How drugs laws compound race inequality 08/10/08
Sebastian Saville on how drugs laws disproportionately effect minorities and those on low income. [Guardian]
Hard times: The myth of public v private has now been exposed
Peter Beresford muses on the shift in opinion between private and public organisations and whether it is a ‘Berlin Wall’ moment. [Guardian]
Hard times: Can PFI deliver hospitals and roads during a credit crunch?
Alison Benjamin considers whether PFIs have any place in current and future public investment projects. [Guardian]
Below is my response:
I agree with the above posters view that PFIs need close scrutiny, especially given that we are in a period of political economic introspection at the moment. The last thing desired is to perceive PPPs as some solution to our present and future challenges. Successive governments since the 1980s have colluded with private interests to carve out the public realm. This needs to be reversed, with more decisions to be put in the hands of local regions and local professionals, with a greater emphasis on encouraging grounds up initiatives.
PFIs and PPPs have acted as a conduit for introducing neo-liberal practices into the public sector, practices that in my opinion have lacked both equitable and efficiency benefits. By some it also was seen as a method of destabilising the public sector and strengthening centralisation. Its ‘architects promised a new solution, training the public sector to become a better, faster, stronger champion. Unfortunately, the coach has been forcing its athletes to train in the wrong event.
Effective governance and public policy should be based upon the balancing out of differing strengths and weaknesses of private, public and third sector organisations. Through taking the positions that the private sectors motivation will be able to secure efficiency savings like a pig searching for truffles and that the flow of money should be the overriding factor to decide investment decision. However, private investment decisions are likely to be different to public or third sector decisions, as the emphasis in our current hyper-capitalist economy is geared to short-term investment decisions to maximise share value.
There is a high degree of moral hazard from large scale PFI projects, as the contracts tend to offer high rewards for success but minimal risk for downturns. This means that once the contracts are signed contractors are free to skimp and save on long term investments (such as painting tube stations rather than installing air conditioning), place emphasis on quick or easy fixes (such as 3 road sweepers governing an area rather than 4 to boost efficiency(meant as an innocent example but question it if you may)) which a competent public servant should be able to initiate, and try to lobby for extra funding, due to unforeseen spending requirements and the need to sustain vital public infrastructure (cant see the wood for the trees).
PFIs have a tendency to be a drag on investment decisions, pernicious as I mentioned previously. Most PFI schemes tend to be greater in budget than initially expected. This usually results in other services being cut, as they do not have the security of 30 investment contracts.
It should be emphasised that economies of scale are not necessarily everything. Doing the right thing badly is usually better than doing the wrong thing well. In the case of PFI contracts the ability to streamline is neutered, as there are very complex rules, procedures and formulae to navigate before any changes are made. Sometimes natural economies have been ignored by politicians, carving up infrastructure to create false competition (e.g splitting the London Underground into two).
Who will save us from this dilemma? To address the Little Otiks the government needs to step in, wearing the mask of regulation. They spend their time exchanging lawyers and civil servants in the process of accountability. The system has been at the expense of local democracy and professional influence, as PFIs tend to be made at the big table. The UK has had a generation of politicians who can only think large. They walked past local experts, went to big organisations and signed long-term deals that guaranteed Westminsters involvement in decision-making in return for private sector action. Remember Gordon Brown and Alistair Darling forcing through the PPP of the London Underground all those years back despite Ken Livingstones alternative of a publicly financed and publicly upgraded Tube(2002?).
This blurring between the public and private sphere is ugly. Residency in the UK is like living on a road with two violent gangs. You have to pay each gang off to buy protection from the other gang. They promise you that you will be safe and they are going around to the others to sort things out to keep the peace. I swear I could here laughter last time I was passing by, last time they met. The optimist in me is hoping that some of the recent positive press from the part privatisation of the banking system is cause for improvement. I just cant held thinking that its the same suspects demanding greater public trust in larger government, larger finance companies and greater public appropriation of future tax decisions.
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