The demise of the £30 billion “public-private partnership” (PPP) on London Underground is the latest in a series of high-profile collapses.
The Tube Lines consortium messed up its finances so badly that even London’s Tory mayor, Boris Johnson, was forced to effectively renationalise it and bring the work back in-house.
The case shows that putting public services in the hands of private companies is disastrous. Privatisation undermines democracy and accountability and brings enrichment for a few.
But the collapse of Tube Lines also reveals that, contrary to the idea that privatisation is the only way to go, governments can nationalise when they choose to.
New Labour part-nationalised the big banks after the credit crisis. And governments have nationalised other companies facing bankruptcy – notably Railtrack, which is now state-owned Network Rail.
Politicians know that privatisation is unpopular, and they will nationalise when they deem it necessary. Yet they remain committed to privatisation – and so are changing the language they use about it to try and sneak it through.
The rhetoric of “choice” and even “empowerment” for service users began under New Labour. The Tories have taken it up with relish. They talk of having “parent-run schools” or “cooperatives” running schools and sell this as a way of reducing the power of the bad old “authoritarian” state.
Some in the trade union movement support “worker‑run” bids for public services, as an alternative to full-scale privatisation. But these things are privatisation put in a way that sounds nicer.
The “Parents Alliance” in Birkenshaw, West Yorkshire, is behind one of the first proposals for a “parent-run” school in Britain. Yet its proposal is to hand the school to private company Serco!
Serco’s empire now runs trains, prisons, immigration detention centres, leisure centres, speed cameras, entire local education authorities in Bradford, Walsall and Stoke, “fleet support” at navy bases and even managing the development of nuclear weapons at Aldermaston.
Its profits soared to £195 million this year, every penny of it from our pockets. “There are more opportunities than we are able to bid for,” says Serco chief executive Christopher Hyman.
So far 14 “GP-led health centres” contracts have gone to the private sector.
Cooperatives and the like are just another way for huge corporations to build themselves out of bits and pieces of our public services.
Socialists are in favour of nationalisation and of governments and local councils running public services. Governments and councils, for all their lack of accountabilty, are democratically elected and big business is not.
However little control workers have over their elected representatives, it is more than they have over the boss of a private company.
If councillors announce plans to close a local hospital, people can vote them out – and this pressure can make them think twice.
There is no such pressure on a boss. Private companies in charge of hospitals can close them if they’re not “profitable” enough – with no regard to the needs of ordinary people.
There is also an important ideological point to make in opposing privatisation. We do not think that our services should be run as businesses to make profit – we think they should be run as services to meet the needs of the people who use them.
The dominating mantra of “business is best” turns services into things to exploit for profit – with horrendous effects for those who rely on them.
It is for these reasons that socialists oppose all forms of privatisation. But we don’t think nationalisation is perfect.
The government isn’t a model employer to have or the best defender of public services, as today’s civil service workers will testify.
Government control of services also doesn’t translate into control by ordinary people – because real power lies outside parliament.
Socialists also need to raise the demand for workers’ control. This means having things not just publicly owned, but democratically run by workers. It means elected, recallable committees of workers, not bosses, taking over every workplace.
It means us running the economy not for profit, but for the good of everyone. And because the capitalists who run society today will never allow that to happen, it also means getting rid of them and building a whole new kind of society.