Monday, 21 February 2011

privatisation as a form of insanity

There's a rather clichéd definition of insanity that runs like this: insanity is doing the same thing over and over again, and expecting different results. I feel like it is completely apt for Cameron's latest public policy pronouncement, in which he basically states that the private sector should be assumed to be better unless proven otherwise.

As anyone who gives enough of a shit to check can tell you, the history of public sector privatisation argues exactly the opposite. So rubbish (for service users and workers) have these policies been that the assumption should be that they will always be terrible unless proven otherwise.

Do I really need to even list the examples? The railways, 50% more expensive than in the rest of Europe (in 2009), still subsidised and the odd (unprecedented) massive accident. The privatisation of utility companies resulted in rising levels of fuel poverty. The outsourcing of various services in our hospitals resulted in higher costs, lower wages and poorer service provision.

It's a really simple concept to get your head round. If you give a private company 100m to run a service, it wants as much of that money as possible to finish up in their shareholders pocket. If you give it to a public institution it spends every penny on the service. For the private company to turn a profit, it has to spend less on the service or charge more for it. Why, logically, would you expect it to give better value for money? Why?

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