The government is said to be  working on measures to speed growth and raise economic performance. One of the worrying features of recent economic figures is the apparent poor showing of productivity.
I have been working on how the UK considers and provides  public service. This builds on a book I wrote entitled Third Way Which way? under Labour.
To improve the performance of the Uk economy we first need to  widen the definition of public service. I regard the bread supply as a public service as well as the water supply. I regard scheduled airline services  as public transport, just like train services. I see the internet as a public service, just as the post is a public service. A   public service is not limited to a service provided by public sector employees, or provided free at the point of use, or heavily subsidised. Some of the best public services are provided with user charges by competitive private sector companies.
I have identified a spectrum of ways of delivering public service. It is not a simple public sector good , private sector bad (Labour’s view) or vice versa (Some conservatives’ view). There are 8 different types of public service:
- Public sector monopoly provided free at point of use by public sector  e.g. Roadspace
- Public sector provision free at the point of use with some competition between public sector providers – hospitals, schools
- Public sector monopolies provided free at point of use by private sector contractors e.g. domestic rubbish collection
- Private sector monopolies provided free at the point of use  e.g. free local newspapers, certain types of internet service, ITV
- Monopoly activities provided by the public sector but paid for by users – e.g. Planning and Building Regulation services, passport issue
- Competitive services provided by the private sector but paid for by the state e.g. care homes for people without capital
- Competitive services provided by the state but paid for by users – municipal or state trading – e.g. public leisure facilities
- Competitive services paid for by users and provided by private sector – this is most public service in a free enterprise economy – everything from food to most  professional services
             All public service can be grouped according to whether the service is a monopoly or subject to competition, whether the user pays or the taxpayer pays, and whether the service is run with and by public sector or private sector employees.
           The importance of this understanding is to boost productivity, encourage new investment and innovation and raise growth. This can be done by moving more services from monopoly to competitive models, whether they be in the public or private sectors. It can be done by moving more services to user charges, allowing more private finance and providing a better market test of the efficiency and value of the service. That can only be acceptable if there are offsetting tax cuts, so people pay less, not more, overall.  Moving from public sector employment  to employee buy outs or other ways of organising effort  is often a good way of boosting performance.
           It would be good to make more progress in shifting services in these directions to achieve better outcomes. Some suggestions include:
- Moving to competition for all users of water services when the government  take powers to introduce some competition into the industry. It is a prime candidate for new models and new investment. It can be allied to switching to meters when people change house as well as letting them switch if  they choose to do so.
- Launching a series of new toll road projects to start to bring user charging into roads. You would only pay for a new road that the company was providing, not for existing ” free”  roads.
- Reducing the number of areas where the private sector has to buy licences and permits from the public sector to operate
- Allowing profit making companies to provide schools and Colleges
- Breaking up Network Rail and returning it to the proper private sector, with competition allowed between the differing regional railways that could create. Where train companeis wanted to it could reunite trains and track.
- Splitting RBS into competing UK clearing banks and returning them to the private sector
      Improved performance in big areas like banking and water, where there is a substantial government involvement, would boost general productivity. The heavy loss making businesses like Network Rail and RBS are not contributing to our national wealth and prosperity as we would like, and are a drain on taxpayers.
August 17, 2012
Indeed I agree with all this. The government is able to virtually take over whole industries with unfair competition, unfair subsidy and unfair regulations – we see this in the NHS, Universities/Schools, even car parking in residential areas, the whole green issue, the new car share/hire companies and even Boris bikes with unfair access to street parking. The list is endless, the invisible hand of Adam Smith is being twisted and distorted to do harm not good at every turn.
Now we have the ÂŁ35K cap on care costs floated again by Cameron. Can we assume this will come in in about 10 years, if it ever does (well after the Tories have left office anyway). The cap will be about ÂŁ250K by then I assume. After all we are still waiting for IHT thresholds of ÂŁ1M as promised by Osborne many years ago. What is the point of a politicians promise?
August 17, 2012
I see that William Hague has said Julian Assange will not be allowed safe passage to leave the United Kingdom. I assume he is just obeying US orders. Hopefully he will not do so when they want to start another, pointless and counter productive war.
August 17, 2012
I wish I read the same I’m-so-independently-minded newspaper that Jemmima Khan does.
Then I might see Julian Assange as a romantic activist rather than the dangerous, squirming coward that I do.
August 17, 2012
I believe Jemima Khan has some bail money at stake, so she may not be exactly impartial.
Nevertheless, Hague would be very unwise to tamper with the status of diplomatic asylum. Countries have had to grin and bear it in the past even when murderers have secured diplomatic immunity.
He might do rather better to improve on the conditions of the European arrest warrant which grants rendition on the back of no evidence. If evidence is presented (notwithstanding that the EAW doesn’t require it), the moral case for Ecuador to continue to offer asylum will be undermined.
August 17, 2012
Well at least if Mr Hague is being this robust with diplomats….perhaps we can look forward to him making the US Embassy pay the massive amounts it owes in parking fines in London? Just a thought…..
zorro
August 17, 2012
I wonder if her contract to advertise the i newspaper will be renewed.
August 17, 2012
I do not see Julian Assange as a romantic activist nor do I agree with many of his actions, but I do not think he should be extradited anywhere just so he can be questioned over these allegations. I have very deep suspicions over whole nature of the allegations and indeed the whole matter. The absurd government threat to the embassy and diplomatic system, by Hague, seemed rather absurd and pointless too.
August 17, 2012
Under Cameron, symbolically speaking, Adam Smith would be in the last stages of leprosy!
zorro
August 17, 2012
The NHS is competing with private hospital, state schools compete with private schools, and state universities compete with private universities (there are a few private universities).
August 21, 2012
Not easy for the private sector to compete with a free state sector provider paid for from taxes. Why pay when you can get it free (or have already paid taxes for it), so only a few can both afford and want to. The private sectors in these areas are therefore relatively small.
August 17, 2012
Well written!
This is one of the most exciting posts I have read for some time.
Thinking things through like this opens a wide vista of possible improvements.
August 17, 2012
I congratulate John Redwood MP on taking the initiative on improving the Public Sector. There are some excellent suggestions, worthy of wider debate.
On the other hand I have been disappointed with David Cameron’s Government’s achievements on Public Sector Reform. Sadly, too much of the austerity cuts have directly impacted front-line services.
What is required is a ovvision, strategy and carefully articulated
August 17, 2012
I congratulate John Redwood MP on taking the initiative on improving the Public Sector. There are some excellent suggestions, worthy of wider debate.
On the other hand I have been disappointed with David Cameron’s Government’s achievements on Public Sector Reform. Sadly, too much of the austerity cuts have directly impacted front-line services.
What is required is an over-aching vision, joined-up strategy and carefully articulated delivery plan. Well done to John Redwood.
August 17, 2012
Look a little closer, Dr Oldman, and you will see that what Mr Redwood has outlined is a disastrous neo-Socialist vision to second-guess market forces and destroy more British business.
By defining public services so widely, he is claiming a right, nay a duty of Government to interfere with, regulate and restructure any industry in the country that supplies the public. That may appeal to you as a management consultant. To me it is a nightmare.
Take bread, which is now defined as a public service. To improve efficiency and productivity, it is incumbent on government to decide and enforce an optimum competitive structure on the bakery industry. Easy to see, for instance, that supermarket in-store bakeries distort competition and serve vested interests. So let’s ban them. Or perhaps force supermarkets to franchise them, overseen by a suitable regulator. Or perhaps we should impose a countervailing tax (the initial excuse for the pasty tax).
This is not a reductio ad absurdum. Some of us can remember a former Labour government’s attempt to change the marketing of detergents to what was deemed to be a more efficient model. Detergents would be a public service under Mr Redwood’s analysis.
Previous Conservative governments have imposed their own preferred
theoretical models on, for instance, the beer industry, with predictably awful consequences. A doctrinaire restructuring of the bus industry for privatisation led to years of disruption for passengers before the private sector managed to get back to the something like old structure. The rail problems Mr Redwood seeks to remedy are entirely the result of ministers’ insistence on countermanding the natural private industry structure to promote competition, which hardly ever materialised.
I see that Mr Redwood now wants impose his own neo-Socialist model of enhanced regulation and restructuring on the private sector water industry, which he clearly does not understand and ain’t broke.
Much as I admire Mr Redwood, this vision should be rejected.
Reply: I have no intention whatsoever of trying to restructure private sector industries like bread!
The water industry still is based on regional monopolies dating back to the old nationalised anti competitive model. I do think the government is right to allow competition in this sector, where it has been banned by law. I wish to see competition allowed for retail as well as for business customers. What is wrong with that?
August 17, 2012
PS: I did not even mention electricity, seemingly the new model for water. It would take too long.
August 18, 2012
Dear Mr Redwood,
Thanks for reply. There can be no objection to water supply competition from companies using their own water resources, pipes and sewage works, or even if even if they use others by contracts freely arrived at. The more the merrier. But if you force competition artificially by forcing existing firms to supply new competitors with “wholesale” water and “common carriage” pipes, you increase regulation and destroy the model that still delivers more than ÂŁ5 billion a year investment at internationally modest prices. If you look at Ofwat’s website they are already demanding more bureaucratic regulation including separate but “notional” accounts for wholesale and for retail supply in preparation for such developments. Of course, all contracts would have to be regulated, as in fixed-line telecoms.
The existing high-investment model depends on minimising permitted rate of return (cost of capital) and required productivity gains. If you restructure into three bits with much higher risk in one you will probably end up with either higher prices (through higher overall cost of capital) or lower investment in the reservoirs and so on that you were talking about when Mrs Spelman was telling us we would need buckets a few weeks ago. You would also probably convert three or four big, solid UK companies into BT-like zombies.
By the way, you might ask Ofwat why it allows a higher rate of return for South East Water, which I think supplies Wokingham, than eg Thames Water or Southern Water and how this is in the interests of your residential and business constituents. It also seems to me that Ofwat plays too little attention to the interest of business.
Reply: If you introduce lop sided competition, as in Scotland, for business custoemrs only, then of course you need more regulation. You need to try to stop the industry loading costs onto the monopoly side of the busienss in order to undercut on the competitive side. That is why I prefer full competition, to avoid much of that. The current rate of return regulated structure can lead to the anomalies you highlight, as companies bid for approval for capital spending, where more captial spend should help reduce the return on capital to stay beneath the controls and “justify” higher prices. Surely competition is better at settling prices?
August 18, 2012
Like the electricity industry? That bastion of clear low prices and competition?
August 18, 2012
I recall that 40% of the cost of a pack of washing powder is typically advertising spend, much of it in a battle against other brands. One brand offered the same powder without the advertising in a square deal (i.e. much cheaper), but proved to have little market penetration, as consumers assumed it was less effective since it was cheaper and there were no adverts to tell them otherwise. The brand owners rapidly returned to increasing the advertising budget.
August 19, 2012
I am responding to the challenge made by “Outsider”.
I endorse John Redwood’s proposals, because by and large, they increase competition, rather than reduce it. In my judgement, that is not neo-Socialist, it is an excellent example of “Third Wave Neoliberalism”.
Secondly, I would add that many inefficient, regulated industries, are charging too much because their processes are not lean, oFten because of bureaucratic rules emanating from the EU – take procurement for example.
Thirdly, I do not make my argument because I am a management consultant. I am actually a retired independent consultant, choosing to retire, recognizing that David Cameron’s Government was hostile to independent professionals – this has left the way clear for major consultancies and outsource providers to effectively reduce competition.
August 17, 2012
Some smart guy once said, individual citizens can do anything they like unless there is a law that stops them. The State can do nothing unless there is a law that allows the state to do it. I am not sure that is still true; and, we do not have a written constitution to look up to prove it.
A comment previous on this site referred to the French health system where co-payment is the norm. The French recognised some while back that “free at the point of use leads to abuse”. The US system is insurance based with co-payment and costs about ÂŁ4,500 per capita year compared to ÂŁ2,000 in the UK.
When the State is both purchaser and provider there are multiple monopolies at work including public sector trade unions. You may have noticed in the ONS data that over 90% of strikes were in the public sector and privatised entities which still retain there public sector trade unions; transport particularly.
Reply: Your opening describes the traditional UK position. There are now so many UK/EU laws that many reasonable things people would like to do might fall foul of some law.
August 17, 2012
@ JR: “There are now so many UK/EU laws that many reasonable things people would like to do might fall foul of some law. ”
John, might I suggest a post Franco style “reset”, as I understand it when democracy was re established in Spain after Franco’s death they repealed all laws, in the same parliamentary sitting the MPs brought forward new laws covering the most important points, criminal, civil and taxation etc. and then over the next months and years other laws, I’m sure you get the drift.
I can see that the UK might be fast approaching such a need, especially if we ever do rid ourselves of the EU burden.
August 17, 2012
There are a lot of funny quotes about what is permitted or prohibited by law in various countries. Here is a sample.
If you are in the USA, everything that is not prohibited by law is permitted.
If you are in Germany, everything that is not permitted by law is prohibited.
If you are in Russia, everything is prohibited, even if permitted by law.
If you are in France, everything is permitted, even if prohibited by law.
If you are in Switzerland, everything that is not prohibited by law is obligatory.
If you are in North Korea everything that is not forbidden is compulsory.
If you are in China, everything is permitted if you are in the party, even if prohibited by law. Everything is prohibited if you are a normal citizen, even if permitted by law.
August 18, 2012
Sounds like the USA is the most attractive place to live out of those. Should we be welcoming you to the political right?
August 17, 2012
“The importance of this understanding is to boost productivity, encourage new investment and innovation and raise growth. This can be done by moving more services from monopoly to competitive models, whether they be in the public or private sectors.”
Michael Gove is transforming state education by introducing more competitive models. This is not boosting productivity or encouraging innovation and raising growth except in a very few cases as the clear expense of the vast majority. It has yet to be determined whether the injection of capital with expected returns will be of benefit to state education.
It’s not enough simply to say that a particular model of managing a sector of society will lead to improvements without also making explicit that any such changes have to be managed by extremely able leaders who consult thoroughly and bring the most able in negotiations, rather than consulting with very young ‘disciples’ with no relevant experience and sacking and systematically discrediting anyone who knows what they are talking about with the help of the press.
Hayek himself clearly identified the key problem with and limitation of the free markets model which is that he was assuming there is no such thing as altruism. It doesn’t matter how much you control the media spin to present the message that teachers are deeply self interested and ignorant – altruism is a huge generative power in education. If you try to force through reforms which prevent it operating as Gove is doing more by the methods he is using to drive change than by the nature of the change desired, you will do substantial damage to state education.
Reply: Your preferred pre Gove model does include competitive elements in most parts of the country. In my area there is choice between schools, with popular schools being oversubscribed- these tend to be the better performing schools. The pure market model of course embraces altruism, leaving a decent role for charitable and voluntary effort. Indeed, if we did have a pure free enterprise model the for profits could always be undercut by not for profits and charities.
August 17, 2012
I don’t have a preferred model John, but there are some things which are clearly unacceptable such bullying and dismissing all with ability and experience in order to push unproven, unconsulted and clearly counter-productive policies and using an inspectorate body to bully schools into accepting changes which are unproven and are not properly consulted by threatening them with very severe punishment if they do comply.
I ask you John, do you think there needs to be local level planning of education and children’s services in order to create economic efficiency or do you think there does not? If you think there does not I strongly suggest you analyse what is going on in Scotland so that you can justify why it is not producing the efficient provision of services claimed and then you have a fair chance of being able to defend your position.
Do you think there needs to be local democratic scrutiny of education services or do you think there does not?
Do you agree with Michael Gove that all those who have worked in English state education should be excluded from consultation to make policies fit for purpose and that the SoS for education should instead seek only the counsel of Rupert Murdoch and a bunch of bright young things with no experience in education and who have not even had children who have been to any school, let alone state schools instead?
Reply: I think you need advice from various sources. I do oto accept that Mr Gove takes his cue from Mr Murdoch. Of course local accountability is needed, but this can take the form of elected Governors and school meetings as well as through elected Councillors. The ultimate accountability to parents is reflected in parent preferences over choice of school.
August 17, 2012
I was at the consultations which took place during the early stages of this parliament and those which existed were clearly pointless and the framework for discussion never overlapped with what actually needed to be discussed. I cried through most of one. Nobody there had any power to influence anything to make it fit for purpose. Do you remember that Gove was found guilty of not consulting regarding the cancellation of BSF? We all knew that sham consultations would be the result of that judgement and sham consultations we got.
Michael Gove rammed through massive changes during his first through months in power. These were very clearly not consulted with any appropriate professional bodies. If you watch his Leveson evidence it’s clear he was meeting frequently with Murdoch at this time. This seems to be fine as they were discussion education not the BskyB takeover. At that time Michael Gove shut down our expert bodies on the technological infrastructure for education disabling our ability to create intelligent and balanced policy in this area. Meanwhile its now clearly established that Murdoch was planning global domination in the technological infrastructure for education. The fact that the Murdoch press were running a spin campaign to portray all though who worked in education as being self-interested self interested does not justify Michael Gove acting to exclude them all from consultation.
I know that Michael Gove also took his cue from think tanks who employed nobody with experience in education, random bright young things and the anarchic libertarians who believe that if you dismantle all state organisation thing will rapidly improve but your conclusion that he was not also taking it form Murdoch is deeply naive given his Levison evidence of his meetings with Murdoch at critical times, Murdoch’s specific interests, the behaviour of the Murdoch press and Michael Gove’s repeatedly expressed deep admiration for Murdoch.
I mean for goodness sake why else is Michael Gove in post apart because he is a Murdochite? Does anyone really think he has any management ability? If so please then please could the person who asserts that he has appoint him to be MD of their business?
“The ultimate accountability to parents is reflected in parent preferences over choice of school.”
I think this is true for young children in places where there are plenty of schools with a surplus of places but it does not work in areas where there are few schools, areas where the schools are full or for children whose parents who cannot transport them to alternative schools. It also has very limited usefulness for parents of secondary school children who may be part way through exam courses or engaged with friends and activities which in practice make it virtually impossible for them to move. There need to be forms of accountability which lead to particular issues being addressed.
reply: I do not think Mr Gove’s appointment or main views on education have anything to do with Mr Murdoch. Mr Gove has intellectual self confidence, and I think bases his views on his own experiences and observations as well as on the wide range of advice a senior politician has access to.
August 17, 2012
I am astonished if you support Labour’s plan to rebuild every school in the country in little more than a decade. Imagine if we tried doing that for every building. It was one of the most wasteful bits of public spending (and admitted as such recently by Mr Twigg I note) ever invented. Or is your real criticism that some arcane procedure, designed to prevent efficient operation, wasn’t followed to the letter?
August 17, 2012
I don’t support Labour’s plan.
August 18, 2012
Labour won’t even be able to rebuild its reputatiion in a decade.
August 18, 2012
I’ve been watching Labour carefully too and I’ve been impressed at their progress in education in the last year. I’ve seen Stephen Twigg at two meeting and have chatted to him and he’s been sensible and credible at both. Chatting to him in person at both meetings he’s held up under scrutiny. You can watch the video of one of those meetings on the RSA website (events, past events, is education the answer to social mobility).
Kevin Brennan has been credible and competent for a while and spoke well at the same ACME conference where Nick Gibb had the whole audience aghast with horror.
They have the benefit of opposition funding and Tim Brighouse – both exceptionally valuable assets. A recent DFE report said that Tim Brighouse’s London Challenge program had a much greater positive effect on schools than the academies program.
Beware Labour I say (I’m not labour by the way).
August 17, 2012
“I do not think Mr Gove’s appointment or main views on education have anything to do with Mr Murdoch.”
Then I presume you haven’t watched his Leveson evidence.
“Mr Gove has intellectual self confidence, and I think bases his views on his own experiences and observations as well as on the wide range of advice a senior politician has access to.”
Indeed. It’s just that all his limited life experience is with Murdoch. Mr Gove has removed the part of the range of advice senior politicians used to have access to which relates to the real world. This is a problem for me in my work with the Lib Dems as they no longer have access to it and they need it.
Instead Mr Gove has used the wise advice of the Centre for Policy Studies where the education policy is written by one person who appears to pay them to be their expert and whose credentials do not check out. I notice his claims to be a visiting professor at the University of Derby have now been removed from his Free School Website. It’s interesting that the CPS still have his claims to be a visiting fellow a the University of Buckingham on their site despite that University denying that he has anything to do with them.
Reply: Mr Gove made a spirited defence of media independent at Leveson, but that does not mean he takes his educational views from mr Murdoch. As someone concerned about standards and academic quality it is important not to be hostile to everything a person does out of prejudice, without examining closely what they are saying.
August 17, 2012
Rebecca Hanson prejudiced? Surely shome mishtake.
August 17, 2012
I am not prejudiced!!!!! My concerns about Gove are entirely based on his behaviour. That’s precisely the opposite of prejudice. I will work with anyone who it’s possible to work with. Gove has repeatedly demonstrated that he is not suited to this job and I am simply pointing out that he as done so and justifying in detail the ways in which he has done so.
How can I work with someone who proactively denigrates and straw-mans (or totally ignores) anyone with reasonable comments to make? Gove even openly slates the leaders of the headship unions these days. They are the elected representatives of the headteacher of this country for goodness sake. He puts them in the same category as militant union leaders of the 1970s. I don’t mind him criticising aspects of what they say – that’s absolutely fair. It’s the way he completely dismisses them as people and therefore avoids engaging with their concerns which is unacceptable.
I’m also not hostile to everything Gove does. I’m critical of most of it. Being hostile and being critical are not the same thing. I quite like the bible in my son’s school given that it was paid for by donations. But it’s hard not to be at all angry when I am watching good schools being destroyed because they have been placed in special measures at Gove’s whim when there really could not be a less appropriate thing to happen to them. Day after day I am meeting excellent teachers who have been destroyed by this process. So when you sense frustration in my posts this is why – because I properly understand what the consequences of those staff being destroyed will be for children.
August 17, 2012
Dear Rebecca Hanson,
I really think you have got the wrong end of the stick here. Mr Gove is influencing the editors and Mr Murdoch rather than the other way round. Mr Murdoch is not Beelzebub and has little commercial interest in education but he likes backing winners and doubtless thinks that Mr Gove is one.
August 17, 2012
John in your reply it seemed you were suggesting that I wasn’t closely examining what Michael Gove is saying. Please could you point me to the aspect of what he is saying which you feel I have not closely examined?
On a positive note I am happy John Hayes and Sarah Teather and Tim Loughton and Lord Hill have been okay on the whole. All four should stay in post and be given the chance to work with a decent SoS for education.
Reply: You give n o credit to Mr Gove for wanting to see higher standards of attainment, and for wanting to give parents and pupils more choice of school.
August 18, 2012
Reply: You give n o credit to Mr Gove for wanting to see higher standards of attainment, and for wanting to give parents and pupils more choice of school.
I’m happy to give Mr Gove credit for noble aspirations. The could also include for example his intention to create more professional freedom and to properly reform Ofsted.
However the road to hell is paved with good intentions. In order to deliver your intentions correctly it is necessary to consult until you have a method by which your intended outcomes will be achieved. If that consultation does not include the people who actually understand what’s happening on the ground then it will not be effective.
August 18, 2012
Mr Gove’s approach to education is to be commended. He seeks to improve standards, restore rigour and discipline and thereby improve the real productivity of education. I wish it were also applied to tertiary education, where sadly there is no attempt to improve the productivity of the money spent: indeed the reverse, as we now expect over 50% of students never to earn enough to pay off their loans, which rather suggests that their studies are a poor investment to be written off by taxpayers.
August 18, 2012
Mark please see my comment above yours which had not been published when you wrote yours. It’s not enough to have good intentions if those good intentions are translated into policies which will not achieve them.
August 17, 2012
I suspect Murdoch has rather sound views on education. Certainly preferable to the BBC type of ever larger state, enforced equality (downwards), the unquestioned warmist religion, ever more regulation of everything, a non democratic EU superstate and anti “the evil private sector profit motive” in everything.
Also of course the “lets all pay more & more taxes” – unless you are one of the nearly 500 BBC employees with private service companies of course.
August 17, 2012
Which aspects of the view that NewsCorp/Pearson should run the whole of global technology in education do you think are particularly sound lifelogic? Is there anything you think they shouldn’t run or are they just intrinsically the best at everything and if so why is that?
August 17, 2012
Rebecca – “Professional bodies”
Our children have slipped to the bottom of the lower quartile of the international league tables of developed countries for maths.
20% of our children are leaving school functionally illiterate.
This cannot go on. Not if we are to earn our crust in this cruel world.
I’m sure that Mr Murdoch – for all his faults – knows how to spell and to add up and wouldn’t stand for anything less in his organisation. I expect that this rubbed off on Mr Gove.
Perhaps it could now rub off on our educational establishment too.
I was encouraged not to hear yet another “record breaking year for A level results” I see this as a return to real standards and not a failure on Mr Gove’s part.
August 18, 2012
“Our children have slipped to the bottom of the lower quartile of the international league tables of developed countries for maths.
20% of our children are leaving school functionally illiterate.”
Please could tell me where you have got these statistics from Electro-Kevin?
Would you perhaps agree that if it was concluded that it was an issue that many people who learn the guitar do not achieve a high standard in it, it might be wise to involve guitar teachers in the discussion regarding how the progress students made might be improved rather than simply asking Tony Blair and expecting his ability to play the guitar to rub off on society?
August 18, 2012
Telegraph and Guardian newspapers are my sources.
Sheffield University research showed that 22% of school leavers are functionally illiterate.
http://www.guardian.co.uk/education/2010/may/07/poor-literacy-numeracy
UK children came 28th out of the top 30 OECD countries for maths according to the telegraph.
Tony Blair’s influence on the nation’s guitar abilities ?
He was very good at showing this country how to slide !
(For those who don’t know slide is also known bottleneck blues guitar)
August 18, 2012
“UK children came 28th out of the top 30 OECD countries for maths according to the telegraph”
That is not a true statistic.
The article you’ve linked to is not a strong article. The author does not seem to understand that a student may have core skills but be unable to apply them to real life situations – leading to functional innumeracy or illiteracy.
August 18, 2012
@Rebecca Hanson reply to E-Kevin: “The article you’ve linked to is not a strong article. The author does not seem to understand that a student may have core skills but be unable to apply them to real life situations – leading to functional innumeracy or illiteracy.”
Err, what are you talking about, they are either “incapable of dealing with the challenges of everyday life” or not, core skills have nothing to do with it!
Either way the current education system (comprehensive+) that you seem to back has failed, let’s find another system -the Grove wish [1]- or go back to what we knew did work -the UKIP and those who want a return of the Grammar and S/Modern Schools wish- even if a minority of children were wrongly streamed [2].
[1] which can’t be any worse than what we have now and is likely to be a lot better, simply because the default will be the current system.
[2] with better testing and detection of SEN in junior schools far less likely to occur now days and even then such children would have a second chance at 14yo plus if they wish to transfer to Further Education college system.
August 19, 2012
Rebecca – “The author does not seem to understand that a student may have core skills but be unable to apply them to real life”
If they can’t apply core skills to real life then where can they apply them ?
The figures I quote can be found from sources other than the ones I mention here.
August 19, 2012
Children are often able to pass tests in the classroom but are unable to use them in contexts where they haven’t been told what to do. Children have ‘functional skills’ if they can apply them, not if they can pass tests in the classroom. The author has not understood this.
August 19, 2012
“If they can’t apply core skills to real life then where can they apply them ?”
In a test of similar abstract questions.
The figures I quote can be found from sources other than the ones I mention here.
You haven’t given a source for the 28th out of 30 OECD countries statistic.
August 18, 2012
Rebecca, I’m not sure if you are allowing pre-conceived ideas to cloud what you are saying, I was struck by a couple of comments that read as if they have been lifted straight out of a vestige interest group pamphlet, such as your comment about “unproven, unconsulted and clearly counter-productive policies”, and then we had a veiled attack on anyone who is either young, without their own kids or both. The best two teachers I ever had were young (female, early 20s, just out of TT), single (male, late 30’s), both without children. Each had their own and individual approaches to getting the very best out of each and every child – both teachers would now likely fall foul of the over regulated environment found in schools and colleges today.
Mr Grove has his faults but he seems to want a return to a time when teachers were allowed to teach at the the individual child level without having to a/. look over their shoulders to check if the compliance police are looking and b/. that the national curriculum is being followed so that all the check-boxes can be ticked. Unless I really have grasped the wrong end of the wider debate on this…
What ever the future, the comprehensive school system is its own worst enemy, it does nothing very well, unless the child is average. Kids who need help only get it if they have a pre-determined SEN requirement whilst the brighter kids are often left to their own and not pushed to do even better. This is often due to teachers having to deal with kids that are simply out of their depth, kids who should not be in such a academic environment, but would have thrived in an old fashioned Secondary Modern studying for a practical trade or discipline of some description.
Also, when you say “unconsulted” by who, parents, teachers, educational psychologists etc. or the trade unions. Then you went onto say later “I’ve seen Stephen Twigg at two meeting and have chatted to him and he’s been sensible and credible at both”, but was that because you heard what you wanted to hear (he confirmed those pre-conceived ideas/beliefs) of because he told you what you need to hear. Put it this way, many people are happy to watch BBC1 because it provides a ‘comfort zone’, less people watch BBC4 even though it provides what many should be watching.
August 17, 2012
we dont need “local” planning, especially as so many of us move location frequently, pay the most in, and get the worst out! we need the individual parents in the case of education to be empowered to take their education spend absolutely anywhere they want. force the providers to react to what the consumers want and not the other way around.
August 17, 2012
You are proposing the voucher’s system Iain.
This has been very thoroughly analysed and it has been concluded that while it is a wise way to organise the funding of state education in an emerging system of education it is not implementable in a fully developed market.
The main reason for this is that you would have to give all the people who currently send their children to private school vouchers too and this makes the policy too expensive to implement. If you try to find a cut off point it doesn’t work because of the life decisions people have made about where to live and the way that those interact with their decisions about education. So some people with substantial incomes have chosen to spend their money on houses in areas with good state schools. They need the vouchers because they’ve spent their money. Others on lower incomes may have chosen to live in cheaper areas and are sending their children to private school. They don’t need the vouchers but it wouldn’t be fair not to give them them. So the threshold would need to be so high it would be of little effect and the cost of implementing this scheme is prohibitive.
August 17, 2012
how do that apostrophe appear in vouchers? tut tut Rebecca
August 17, 2012
we disagree
your analysis is plain wrong in my view
it would be a lot cheaper and more efficient way to quickly raise standards to give parents complete control, it would quickly wipe out large numbers of the rubbish schools in the bottom quartile which decades of state sponsored busy bodies have failed to fix which would be a blommin good thing in my view, that in turn would fix a lot of low level vandalism and so on which costs the country a fortune
August 17, 2012
did not do. I must stop posting on the computer the kids have kids have clarted up with food while they are climbing on my head. At least they are in bed now!
August 18, 2012
my ‘did’ not ‘do’ post was not a response to Iain.
My response to Iain is to ask him to explain why my analysis is wrong. I wouldn’t just say to a students ‘your work is wrong’ without explaining where they have made their conceptual mistake as clearly they don’t know where they have made their mistake or they wouldn’t have made it.
Please could you also explain how empowering the parents in our most challenging areas to wipe out their children’s schools would get rid of vandalism?
August 18, 2012
Well Rebecca, I rather like the idea of vouchers, I understand that setting the notional value of the voucher is diffcult for the reasons you have set out, but these are not insurmountable problems to overcome.
The first crucial stage before vouchers could be introduced would be to allow those schools who are always heavily oversubscribed to expand and create spare places ahead of time.
But I realise this is a radical change the education establishment do not like.
As for costs this is an abstract concept because education is already paid for out of general taxation.
The only extra costs would be for those parents who currently use the private sector and would gain a sudden subsidy.
This could be mitigated by a tax adjustment for those who are on higher rates perhaps.
Vouchers merely place some improved power of choice into parents hands and finally give parents the improved local control and accountability I read you asking for.
August 18, 2012
@ Richard
“But I realise this is a radical change the education establishment do not like.”
Do you understand why they dislike this idea and have you addressed the issues they raise – which are mainly to do with the practicalities and issues of maintaining standards and cost effective education in schools which are rapidly losing numbers which be easily or rapidly closed, however much politicians would like to think that they can.
“As for costs this is an abstract concept because education is already paid for out of general taxation.”
???? I don’t think taxes are an abstract thing. I think they are a real thing.
“The only extra costs would be for those parents who currently use the private sector and would gain a sudden subsidy. This could be mitigated by a tax adjustment for those who are on higher rates perhaps.”
I’ve already explained why this seems plausible but won’t work in practice.
“Vouchers merely place some improved power of choice into parents hands and finally give parents the improved local control and accountability I read you asking for.”
They don’t reliably do this Richard. They only achieve this if children are easily mobile and there are alternatives on offer which are accessible to them. I’ve written above why this is often not the case.
August 17, 2012
Unsure about how well Gove is transforming education, given that he keeps overruling independent advice in order to sell school playing fields.
http://www.independent.co.uk/news/uk/politics/michael-gove-says-sorry-for-playing-fields-selloff-error-8056376.html
August 18, 2012
On the BBC news last night they were explaining that some of the schools in question are having to sell off their fields in order to pay for essential building work cancelled by Gove when he cancelled BSF to pay instead for his academies program.
Schools are really struggling with their issues with buildings. The essential problem here is governments focusing on their own pet issues rather than paying any attention at all to what schools actually need.
Under labour I watched as a secondary school faced huge structural issues with it’s buildings which were failing due to them being 1950s concrete structures built on an area of substantial subsidence. They needed a simple stage rebuild but they only way you could get a rebuild under Labour was to become an academy and that school had the wrong catchment. So its only option was to merge with another local school which had to right catchment to become an academy with a vastly expensive fancy building. If only the school could have had a simple rebuild the costs involved would have been far lower and there would not have been a need for an inappropriate and contrived school merger. It’s complete madness. I didn’t think it could get any worse but Gove is indeed worse.
What are schools supposed to do when their buildings are clearly likely to be closed because they are unsafe (as was the case in the situation described above and did go on to happen so children were being taught science in nearby office parks and so on)? Labour realised the problem far to late to make a reasonable job of addressing it.
Reply. I am like most in favour of good playing field facilities for children and young people. I am also in favour of more local decision taking. It is interesting how many people think the national Minister should overrule local Boards of Governors and LEAs on playing fields. If a school is replacing playing field A with a new playing field B in order to make a development gain on A, that may make sense. If School C is closing, its playing fields may no longer be needed. Why not sell them, and strengthen playing field provision or use to the full existing playing field provision at the replacement schools? Why shouldn’t a local authority review playing field provision taking into account municipal facilities as well as school facilities, and use the best to best effect? There does need to be scope for change in playing fields as well as other features of life. What we all oppose is the removal of any reasonable sports provision for schools and young people in a community. That is what the guidelines are designed to prevent, and what Mr Gove will presumably prevent should too many localities seek permission to sell fields.
August 18, 2012
Here is a link to last night’s BBC news report on this issue:
http://www.bbc.co.uk/iplayer/episode/b01m2t3h/BBC_News_at_Ten_17_08_2012/
It starts at 12:35.
August 18, 2012
“On the BBC news last night they were explaining that some of the schools in question are having to sell off their fields in order to pay for essential building work”
Sorry they are not having to, they are choosing to, and for the small minority of schools that are “having to” (such as the school featured, if we are to take the report at face value) the blame actually lies at the feet of the LEAs. Why, because Blair and Mr Blunkett started a national “I’ve got better buildings than you have” competition between schools, often paid for by PFI that is coming back to bite the future children of the children it was designed to help.
Just Imagen if Oxbridge took the approach of some of schools!… Just how can world class private schools, colleges and Universities still teach effectively in building some of which are a hundred or more years old yet the local school can’t do so in buildings that are a mere 50 or 60 years old -yes some of this is due to poor maintenance but not all.
August 19, 2012
There is a new post on this.
August 17, 2012
Good piece.
The BBC really needs sorting, having just received my new licence brings this anachronistic, unfair and potentially avoidable (internet usage) tax to mind again. The organisation is massively overbloated and biased and needs to be funded with willing subscribers.
I am always amused when I read how water meters can save you money. I liked the old, really old system, when it was included in the rates, but unfortunately we have had a meter for 30 years. The cost of water and of course the mandatory/abrbitrary sewerage costs are ridiculous. Our annual water and electricity bills are very similar and whereas it is possible to save electricity with careful usage, there is a limit on water saving despite the expensive brochures sent by water companies extolling various gadgets. This of course presupposes that you want to lead a hygienic life.
The railways perhaps could be split further with branch line and minor routes separated from the main line services with the prospect of being locally and better managed. Much as we want to use the train locally the cost against the car for two people is prohibitive and only to get worse it seems.
August 17, 2012
Everyone gets water meters, and costs will go up.
Just like petrol prices. We get more efficient cars and then the treasury ups the tax because its not taking enough tax.
Exposes the real aim, which is extorting money.
August 17, 2012
It looks to me as though the money will be wasted on greenplated standards. The EU Water Framework is set to cost us maybe ÂŁ100bn according to OFWAT.
August 18, 2012
An introduction to the Directive:
http://ec.europa.eu/environment/water/water-framework/info/intro_en.htm
August 18, 2012
The great water meter scam has yet to begin.
August 17, 2012
Although anachronistic, the licence fee does have the big advantage of providing a counter-balance to commercially funded TV and radio broadcasting.
But the size of the BBC is a different matter. It is probably too big and trying to do too much, especially where commercial broadcasting is entirely viable. On the other hand, a licence fee funded broadcaster should be covering far more minority interests, for if a licence fee funded broadcasted isn’t doing it then no one will.
Also, the BBC is well placed to be technically innovative, such as with HD sound and HD TV in 3D. Commercial operators can benefit once the BBC has created the market.
As for bias, that clearly needs rectification, but scrapping the licence fee will not achieve it.
As I have said before, make the BBC Trust Members elected by the licence fee payer and let the Trust set the licence fee.
August 17, 2012
The BBC shut its Kingswood research facility. I don’t think they managed to replace the inventive engineers of the past.
August 18, 2012
@Alan Wheatley: You sum up my ideas about Public Service Broadcasting (PSB) and the BBC, it’s there to provide what the commercial/subscription broadcasters can’t or wont supply, not to compete and as you say is in a prime position to develop new systems, standards and techniques. I just wish they could teach their camera operators to hold the camera still, some camera angles make me feel sea-sick!
@Mark: Indeed, moved R&D up to Salford, nice new building and all that but totally lacking the charm of the old locations (from comments made by those who worked/knew the places), ambiance and location is everything with R&D…
August 17, 2012
Most of John Redwood’s issues boil down to how opinions are manipulated and the debate is skewed. 70% of digested news emanates from the BBC. Yet, he fails to acknowledge the elephant in the room, even when the outgoing Director General admits “massive left-wing bias”.
Just look how the BBC fabricated evidence to try to convict someone who does not pay the TV Tax:
http://www.thurrockgazette.co.uk/news/9867463.Man_wins_TV_licence_battle/
Jeremy Hunt blocked the NAO’s attempt to audit the BBC payroll. LibLabCon all in it together. We need an alternative. UKIP
August 17, 2012
the BBC does stray far too far outside its core remit, for instance providing education content free wiping out folk who were selling content to schools is just outrageous and leads to worse and more expensive provision for society as a whole
August 18, 2012
Rubbish, if something is provided free then the costs to society diminish, they don’t increase – and as for the free market, well it will find another market or product.
Television content is very expensive, few if any commercial providers can finance the content (that is why most came either from the BBC or ITV/Ch4). What content that is provided by the commercial sector is either very expensive or a by-product of educational establishments own content production (the classic example being the OU) and thus puts it out of the reach for many, not just schools in some cases but those who would have used the content in home schooling. If the private sector wants to provide follow on content for such programming then by all means, that is a different issue and a place were true competition could flourish on varying levels.
The BBC could redeem much of their PSB credentials by broadcasting this sort of content again considering that Teachers TV is effectively dead (the replacement web access is dire from what I’ve seen). Not only that but having freely accessible educational content can actually lead people to want to know more, how many people back in the 1970s and ’80s decided to enrol on OU courses after their interest was first pricked on a Saturday or Sunday morning when the BBC was broadcasting such content.
August 19, 2012
Independent producers coming up with content for educational CD’s and websites and charging schools for the content is a good model, it fosters competition which keeps standards high and rewards innovation. The competition keeps the costs down. The state (the bbc) producing similar content paid for by taxes (the licence fee) and giving it to the schools for free distorts the market, destroys many of the best competitive players in the open market as its tough to compete with free. And once the bbc has destroyed free market players in a segment of the market it then has a monopoly and there is no pressure to keep costs of production down, standards up, innovation high. The public end up paying through their licence fee more for the content the children need than they would have done if the schools were paying free market providers, and the quality of the content becomes the standard bbc politically correct unchallenging and stagnating dross.
August 20, 2012
Iain, educational PSB can actually create a greater market for the private educational supply market, as I said, think of such programming as a springboard, even PSB programmes need printed/computer course literature and then there are the follow-on studies. How many people now know nothing of the OU because they are not exposed to the courses via PSB television.
August 18, 2012
The advantage of including water with the rates was that is meant there was no need for a separate billing system. Operationally, most water companies are really little more than meter reading and billing companies. It has to be inefficient to run a system just for water.
August 17, 2012
The reason this is an important post from John Redwood is that we can only earn more as a nation is if we can increase our productivity.
The productivity record of the monopoly taxpayer paid services is lamentable and they represent a large proportion of the economy.
August 17, 2012
Your listing is excellent.
Your suggestions are quite insane.
You failed to point out that the railways are more state-controlled NOW than they were before the vile Major’s diastrous act. What makes it worse is that private companies are raking off the money, AND it’s costing us MORE ….
As for water being private, I contend that both water & electricity & probably gas should revert to the previous model, when there was, at least some long-term planning.
Under CEGB we would have had our desperately neede new nuclear power station built by now – and NOT by the French!
August 17, 2012
It says something when many unionists I speak to say that they don’t want a return to railway nationalisation.
August 17, 2012
Hi John,
What do you think of John Seddon’s efforts to bring rationality and control of costs to the public sector ?
August 17, 2012
This list and idea is all well and good if it worked, but history suggests otherwise in many cases.
Why can we not simply get the public sector to operate in a more efficient manner, by changing workers contracts (to those like used in the private sector) and employing Prive sector type methods ?
Yes of course there is , and will be resistance, but given the choice of accept change or loose a job, as would be the case if work was sent to private contractors, then surely worth a try.
All we ever seem to do is create a private monopoly, fully funded by the taxpayer whose services are not that much better than the original, but also keep public sector workers engaged as toothless quango’s to oversee what they do, only to find out that the contract was badly written in the first place in favour of the new private monopoly.
That or we put so many controls over the Private sector competition where there is some, that it is not real competition at all.
In short most privatisations seem to me to have been a giant cock up, which does not reduce prices to the end user, for the little gained in service improvement.
I am all in favour of a smaller state, but when tax payers fund the bill for all of this outwork, is it really a smaller State.
August 17, 2012
I read in today’s email news from The Taxpayers Alliance that have won the prestigious Templeton Freedom Award for Initiative in Public Relations for their campaign exposing the taxpayer-funding of trade unions.
Which reminds me of reports of trade unions pressing for extra benefits for working during the Olympics, and thinking how starkly this compares with the universal acclaim given to the Olympics volunteers.
August 17, 2012
This is a very illuminating analysis of service provision. I agree that a transition from monopoly to competition, from tax payer funded to user charges and from state employed to privately employed are necessary ingredients in the provision of better, more efficient services.
There is a further ingredient you do not mention. That is the role of regulation and the rule book in stifling initiative and change. Some is a function of effective campaigning by single issue pressure groups, some is a function of effective lobbying by businesses (often big business with clout), some is a function of bees in political bonnets. They are inescapable frictions in an open society – the need is to make and keep them open and not concealed behind closed doors. I am unsure how you achieve this.
August 17, 2012
Public sector good – private sector bad…
Me neither, Mr Redwood.
Though I think we ought to be really cautious where public services are contracted to the private sector and the jobs outsourced from the UK (admin/call centres) or where gangs of immigrant labour are used to replace ‘expensive’ indiginous labour (as with our recycling centre.) Or where indiginous workers are so poorly paid as to need supplementary benefits.
The highest burden on the taxpayer is the welfare tab. In many ways contracting work out can be a false economy where all that is needed is good quality control and disciplinary systems.
Two issues which could save a huge amount of money in red tape, workers rights and wages:
a) decouple from the EU
b) restrict the amounts paid to welfare landlords so that housing costs return to affordable levels so that we don’t need to earn so much
August 17, 2012
Reducing the amount paid to welfare landlords will only reduce the cost of housing if these landlords won’t be able to charge a similar rent to someone who isn’t on benefits. Given the shortage of housing in some areas all this plan will do is make those on welfare homeless.
August 18, 2012
Cutting workers rights and wages is a good thing? Who for? Obviously not the peole doing the work. The landlord are artificially inflating rents by being subsidised by the state. Interesting to see how much rent of property would be if there was no housing benefit?
August 17, 2012
Nothing is going to change until you address the issue of debts, all of them.
7,000 bn of debts on taxes of 570 bn is 13 times geared. That is worse than RBS.
Inflation doesn’t work because 6,200 bn of the debt is inflation linked. Inflate and you just move the pension payments to inflation linked benefits, because you’ve stolen pensioner’s income and assets.
Hidden off the books, like an Ostrich or a fraudster.
August 17, 2012
“Hidden off the books, like an Ostrich or a fraudster.”
If this debt is hidden “off the books” how come you know about this, you are either privileged to information you probably shouldn’t be giving out or it wasn’t hidden at all, my bet is the latter.
reply: Indeed, it has all been set out here, and the official figures now include the PPP,PFI and bank debts.
August 17, 2012
I have great regard for Mr Redwood’s ideas but cannot see how regional railways can compete if they remain regional.
August 17, 2012
The mistake with the railways was to make rail firms compete with each other. This caused fragmentation, extra organisational and bureaucratic tiers, contractual complexities…
The essential difference between railways and any other mode is the paucity of locations at which services can overtake each other and diversionary routes.
The railways should not have been made to compete within themselves but with other modes.
A regional monopoly on railways does not mean a regional monopoly on transport there is still room for private involvement and competition.
Reply: The railways have done better since some competition was introduced. They were in perpetual heavily subsidised decline when a nationalised monopoly.
August 18, 2012
JR Reply: “The railways have done better since some competition was introduced. They were in perpetual heavily subsidised decline when a nationalised monopoly.”
Yes, and whose fault was that!
Funny how the then French national railways (SNCF) were able to develop the TGV, the then German national railway (DB) were able to develop the ICE, yet the British national railway wasn’t even given the continued funding to sort out the problems with the APT – eventually the technology was sold to european train builders and exported back to the UK in the shape of pendolino’s etc….
The only government to even start to treat the railways seriously, and even then it has strings attached, was the Tory government of the 1950s with their 1955 “Modernisation Program”.
August 17, 2012
Agreed.
However, I would say this describes a “tactical” approach. Tactics that may well work within their own compass but may fail if they are at odds with strategy. Where is the strategy for the UK?
For instance, what is the plan for population? The greater the population the greater the transport needs. The greater the population the less space there is for other things, such as growing our own food.
Or what about commuting. Do we think commuting is inherently a good thing? Is the best way to approach overcrowding to increase capacity or to reduce demand? Is this something to be left to market forces or are there social considerations, and what is the balance?
Do we think that because metropolitan London is most successful there should be more of it? Why should London be treated as the hub for everything? For instance, if HS2 why does it have to go to London as opposed, say, to providing a direct link between the “North” and the Tunnel? Or, if the UK needs more hub airport capacity, why does it have to be in the London area as opposed to, say, growth of an existing airport between Birmingham and Leeds.
In fairness, not all proposals are in need of a strategy; e.g RBS. But in areas such as transport we do need a vision of where we want to go and not simply attempt a better approach for continuing existing trends.
August 17, 2012
All well and good so far as it goes. What is not addressed is the fact that Government now accounts for more than fifty percent of all consumption; that is, it consumes more than fifty percent of all production.
The capacity and incentive for the private sector to invest is reduced significantly. Large companies will redouble their efforts to avoid tax whilst small companies will collapse under the burden and start-up’s will not bother because the risk reward ratio is too heavily burdened in the early years.
As sensible as they are, none of your suggestions will materially aid productivity until the state starts shrinking in size. It is true that your suggestions of moving services from the pubic to the private sector would start the process however, so long as Government still has the role of rubbish collector , for example, it is clear they have no interest in slimming down.
The government either can not see that its growing need for funds is satisfied by the private sector, and a shrinking private sector will be challenged to increase productivity whilst this situation prevails or it is simply not interested.
Sadly it would seem that what is most likely to happen is that the government will once again “fix” the statistics viz :
http://www.telegraph.co.uk/finance/jobs/9477816/Unemployment-falls-Are-the-GDP-figures-correct.html.
On the other hand just imagine how the public sector would shrink if you privatised rail, schools and the NHS. After all the old Socialist moan that you cannot allow companies to make a profit out of peoples health is a complete nonsense: buildings, equipment, drugs, consultants and all other staff and services; what part of all that is not now part of the profit making sector?
August 17, 2012
If the public sector hires a private sector company to perform a task for them does this count as a public sector cost? If not then the state can use outsourcing to reduce the size of the state while at the same time costing just as much.
August 18, 2012
Nope, absolutely not. No reason why the State should get involved in the provision of any service, and particularly not to reduce the cost. Why should the rest of us contribute to the rubbish collection of others, for example even if the State is outsourcing.
The private sector is quite capable of providing any service and if the State wish to give support to any particular sector of society it should be directly through the welfare system.
The role of the state should be the regulation of quality and the prevention of monopolies, not provision of services
August 18, 2012
Why exactly would the private sector collect people’s rubbish if the state isn’t paying them to do this? If people are expected to hire a rubbish removal company how will you prevent fly-tipping (free) or companies offering a low price because they don’t dispose of rubbish properly?
August 19, 2012
Private companies will be happy to collect rubbish for a fee and the quid peo quo should be a reduction in rates.
Government can license rubbish collectors to avoid fly tipping and introduce a high level of fines to discourage unlicensed, domestic and other fly tippers.
Hardly rocket science.
August 17, 2012
“1. Public sector monopoly provided free at point of use by public sector e.g. Roadspace”
You are joking arn’t you, road space for most is NOT free at the point of use, we pre-pay access charges (VED), this just so that we can place a vehicle on the highway, we then have to pay a per mile and in some cases based on time if congestion is heavy via the fuel excise duty. The only people who have free use of Roadspace are those who walk, ride horses or bicycles – the latter don;’t even need road risk insurance even though they can do substantive damage to the person or property.
John, you also missed out one very important public service, public transport, this is paid for by the customer but the private operating company -often within an affective monopoly- is also paid by the government to provide the service – so in effect the passenger is paying twice.
Your comments about water are interesting, how would this work, the same model as used with gas and electricity won’t work as the supply infrastructure is far to localised – eve with any national water grid,which would likely be for grey (non purified) water only.
What would happen to waste water services, again very localised infrastructure, how to even meter such use. At the moment customers are often charged for what can only be described as acts of god – storm water drainage – surely this charge is untenable, if it didn’t run off roofs or the highways it would still nee to be either treated after finding its way in to the sewage treatment system or into the natural water (land drainage) course.
New Toll Roads, why would anyone use them, isn’t the M6 Toll road under used? I could see some benefit in converting some of the motorway network into toll roads, but to do this effectively would mean either many toll booths on the many exits or the closing of some entry/exits and the construction of booths between the remaining access points. There would have to be adjustments made to, or the abandonment of, the VED. Any attempt at GPS “spy on the windscreen” cards would not wash with the public, even if the ‘security’ services do like the idea.
Any bonfire of red tape is welcome, especially when it’s licences and permits, often needed for no other reason than revenue generation.
Anyone should be allowed to provide schools and colleges, serious child protection issues besides (in other words, not just because some ‘do-gooder’ thinks A, B, and C are bad ideas), schools both state and private should also be set free of the national curriculum, although all should have a published curriculum. One size doesn’t fit all.
There needs to be proper privatisation of the railway system, rather than something designed to maximise income for government (the complaint of Sir Richard Branson only the other day), break the system up into five operating areas [1], sell, auction, give these away as single operator railways entities. Network Rail would be wound up as a company, it’s geographical operations split up to co inside with the formations of the five areas, each new railway company would be responsible for all their own track, signalling, building, structures and were possible train maintenance. “Track Running rights” would need to be awarded in the short term were multiple TOC’s exist and were private operators wish to run specialist trains. As the railway system becomes more stabilised I would expect both of these to reduce in numbers though mergers and acquisitions although some would remain as ‘joint’ lines.
[1] basically the old English and Welsh areas of the old GWR, LMS, LNER and SR, with a new Scottish Railway north of the border
Can’t argue about your thoughts on banking, just as long as “Free” banking remains, customers who are in credit already allow the bank to make money on their money, charging either a transaction fee or what ever is in effect charging the customer twice for the same service,whilst those who have authorised over drafts/mortgages pay via any interest charges levied.
August 17, 2012
You ask:
New Toll Roads, why would anyone use them, isn’t the M6 Toll road under used?
Yes of course but then it has a free shorter route running alongside (as unfair competion) who would pay to fly to Paris if there was a free flight that ran at the same time and just took a few minutes longer?
August 18, 2012
Most motorways -if not all- have an alternate “A” road routes along side, that is why there can be a law that restricts what vehicle use motorways (don’t usually see tractors or learners on a motorway do you…), This is also why the only way many would pay a M-way tolls in the UK is if either VED or fuel excise duty are abolished or reduced substantially. One also has to set the toll fees at a realistic level otherwise people start doing their personal cost vs. time benefit studies on the merits of the possible routes.
August 18, 2012
It’s not unfair competition as the old road was the before the toll was built. Anyone investing in this project knew this. You do not create artificial profits for them by then making the old road a toll road too.
August 17, 2012
I recently used one bit of toll road network – the Severn bridges. The first time, I used the new crossing, and spent ten minutes in the toll plaza (mid morning on a Saturday with no big matches in Cardiff). The second time I used the old bridge – no wait for the tollgate – but the road was in a shocking state. I’m surprised they’re still allowed to levy tolls on it while leaving it in that condition.
There was a good discussion of roads in this post earlier in the year:
http://johnredwoodsdiary.com/2012/01/18/do-nationalised-roads-do-what-is-needed/
August 17, 2012
How about allowing all employers to select employees on no other basis than on their potential ability to do the job and to sack them when that apparent potential is not subserved in practice?
How about criminalising Cultural Marxism? How about repealing thoughtcrime law? Perhaps then our schools and colleges could focus on the achievements of Western civilisation rather than grooming unformed minds with disgusting falsehoods and our police could work towards keeping us safe rather than acting as a weapon to intimidate the English people.
How about simplifying the tax code and the law in general. Compliance is extemely costly and becoming more so. What is the point of a system which enables trusts to be formed and wealth to be offshored for the wealthy, giving total intergenerational tax immunity whilst forcing ordinary people to spend ever longer on record keeping and form filling whilst handing over their hard-earned cash to fund an overmighty state and an increasingly piratical foreign policy?
Where is the proportionality in ‘elf an’ safety law? What about the excessive cost? Why is there no distinction between inherently dangerous occupations and the rest? Why no distinction between those which must carry a risk to be effective and where risk should reasonably be eliminated?
Once again JR ignores the practical benefits of both charities like the public schools and the mutual societies which offer banking services rather than funding the gambling activities of spivs. It is extremely damaging and inefficient to promote organisational models purely on the basis of their capacity to generate tax, unless of course you believe that allowing private sector companies to compete for exam entries by competitively reducing standards is in the public interest. Sometimes capitalism per se cannot compete with a simple desire to be the best; not everyone is motivated purely by the potential for monetary reward.
August 17, 2012
public schools in this country are not charities by most peoples definition of the word, its a disgrace that they are allowed to continue with those perks while most people are forced to accept a rubbish education.
August 17, 2012
What perks ? They do provide a charitable purpose, substantial in fact – or do I detect envy? They with the number of State Grammers have been the bastion of standards. Most parents struggle to send their kids to Private schools, and I believe in the freedom of choice. Not only that those struggling parents ‘save’ the taxpayer at least ÂŁ6/- pa when not using the state system.
August 17, 2012
“most people are forced to accept a rubbish education.”
…and the parents of those at private schools who will most likely be in work and pay taxes, as well as others, are forced to pay for that rubbish, but don’t let’s concern ourselves with that; so much easier to do a bit of leveling. There was a time when the free grammar schools provided as good an education (better in science) than the private schools; it’s hardly the private schools fault that public education has been deliberately trashed whilst private schools have substantially improved.
Reply: The grammars that have survived continue to provide an exzcellent education, as the high rankings of Kendrick and Reading School in my area in the latest exam league tables demonstrate.
August 17, 2012
Dear Mr Gill,
My old school (then tax-funded now private) sends me yearly appeals for funds, as well as a bequest for which I hope they will have to wait, in order to provide more free places for children of poor families. That sounds pretty much like my idea of a charity.
August 17, 2012
It is certainly a disgrace “that most people are forced to accept a rubbish education” but what on earth is wrong with people paying twice on for their children and once more in taxes for others? Education has always been a charitable activity so long as it is proper education not as so often indoctrination it certainly should get some tax relief.
August 18, 2012
Don’t private schools offer scholarships any more, also I understand that some make their facilities available when not being used for their own needs.
Many other “charities” are far more in the firing line than private schools are if you start trying to define what a charity is and is not, many so called charities are now so close to being political pressure groups that they should really be classed as political parties…
August 18, 2012
Hopefully it’s not envy but I am human. As a “for instance” a lot of money with the tax advantages of charitable status behind it ends up getting spent on things like ski holidays for groups of posh boys in the worlds top ski resorts. Much of this I don’t feel should have any tax advantages especially as the typical state school seeks no such tax perks for school trips for their pupils. (I do feel some school trips can be educational but there are limits to what should attract tax perks and I have highlighted one here).
I like UK public (private for any Americans) schools in general, apart from the arrogance, nepotism and delusional self-belief they foster. As in other things the UK would be a lot stronger if we learnt from the best of the rest of the world. And as one of the top 1% of a big state comprehensive I have learnt the hard way how they rig the markets in higher education and the world of work.
I agree that all parents should have control of the education budget spent on their own child, and that folk sending children to public school should be able to top this up (or to put is another way have their current fees reduced by average spend on a state pupil). On the other hand all schools should be on a level playing field when it comes to tax perks.
I have absolute faith some particularly rubbish schools would shut within a year or two if the parents really did have buying power, and parents would club together to hire coaches etc. so I don’t think schools should be protected because they are the only ones close to a big sink estate as Rebecca and the educational establishment seem to think.
I agree its “not the private schools fault that the best of state education has been trashed” but I want to see standards improved across the board by real control in the hands of the parents and I think many public schools need to improve a lot (on the the arrogance, nepotism, and so on aspects most notably).
Re “Don’t private schools offer scholarships any more” with the best will in the world there aint many kids with broad working class accents getting the scholarships are there? In practise its mainly folk in the same demographic as all the other pupils who are having a tough year financially squeezed in on the nod.
On the NHS I have similar views, I don’t regard the NHS as a national treasure rather it’s a national disgrace kept afloat by false PR from the media luvvies and political bubble – the service in practise in much of the country is sub 3rd world. And it hacks me off the have to fund family members private medical treatment cos the NHS has let us down yet again (Id probably be able to fund a public school for my son if it wasn’t for this : ) ). So as in education I would give the end consumer control of where the payout from the state backed insurance scheme of a new NHS was taken at all stages of the medical journey through the system, and I would get the state out of running providers of care and decisions about rationing (I would have a clear simple easy to understand legal contractually enforceable list of what you got payouts for and what you didn’t).
And so on.
It seems theres a lot of “group think” and indoctrination that stops people seeing the bloomin obvious.
August 17, 2012
How about allowing all employers to select employees on no other basis than on their potential ability to do the job and to sack them when that apparent potential is not subserved in practice?
Indeed Cameron would have to change his basis or recruitment rather a lot then. Instead of looking a gender, religion, colour, minor celebrity status and the like he might have to look at actual ability for a change.
August 17, 2012
forthurst.
I can confirm that your second paragraph is no exaggeration, having been banged up in the police cells in Glasgow for two days on trumped-up charges of public order offences while attempting to promote the Union of Great Britain recently. The Procurator Fiscal threw out the spurious charges as soon as he saw them on the Monday morning following my weekend incarceration. Being treated as a criminal, full body search and a humid concrete cell was an interesting experience.
August 17, 2012
Just returned from France, having spent a fortune on road tolls and averaged only 60mph because of the frequent stops. I also have a water meter, where the local water supplier turned on the stopcock when the house was empty, caused a leak for 6 months and sent a bill for enough to fill the house to a depth of 3m. PLEASE. NO!
August 17, 2012
Stred
What an idiot the bloke that turned your water on.
But
You should really have used the stopcock in the house to turn off the water !
Agree with you that tolls abroad can add a significant cost to a journey.
They also use them for average speed calculation between toll booths,(time entered-time leaving) so if speeding you could be fined !
August 18, 2012
“You should really have used the stopcock in the house to turn off the water !”
What if the leak was between the two…
As for the leak, don’t most water companies pick up the tab for the first reported leak, and often fix it for free – certainly on properties retrofitted with water meters? Perhaps I’ve just got a very understanding water company, not that I’ve had to actually put their stated policy to the test!
August 17, 2012
The one public service I abhor is the one where we give EU immigrants and illegal immigrants everything from benefits to housing and help with energy bills etc. It is wrong. I met an Englishman (a tramp) from Yorkshire who had hit hard times and come down to London to try and get a job but had not been able to. He was on the streets with no-one to help. This is disgusting when we are giving aid to nuclear armed countries like India. Charity begins at home I was always taught, but not any longer. Stuff the British people let’s save the world first is this idiot PM’s mantra – Gordon Brown’s puppet??
August 17, 2012
The Department of Business Innovation and Skills (BIS) wishes to boost the economy by empowering consumers. Specifically, they are promoting an initiative called midata, under which the suppliers of goods and services will be obliged to allow consumers to access all their personal data from those suppliers. Please see BIS press release and consultation.
In what way would this empower consumers? How would it boost the economy?
These questions were put to BIS at an open forum last week. There were no convincing answers.
How do we stop BIS wasting their time and our money on midata?
August 17, 2012
Can’t see what is so wrong with this, good house-keeping, good customer relations and shouldn’t cost much at all, probably less than many companies spend on those mail shots that go straight in the bin.
August 17, 2012
Jerry, fair points, thank you for prompting me to expand a bit on my objections to midata:
1. The banks have always provided us with statements, the gas and electricity companies ditto, the phone companies also. Amazon lets me access order history back to when my account was opened. And so on. Any other personal data can always be asked for and, if the supplier is recalcitrant, you can always use the Data Protection Act to elicit the data if it’s on computer (midata only applies to computerised data.). So which suppliers do BIS want to add? They give the banks and the energy companies as examples. But the banks and the energy companies already release our data. We’re going round in circles. BIS have not made their objectives clear. What problem are they trying to solve?
2. Last November, BIS promoted midata as a voluntary and non-regulatory initiative. Nine months later and they’re trying to take powers to make it compulsory. Why?
3. BIS say it’s to make the economy grow. The burden of giving people access to data held by their suppliers and enforcing the system is bound to become onerous once legislation is involved. BIS don’t know how much it would cost but their economist,David Miller, agrees that the boost would have to overcome that cost, whatever it is, before midata could actually be said to have expanded the economy. How much would the economy grow by? Mr Miller said it is very difficult/impossible to come up with macroeconomic numbers like that. BIS have no reason to take these powers they’re seeking.
4. BIS say that consumers will be empowered through midata by taking control of their data – “Providers give consumers the ability to correct, update, change settings, preferences, permissions etc” (p.23). They say that, but their consultation questions only concern consumers accessing to data, not controlling it. Are they offering control? Or aren’t they? If they are, they’ll need to change the law radically in the UK and abroad. Something of a tall order.
5. The BIS suggestion is that midata will give birth to a market in applications which allow consumers to improve their lives by making decisions based on transaction data. Governments are not good at creating markets. Asked what applications they have in mind, Kirsten Green a deputy director at BIS, suggested help with choosing a better energy supplier. But we already have such applications. Or a better mobile phone tariff. Or ways to reduce one’s carbon footprint (“green button” in the US), or to improve our health (“blue button”). Not convinced that any of those require midata, we’re already paying extra for our energy to combat global warming and we are already inundated with health advice.
6. The one class of supplier who won’t be included in midata is the public sector. Why? Because there will be a separate system to give consumers access to data held by central and local government. Why? Why have two systems instead of one?
August 18, 2012
David, I guess that the objective might be to unauthorised stop data-mining.
I won’t now use certain retailers because they have very aggressive data collecting regimes. One of the major DIY chains wanted to know my address when I returned a clearly faulty own label item, complete with a day old till receipt, to them for exchange (not refund) and this was not a big-ticket item either at a sub ÂŁ5 shelf price – after a heated debate they had top back down, although they still had to complete ‘company policy’ by entering entered their own store address. Another major home electronics retailer wanted to collect my home address when I purchased a new DVD player, when asked why, something was muttered about the TVL laws, until I point out what the law actually states and gave them the choice of either issuing just a sales receipt or do without the sale, they issued the sales receipt….
Go figure what these sorts of policies are actually costing in back room office and loss of sales as people like me refrain from using the company.
August 17, 2012
The best way to improve the efficiency of the BIS and the economy at large is to abolish it. The same would apply to the DfE and most of the DoH. Congenital meddling is extremely damaging to the economy and in delivery of services, especially when driven by a
political agenda. Where you ask would the politicians get their train sets? Hamleys, let them have the best, it would cheap at the price.
August 17, 2012
Well yes, any regulation is damaging to a total free-for-all…
August 17, 2012
I wasn’t implicitly advocating a free for all; I was merely trying to suggest that local services are not necessarily improved in cost or performance by being micromanaged from the centre by civil servants who typically know nothing whatsoever about that with which they are meddling.
August 17, 2012
It would be interesting when you have time to see your views more fully set out on water and rail and how competition could be introduced. These are 2 services which are nominally ‘privatised’ but seem to provide a very poor service and to be very politically controversial.
August 17, 2012
You need to consider which dynamics improve service over time. There are a few choices:
1 you can have regulation where the regulator is charged with enforcing some parameters and bringing sanctions against anyone outside those parameters. Poor track record of moving things forward.
2 you can have top down control, the centre knows best, buy your widgets from us because we can get a bigger discount, design your IT the way we say because we are cleverer than you, improve rice production (without realising folk in obscure parts of the organisation need special delivery times or service arrangements and so on), command and control. Even Russia has given up on this style.
3 you can identify the best, figure out how they do it and spread their techniques amongst others doing similar things.
4 you can peer review and let the professionals themselves rate each other and put in place measures to improve those the profession itself thinks could up their game.
5 you can empower the end consumer to take his business elsewhere at any stage of the process. If its too dirty or whatever they can go somewhere else and the money follows them in a real sense.
And you need a cycle of improvement that self-optimises over time to evolving techniques, consumer demands, changing society, and so on.
The best way to self-optimise regardless of who owns the providers of the service is 5 above, every time.
That’s the reality and as much as possible the power should be given to the individual citizen and taken away from those being funded out of the public purse.
I don’t care who owns the providers of the service I use, I just demand that if I am getting service I am not happy with I can quickly and simply take my business elsewhere. This dynamic also keeps the providers financially efficient when the consumer has visibility of costs.
For the few unavoidable true monopolies (there arnt many really in my view) such as the Army you need to shake things up from time to time with good leaders from outside.
August 17, 2012
Dear Mr Gill
By far the biggest “avoidable” monopoly is the NHS. Your suggestions? I note from your earlier comment that you wish to make it harder to switch education provider, unless you are very rich. Rather, you suggest, everyone should be forced to have the same “rubbish education”. Thankfully, there are lots of tax-funded schools that provide a great education but efforts to spread best practice have had limited success and to some extent have been thwarted.
August 18, 2012
My suggestion is turn the NHS into a state guaranteed insurance e scheme into which we all pay in according to ability and we all get out cheques according to need. But get the state out of running providers of care. Let individual patients control exactly where to take their individual insurance payout cheques. No masses of people organising rationing needed because a simple easy to understand contractually enforceable list of what you got payouts for would be published. Subsidise the most needy patients more by giving them more money.
If you started issuing the cheques to those patients most obviously let down by the current NHS (eg those who have been waiting the longest in a queue) then you could even sell the transition as a way of helping the most needy.
August 17, 2012
Most railways in Europe are subsidised have been for years, investment from the governments have given them a headway start on modernisation; ours have lacked investment for years. Here they were privatised and, yet, still have public money to support them, they add, because of lack of investment years before. That could apply to many public services we have.
I hear many suggest private investment in public services for e.g. NHS, would be beneficial, for whom. Not everyone as the money to provide health care for themselves, a collective health care system provides assurance and assistance when and where needed. Indeed, we are not some small Eastern country where health care is had hoc, we are supposed to be a modern nation within the Western world. To begin to try to introduce private health care into our county would cause many problems and costs for many. Those who can afford to pay would feel no pain, its often those who propose to change it, without thought or care for the multitudes who cannot. We have other services that are so sensitive to be hyped off to private companies, like children’s services, the risk is surmountable. All countries have some % of services publicly led, it is the way of things today, to suggest it can be otherwise is a bit much, you have to have many publicly led to protect the people who use them in whatever area they cover. It is how they are managed and led that should be questioned, not their exsistance.
Reply The governemnt is not going to privatise the NHS. A lot of health care, however, is already private sector in the UK. Most minor ailments, cuts and bruises are treated at home with lotions and potions bought from with profit retailers who bought them from with profit pharmaceutical and chemical companies.
August 18, 2012
John, one of the complaints I hear is that there are to many GP practises run now as if a private practice, whilst being in control of ones own budget is good because it should allow the practise to offer the services needed, it also allows them to raise money from services – at least one of my local GP practises still use what is in effect a premium rate phone number coupled to an internal telephone system that has been designed to extend the time of any incoming phone-call – what is more, I am told, is it is also very difficult to make appointments in person at the surgery if it’s not as a follow-up. This in a area/constituency with a a large population of pensioners living on fixed incomes and often with complex medical needs, I know of diabetics who have had to phone though daily blood test readings via the above phone system…
At some point I will be taking this issue up with my own (Tory) MP but I raise it here to demonstrate that it is not the reality but what people perceive to be the case that matters. Some see the above sort of thing as soft privatisation or by stealth. It doesn’t take people very long to forget that such systems were introduced by a previous government and not the current one.
Reply: I have taken this up for my constituents and have been told by Ministers they do not support this approach. Individual MPs have to take it up with local NHS units.
August 18, 2012
Thanks for the reply John, and yes understand that I or others will have to take it up with our MP but that still doesn’t explain why the DfH doesn’t do more to discourage, or better still simply ban, such use.
August 19, 2012
patients should be able to vote with their feet and there needs to be some open competition amongst GP’s.
August 19, 2012
Yeah, sure an old and disabled person is going to trapes halfway across town to a different doctor, it’s bad enough that people have top do that for eye and dentists, when all that is needed is half decent regulation -which would still need to be in place even if we had a US style health care system.
Sorry Iain but competition is NOT the answer to all problems.
August 20, 2012
the fact there is only one supermarket within walking distance of my aged relatives does not stop the fact that consumers can vote with their feet keeping their local supoermarket on its toes and competitive. regulation is a dramatic failure in the health business in this country.
August 20, 2012
“the fact there is only one supermarket within walking distance of my aged relatives does not stop the fact”
Iain, they are not normally ill or in (extra and extreme) pain, etc. etc. etc.
Indeed some of the elderly, infirm or disabled people I know now have to rely on on-line shopping because they are not close enough to either of the two supermarkets that have decimated many of the local shops due to the free market and buying power etc..
August 17, 2012
As many questions as answers:
1. Physical competition implied: Competition between resevoirs? Between pipework delivery systems? Or both?
2. I want tolls to pay for motorway widening, which will (inter alia) make daytime maintenance more feasible (enough capacity to remove a lane temporarily). Electronic tolling (technology and liberty implications) or huge great wide plazas?
3. Agreed but not my area of expertise (thank goodness).
4. Already happens. The Merchant Taylors’ company is an excellent example. In future, we might get the Depleted Uranium company building ….. DoTheBoys School for little Green Men.
5. You can either have vertically integrated regional companies or the restoration of one Railtrack. You can’t do both. If you go the Railtrack route, than track access charges must be charged according to market forces; no interference by John Prescott or Stephen Byers.
6. RBS and Lloyds. And hive off insurance companies if needed.
Reply Water competition – a competitor company might put in new supply pipes, or might use the exisiting pipes as a commomn carrier. They do this already in Scotland where they have competition in business water supply, which works well.
Road tolls for new roads could be electronic. The drive through electronic recognition card system works well in the USA.
August 17, 2012
The government is said to be working on measures to speed growth and raise economic performance.
So it’s going to cut the public sector down to a sensible size, reduce the regulatory burden and slash taxes?
Thought not…
August 17, 2012
2) I’d recommend adding a mechanism that allows the company to sell the road to the state if they no longer wish to maintain it.
Also the company has to ensure the road conforms to basic safety standards. Unsure who should be responsible for gritting it in winter.
4) As long as these schools and colleges don’t require taxpayers money this is viable. It could be very useful for companies that need their employees trained in specific skills, for example technicians and engineers.
August 22, 2012
You should be careful about making it too easy for a toll road concession company to cut and run, dumping future costs on the state. A toll road concession company is often a shell company, with the parent companies putting a very limited amount of capital into the shell company.
I once worked on the traffic and revenue forecast for a shell company bidding for a potential toll road project in Italy. When the team’s lawyers read the draft contract between the winning concession company and the Italian government, they found that is said that assets of the parent companies were at risk in the event of a default. I’ve never seen a bid dropped so fast.
On the London Underground, there were three Public Private Partnerships (PPP) between Transport for London and Concession companies. These were John Prescott’s pride and joy. All three PPP contracts eventually collapsed, the first two due to sheer bad management, the third due to a rapidly escalating station improvement cost. TfL were in all 3 cases left holding the baby, with future losses by council tax payers and national taxpayers. Companies participating in the Concession companies – including Bombadier and WS Atkins – walked away more or less unscathed.
In China, there are a lot of PPP contracts but they do things differently. Participating companies have to sink 30% of their capital into the concession company. Not many walk away.
August 17, 2012
I like that post, really good to see the acknowledgement that areas like food production and sale are one of the most important public services there are and all private sector ofcourse.
Network rail is a real issue, from the unions that aren’t confronted to the generous contracts given that make us the most expensive. I was hoping for more of a crackdown from this government. Also Virgin not getting their franchise renewed was a big suprise and one I think will be regretted.
August 18, 2012
The unions fault for wanting decent wages for their work not the companies fault for syphoning off millions in profit? You can work for free if you want Jon. The rest of us will just ram it.
August 18, 2012
Two words Bazman – British Layland!
BMC and then BL could have been a fantastic car manufacture, trouble was it stated to pay more in wages than it was able to recover through sales, this meant that other things started to suffer such as new model R&D and product face-lifts, even silly things like dealer networks that would have attracted new customers. You talk as though profit is a dirty word like bankers bonuses (have become), but profits pay for more than the Directors perks.
Remember what eventually happened to the BL empire, many of the same people who demanded more pay and put both hands up in the air whenever “Red Robbo” asked for a show of hands would now have worked for less than half the equivalent wage. A fair wage is not the same as working for free, and before you ask, yes there should also be responsibility in the boardrooms too.
August 19, 2012
The railways and the banks are not British Leyland. The public have little choice in using them, so the idea that it is OK for the managers and share holders to take large amounts of money from the taxpayer whilst telling the workforce they do not deserve anything will not wash. You seem to be under the impression that the nations workforce should cut each others throats in order to stay in work. If a company is making large profits then it is only right the peole creating those profits should get a share.
You are right about strikes though. If the workforce votes for a strike then they do not need another vote to on whether they should return to work.
August 17, 2012
The water business has some perverse incentives as a consequence of its long lived assets. It can make sense to lobby for a power station to be closed if that means investment in additional capacity can be avoided while supply is routed to more lucrative retail customers. Leaky pipes still work after a fashion but are expensive to repair. Metering is not cost effective for smaller household customers.
Judging from this OFWAT paper:
http://www.ofwat.gov.uk/competition/review/prs_inf20120510retaildefn.pdf
it seems that the decision has already been taken to use price and rationing to reduce supply per capita by 20% in order to accommodate an increased population. Metering will be enforced by regulation to achieve this: the only issue is who will own and read the meters. This OFWAT document is also key:
http://www.ofwat.gov.uk/aboutofwat/reports/forwardprogrammes/rpt_fwd_20100303ofwatstrategy.pdf
It reveals the EU has landed us with another ÂŁ30-ÂŁ100bn bill for its Water Framework by 2027.
All these assumptions need to be challenged.
I have suggested before that street level metering might be more useful than metering every home, as it will involve many fewer meters and allow leakage to be traced in the delivery network. We have also discussed the need for new reservoirs and the possibility of long distance water transfer (I note OFWAT are less keen on that idea, yet it is exactly what the Victorians did – supplying Liverpool from Lake Vyrnwy in mid Wales for instance). The assumption we should grow the population despite the threat of flooding from building on flood plains and the added problems of sewerage disposal also needs to be challenged.
Reply: Exactly. The EU/Ofwat dearer water and rationing model needs to be challenged. Water competition for all is the way to do just that. There is nothing that special about organising a water supply. It should be easier than organising a gas or petrol supply, given the complications of finding those materials and safely carrying them.
August 18, 2012
Change of subject:
FREE PUSSY RIOT
The old question comes again:
WHO BREAKS A BUTTERFLY ON A WHEEL?
August 18, 2012
Welcome to Russia. This advanced country who’s governmental and tax systems some on this site see as worthy of following. How long would they last in Russia? Not five minutes. Count on it. It dangerous to be a man there. The first thing that strikes you there is the shortage of men. Not some paper statistic, but as you look in the street. Have think why and have a think as to where all the nice looking 30 year old ones are too. In a word. Brutal. I watched a video of car drifting in Russia. They actually employed a safety barrier and the safety barrier actually worked when the car went out of control saving the crowd. Elf and safety gone mad!
August 20, 2012
Bazman: “This advanced country who’s governmental and tax systems some on this site see as worthy of following.”
Where do you get this nonsense? Largely we opposed Mandleson’s (and Osborne’s) collaboration with Russian oligarchs. But at the time it was the Socialists in power.
Bazman: “I watched a video of car drifting in Russia. ”
I think you may have interesting things to say, but what you write is mostly unintelligible.
August 20, 2012
You obviously have no understanding of the Russian psyche and its relationship with life and death and how this effects the everyday life and lifespan of the average Russian. My wife suspects it was and still is a conspiracy to get rid of all the men so the corrupt elite can steal all the wealth.
August 21, 2012
Bazman: “You obviously have no understanding of the Russian psyche .. ”
Correct, nor do I need such an understanding. Yet.
Bazman: “My wife suspects it was and still is a conspiracy to get rid of all the men so the corrupt elite can steal all the wealth.”
Tell her we in the UK are more than happy to shoulder the burden of all those cute lonely Russian women.
Send them all over here. It’d be a hell of a job, but someone has to do it.
August 23, 2012
The first thing they would do is start to liquidate your assets and and them back to Russia.
August 20, 2012
Lindsay McDougall: “FREE PUSSY RIOT”
Yes, Hague could do much worse than offer them all political asylum in the UK.
Oh! I forgot , Hague has done much worse by threatening the territory of a sovereign state. And trying to intimidate Ecuador.
He is a fool and a knave. For god sake Mr Redwood, *DO* something about the fools running your party!
August 18, 2012
“25. Monopoly activities provided by the public sector but paid for by users”
This is an area which which should be closely monitored. How are prices set and who regulates them?
During the previous government, the charge for passports rose very sharply. One cannot expect to have competition in the issuing of passports, but the mere fact that the price of a passport can be increased by so much, makes one suspicious than not enough may being done to control costs.
The Building Regulations Part P are over-intrusive into people’s private houses. Who decides whether the building regulations strike a fair balance between personal liberty, domestic safety and the cost of enforcement?
Many of these monopoly activities are managed by Quangos. They should all be required to account to Parliament annually for their practices and their prices. It would be good if such hearings were opened up for comment, such as on this weblog.
Reply Ministers are meant to act for us forced consumers. They should push back hard on costs in budgets, and refuse to sanction inflaiton busting price rises.
August 18, 2012
Yes, certainly ministers should push hard on costs; but if heads of quangos knew they would have to appear before Parliament, they would be more careful about what they proposed to ministers.
August 18, 2012
Most of this sounds like a fantasy for different billing companies as in the the gas/electricity industry Why do we need these layers of companies paid for by the state externalising the costs onto the workforce and the population? All these so called profits should be used to provide better service technology and prices. Not put into the pockets of often already rich people and sovereign wealth funds with the banks creaming off there fees. Stupid right wing dogma. ‘Competition’ as has been proved in the past mean more expensive. Trains, banks, utilities and many others. With the poorest users bearing the brunt. Communism for the rich. Ram it.
August 18, 2012
On banking: I agree that smaller, more focused banks would improve customer service and lower systemic risks by making their risks more clearly identifiable. However, we still need a mechanism to handle balance sheet torture from writing down mortgages and international exposures.
On rail: we may not quite be there yet but the idea that railtracks should be replaced by roadways for automated autonomous vehicles on many routes – some dedicated to trucking, and perhaps others to commuting – should be kept in mind when deciding about committing large scale funds on renovation or expansion. The DoT data show that almost no routes run at a true profit. Because they would require automated vehicles, some tariffing might be rather easier to institute than on regular roads, where we have discussed the problems before.
On roads: The present structure of responsibility divided between Councils and the Highways Agency is unsatisfactory. Audit reports show the HA lacks expertise in engineering and procurement. I suspect many councils also fall short. An idea to inject some competition would be to ask companies to submit bids on what they would do with say 50-80% of the road budget for an area, and ask the public to choose the winner.
August 20, 2012
I discover Portsmouth has already implemented the roads idea, with some success it would seem – albeit as a PFI, which is normally grounds for suspicion about poor value for money or gold plating.
http://www.portsmouth.gov.uk/media/tecs20090318r3app.pdf
Benefits include a sharp reduction in accident claims. The benefit of having joined up thinking and proper expertise on keeping the roads maintained is clear. It doesn’t have to be toll roads.
August 19, 2012
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