Companies which have been handed public services by successive governments have given increasing amounts of cash to shareholders, a new survey shows.
The TUC union federation said its research found that change was needed to protect public services in the wake of the collapse of engineering giant Carillion.
Shareholders have been grabbing millions while services suffer and workers are hammered.
Last week 23 Carillion staff working in design-based construction roles were made redundant. This takes the total of those who have lost their jobs to over 1,820. Another 7,000 are still waiting to hear their fate.
They include 60 outsourced cleaners, porters, technicians, plumbers and electricians at the British Museum who were handed over to Carillion five years ago.
The PCS union is continuing to campaign for them to be taken back in-house, and they plan to protest this week.
But many other Carillion workers have no union to fight for them.
On Saturday the Construction News magazine revealed that the firm had liabilities of almost £7 billion when it went into liquidation in January.
This includes unpaid taxes, money owed to small business and sub-contractors and suppliers on its sites and money that should be paid into workers’ pension funds.
One industry group said recently 30,000 businesses—many of them very small—were owed money by Carillion for work carried out prior to the liquidation.
Dividends for the biggest public limited companies with significant business running outsourced public services have risen in most years since 2010, reaching a combined total of £642 million in 2016. This was an increase of 67 percent on the previous year, said the report.
Some companies had years between 2010 and 2016 when they continued to pay dividends despite making a pre-tax loss, which the TUC said was evidence of a “fundamentally flawed model”.
TUC general secretary Frances O'Grady said, “Carillion was a wake-up call. It put the spotlight on private firms hoovering up public services contracts with little public scrutiny.
“It showed how these contracts line shareholders' pockets instead of serving the community, and when Carillion failed, the government had to clean up the wreckage.
“We need to get back to running public services for the common good.
“Frontline staff work hard and aim high because they care about the community they serve. That should be the motivation for public service managers and boardrooms too.
“Most services would be better off back in public hands.
“The government must reform outsourcing and corporate governance rules so that all services are run for the long-term benefit of the communities that depend on them.”
Privatisation isn’t working—except for fat cat bosses and shareholders. All services should be brought back into public democratic control now.