The day before yesterday we looked at the different approaches to the health and financial sectors when large companies make mistakes. I agree with those who wrote in to say one of the worst features of banking was the way the state bailed them out instead of making them pay their own losses and sort themselves out, whilst protecting depositors rather than bondholders and shareholders. You may recall I was against the bail outs at the time. One of my reasons for opposing the equity bail out was the likelihood it would fuel resentment at bankers on a large scale. Today I want to look at the different approach we take towards serious error in the public and private sectors.
This week came confirmation that a young man died of thirst in an NHS hospital. Instead of responding to his expressed need for a glass of water, the hospital overrode his wishes and he died. Apparently they did not understand his condition which left him short of fluid, and failed to monitor it. The hospital has apologised profusely for its mistake, and accepted much of the blame.
I suspect if such an event had happened in a private sector hospital we would be now be in the midst of a huge row. There would be some who demanded that the Chairman and CEO of the hospital company resigned. There would be others who argued that that the hospital company should lose its licence. Some would expect tough regulatory or legal sanctions to be applied. Others would say it proved that we needed to regulate the private healthcare industry more, or even nationalise it.
Because it happened in the NHS there has been an eerie silence. Parliament has not taken up the matter in a big way. There is no demand for a show trial of the hospital managers, no demand for resignations of top staff, no demand for more regulation of the sector.
Meanwhile, a private sector security company has let it be known it has failed to recruit all the people it needs for a future contract. Fortunately they told the governemnt, the client, in advance. They have said they will pay the bill for troops to make up the numbers, so the job can still be done. Parliament will investigate how well the contract was constructed, how long they had to meet the extra numbers, and how well the failure has been managed.
The political and media response is much more intense and condemnatory. This is after all a private sector company which has let us down. So far no harm has occurred in the security case. There is time to plan our way round any shortfall. The young man did die in the hospital. Some media reactions are different because there always seems to be more condemnation if it is a with profit company rather than a public body at the bottom of it.
I am all in favour of the security company paying for its mistakes. The troops who have to be drafted in to help should be well rewarded for their trouble, at the company’s expense. Their shareholders must decide what to do about the management of the Group, as they I am sure will be worried about the reputational damage done, and the failure to impress one of their most important clients, the British people.