Is there any wonder that a sizeable proportion of those eligibe to vote are reluctant to engage in elections? Take a look at [url=http://falseeconomy.org.uk/blog/barnet-council-hands-another-tranche-of-services-to-capitathis link[/url and see the number of council services that Barnet Council are shifting to the private sector.

The services to be handed over to Capita include:

Trading Standards & Licensing, Land Charges, Planning & Development, Building Control & Structures, Environmental Health, Highways Strategy, Highways Network Management, Highways Traffic & Development, Highways Transport & Regeneration, Strategic Planning & Regeneration, Hendon Cemetery & Crematoria.

Barnet council tax payers will now be funding the balance sheet of Capita Symonds instead of paying for services to the public, by the public. Capita will not be answerable to the Barnet electorate so why should the Barnet electorate bother voting in future?

This is just one council that has embraced the rush to offloading services to private companies, others will follow, all in the name of "value for money". It's not just local government, the coalition is determined to move as much of the state as they possibly can into private hands, such as:

Royal Mail
East Coast Mainline (the best performing rail franchise in Britain)
Various NHS services
etc.

You could reasonably ask, "why should anyone bother voting in the future?"

Ah, good old 'EasyCouncil'.

On voting, I suspect the supranational corporatocracy would much prefer that we didn't bother.

Just lob the magic word "choice" into the mix and Bingo!, you don't need the council anyway.

I wonder how long before we transfer the treasury and HMRC to Capita? They could then contract Virgin Healthcare to control the NHS and Social Services, while they give G4S the UKBA, emergency services and prisons. Justice could be determined by a TV show. Virgin Rail and First Group could handle all travel.


We could then dispense with parliament and simply elect trustees

Probation is currently going through the process – they want to flog 70% of it.

Only in the last week, the possibility of privatising the fire service has been touted.

And for clarity's sake, this has been an ongoing process for 30-odd years.

Labour, for instance, never did provide a business case for the sale to Parcel Force of NHS Logistics. Admittedly that might have something to do with there not being one. It was an award-winning business in its own right, reckoned to be saving the health service money. The sale was nothing other than ideological in basis.

As I understand it the criminal justice system is about to be effectively privatised. Senior criminal barristers are trying to join the judiciary. Junior barristers and high street solicitors are about to be be put out of business. Mind you, I think (not sure) justice will be served in that companies such as G4S will be incentised by the number of guilty pleas they can obtain.

Maybe after the war on terror it's the way to go - privatise confession by torture?

My experience of Capita's "service" (in the field of registering share transfers in listed companies) is worse than abysmal. I understand even major stockbrokers try to avoid investing in companies where they act a registrars! On the basis of that limited expeience of them ........


This privatisation is senseless. I went to the offices of our county council recently and the guy on repetion was dressed in a Serco uniform. I couldn't see the point of a couple of people out of thousands being employed by someone else. So far as I see it all that happens is you get demotivated people doing a job because the Council basically pays the same or more as before (initially maybe less, but over a 10 year or whatever contract you can almost guarantee the taxpayer will lose out), the private company takes a big slice of the money and the employee takes a big pay cut.

That pretty much sums it up - the council are actually having funding reduced year on year and yet with that reduced income can employ a private company to do the jobs for the same or less, those company's have a profit margin to make so even less of the budget is left for wages, it may seem a simple example and you may think that a minimum waged employee can manage a council offices reception but when its you who can't get through on the phone or who turns up to find no-one on reception, or you can't be guided to the correct department because the person on reception only turned up here this morning and they don't know either - then you'll realise that services are slipping right across the board.

Did you not get bad service while you were in there?

Result.

I'm guessing another factor is shifting people off good but expensive council / civil service pensions to cheap and nasty ones at Crapita et al.

Just a small example from when I worked in the NHS, but I often found that when there was a problem (in this case lack of storage space for medical records) the initial response was to put it out privately. Not due to cost, but simply because it was easier.
Eventually we managed to persuade the powers that be that it was far cheaper and more efficient to store the files locally ourselves, but it took a couple of years of constant badgering of senior execs at the Trust and evidence of cost savings. The kind of work that should have been undertaken at the point of the original decision and wouldn't have happened had we not been awkward buggers.
I later worked out the additional cost of putting it privately for 2 years compared to in-house was around £7500.
Not much in the grand scheme of things I know, but its still frustrating when it's money that could have quite easily been saved.

This thread obviously has a strong ideological disposition against the private sector delivery of publicly funded services, but it isn’t really making a strong pragmatic case for the why the public sector should internally deliver those services.

Ultimately the underlying principle is economies of scale can [uoften[/u be delivered by using specialist providers, this goes beyond local authorities and can apply to any sort of organisation. Unless they happen to operate in that specific industry most organisations don’t have their own postal service, telecommunications network, refuse collection and disposal service, own utilities provision etc etc... It is recognised in the “real world” that specialisation (and division of labour) on aggregate delivers greater efficiency than trying to do everything oneself. All organisations need to find their own mix of what can be done most efficiently in house versus outsourcing, whether it’s IT support, printing, catering or whatever. I don’t believe it is always most efficient to outsource, but it can be depending on the hard cost benefit analysis, not the ideological position for or against. If it is genuinely more efficient to do internally then that’s what should be done as outsourcing shouldn’t be done out of laziness no more than internal provision should be used because of an ideological predispoition that it's the way things should be done.

Whether money ends up on the balance sheet of a private company is an utterly facile ideological irrelevance. The money has to come from somewhere and it has to go somewhere, the important thing is that in between it achieves the desired outcome, and that’s the sticking point. There are those of us who see it more narrowly as a means to an end, a matter of fulfilling a given responsibility legally and decently but efficiently and cost effectively (some find it all too easy to forget they are spending other people’s money), and those who have a more statist view. There is a long standing ideological argument against the pursuit of efficiency, but it’s not one that many who hold it are brave enough to openly promote.

Now a local authority is precisely what the name suggests “a local authority”, it should be responsible for defining policy and providing overview and scrutiny of the statutory responsibilities it has to provide. It’s as equally ideological to say a local authority has to physically deliver those things internally as it is ideological to say that they can often be delivered more efficiently using contracts. The democratically constituted local authority is there to ensure that the statutory responsibilities are met, which can just as reasonably mean that contracts and service levels are structured properly, are monitored properly and are ultimately met. Your local councillor doesn’t usually empty your bin or approve your planning application, so whether the person who does is a direct authority employee or a contractor is irrelevant for the purposes of democratic accountability

Those who are ideologically opposed to public services being delivered by private companies struggle with the contradiction that if the people responsible for commissioning an outsourced service are not capable of negotiating and managing an external contract, why should we believe them capable of managing the same service internally? In the absence of a magic sack of money or some other mythical exogenous factor this contradiction can only really be passed over quickly with the hope that nobody has noticed it. But by far the biggest problem for those ideologically opposed to private delivery of public service is that when it comes down to it the majority are indifferent to their ideological position e.g. people want their bin collecting and if it isn’t they’ll complain to their local councillor, the fact that the person doing the collecting may or may not work directly for the council is for the most part not of concern.

Your first point seems to be that a private business can be cheaper. Which I wouldn’t argue with. I just wouldn’t equate cheaper with either better or more economical.

On your second point regarding the ideological problem some may have with the private sector in the public sphere. I would simply turn the question around. If we cant trust these public sector employees to run the service with the correct mix of economic efficiency and quality public service, how can we trust them to outsource it to a private company correctly?

There is no doubt in my mind that, all things being equal, it would always be better to run the service in house. You would have to be doing a bad job for ‘cost of provision’ to be greater than ‘cost of provision + profit’.

I don't see how anyone can seriously argue that privatising services doesn't lead to amazing drops in cost. Just one look at things like the incredibly cheap utilities we all now enjoy should tell you that. Why, those wonderful people at NPower just the other day wrote to me that they are, somehow, only putting their absurdly high costs of gas up again in July by a meagre 9.8%. How can I be anything but grateful? I may hold a party. Then there's bargain basement rail prices, almost free water services, the list is endless.

You ideological guinea pig hater, you.

It doesn't make any difference, remember.

PFI - another stinking, cost-saver.

I doubt that any private provider can boast economies of scale greater than the NHS already has.

There is a further, and completely idealogical, difference with the NHS in that more than any other area, cost relative to service just hugely lacks importance.

Nobody wants a cheap doctor, everyone wants a good one.

Profit should never detract from the provision of health services.

Utilities costs reflect different underlying costs, whether it be wholesale prices of gas, or the cost of replacing infrastructure some of which may have been originally put in place pre-nationalisation. Much of our rail infrastructure we actually owe to the private railway companies of the 19th centrury, the gas industry started out as a mix of public and private etc. Which is why a lot of the whining about "selling off the family silver" with (re)privatisation in 1980's and 1990's is often a big pile of poo, the "silver" was more like the tatty plastic cutlery left behind by the previous owner.

Its a point that has been highlighted in the recent BBC documentary series "Keeping Britain Alive" where surgeons were asked on one day last year to cost the services and operations that they had performed, without exception they did not know and did not care about knowing, they did what they had to do to maintain clinical excellence without consideration for cost - this was brought home in one hospital when an accountant labelled all of the parcels of kit that were ready for that days surgery with the cost to the NHS of each parcel - steralised instruments are wrapped into "kits" for each theatre - and it surprised some of the surgeons that each kit cost so much to bring to the point of use, surprised them, but wouldn't stop them from asking for another (expensive) kit to be brought if just one instrument from the original kit needed re-using again after it had become contaminated.

Ultimately it always brings me back to the real-life situation that I was present at in the 1980s when BUPA were making big inroads into private businesses selling private health insurance as a "perk", they would approach us on a regular basis with a cost for us to cover all our employees with one of their policies until we pointed out that one of the business partners had no kidneys and was on dialysis three times a week and would he be covered too - no was the answer of course, he would not be offered health insurance under any circumstances not even if he agreed to not make a claim for any kidney related condition.

For me that sums up the provision of health services by private companies - its fine while you're healthy but when you're sick you're fooked over by the insurers.

The long-term reality of both central and local government finance is that unless you subscribe to a level of statism the vast majority of the British public baulk at the options are limited to driving efficiency, we have an ageing population, so fewer taxpayers will have to support more claims on the state in the long term. In reality that means looking for economies of scale that individual local authorities (even big ones) can struggle to deliver, or simply not doing some things.



See my response above, individual local authorities have limited scope for economies of scale, but that is where the long-term pressures are leading. If you cannot trust the administration to have the right policies and staff to outsource to a private company which will give you economies of scale then you cannot trust them to run an internal service, either way they are spending your money, and either way you can boot them out if you're not happy (or at least enought of you aren't happy, which ultimately trumps ideological direction).



Unfortunately all things are not equal, there is a need to do more with less in the long-term, and where economies of scale are available they need to be taken. Any politician needs to always remember it's not their own money they are spending, and if a private company can (legally, sustainably and responsibly) make a profit whilst delivering a saving that means they are spending less of other people's money then that is something they should view positively. I'm not saying outsource for the sake of it, but if you need to meet a statutory obligation and you can make the public's money stretch further by doing so then you should do it, the role of the local authority is primarily it's statutory obligations towards the people it serves, not to be some overarching paternalistic social project.

Thank god Kelvin is no ideologue and it's just the rest of us, eh?

IIRC - and fortunately it is not an ideological position - the Ferret also has no problem with people who work not being paid enough to live. He says - again, IIRC - that it's up to the taxpayer whether they get help to do that basic living stuff.

Quite apart from being utter economic illiteracy, given the nature of our economy, it does rather suggest a sort of nasty 'couldn't give a about my fellow human beings' approach, which - and this could just be me - seems lacking in a certain amount of morality and, indeed, enlightened self interest.

I note, too, that Kelvin has not responded to comments illustrating instances where privatisation has simply mean vastly hiked prices, whether for the private individual (utilities) or the state (PFI). But, let's not forget, the question of whether there is any private profit in services is utterly irrelevant.

And this on a day when that bunch of lefties, the IMF, again had a pop at Osborne's failing policies.

This really is an irrelevance, not least because the preparation of an outsourcing contract is in no way similar to actually running the service, so someone can have been running a service perfectly well but could well be unaware of potential pitfalls in a contract.
I speak as someone who has provided outsourced services for more than a decade.

There is no contradiction with which to struggle.

It's this kind of idiotic poo that makes discussing things with you pointless, you decide for me what my views are (regardless of what they actually are), and then you rail against what you've decided my views are. My views (and for clarity mine and not the ones you've so graciously granted me) are deeply sceptical about paternalistic and statist behaviour because it never can consider the consequences fully let alone acknowledge them. You’re emotive and “moralistic” criticisms are not a substitute for the consistent, coherent and realistic competing theory you don’t have, a theory that is capable of addressing all the holes, downsides and unintended consequences of your sloppy thinking.

Maybe one day you can introduce me to the omniscient , paragon of morality, enlightened depot whose motives are beyond question and then I’ll be able to put my nit picking about the gaping holes to one side?



What do you want me to do? Should we address every anecdote where contracted or outsourced services have gone wrong and presumably, for the sake of completeness and thoroughness, we should do this in the vast context of everyday reality where such contracts and outsourced delivery work perfectly well day in day out? Do you think we’ll get time to discuss anecdotes about where in-house services go wrong, and just for completeness we’ll also do that against the backdrop of where they do?

If you read what I’ve written carefully you will see that I don’t support outsourcing for the sake of it, but as a practical reality, where it delivers economies of scale against the finite resources provided by other people’s money it often makes sense. Yes, I think it is fine if someone can make a profit by delivering an efficient and well managed public service that also means less of taxpayer's (i.e. other people's) money being spent. Just because you don’t agree with something doesn’t mean there isn’t a strong long-term case in favour, just because you haven’t researched all the discussion, analysis and debate that genuinely does go with the awarding of contracts doesn’t mean it didn’t happen.