Public Argument

Only new Labour could have come up with a system whereby everybody is obliged to pay for the profits of certain companies, or at least only after Thatcher had given them the idea. Certainly the current bunch of feckless toffs don't appear to have the gumption to dream up anything so radical. Maybe I am being hoodwinked, or maybe the Lib Dems deserve more credit as a moderating influence than I give them. Who knows. This doesn't change the fact that one of the legacies of the last Labour government will be the PPP.
I'd like to say that I don't have an issue with the private sector providing public services and in principle I don't. However, I do have an objection to being compelled to pay for the profits of private individuals. Are these two things entirely incompatible? Not entirely in a fully functioning modern democracy.
I understand the need to make the service sector a useful income generator in an economy that cannot rely on manufacturing. I also understand that private sector structures and practices have added efficiencies to a sector that was once riddled with institutionalised inefficiency. However, that does not mean that the private sector is a panacea for all the ills of public services. In many cases the cartels of unions that once ran these services have simply been replaced by cartels of companies with an eye on the best opportunities for profit. Many of these services are run by the same small number of large companies, who have no interest in efficiency beyond those that will save them money in the short term, which are usually those around saving staff costs. Little of this happens though investment in new technology. In the case of some sectors - most notably rail, the companies involved complain that the length of the contracts do not allow them a guarantee that they will make a return on their investments. HELLO? THIS IS CAPITALISM: IF YOU DON'T DELIVER THE GOODS YOU DON'T MAKE THE PROFIT. THAT'S THE GAMBLE. I find myself saying this a lot, but did I miss the point? The private sector can't push for open markets only to complain that open markets don't guarantee a profit. It doesn't work like that, except that largely, it appears it does. The last bunch of cowboys 'running' the country - and therefore by extension the current shower - are only too happy to make contracts with private companies almost entirely on the company's terms. This is not competition: it is simply jobs for a different set of boys than the ones available when the unions had a stranglehold on the public sector.
I had the dubious pleasure of being involved in a re-tendering exercise for quite a large public sector contract as an independent consultant a few years ago. Whilst we weren't reviewing every aspect of the service delivery of the incumbent provider, we were reviewing the quality of the data they held, which was fundamental to the service they were providing. Along with the staff and buildings, the data was one of the largest assets they had inherited with the contract, and easily the one in need of the most modernisation. From what I saw (and I spent months looking at this data) they had done little over the seven years of their contract but carry on the arcane practices of the department when it had been public sector, except with the data was stored on a different system. Personally I struggled to see how the incumbent contractor added any value at all, whilst they must have made a reasonable profit (the operation was on too big a scale to be a loss-leader). What truly astonished me was the fact that there appeared to be no differentiation between the data they had inherited from the public sector and that which they had generated themselves: they treated it all as equally unreliable. This is surely an indicator that they were adding little additional value.
Some months after my involvement ended, I heard that the incumbent had retained the contract dispite three other companies bidding for it. Now as I was not involved in the decision-making proces, I cannot say what led to this outcome, but if it was based entirely on what was offered, what does that say about other bidders? In their defence, even whilst I was still involved, the incumbent provider had wheeled out the big guns and started to make all sorts of lavish promises, and maybe their public sector paymasters have put all sorts of delivery conditions into the new contract. I don't know. At the time, for understandable reasons of commercial confidentiality, the whole process was entirely confidential. However, now I would expect it should be a matter of public record, as the public are paying for it. I suspect though that what actually swung it was scaremongering by the incumbent about what others might to with data in such a poor state, that now they were familiar with it, they would be best placed to deal with it (and presumably do all the tidying of it that they hadn't bothered to do so far). If this is the case (and I admit I am simply speculating now) then the contract was awarded due to fear that any new contractor would do an even worse job than the incumbent or the data was in too poor a state to go through another migration. The least worst option is not necessarily what you would associate with raising standards, but it's got to be better than the whole thing being run by the state. Well, only if by the same logic the service provided by the civil service would be worse than the least worst option.
This leads me to the next thing I don't understand about these contracts: why are there no bids from the public sector? Again I can hear the chorus of protest from the private sector that this would be unfair competition because the public sector doesn't need to make a profit. Well, I'd be willing to change that: let's make it so that if they want to get involved in these contracts, the public sector does have to make a profit. The contract I reviewed was all based in one city and was a big employer in that city. What stopped the local authority putting in a bid to run the contract? They could have used it to generate a bit more money to subsidise a cut in council tax, or more likely to pay for other cash-strapped services, or even (just imagine!) to invest in service improvements on that contract. What stopped them as far as I can tell is the idea that it is somehow immoral for the state to make money out of the business of running the state, but absolutely fine for private companies to make as much money as they like. Furthermore this appears to be a moral that we apply only to our own country: the sovereign wealth that other countries have amassed through making money in commercial circumstances appears totally acceptable, indeed it is currently our preferred source of debt relief now the markets are running away from bonds.
If we are to become a proper service economy, why don't we do it properly: if the civil service really is continuing its tradition of recruiting the brightest and best, why aren't we outsourcing their bureaucratic talents to Brussels? We could have a civil service version of BBC Worldwide, which makes a profit for its shareholders, or taxpayers as they're more commonly known.
I'm not saying private companies shouldn't be allowed to bid for public sector contracts, I'm just saying maybe public departments should as well. As a taxpayer paying for the profits of these companies, I feel the company I am a shareholder in should have an equal chance to make some of that profit: I am talking about UK plc.

Polish

On my way home last night I was graced with a prime example of one of my pet hates. Not only do these shoes have enough spare shoe in the pointless pointy bit to make a spare pair of silly pointy shoes for a baby, but they are also entirely unpolished. They are so unpolished that the pointless points look grey; not a good grey either, it is the grey of soggy cardboard.
The young man covering his feet with these sorry looking joke shoes is not alone either, the City of London is awash with men in Sharp suits and shitty looking shoes. Do they gather round the water cooler and compare scuffs?
CityBoy1: "Check it out, my shoes are so unpolished that even a light fog soaks through to my socks!"
CityBoy2: "Yeah, well the pointy bits of my shoes are so waterlogged they drag along the ground when I walk, which has the added bonus of scuffing them even more."
CityBoy3: "Wow, your feet look like Dopey's from Snow White!"
CityBoy2: "I know, it's awesome: way cooler than Dick Whittington!"
...and so on.