A new war on public services
The new year marks a turning point in the trajectory of Tony Blair’s government: the drive towards privatisation and "reform", which was interrupted by the events of September 11 and Blair’s frenetic globe-trotting efforts on behalf of George Bush, is to be resumed.
With the military offensive largely complete in Afghanistan, the new Taliban to be combated are seen as public sector workers – and their unions – as they battle to keep public services public, and defend their jobs and hard-won pay and conditions against a renewed Labour onslaught.
Blair’s New Year message is that they should brace themselves for a full-scale attack, with 2002 a year of "unprecedented" and "unsettling" changes throughout the public services.
Those first in the cross-wires of Blair’s rifle sights are health and education.
No amount of evidence of the failures of privatisation and the free market – most recently the deepening crisis of Railtrack and efforts to prop up the privatised Air Traffic Control system NATS – will deter New Labour’s team of zealots from their obsessive drive towards more privatisation, "public-private partnerships" and the ruinously expensive Private Finance Initiative.
This is perhaps clearest of all in the NHS, where the answer to any question asked of Health Secretary Alan Milburn appears to be more private sector involvement.
Last summer’s NHS purchase of the bankrupt private Heart Hospital in London has been followed by a renewed drive to send even more NHS patients for treatment in private hospitals, and the decision in December to buy up the entire capacity of a BUPA hospital in Surrey to treat NHS waiting list patients.
To cap it all, Milburn has insisted that he will bring a representative of the tiny private hospital industry onto his "Modernisation Board", giving the private bosses more say on the future of the NHS than they ever had under Thatcher.
"This is not a one-night stand, it’s a long-term relationship, and the private sector has got to be involved in the planning," said Milburn, to the obvious delight of the Daily Telegraph, which carried an extensive interview with Labour’s top privatiser on December 30.
Milburn’s arrogant stance on this deliberate snub to the health unions is another warning that many if not all of the promised 20 new Diagnostic and Treatment centres to speed the treatment of NHS waiting list patients are likely to be owned and run by the private sector.
"We need all the capacity we can get in the NHS, and if the private sector can provide NHS patients with NHS services, then that’s a good thing. It means the private sector has got to be involved from the outset," he told the Telegraph.
But of course the private sector only has spare capacity because it is so unpopular, with fewer than one person in eight having any private medical insurance cover. Half of its 50,000 beds are running empty: and it can only fill those beds with patients if it recruits – poaches – more nursing and medical staff from the NHS.
The costs of private sector treatment, for the relatively restricted range of elective operations it provides – are also consistently higher than the NHS: BUPA’s published scale of charges are all at least 50% higher than the average cost of the same operations within the NHS. For every 10 operations Milburn buys from the private sector, the cash resources for 15 similar operations are drained from the NHS.
And of course any patients who develop more serious complications while in a private hospital will be rapidly dumped back onto the NHS: in 2000 142,000 patients were transferred to the NHS from private hospitals that could not cope, or would not foot the bill for additional treatment.
The government’s cuddling up to a private sector that is only interested in pocketing the profits from a greater share of the easiest elective operations, while leaving NHS hospitals to shoulder the burden of all emergency work and all of the costliest specialities, is an all-round disaster for NHS Trusts and health workers.
But Milburn has made clear things can only get worse. With the collapse of national talks aimed at restructuring NHS pay scales (largely because ministers recoiled at the cost of implementing a fairer system) Milburn has now floated the idea of return to the bad old days of local pay bargaining which developed (and caused chaos) under Thatcher’s market-style reforms.
Perhaps the crowning insult to health workers and Labour voters is that after claiming credit for sweeping away the Tory internal market in the NHS back in 1997, Milburn is now talking openly about a new system of "patient choice" which threatens to restore this most divisive aspect of that market system, leaving NHS hospitals to compete once more against each other for patients and market share.
There is no doubt that as a minister who according to the Telegraph describes himself as "the last Blairite in the Cabinet", Milburn’s relentless drive towards privatisation is backed by Blair. An increasing share of the extra cash being pumped into the NHS by Gordon Brown will be pumped straight out again into the coffers of the private sector.
It is significant in this regard that the Wanless Report, commissioned by Gordon Brown, and hailed by many as an old-Labour style defence of continuing to fund the NHS through taxation, does not discuss how the money is spent, or who is to provide the services is is used to buy.
Former banker Wanless in a flawed and partial study makes no analysis of the value for money of using private hospitals to treat NHS patients – or of funding new hospitals through the Private Finance Initiative (PFI).
Ironically, January 2002 is the 40th anniversary of the Tory government’s Hospital Plan for England and Wales, which massively increased public sector investment and built a new generation of district general hospitals. Now it is Labour which is progressively privatising the NHS asset base, not least through Private Finance Initiative hospital building programmes, which are likely to increase during 2002.
PFI is also playing an increasing role in the development of new schools, though as in the NHS levels of backlog maintenance have escalated alarmingly – with the latest estimate at £7 billion. Over £750m is required for urgent work to avoid closures of premises – with another £3.1 billion required within two years.
New Labour has spent more on school maintenance, but has directed much of the new money to building additional school places.
But Labour’s new Education Bill published in December does not address the issue of resources to prop up the fabric of school buildings. Instead it is looking at ways in which schools can be further detached from local communities and any democratic accountability, and turned increasingly into businesses run on commercial lines.
Education Secretary Estelle Morris has been keen to tress that schools will be given freedom to apply for exemption from current education law, to implement "innovative schemes" – as long as they are approved by the Secretary of State.
In other words, schools that fit Morris’s idea of innovation will be able to disregard the national curriculum, and tear up the national terms covering teachers’ pay and conditions. They may prolong the school day, bring in evening or holiday working, and focus on a few specialist areas to the exclusion of others. It seems that nobody need be consulted over these changes apart from the Secretary of State.
Nor is there any guarantee of higher quality education among schools which break free. They may well be encouraged to use more classroom assistants to cover over gaps in the teaching workforce – regardless of the wishes of parents or the views of their staff.
Worse, schools will also be urged to form, or invest school resources in new companies to provide services to other schools. Labour’s objective is a business model, in which entrepreneurial head teachers begin to coin in profits by selling services such as teaching materials, supply teachers, advisory or specialist teachers, financial management – or even school meals and cleaning services – to less well-provided schools.
How far removed is this from the situation in the USA where private companies such as Edison run schools for profit? And what control, if any, would parents or local councils have over schools which began to make large sums by selling such services?
The Bill proposes new ways of tackling failing schools … by allowing them to be taken over by private firms, voluntary organisations, or other "good schools".
Of course this increased freedom to the best-resourced schools to make profits at the expense of the rest does nothing to tackle the underlying difficulty of a two-tier education system in which the clearest predictor of educational success is still social class. Nor does it address the growing shortages of teaching staff.
Of course the more "specialist" schools are encouraged to become, whether on the basis of the subjects they have dropped or included, or on the basis of incorporating more "faith" schools, which select on the basis of religious prejudice, the more the idea of comprehensive education is dismissed.
Of course the Tories, die-hard defenders of selective education, have keenly welcomed Morris’s call for more faith schools.
While a few Labour back-benchers have expressed reservations, it has been left to the Lib Dems to point out that Morris’s vision of faith-based, selective and exclusive education is already up and running in Belfast, where the result is chronic sectarian division.
The divisive and exclusive character of faith schools is underlined by Church of England spokesperson Canon John Hall, who told the BBC:
"The Church intends that its schools offer distinctively Christian education, and are open and inclusive of those who seek such an education."
New Labour’s determination to reform education is bigots’ charter, and a step backwards … to an essentially Tory, pro-business agenda, combining more selection with an increase in local powers for entrepreneur heads in conjunction with tightening control at ministerial level.
The last people to be considered in this new ideological war on our most treasured public services are the key players: the health workers and teachers on the one hand, and the patients and pupils on the other.
Public sector unions face a stiff challenge. They called off an increasingly vociferous campaign against privatisation in the aftermath of September 11: but ministers are making it plain that they have used the time to redouble their attack.
It’s time for the gloves to come off, and the fight to resume. 2002 will be a test of strength – and it’s one the public services have to win against Tony Blair’s reactionary gang of privateers.