The private sector always has a place in public services

March 8, 2012 1:40 pm

My taxi driver the other morning, at around 6am on the way to the station, was telling me about his operation. He was getting his garden sorted early this year, because for three months he will not be able to tend to his plants because of his hip replacement. He found out he needed the operation in January, and is getting the new hip this month. It’s being conducted at one of the independent sector treatment centres (ISTC) established under Labour, and of course it’s all on the NHS.

ISTCs are a small example of use of the private sector to improve the performance of a public sector service. When they were introduced by Labour, waiting lists and times for operations such as knees, hips and cataracts almost vanished. The challenge from the independent sector led to improved efficiency and performance from the public sector. Surgeons discovered that they could work for the NHS on Fridays after all. Most importantly, the public got a much better service as a result, within the founding framework of the NHS: free at the point of use, based on medical need.

I was reminded of this Labour reform which so demonstrably benefitted patients last night at a fundraiser for Liam Byrne MP’s local party. Alan Johnson MP as the guest speaker. Johnson’s speech was brilliant. But at its heart was a simple message: don’t be ashamed of what Labour did in office, and be clear that Labour is on the side of public service reform. A few months ago, at another fundraiser, Dennis Skinner MP made similar points. He talked about the former miners in his constituency, now in their 60s and 70s, able to get about Bolsover thanks to the new knees and hips they got on the NHS. Under the Tories, never forget, they would have been waiting for months, even years. Many would have died on waiting lists.

The better we get at opposition, the less we look and sound like an alternative government. The NHS is a good example. The rally yesterday at Methodist Central Hall against the Lansley reforms (which I bitterly oppose) was packed to the rafters with opponents of the NHS Bill. But the people there – Unison, the Royal Colleges, the British Medical Association (BMA), the Labour left – were all opposed to Labour’s reforms to the health service too. Successive Labour secretaries of state – Millburn, Reid, Hewitt, Johnson and Burnham – were booed and barracked at their annual conferences, denounced by them in the press, and shouted at by the same placard-waving protestors. A future Labour health secretary would face the same fate. Yet we seem to be allied with these strange bedfellows, who would soon turn to bitter enemies the moment Labour took office again.

Take the police. The announcement this week that two forces are putting out a tender for private suppliers to conduct certain functions was met with howls of protest. These included John Prescott, who claims to have invented the public-private partnership model in the 1980s. I happen to think that the types of function which the two police forces in Gwent and the West Midlands want to contract out are best conducted by warranted police officers – investigating murder scenes, patrolling communities and guarding suspects. These are jobs best done by the police, not private security firms. But I don’t think warranted police officers should be cleaning the offices, doing the filing, serving up lunch or building new police stations. My point is that the private sector, as with the NHS, always has and always will supply services to the police force. Our political argument should be about getting the best service for citizens, getting the best value for money from efficiency and modern management, and ensuring that police get to do what they signed up for – preventing crime and catching criminals. We should rightly oppose profiteering, not the private sector.

The Labour Party is not opposed to private sector delivery of public services. We don’t believe the state should employ battalions of public employees. We value choice and competition within large public services such as health and education. We like social enterprises, SMEs and co-ops. We spent 13 years in office reforming public services, always with the parent, patient, passenger and public in mind, using choice and competition to drive up standards and performance. The next Labour government should do the same, unless we want to preside over failing public services which do worst for the poorest, and which are deserted by the affluent. ‘Poor services for poor people’ is not a helpful slogan for the 2015 election.

Labour’s next manifesto must have a central theme of reform to public services, but based on the world of 2015. By 2015 there’ll be a 40p top rate of tax, free schools, police commissioners, GP consortia commissioning NHS services, fewer parliamentary seats, a more narrow definition of the welfare state and elected Mayors. If all Labour offers is the dismantling of everything the Tories have done, to recreate our perfect world of 2010, the public will judge us deluded.

  • glassfet

    “If all Labour offers is the dismantling of everything the Tories have
    done, to recreate our perfect world of 2010, the public will judge us
    deluded.”

    Andy Burnham’s pledge at the NHS rally was to repeal Lansley’s reforms.

    Deluded.

    • http://pulse.yahoo.com/_7Z2KKBHSH4VQSKABV7ZSI3CVDQ WILLIAM

      Deliberate misreading of the text or accidental Glassfet? Burnham is quite right to repeal Lansley’s reforms. It is however  deluded to think we will be able to afford the undoing of EVERYTHING the Tories have done.

  • Ben

    “The rally yesterday at Methodist Central Hall against the Lansley reforms (which I bitterly oppose) was packed to the rafters with opponents of the NHS Bill. But the people there – Unison, the Royal Colleges, the British Medical Association (BMA), the Labour left – were all opposed to Labour’s reforms to the health service too. Successive Labour secretaries of state – Millburn, Reid, Hewitt, Johnson and Burnham – were booed and barracked at their annual conferences, denounced by them in the press, and shouted at by the same placard-waving protestors. A future Labour health secretary would face the same fate. Yet we seem to be allied with these strange bedfellows, who would soon turn to bitter enemies the moment Labour took office again.”

    So much for the Labour Party being a “broad church” eh? Almost sounds like “you’re with us or against us”…

  • http://twitter.com/waterwards dave stone


    we seem to be allied with these strange bedfellows”

    That’s not so surprising as “these strange bedfellows” are the people who vote Labour and, through their trade unions, contribute significant financial support to Labour.

    Of course, if the Labour Party wants to jettison their support and continue with policies that differ from the Tories only in the detail of a managerialist approach then we all know what the result will eventually be: electoral defeat.

    The trade union connection and labour voters may be an embarrassment to New Labour ambitions but without the support of both there’ll be no future Labour government.

    • AlanGiles

      I have to say that Thursday is the most depressing day of the week for me on LL, thanks to Mr. Richards who seems to get more right wing and intolerant of the left each week. Perhaps one day he will do a Bozier -lines like ”
      a more narrow definition of the welfare state” sound as if they might have been spoken by Mr Bozier himself, or even Duncan-Smith.

      Quite frankly, if Mr Richards is the  future of the Labour party, I am glad I am the past, but if he continues to espouse Tory-lite policy,  and deride anyone to his left (which is the majority of us on LL) I don’t think there is much future.

       If all three main parties continue to offer broadly the same policies,  the British public will just adopt a “better the devil you know” stance and Cameron will win a large majority in 2015.

      • http://pulse.yahoo.com/_7Z2KKBHSH4VQSKABV7ZSI3CVDQ WILLIAM

        But Alan you are the kind of ‘enemy’ to which Paul is referring. Labour does not lose elections because it is not left-wing enough. 1983 was our biggest defeat ever when we had the most left-wing manifesto ever. In similar vein it was in the relatively prosperous East of England where we lost most seats in 2010. It is to this cohort of electors that we must turn our focus if we want to win in 2015.

  • derek

    With all due respect Paul, isn’t the tories that are in the midst of dismantling any public service they can get their hands on?

    People talk about the Thatcher and Reagan economics but wasn’t it that very economic privatisation idea that created today’s economic mess.

    Paul if we’ve got nothing else to offer other than much of the sameness, then we’re a party not only without a soul and no-alternative but a party of blueness, where choice isn’t an option and the tories win every time?

  • derek

    And further more Paul, the more labour advocates the private troy approach, the more likely the UK will be split. Scotland contributes 9.8% of revenues but only has 8.4 of the Uk population. Paul under your notion labour and the tories should unite in the South. Power for power sake isn’t a solution to today’s problems.

  • derek

    And further more Paul, the more labour advocates the private troy approach, the more likely the UK will be split. Scotland contributes 9.8% of revenues but only has 8.4 of the Uk population. Paul under your notion labour and the tories should unite in the South. Power for power sake isn’t a solution to today’s problems.

  • derek

    Labour should oppose every single cut! because Osborne’s plan “A” is costing 158 billion to implement.Ed should fired that back to Cameron at PMQ’s when asked if labour opposed all cuts.

  • Dave

    Absolutely right Paul. Public services rely on private sector suppliers for all kinds of things – be they at the tangible and uncontroversial end of a spectrum (e.g. equipment), or invisible and (relatively) contentious (IT is a good example).

    Private businesses are not run in the same ways that they were run 50 years ago. The structure of a business – large or small – today would baffle a Chief Exec from the 1960s – but so would the productivity, and the scale of what it is now possible to achieve. If we want our public services to lag behind the private sector in terms of quality and effectiveness every year, to the point where costs eventually terminally outstrip growth and our public services are entirely unaffordable, we have only to follow our present path of imagining that services preserved in ideological aspic are the right way forward.

  • Plato

    Re the reference to privatising the police – I hate to break it to some Labour supporters who appear to have been asleep – but the changes were brought in by Labour – about 10yrs ago.

    From BBC Mark Easton. http://www.bbc.co.uk/news/uk-17274446

    “I have to admit to puzzlement as to why the
    “breathtaking” proposals that private firms may deliver some police
    functions have so shocked people – not least senior figures within the
    previous government.

    After all, many of aspects of “privatisation” they say worry them were introduced during Labour’s time in office…

    Since 2003 and with the Labour government’s blessing, G4S (under the
    control of a police sergeant) has managed 500 police cells in
    Lancashire, South Wales and Staffordshire with all the functions that go
    with that [these are just a sample] :

    searching, fingerprinting and photographing detainees
    identity parades and identification procedures
    undertaking constant watch duties
    completing witness statements
    preparing all charges and case management
    statutory drug testing of arrested persons
    seizing items as evidence
    preparing and managing bail

    undertaking footwear impressions
    forensic sampling and forensic medical services…”

  • Dave Postles

    FWIW, I pay my taxes in the expectation of an ethos of ‘public service’ not private extraction of profit, thank you very much.  

  • Guest

    The difficulty is that I, unlike you, have worked in the private sector, and know that ultimately it always costs more in the private sector, because I was once the one doing the sums. But that sounds extreme and to win we have to sound moderate so we pretend it’s all fine. But it isn’t. The railways are only the clearest example of that. The health service is now being led down the same path as the railways. PFI was another classic example. I don’t have an ideological objection to the private sector, but it doesn’t work in most cases for the delivery of public services. How do we fix that?

  • Daniel Speight

    If Labour win in 2015 they will start from wherever this Tory government has left off. This is where Labour found itself in 1997 after years of Thatcher’s and Lawson’s reforms. Of course with hindsight we could say ‘if only…’.

    ‘If only Labour had rolled back the free market liberalization of the City.’

    ‘If only Labour had reversed the de-industrialization of Britain by the Tories.’

    ‘If only Labour had rolled back anti-union laws that it had been originally formed for to oppose.’

    Hindsight is easy, but using it to help foresight is a bit harder. For Paul Richards and his friends, they find this all very difficult. They see 1997 as the beginning of the golden years in which nothing went wrong and career opportunities were there aplenty.

    Maybe what they are looking for isn’t contained in a social democratic or socialist framework. I wish them luck on their search for a party that would represent their views more closely.

  • AlanGiles

    With all due respect to Mr Richards (and I strongly suspect, yourself) anyone who is no on the right of the party, and share the right wing views of D Miliband, L Byrne, Mandelson et al are “the enemy”.

    Now – here’s your problem – if you regard the people who have supported the Labour party for years, financially and otherwise, as “the enemy” and just want them to pay up and shut up, you cannot be too surprised when we don’t get our wallets out, or post leaflets through doors. If we are the “enemy” you are going to need an awful lot of new “friends”, including presumably Tory voters. Now the problem there is that even New Labour will not be QUITE right-wing enough for many of them. If people like me finally walk away after 50 years, you might heave a sigh of relief, but I can’t really see people like, for example, Guy on this site replacing me.

    Paul Richards seems to enjoy painting people as enemies, and I should imagine his message will be taken on board by public service workers, trade unionists etc.

    • http://pulse.yahoo.com/_7Z2KKBHSH4VQSKABV7ZSI3CVDQ WILLIAM

      Alan-The winter palace is not going to be stormed any time soon.  We live in a red raw capitalist system and a capitalist logic pervades the whole of society including ourselves.
      All I am saying is that we need to get real and offer a balanced programme to the British people in 2015.

      • AlanGiles

        And I am not disagreeing with you, William, but the point is you have to offer an alternative programme. Mr Byrne “agreeing with three quarters of the coalition’s Welfare Reform Bill”, and making a federal case of the quarter he is not quite so keen on isn’t enough.

        Similarily, as I pointed out to Emma yesterday, it looks a bit shallow if Labour get indignant about the coalition continuing the “reforms” Labour themselves started (Remploy etc). In pre-internet days it might have been possible to have used the “nothing to do with us, gov” line, but now people can check and see, for example that on February 5th 2008 Caroline Flint, DID say (pace Purple Booker) that only those unemployed people actively seeking work should be considered for council housing”. Given the rules in place then and now, everybody on JSA has to prove they are actively seeking work. 

        My problem at the moment is that Labour is too timid (the EM “made in Britain” speech for example).

        I can’t see how you can win with a sort of “well, we’re a bit like the coalition but nicer because we fairer” approach. What is “nice”, what is “fair”?

        Some of the most vulnerable people in society (like Sue Marsh on LL) are being hit hard by the coalition – thanks to the work started by Labour.

        Pretending Labour hands are entirely clean is both dishonest and insulting to a public who know otherwise.

        As Dave Stone told us a week or so ago, Hazel Blears said in terms nobody in Blair’s governments was “interested in housing” – do Labour really want to go on being this out of touch with the everyday concerns of ordinary people?

        • http://pulse.yahoo.com/_7Z2KKBHSH4VQSKABV7ZSI3CVDQ WILLIAM

          Of course not. But 3 points:
          1) Going over old ground will not help us, (see the Tories 1997-2005 or ourselves 1979-1992).
          2) You are overdoing it. Every Labour MP and every Labour Lord voted against the welfare reform bill – Please also see Dame Ruddock’s remarks at PMQs this week.
          3) We must prioritise matters when we get back into government- a) repeal Lansley’s NHS sell off, b) make sure benefits to disabled kids are restored c) see that Housing Benefit is restored in order to protect against families being made homeless. 
          IMHO people will be able to see the sense of those limited number of promises given that there are going to be a lot of really peed off people by 2015 when the worst of what these toerags have done will be evident and real. We can then build from there 2 or 3 years into government.

          • AlanGiles

            But William, even if every Labour MP and Lord voted against Freud this time, why didn’t they do so to what were virtually the same basic plans in 2009 when Labour (Purnell) steamrollered them through?. Here we have another example of prime hypocrisy: a bad and shameful policy remains a bad and shameful policy whether it was devised by Freud and Duncan-Smith or Freud and Purnell.

            If the Labour leadership wish to persist with having the same limited talent sitting round the shadow cabinet that was sitting round the cabinet table, and voted for things that they now claim to oppose, they just make themselves look incredible. There really are people in the shadow cabinet who are ineffectual. they would be no better in government.

  • Dave Postles

     I’d prefer my public services to be audited by the District Auditor and
    the NAO rather than some accountancy firm apparently superficially
    signing off the accounts.   That’s the only reason that this Coalition is intent on abolishing the NAO, to allow private companies to use public money unaccountably.

  • Dave Postles

     IT: could all be conducted by collaborative and cooperative services on a community basis. 

    Associate Member of Trisquel Linux and sponsor of Mageia Linux.

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