two excellent articles in yesterday’s papers considered the implications of the G4S Olympics security contract failures for privatisation and outsourcing in the UK. Michael Meacher MP writing in the Morning Star states that it is ‘a delicious paradox that the one persistent theme in the coalition's ideology is privatising everything in the public sector that moves, yet nothing has exposed the inadequacies and incompetences of privatisation so ruthlessly as the government's enthusiasm for it’

Seumas Milne in the Guardian points out that ‘public opinion in Britain has always opposed privatisation. But after the G4S fiasco, even paid-up Conservatives are getting restless. The Tory MP Michael Ellis told Buckles the public was "sick of huge corporations like yours thinking they can get away with everything". And the Thatcher minister William Waldegrave warned Conservatives in Monday's Times never to "make the mistake of falling in love with free enterprise", adding that people who believe "private companies are always more efficient than the public service have never worked in real private enterprise".’

At no time in the past 35 years since the Conservative party under Margaret Thatcher unleashed its ferocious political offensive against public services has the disastrous reality of private sector delivery of public services been so widely understood as it is today. As Milne goes on to say

‘The experience of privatisation and outsourcing is that it routinely reduces service quality while failing to deliver promised savings. And where it does make early savings, it typically does so at the expense of low-paid workers' wages, jobs and conditions. Meanwhile, the public service ethos is eroded, and administration and transaction costs are driven up, as power slips from purchaser to provider and effective democratic control is lost. Privatisation has been central to the neoliberal economic model that reigned supreme for a generation and crashed in 2008: creating profit growth out of existing provision – rather than delivering new goods and services, as entrepreneurial capitalism is supposed to do. It is a parasitic business whose main beneficiaries are taking the rest of us to the cleaners.’

However there is no room for complacency. In a third article on the G4S debacle, in yesterday’s Financial Times, Jonathan Ford acknowledges the ‘reputational damage’ to G4S but states that ‘funding pressures will force the public sector to continue pushing work out to private contractors’ not because they deliver better services but 'because they offer the chance to cut costs and increase flexibility through a form of regulatory arbitrage. This has been seized upon by public authorities constrained either by inflexible employment contracts or by organisational structures'

The current public mood provides the trade unions and Labour Party but in particular UNISON with an unprecedented opportunity to promote democratically accountable and directly delivered public services in education, health, local government, police and social services.

The tide is going out for the discredited, false economy Thatcherite model of privatisation and outsourcing.

It’s time we sunk it once and for all.