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Tory council nightmare to boost robbery by the rich

This article is over 8 years, 10 months old
Selling off services means misery for ordinary people and more wealth for the rich—now the privateers are using cuts to grab more, writes Raymie Kiernan
Issue 2464
Outsourced workers in Barnet have fought against attacks on their pay
Outsourced workers in Barnet have fought against attacks on their pay (Pic: Socialist Worker)

Instead of celebrating his severely disabled daughter Roisin’s 15th birthday two weeks ago Paul Rooney was fighting off bailiffs trying to evict him from his home. 

Solidarity from Unite union and other activists in Bromley, south London, blocked the eviction. 

Paul was handed a £51,000 council tax bill by Liberata, the firm that Tory-run Bromley council has farmed out its council tax collection service to.

Unite said Liberata made mistakes in processing Paul’s application for council tax benefit, which meant the council tax wasn’t paid on time.

It is alleged he owes £2,000 in council tax and that the firm added £49,000 in solicitors’ fees.

The case against privatisation could not be clearer—but the situation is set to get worse. Only Greece, Spain and Ireland have made higher public spending cuts than Britain in recent years. 

And neoliberal ideologues are using cuts as an opportunity for more mass selloffs of services.

Outsourcing, where services are contracted out to private firms, has accelerated rapidly under austerity. 

“We are in the middle of the biggest wave of government outsourcing since the 1980s,” a CBI report noted in 2012. 

The transfer of public money to private hands doubled between 2010 and last year to £88 billion.

The bosses’ Financial Times newspaper could barely contain its excitement about the “entrepreneurial thinking” that dominates local government after five years of cuts.


“The more that Mr Osborne reduces the size of the state,” it salivated, “the more difficult it will become for councils to meet rising demand with diminishing resources.”

Localis, a neoliberal local government think tank run by Tories, called this “a perfect storm”. 

It hopes councils will become “ever more independent of central government in terms of financial support (and therefore hopefully legislation)”.

Labour costs and trade union facility time are prime targets for the axe. 

Wholesale outsourcing of the workforce is increasingly common as councils “balance the books”. 

Even the limited protections workers had under Tupe legislation, covering transfer from the public to private sector, are being whittled away.

Bosses can ignore collective bargaining agreements. Wage protections have been scrapped, as has a code of practice governing workforce matters in public sector contracts.

Voluntary “good practice” principles have replaced it. But adhering to them costs bosses money—and they are more likely to win contracts for outsourced services if they can deliver them cheap. 

The Tory ideologues’ nightmare vision is of “commercial councils”.

If union leaders don’t lead a real fight the end of local government as we know it could be just around the corner.

Big bucks for the bosses

Kent County Council’s commercial and traded services businesses turn over £400 million in revenue and brokerage charges. 

It is the largest public sector trading organisation in Europe.

Kent council cabinet member Bryan Sweetland said staff see themselves as “profit centres rather than cost centres”.

By the end of this Tory government all councils will own a trading company, according to Localis. 

Some 58 percent already have one. They go under various guises but all have the same purpose—to remove liability for the services they run and the workers they employ from councils’ books.

Some councils are further along this route than others. 

Tory-run Barnet Council has led the way, using the north London borough as a neoliberal experiment since 2009. 

Its latest wave of outsourcing could leave just a few hundred directly employed staff. 

Other Tory-run councils have been racing to catch up with Barnet. They include Northamptonshire and Suffolk county councils and Bromley Council in south London.

Selloffs mean services suffer

Companies running outsourced services are committed to shareholder dividends and profit—not the public sector.

In Suffolk the council handed over its care homes to private health firm Care UK as part of a £60 million deal to build ten new homes. 

The Care Quality Commission (CQC) slammed Care UK for failing four out of five care standards at one of the homes last year.

It was forced to close admissions to two of the three new homes it had opened.

Similarly, one of the creations of the Tories in Barnet was the subject of a scathing CQC report this year.

 It rated standards at the council-owned care firm “inadequate”.

Common themes were low staffing levels and ill-trained staff.

Care UK took over the running of supported living services at Labour-run Doncaster Council in South Yorkshire in September 2013.

Bosses set about attacking the conditions of experienced staff. They slashed pay for some by up to 35 percent.

Workers fought back with 90 days of strikes.

But sadly their determination was never matched by their national union, Unison.

Some 150,000 lose home care

In 2009/10 English councils funded or arranged home care for 65 out of 1,000 over?65s.

The equivalent figure in 2013/14 was 46—so this is a real terms cut of 28 percent.

That’s 150,000 older people losing access to a service they would have received four years ago.

Union reps’ jobs have got harder

One quarter of Unison union local government branches have suffered a cut in facility time in the past two years.

With outsourcing on the rise, union reps in councils find representing members who work for other employers covered by the branch increasingly difficult.

Over two thirds of branches told the union they can no longer do this kind of work.

Safety checks are slashed

The Tories hate “red tape”. 

In five years their cuts have seen proactive health and safety inspections made by councils in England drop by 91 percent—from 54,175 to 4,901. 

Fifty three councils have abandoned them altogether. 

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