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.

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