Unions to tackle Blair on privatisation

The unions and the government are heading for a major confrontation over privatisation at the Labour Party conference.

Three powerful unions are planning to table motions calling for a moratorium on any further private sector investment in public services.

The leader of the TUC's largest union, Unison, told BBC Radio 4's Today programme that the private finance initiative was a waste of time and money.

Unison general secretary Dave Prentis said: "The government is relentlessly pursuing a policy that wastes money, wastes time and fails any objective test of value for money.

"It is a policy that is squandering the only chance in a generation of renewing our public services.

"It cannot be right that during a period of unprecedented public investment, huge profits are going into private pockets when these funds should be directed at essential public services."

No U-turn

The government is determined to press ahead with its private finance initiative, which it believes will allow hospitals and schools to be built faster - and for less public cash upfront - than the existing system.

Gordon Brown told the BBC that any delay was unacceptable.

He said that it was "completely unacceptable to put a moratorium on hospitals, schools, roads and rail projects, denying the public services they need and holding back the biggest investment programme the country has ever embarked on".

"We will resist the policy of depriving public projects of private finance where necessary. And we will resist the idea that we should return to reckless borrowing," he added.

Spreading fast

The government's private finance plans are growing fast.

There are 63 privately run hospitals in the NHS pipeline already, with more being announced every month.

The trade unions believe that the government is mortgaging its future by giving private companies the right to run hospitals, schools and roads for periods of up to 30 years in return for a fixed yearly payment.

They say this will be much more expensive in the long run than the government building the hospitals and schools itself.

And they are worried that staff in the new private hospitals or schools will be employed on worse conditions than when they worked for the NHS or local government.

Unison has won some concessions in this area, with a code of conduct applying to workers in local government - including schools - which guarantees that new staff will be offered "broadly comparable" conditions, and an agreement that 85% of workers in private hospitals will continue to be employed by the NHS.

The government says that PFI is a vital part of its plans to expand and modernise the public sector, and that using the private sector can mean better value for money.

Far from rowing back from its ambitions, it is planning to expand PFI to more infrastructure projects such as roads and bridges.

And it wants to partly privatise council housing through the mass transfer of estates from local authorities to housing associations.