Is this the beginning of the end for the £200bn PFI disaster? It’s been a long time coming

"The outsourcing party is over" Labour will promise today – and the call to end PFI is supported by some unlikely figures.

“Carillion’s collapse means the outsourcing party is over”, Jon Trickett, Labour shadow minister for the Cabinet Office, will promise this afternoon, whilst opinions across the political spectrum are turning against PFI.

A Labour shadow minister will this afternoon promise to “take immediate action within hours of taking office to change to the way in which our procurement works.” Jon Trickett will continue:

“We will enforce every single clause in the contracts of those companies handling taxpayers’ money to deliver public services.

“Those suppliers of services who are in breach of contractual conditions can expect no special favours from a Corbyn government.”

And Labour aren’t alone in attacking shambolic and financially crippling outsourcing companies — dissent against PFI has come from the most unlikely quarters since Carillion’s collapse.

Last week the chairman of RBS, no less, called PFI a “fraud on the people”, not the sort of thing you’d expect to hear from one of the UK’s most prominent bankers.

And today a former director of Capita, one of the largest outsourcing companies in the UK, said “the Private Finance Initiative has been a gigantic rip off”. In an article written jointly for the LSE, John Tizard continued:

“Public services in England (and to varying extents in other parts of the UK) have been stigmatised and eviscerated not just by austerity but by the enforcement of market-inflected doctrine”.

The most recent polling figures show 68 per cent of people think PFI should be banned outright – this figure was 73 per cent in Scotland.

Not surprising given PFI will cost the UK taxpayer an estimated £220bn in charges to outsourcing companies over the length of existing contracts.

With the public mood hardening against PFI and public-private partnerships – and the Tories having utterly failed to take any action — Labour will be rewarded for taking the initiative here.

Last week Jeremy Corbyn set out how a Labour government would take back control from outsourcing companies. Here’s what he pledged to do:

  • Consult the public before any service is privatised or outsourced.
  • Make delivering services in-house the preferred option.
  • Make sure the public bodies are well equipped to make bids on services contracts.
  • Introduce more transparency for companies who win public contracts: “Labour would extend FOI rules to all private companies given a contract to provide public services.”
  • Force contractors to give their employees the same pay and conditions as public sector staff doing the equivalent work.

Public opinion on outsourcing has been clear for years. Let’s hope something positive comes from the collapse of Carillion – a Labour government with the determination to act against ripoff PFI deals.

Like this article? Left Foot Forward relies on support from readers to sustain our progressive journalism. Can you become a supporter for £5 a month?

3 Responses to “Is this the beginning of the end for the £200bn PFI disaster? It’s been a long time coming”

  1. Alasdair Macdonald

    When is Labour going to admit that Bodger Broon the Kirkcaldy Loon was the main villain of the piece? Until Labour admits the culpability of the 1997/2010 Government it’s position on PFI will sound humbug.
    There were many right across the political spectrum who, in the 1990s saw PFI for what it really was – a means of transferring public funds and public assets to powerful corporations controlled by a few wealthy individuals.

  2. William

    “Bodger Broon the Kirkcaldy Loon” was a part of “New Labour” which in turn was Tory based and nothing like the current party.
    We need a proper change of policy and attitude to make the country fairer for all of it’s inhabitants, especially the younger members of society who need a lot of help and encouragement.

  3. Das

    The unsustainability of the conservative party privatisation scam was well known from the beginning. How it survived so long is testament to the coruption and greed of capitalist ideology, the PFI ripoff is just another route to contract proof against socialism by major and then Blair, the New Labour dictator.
    The NHS is now so overburdened with crooked debt to private sector contracts that the people have just 2 options left.
    1. Full privatisation of the NHS which will take over the NHS and which will be paid for partly with NI contributions AND charges for your treatment (to pay for the profit margins).
    2. A return to the fully comprehensive not for profit public national health service that is paid for by the NI contributions without the enormous amounts being diverted to the private sector.

    With Tory ideology against the later and labour against the first choice it could easily be down to the electorate whether they wish to be spiteful and force us to accept an American style health service or take the safer option and back the socialists.

    In either case the public contractual obligations will have to be transferred to a specialist government department which must overhaul the contract law that is now deemed non- mutual.

Leave a Reply

You must be logged in to post a comment.