Posts Tagged ‘Internal Market’

Shirley Williams on the Growth of Bureaucracy under Thatcher

May 25, 2016

SWilliams Book Pic

The great boast of Margaret Thatcher and the Conservatives is that private enterprise, unfetter by state control, somehow magically reduces bureaucracy. Apart from ignoring the fact that firms also necessarily have their own bureaucracies, the economic and social importance of many of the industries taken into state control means that even after these industries were privatised, there still had to be a state bureaucracy to make sure these industries continued to act in a fair and responsible manner. So there are a plethora of regulatory bodies supervising telecommunications, electricity, water and the environment. And one effect of privatisation was to make these regulatory authorities and the state supervisory bureaucracy bigger than they were under state ownership. Private Eye in the 1990s during John Major’s administration ran story after story noting the massive increase in such bureaucracy in the electricity, water and environment agencies. The Eye also noted how Thatcher’s successors attempted to cut down this bureaucracy by increasingly depriving them of their statutory powers and limiting their remit. Bureaucracy was reduced not be being more efficient, but by being deliberately cut down to prevent it interfering. And thus was public protection against the predation and mismanagement by the newly privatised companies removed.

Shirley Williams, the former Labour MP, who became one of the founders of the SDP also noted the growth of bureaucracy under the Conservatives before Thatcher in her book, Politics Is For People. She wrote

Another paradox can be seen in Britain, and no doubt in many other countries as well: the growth of administration. In 1970, the then Conservative government brought in the American industrial consultant, McKinsey & Co., to advise them on the reorganisation of the National Health Service. the reorganisation, in which professional interests were extensively consulted, led to a substantial increase in the number of administrative and clerical posts, and a higher proportion of administrators and clerical employees to doctors and nurses, the front line of the service. Local government reorganisation, under the same Conservative government, had similar consequences: more highly paid administrative posts, no evidence of improvement in local government services. Big government has its own impetus which is hard to stop, whatever the philosophy of the executive in charge. But opposition to it rubs off most on political parties identified with a substantial role for it. (Pp. 29-30).

Labour has suffered because, as the party most identified with big government and state expenditure, it has also been criticised by its Right-wing opponents as the party of waste. Yet the Tories have vastly inflated the bureaucracy involved in the remaining areas left under state control. Private Eye noted that the creation of the internal market in the NHS, and the PFI financing of hospitals, vastly increased bureaucracy in the Health Service. Successive governments have carried on the marketization of the NHS, with a further increase in bureaucracy. Within the BBC, the Eye also noted that John Birt’s administrative reorganisation of that once-great and respected institution resulted in the expansion of the upper management grades on vastly bloated salaries coupled with a damaging reduction in the production staff, who actually made the programmes people watch.

Britain’s public services and industries have been made increasingly inefficient through the creation of a corrupt and parasitic class of managers, who seem to serve only to perpetuate themselves at the expense of their own companies and their workers. Indeed, Ha-Joon Chang in his book, 23 Things They Don’t Tell You About Capitalism in one of the very first chapters describes the cases of several companies that actually went to the wall because their managers cut investment and wages, and sold of the companies’ assets, in order to increase their share price and their own salaries.

The Conservatives are the party of parasitic, useless bureaucracy. And the management consultants they have called in to advise them on how to reform British state administration have done nothing but wreck it. Arthur Anderson, later Anderson Consulting, destroyed the Benefits Agency and the Inland Revenue in the 1980s and 1990s. Their successors in PriceWaterhouseCoopers and the rest of the accountancy firms sending their senior staff to help both Tories and Labour draft their policies on tax and so on are part of the same poisonous trend. The Tories should be thrown out of government, and the management consultants and accountancy firms firmly excluded from the business of government.

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Vox Political on the Tories Empty Pledge for Extra NHS Funding

April 13, 2015

On Saturday, the Tories declared that they were going to add an extra £8 billion to the NHS budget by 2020 if they are returned. When pressed by Andrew Marr on his show about where the money would come from, George Osborne repeatedly refused to say, and instead gave evasive non-answers about the state of the economy instead. He also gave assurances that it had all been correctly costed, despite all the evidence to the contrary.

Labour have released a video of this section of the interview, which the good Mr Pride has put on his blog. He had accompanied it with a clip from the classic Newsnight interview, when Paxo repeatedly asked Michael Howard a question, which the then head of the Tories refused to answer, and hummed, ha-ed, and bluffed instead.

Mike over at Vox Political has also posted his critique of Osborne’s claims in the post ‘Tory NHS pledge is ‘fantasy funding’’. This begins

The Conservative Party must be getting very desperate indeed.

Faced with the failure of the plan to belittle Ed Miliband, the Tories are making a belated attempt to take some of Labour’s policy ground with a promise to provide £8 billion extra, every year, for the NHS.

From where?

The Conservatives have already told us they will be squeezing the economy by (at least) £30 billion over the next five years – if they remain in office. The National Health Service is ring-fenced from those cuts, we are told, but that hasn’t prevented real-terms funding from falling during most – if not all – of the Parliament that has just ended.

The Tories had no intention of adding funds to the NHS – or at least, they didn’t until today.

Despite claims that the health service in England alone needs another £8 billion in order to cope (the shortfall is £30 billion but NHS boss Simon Stevens reckons “efficiency savings” – cuts – will cover £22 billion of it), the Conservative Party had been hoping to keep it quiet and let the public service quietly starve while private, profit-making firms strip it of its most lucrative sources of funding; the services that attract the most money.

Like the plan to attack Miliband, this was a mistake; Labour has campaigned forthrightly on the needs of the NHS and the public has responded strongly.

So the Tories have wheeled out Jeremy ‘Misprint’ Hunt to announce a funding commitment that they don’t have the ability to honour.

It is exactly the kind of fiscal ineptitude of which they were accusing Labour, before the other party publicised its fully-funded plans for government.

Mike also refutes Hunt’s claim that the Tories have increased funding to the NHS. They haven’t. As the table from the National Statistics Authority shows, it’s actually been below intended funding, not above.

He also shows Hunt’s claim that the Tories have turned the economy around to be equally mendacious. Well, not exactly. Not if you believe the exact opposite of what they’ve said. They claimed that Labour had produced the depression, and that now, thanks to them, the economy is expanding. In fact, the economy was growing thanks to Alistair Darling. The Tories, on the other hand, have managed to shrink the economy.

Mike therefore concludes that What we’re seeing is fantasy funding – building castles – or rather, hospitals – in the air.

Judging the Tories on their record, they certainly won’t be improving health here on the ground.

Mike’s article can be read at: http://voxpoliticalonline.com/2015/04/11/tory-nhs-pledge-is-fantasy-funding/

In fact, as I commented on my reblog of Tom Pride’s post about this, there is a way to increased effective funding of the NHS and make massive savings: cut out the waste of money that is the Private Finance Initiative, the internal market and the outsourcing of NHS treatment to private firms. The bureaucracy involved in this waste’s billions, as well as causing massive inefficiency and waste.

On the other hand, it does provide a nice, juicy income to Tory donors, and the private healthcare firms which 92 Tories and Lib Dem MPs either own, or are employed in. Cameron, IDS and Clegg really won’t want to upset them, especially as they might need to find a few more jobs after the election.

Lies and Secrecy in the Tory Privatisation of the NHS

March 16, 2015

NHS-privatisation

Yesterday I put up an extract from Robin Cook’s Fabian Society pamphlet, Life Begins at 40: In Defence of the NHS, refuting health insurance as an acceptable source of funding for the NHS. Cook had been prompted to write the pamphlet in response to a review of the NHS by Maggie Thatcher. He was concerned at the way the review seemed less interested in improving the performance of the NHS as a state institution, than in opening it up to the market. Cook’s fears have been born out in the decades since. The Tories introduced the internal market under John Major. The role of the private sector in the NHS was then taken up and expanded further by Tony Blair. Now, nearly three decades after Cook wrote his pamphlet, the Tories are once again privatising the NHS.

This is being done piecemeal, and is shrouded in secrecy and denials. There are 92 Tory and Lib Dem MPs who stand to gain financially and commercially through their business contacts with private healthcare firms. Andrew Lansley himself has advocated the dismantlement of the NHS and its replacement with a private, insurance based healthcare system. So has Nick Clegg in the Lib Dems. Yet when one Tory official candidly stated that ‘in five years the NHS as we know it will not exist’, Tory Central Office immediately started issuing denials and spurious clarifications. The original statement made it clear that they expected the NHS to be sold off, and what remained of its bureaucracy would merely be concerned with processing the private insurance claims.

Not so, according to the ‘clarification’ issued by the Tory apparatchiks. What he meant, they claimed, was that the Tories would cut simply cut bureaucracy and improve efficiency. He never said anything about privatisation. ‘Onest, Guv.

It’s a lie. And the Tories have a long record on lying. To go back to the beginning of Cameron’s government, the plastic-faced android Toff promised that NHS spending would be ring-fenced and protected from cuts. This has most definitely not been carried out, and indeed the Tories have tried to purge the records of that promise ever having been made from their own internet site.

This is just part of the Tories’ long term strategy of secrecy and denial when it came to NHS privatisation. Thatcher also claimed that she would not privatise the NHS. Even so, documents released a year or so ago under the 30 year rule show that the review she commissioned argued for its privatisation. One of the authors of the report was Wassermann, who is now one of Cameron’s assistants on health policy.

Cook in his pamphlet also remarks on the secrecy surrounding the compilation of the review, and the way Labour researchers were denied information on it. Cook wrote:

This is not Review by independent inquiry but Review by Cabinet sub-committee. Entertainingly in the first week after the Review was appointed the Table Office of the House of Commons declined to accept parliamentary questions about it, as internal Government committees officially do not exist.

Not that we have learnt much more since questions have been accepted. Ministers have refused to publish any of the evidence submitted to the Review as some of it may have been confidential. They have refused to name the organisations who submitted evidence on the imaginative grounds that “it would be impracticable to try to distinguish between those communications which see themselves as specifically ‘submitting evidence’ and those which do not, but which may, nevertheless, be relevant to the continuing review process”.

Even our attempts to obtain the official remit of the Review have been baffled by the formula that the Review is “wide-ranging and fundamental”.

Tory policy on the privatisation of the NHS has not changed in the decades since then. It is still one of secret privatisation masked by public denial.

Tory Secrecy and Lies about Workfare

The privatisation of the NHS is not the only area of Tory policy, about which the government remains secret in order to prevent any criticism. Johnny Void has repeatedly blogged about how the identity of the firms involved in the Tories’ workfare scheme have also not been released. In this case the Tories have admitted that they are afraid that the scheme is unpopular, and fear that if the names of the participating companies were made known, they would be placed under massive pressure to withdraw. As a result, the scheme would be unworkable.

Lies and Secrecy about Sanctions Deaths

And Mike over at Vox Political and other bloggers about disabled issues have also met with refusals for their inquiries into the numbers, who have died after being assessed as fit and well under the Work Capability Assessment. Mike has estimated the number to be about 55,000 a year. Yet we cannot know the real figures, because the government says they are collating them for release later as part of government policy. They’ve been doing this for two or three years now. And if you try to ask for this information, you will see your request turned down as ‘frivolous’.

Secrecy about Honours Candidates

And yesterday it was reported that the Tories weren’t going to announce their honours list until after the election, because there were fears that too many of the MPs named would have been caught up in corruption scandals, like Jack Straw and Malcolm Rifkind.

So much for Cameron’s vow that this would be the most open and transparent government.

The Tories are privatising the NHS, and literally killing people with the sanctions system. This is being covered-up through lies and denials. Just as the party has always lied and covered up the truth.

Private Eye on the Costs to NHS of Free Market Reforms

January 28, 2015

Some idea of the immense cost to the NHS of various Tory and New Labour reforms to introduce the free market into the NHS can be gained from a piece Private Eye ran about them in their issue for the 15th – 30th May 2009. This commented on the campaign by Labour’s health minister, Lord Darzi, to find further savings in the NHS by pointing out just how much administrative costs had risen. Here it is.

Efficiency Savings
Prize Chump

Health minister Lord Darzi is dangling a financial carrot to encourage NHS staff to help the government find efficiencies and savings of £15bn over the next three years. Rewards of up to £5 each will go to those who most impress the panel of experts in Darzi’s den, which holds a total pot of £240m in prize money.

Darzi cites challenges such as combating the increasing burden of childhood obesity, or dementia in the elderly. But how about tackling the so-called “transaction costs” of healthcare, started by the introduction of the internal market by the Tories and accelerated by Labour’s privatisation agenda?

In the old NHS days, administrative costs were no more than 5 percent of its annual budget. By the mid-90s they accounted for 12 percent. With subsequent wholesale market-based measures such as payments by results, patient choice and self-governing foundation trusts, coupled with the costs of management consultants, private finance initiatives, independent treatment centres etc, administrative costs have soared to 20 percent of the budget about 20bn a year.

Reduce that and Darzi can make his savings in one go. Or how about axing the most disastrous computer project in British history, the NHS National Programme for IT – £12.7bn and rising? Cheques please to Lord Gnome.

So there it is in black and white: £20bn eaten up in administrative costs through the piecemeal privatisation of the NHS initiated by Peter Lilley.

And this is the system that Alan Milburn and the Blairites are so keen to defend.