A-Infos (en) Freedom 6405 8 Mar, 2003 - Welfare for the wealthy

[Worker <a-infos-en@ainfos.ca>]

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Privatisation takes many forms, from the earliest 
under Thatcher to Labour's preferred method, the 
Private Finance Initiative (PFI). But all the forms 
have one thing in common - corporate welfare. Put 
simply, the public purse pays for what is laughably 
called private sector 'expertise'. The only difference 
between the public and private sectors is that the 
private sector has more ruthless senior managers, 
who are consequently paid more than the backbone 
of the Labour Party that is public sector 
management. The alleged expertise that the private 
sector brings costs more.

Under some schemes, private investors take a risk. 
Following conventional capitalist economics, they 
demand a greater return on their money for taking it. 
A cursory glance at recent cases of PFI hospitals and 
prisons, as well as at Railtrack and British Energy, all 
show that this risk is non-existent in the case of the 
Private Finance Initiative. Its non-existence doesn't 
prevent the government from being prepared to pay a 
premium for it, however.

Either Chancellor Gordon Brown is a very stupid man 
or there's something else going on. Of course, this 
'something else' is that our old friends from the 
international financial institutions Ğ the 
International Monetary Fund, the World Bank and so 
on - have a view on how economies should be run. It 
isn't just the IMF either. All the big accountancy 
firms do too - respected names like Arthur Andersen 
and Price Waterhouse.

Even the palest pink social democrat knows that you 
can't run a major economy like Britain's with the 
appalling level of investment that's been put into 
public services in the last 20 years. But Gordon 
Brown also knows that he'd be spotted if he invested 
directly in public services. So, rather than risk any 
sanctions from the Bretton-Woods gang, he opts for 
privatisation, even though it's inefficient, morally 
repugnant and more expensive.

Once we understand this, we can see why it's only 
Brown, Prescott and the companies who stand to 
profit who think the Public-Private Partnership on 
London's Tube is a good idea. It isn't, any more than 
the various Structural Adjustment Programmes 
forced on Africa and Latin America have been.

In some areas of work, the private sector has no 
experience whatsoever. In these, they simply buy out 
public expertise. We're all familiar with scandals like 
the one in Southwark Education. The Director of 
Education in this South London borough was 
headhunted by Atkins, an engineering company who 
subsequently won the contract to run Southwark's 
education for profit. His pay doubled overnight.

But this isn't just about fat cats. In many areas of 
council and government work, the assets are the 
workforce. They've been trained by the public sector 
and are then pushed into the private sector to make 
profits. In some cases they're even paid better, 
though there's always relentless pressure. For 
example, when the Tories forced councils to put 
services out to compulsory competitive tendering in 
the 1980s and 1990s, most contracts were won by 
local authorities' existing teams because there was 
no realistic competition in, say, building repairs, 
housing benefit, social services and council tax 
administration. Where there was or could be (in 
competing for large scale building projects, IT 
support, refuse collection and so on), many contracts 
went to private companies.

Since Labour came to power in 1997, this has 
changed. Central government and local authorities 
have actively connived to transfer more work to the 
private sector. Many of the big names in 
privatisation, such as Capita (which oversees 
London's new driving tax), make regular donations to 
the Labour Party. Some have even closer links. One 
example is Service Team, set up by managers and 
Labour Party bigwigs from Lewisham Borough 
Council, also in South London.

Those on the left who still believe that Labour has 
any 'organic connection to the working class' should 
just look at the machinations of managers in all 
areas as they try to carve out some little empire from 
which they can launch a buy-out when they go 
private.
Martin H.

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