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 Privatising public services a great con...
Topic Originator: OzPar  
Date:   Wed 17 Oct 21:52

Ever wondered if there are any benefits to privatisation? Well apart from a short-term "sugar hit" to Treasury finances, the short answer has to be no.

The following is from a commentary piece in The Guardian.


<<Privatisation and austerity have not only weakened the country’s financial position – they have also handed unearned wealth to a select few. Just look at a new report from the University of Greenwich finding that water companies could have funded all their day-to-day running and their long-term investments out of the bills paid by customers. Instead of which, managers have lumbered the firms with £51bn of debt to pay for shareholders’ dividends. Those borrowed billions, and the millions in interest, will be paid by you and me in our water bills. We might as well stuff the cash directly into the pockets of shareholders.

Instead of competitively run utilities, record investment by the private sector and sounder public finances, we have natural monopolies handed over to the wealthy, banks that can dump their liabilities on the public when things get tough, and an outsourcing industry that feasts upon the carcass of the public sector. As if all this weren’t enough, neoliberal voices complain that we need to cut taxes and red tape, and further starve our public services.>>
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 Re: Privatising public services a great con...
Topic Originator: londonparsfan  
Date:   Thu 18 Oct 09:57

Don't get me started on privatisation again 😂
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 Re: Privatising public services a great con...
Topic Originator: kelty_par  
Date:   Thu 18 Oct 10:42

Yes, it's true - but bizarrely despite all this and the Brexit shambles, the Tories are at worst only a point or two behind Labour in the polls and Scottish voters will vote Tory rather than SNP for some bizarre notion of Unionist pride.
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 Re: Privatising public services a great con...
Topic Originator: richie5401  
Date:   Thu 18 Oct 14:10

What a choice.Services run by a small number of largely incompetent fuds or a bigger number of the same calibre.
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 Re: Privatising public services a great con...
Topic Originator: londonparsfan  
Date:   Thu 18 Oct 18:09

Richie I don't know if you know as I think you're based in the US but the last time the Government had to renationilse the East Coast main line not only did they massively improve the service but it was also the only line to return a net profit to the tax payer.

We've moved on a long way from the 70s and the main reason public services still run by the Government don't work in the UK is from deliberate under funding.

The model now always has the tax payer on the hook it's not a true free market as the services always have to continue to be provided.
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 Re: Privatising public services a great con...
Topic Originator: kelty_par  
Date:   Thu 18 Oct 21:53

You only have to look at the trains to see the issues that the crazy way the services have been privatised caused more issues than it solved. Rather than operators competing for the same customers, which may have driven down prices or allowed different companies to offer different levels of service the same way airlines can on the same route (and as happens in Italy, where the intercity services between the biggest cities have genuine competition between Trenitalia and Italo), it was done on a geographic basis so there is no competition. It also was set up so that the public sector couldn't bid for a franchise - so we have the crazy situation where the French, Italian, German and Dutch governments, through their own companies SNCF, Trenitalia, Deutsche Bahn and NS can bid for a UK license but the UK or Scottish government can't. It's also incredibly difficult for a smaller operator to try and bid as shown on an excellent documentary on BBC 4 a year or so back.
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 Re: Privatising public services a great con...
Topic Originator: GG741  
Date:   Fri 19 Oct 00:53

In Australia:

- Government-owned banks (at state and federal levels) were privatised decades ago, and are in competition with other major commercial banks. Over time, the focus has moved from servicing customers' needs to rationalising services, expanding internationally, increasing profit / shareholder interests.

- The provision of energy (electricity and gas) and water were previously government run, and were privatised decades ago. There are a couple of providers for the 'supply' of energy (wholesale, by geographical area) and plenty of retail providers. Even this retail competition has not kept prices down (although there is some press frenzy driving this conversation, as household expenditure on energy is not as high as we generally perceive). Water supply is a closed market, by geographical area. Major concerns are with the infrastructure refresh and maintenance.

- Major road infrastructure projects have been funded via privatisation (toll roads). But there is no real competition in this area (unless you want to cope with traffic lights, low speed limits, etc., outwith the toll roads). And unfortunately there would appear to be no effective KPIs in place. Should there be an incident on a toll road, traffic speeds can drop to crawling pace for kms and kms, with tolls still collected by the private 'operators'.

- Public transport was privatised, but again there is no real competition in this area. And again, the KPIs on the providers are reasonably generous before any penalties are imposed. At best, users of public transport (who satisfy certain travel history requirements) may get a day or two of their fares credited to their accounts.

I can't think of a privatisation that has been of benefit to the public.
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 Re: Privatising public services a great con...
Topic Originator: Rastapari  
Date:   Fri 19 Oct 06:42

So It's 2018....and we've just realised politicians selling their rich pals services on the cheap is a con?
Really?

I Hope You're Ok Today....
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 Re: Privatising public services a great con...
Topic Originator: londonparsfan  
Date:   Fri 19 Oct 10:50

I don't think so mate, I think most have us have been banging on about this since not long after it started.
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 Re: Privatising public services a great con...
Topic Originator: richie5401  
Date:   Fri 19 Oct 12:41

That would be great in all cases LPF,but with frequently you have poor management with both models and as Rasta points out greed is a huge factor in all scenarios.
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 Re: Privatising public services a great con...
Topic Originator: Bertiesback  
Date:   Fri 19 Oct 13:28

I said when it happened it did not make sense.
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