CBI on public services

No one ever accused the CBI of subtlety. Their latest effort to rustle up work for their members is a call for private companies to have a ‘right to bid’ to deliver public services. This is a retro policy in so far as we have done all this before. Compulsory Competititive Tendering (CCT) and market testing was the 1980's version of this. That's why we have described this as a "Thatcherite Wonderland".

The result was a complex chain of contractual relationships with huge costs for public services. This proposal goes even further than CCT, requiring an army of people to manage it, taking staffing resources away from delivering frontline services.

The evidence on privatisation, outsourcing and shared services is not that they are cheaper and better run – quite the opposite. We have seen time and time again the huge failures of privatisation. A perfect example is the outsourcing of hospital cleaning which resulted in the number of cleaners being cut in half and hospital infections rising as a result.

Last week I highlighted the evidence of G4S work in England. No wonder they wanted to highlight South Wales and not Staffordshire where the contract now costs the force three times more. In November last year, a leaked report revealed that British Telecom was overcharging Liverpool City Council by £10 million a year for outsourced services. It highlighted that the council could save £23 million a year by cancelling the contract for IT services and a call-centre operation, and taking the work in-house.

Integrated public service delivery is by far the best way to manage essential services. Harking back to the failures of the 80's is a pretty poor contribution to public service reform.