Private failure in public provision

Every age has its fads and foibles. In recent times it has been
private enterprise. Its mere presence has become an indictment of
the inefficiency, waste and bureaucracy of the state.

Health and welfare were recreated in its image, with logos,
targets, mission statements and performance indicators.
Sharp-suited consultants, who had rarely run a corner shop, let
alone a big business, were recruited in droves to teach public
sector workers to “reconceive need” and heed the bottom line.
Globalisation meant that multi-nationals provided care home places
by the thousand and private hospitals could promise accommodation
and itemised accounts.

But suddenly we’re being told something else. It’s all been a
terrible mistake. The market economy isn’t working. World-class
brands are in trouble. There are serious problems of “corporate
governance”. Big business successes like Enron and Worldcom were
scams. Profits have been invented to boost share values. The
conventional wisdom was that manufacturing was old fashioned, fit
only for the “third world”. Now the bright new hopes of financial
services, electronics, communications and e-commerce are

Be afraid, for where economics hiccup, public health and welfare
can expect to catch pneumonia. Already we are seeing occupational
pensions in chaos. Unless the patient recovers, next will come cuts
in collective provision. The limits of people’s capacity to make
personal provision for life’s difficulties now become clear.

There may be little for us to take comfort in, but the market
economy seems to have found its saviour – the public sector. As all
the market’s principles of competitiveness, efficiency and
entrepreneurship come crashing around it, its nurturing of a new
domain for exploitation over the past 25 years – public services –
now seems to be paying off handsomely. Here at least is one area
where for minimal risk and investment it can make massive profits
and capital gain.

Here also to be found is the real “dependency culture”. This is not
the Daily Mail‘s and Sun‘s “benefit scrounger”,
ripping off small sums a week, but companies treating public
provision as a milch cow to be sucked dry by the

Sadly, so far the market’s performance in the public sector appears
no more effective than elsewhere – except that there seem to be
even fewer checks and balances. Surely it’s time for health and
welfare to put new confidence in old ideas of public service.

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