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Thursday, 6 September, 2001, 16:09 GMT 17:09 UK
Unions and business quizzed on PPP
Pat Gardiner, MD of Jarvis Projects, and Roger Lyons, head of MSF union
To watch coverage of the forum, select the link below:

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The government has said that the only way to improve the public sector is to involve private companies in providing more services.

It plans to extend the role of private companies from building prisons and roads to running schools and hospitals.

Critics say that private sector involvement is more expensive in the long run, and could damage the interests of workers and consumers alike.

Will private money rejuvenate or kill the public sector? Will direct funding of new schools and hospitals eventually cease?

Roger Lyons the General Secretary of the Manufacturing, Science and Finance union, and Pat Gardiner, managing director of Jarvis Projects, a leading private firm bidding for public sector projects, took your questions in a live forum.


Highlights of the interview:


Newshost:

The first e-mail comes Michael Evans in the UK who asks: What can a private company offer that the public sector can't?


Patrick Gardiner:

I am not sure that there is anything that a private sector company can do that the public sector couldn't do. I think the question is can it be done better and more efficiently by the private sector? I think there are disciplines that the private sector have and flexibility that the private sector have that perhaps isn't so open to the public sector. The ability to invest where it is seen as appropriate, to get a return, decisions of that type can be made quite quickly. I think the private sector can therefore be more fleet of foot in responding to a changing environment.


Newshost:

Roger, do you agree that the private sector can do certain things better than the public sector?


Roger Lyons:

I think you have to break this down a bit. There should be a strong public sector ethos in such services as health and education but that's not to say that within that there aren't speciality areas like the provision of construction, IT systems, catering, car-parking etc. which can be done more effectively through specialist firms which will be in the private sector. No doctor or nurse has ever built a hospital - and nor should they.


Newshost:

Robert del Valle, Detroit in the USA asks: Can you point to any single example where this approach utilising the private sector has actually succeeded?


Patrick Gardiner:

The first example I could think of would be the Queen Elizabeth II bridge at Dartford which has significantly eased congestion. It has been very successful from the motorist's point of view who spent, like myself, many hours queuing at the old Blackwall Tunnel. It's been very profitable for the private sector - so one has to say that it's win-win situation.

My company is involved extensively in the education sector and I think the fact that the Government have devolved more and more responsibility for schools' budgets to individual schools and the governing bodies has put a lot of additional pressure on head teachers. We all know that they are under considerable strain with the demands of providing education and we think that the services we provide to schools take a lot of that pressure off. Why should a head teacher have to worry about how to get a leak in the roof repaired or deal with a broken window?


Newshost:

Roger, can you point to any examples of success or perhaps from your point of view - failure?


Roger Lyons:

The important thing to remember is that it's not that everything private is good and everything public is bad. The bulk of public service provision comes from dedicated, vocationally committed professionals - particular in the health service and education areas - who provide a publicly committed service to people free at the point of need. But there will be areas where, for example, building work, IT systems, do require very professional, state-of-the-art solutions. We have been very much encouraged by some of the excellent equipment that we've now been able to lease into health service laboratories for example which could never have been accommodated within NHS budgets.


Newshost:

Roman in Bratislava, Slovakia asks: Because of the inherently higher efficiency of the private sector, I welcome any moves that delegate more of government's functions to companies.

Patrick, you would presumably agree that the private sector can do things more efficiently?


Patrick Gardiner:

I think they can certainly do certain things more efficiently. As I have said they have got the freedom and the discipline to be able to invest. There is always a question of where the line is drawn. We focus on providing support to the public sector, not delivering their services.


Newshost:

Roger, do you think that the public sector is less efficient?


Roger Lyons:

The fact is that private health care, private dental care is far more expensive than the cost to the NHS of providing medical and dental care. So it is more expensive. Now the question then is - how is it more efficient? You then have to dissect it and look at particular issues. For example, we have speciality services- in construction services - you can get advantages of scale in the private sector in providing help - building medical centres, building schools, building hospitals, building universities - all that kind of specialist provision of labour. But when you come to patient care, there is nothing that can be more efficient than dedicated care for patients in the NHS than the public sector free at the point of need.


Newshost:

Patrick when you're bidding for contracts or helping companies to put together bids, how do you counter that kind of argument?


Pat Gardiner:

I don't know that we need to. I certainly wouldn't disagree that the provisions of public services are carried out by very dedicated people. I think in the process and the systems that surround them, there are some inherent inefficiencies. I think the private sector in the operating of private clinics can perhaps introduce some efficiencies in speeding up the through-put of patients and so on. But the last thing that I would want to do would be to threaten patient care in any way and safety of the service delivery at that end needs to be the main priority.


Newshost:

Let's move on to our couple of e-mails, particularly about the unions, which is probably a good time to ask because we are coming up to the TUC conference at which presumably there is going to be some discussion about this whole issue. How much is going on within the unions about some of the concerns which we have heard expressed in these e-mails?


Roger Lyons:

This very day, the entire TUC leadership have been discussing this whole question. We've agreed a policy position and a jointly agreed statement that will be put before the TUC Congress next week. This brings together the willingness and the commitment to improve the efficiency and effectiveness of the public services. But at the same time the need to protect and promote the public sector ethos both for those working in it and for those who depend upon it. We know that privatised systems can sometimes only benefit rich people - American healthcare is good example - and we need to ensure that there is a public sector provision both in health care and education on a universal basis. We mustn't let any suggestion of private involvement undermine those principles and that's the central thrust of the proposals at the TUC next week.


Newshost:

So to what extent are the unions now prepared to buy into this?


Roger Lyons:

A number of unions already represent people in private sector providers. A number of unions are involved in ensuring that their members, for example in my case, members involved in clinical services are not in the private sector - some who have been, have been returned to the NHS. We have been arguing strongly that that area is not for the private sector. But we very much welcome provision of laboratory equipment, provision of IT systems and other specialist services and construction and maintenance where the private sector has a record of good delivery so that there aren't leaks in the roofs of hospitals and we do have the equipment to get the operations done and we can shorten the queues and that is what the people of this country want.


Newshost:

It does seem that on this issue the unions have come quite some way from the days when they would not have had any truck with this. Is it almost a case of accepting the inevitable?


Roger Lyons:

There is a range of views within the unions. Some of our members don't like the concept of private sector initiatives at all - others welcome it because it's what gives them their bread and butter. You get a range of views and you get a range of solutions. What I think people aren't willing to do is to accept the need that to have public services you have to be prepared to take risks, you have to be prepared to work hard to improve them. The people of this country said in the last election to all parties - and certainly the Government has taken it on board - there must be improvements in healthcare and education or else.


Newshost:

John Kay in Leicester asks: The unions do not have any real power now so why do they give false hope to workers when they know they can't win?


Roger Lyons:

I went to Downing Street and sat down with Tony Blair to discuss private sector public sector relationships and arising from that I was very pleased with the way in which we were to get an understanding that clinical services would not be privatised. We have subsequently met with Alan Milburn, the Health Secretary, and firmed up this position and we are busily working it through at regional and local level. If that is a union without influence on behalf of its members - I don't know what is. I think that is the kind of constructive engagement that unions are having, it is what our members want. And it is not just for our members as producers, as providers - it's for our members as clients of the National Health Service who depend on it for their well being.


Newshost:

John Ryan in London asks: Now that Labour has seen the light and adopted yet another Conservative philosophy, how long do you think the link between Labour and the unions will continue? After all they are funding another Tory party.


Roger Lyons:

I totally reject that suggestion. We have gained from this Labour Government not only massive increased investment for the health service and education, which the previous government starved them of. But we have also got, for example, major improvements in the family friendly agenda, in employment rights - in a whole series of issues that we couldn't get a response from the previous government. So there is a big difference. But we are working with the Labour Party and we do provide them with funds because we are working on an agenda that marries social justice with economic effectiveness. If we can marry those two and we can do it in health service, education and public services - the people will say at the next election - you've done a good job.


Newshost:

Patrick, you have heard what Roger has been saying about the attitude now within the unions to some of these initiatives. Are you encouraged? Do you think that the unions, from your point of view, have seen the light?


Pat Gardiner:

I very much welcome Roger's comments and I believe that we can work well in partnership with the unions. We are not there to exploit workers. We want to provide workers with a good standard of living and we believe that by that way they will be more motivated and more efficient and effective in carrying out their various duties. I think the days when the unions were seen as something to be defeated are now thankfully gone and I think we can all work together. PFI is part of what's called PPP -public private partnerships - and I think partnership is the right word between the public sector, the private sector and the unions representing their members.

See also:

04 Sep 01 | Business
Serco reaps PPP rewards
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