If someone told you that the UK’s water supply could be delivered much more cheaply than it currently is, you’d probably want to know why the relevant changes weren’t being made. Or how about if you were told that direct spending on rail has more than doubled since privatisation? You could be forgiven for thinking privatisation instead benefits the user, through cheaper fares. Not so, the cost of rail fares has shot up in real terms by 55% since 2010 according to the Office of National Statistics. Bus fares have suffered a similar fate and risen 54% since deregulation. Confused?
You may then wonder if privatisation brings better delivery outcomes, perhaps that’s why our politicians are so enamoured of it. Sadly not. Evidence shows that those costly deregulated buses offer a poorer service due to lack of competition in the market place, according to the Competition Commission.
At times privatisation and outsourcing failures can become a case of life or death. The launch of the NHS 111 service has led to confusion and increased pressure on accident and emergency departments. In recent days a raft of bad headlines has hit the scheme. NHS Direct are to pull out of the 111 contract, as it is now too expensive for them to run. Furthermore an undercover investigation by Channel Four’s Dispatches highlighted serious failings within the service. A manager at a 111 centre admitted: - “We don’t have the staff to deal with the volume of calls coming in. We had a very bad service. Realistically, on the weekends we (are) still unsafe.” Even before the 111 problems became headline news there was plenty of evidence to show the outsourcing of health services leads to increased costs and poorer quality of care.
The story is the same across the board. Whenever a service is privatised it generally costs more in direct public spending and costs the user more to boot. No one seems to win. Not the public, not the users of the service, certainly not the government who spend more. So why the drive for privatisation? It’s certainly not because it’s popular with the public. Repeated polls have shown huge support for a nationalised health service. And as far back as 2002, 61% of the public supported bringing the railways back into public ownership and that was well before the East Coast Mainline fiasco.
The strength of public opinion is no surprise. The failures and scandals associated with privatisation are endless and seem to hit the headlines weekly. Soaring energy prices and record profits by energy firms are regular front-page news. Back in 2010 the head of Age UK called the level of fuel poverty in the UK a national scandal and yet things continue to get worse. Another of the government’s reforms, the welfare reform plan is also in disarray, and the use of private contractors is simply not working.