Carillion

We're all to bame for PFI, even those who had no idea what it was, and those who didn't vote for Blair, Major, Brown, or Osborne.

www.taxresearch.org.uk/Blog/2018/01/18/after-fifteen-years-of-my-saying-pfi-does-not-work-the-nao-finally-agrees-why-has-it-taken-so-long/

The NAO at last agrees with Richard Murphy that PFI doesn't work.
Like Richard Murphy, I still want to know what they were doing in the meantime. They obviously thought it was a good idea until recently.

Hexham Hospital was built under PFI rules by a consortium including Bovis Lend Lease.
It has now bought itself out of the PFI by borrowing from Northumberland Council, and it will save itself over £67 million in costs.
So it can be done.
However, after that happened, there was a lot of consternation from other PFI trusts, who were scared of losing money. I don't think it's been done since.
Now's the time to start.

I seem to remeber massive concerns about PFI in the early 2000s in The Guardian, at least. They ran several stories about how schools & hospitals were being locked into ruinously expensive contracts and idiotic conditions such as schools having to rent their premises out of 'normal' school hours.

I was really concerned because we had the threat of amalgamation with another secondary AND a PFI new build hanging over our heads for 2 or 3 years. Much as I disliked the 2010 GE result the cancellation of Building Schools for the Future was a huge relief.

fullfact.org/economy/labour-carillion-contracts/

Interesting figures about Carillion and PFI.
May was correct when she said that 1/3 of contracts were signed by the last Labour government, but the published figures do not include 2016 and 2017. A bit disingenuous, considering they have signed up to HS2 since then. She must have known she was being economical with the truth when she said it.

fullfact.org/economy/why-was-pfi-so-popular-2000s/

Andy Burnham and Howard Davis factchecked on Question Time last night.

Found your link to the "story of Britain's fake markets" really interesting. I know some people do not connect so thought I would copy and paste the most relevant paras.

But here's the thing – we have marketised services without creating markets. Most of the privatised utilities have descended into regional monopolies or oligopolies, but outside of that, the 'market' for provision of public services is not a genuine market at all.

A genuine market has customers – individuals or corporates – spending their own money from a choice of providers. I choose a supermarket, and choose items within it. A company chooses a supplier of goods. Money is paid, profit is made. Marxists aside, this is not controversial.

What happens in our marketised public services is different. The government requires a service. A charity or company – often selected from a limited sphere of options – provides it. Taxpayers' money is handed over. Many of these providers are heavily dependent on this source of funding. The private sector providers make a profit from it. But throughout, the taxpayer is on the hook – if something goes wrong, the taxpayer pays.

These are fake markets, and they proliferate in Britain's social state. There is no natural, genuine market mechanism. Market sectors spring up purely to suck at the government teat. Providers demand assurances that a lengthy 'pipeline' of government-funded projects will be offered to them to make it worth their while to even bother offering the services that until then the government had provided itself.

Water is a perfect example of that, GracesGran.

"A report by Corporate Watch shows that nearly a third of the money you spend on water bills goes directly to investors and banks. The CEOs of the 19 water companies were paid almost £10 million in 2012. Six water companies are avoiding millions in tax. Water companies can rely on you paying your water bills regularly, and they use complicated debt structures to make huge amounts of money. Meanwhile, water poverty is increasing as the poorest households struggle to pay their bills.

The FT recently reported on the huge debt piling up in the water industry, and confirmed what we already knew - our water bills are rising to pay for huge shareholder payouts. They cited a study by the Public Services International Research Unit (PSIRU) at the University of Greenwich which calculated that bringing water into state ownership would cut the average household water bills by 25%."
from www.weownit.org.uk

weownit.org.uk/blog/bransons-big-bailout-action-today-84-are-our-side

The reason|I hadn't replied was because I was in bed trying to sleep, I then decided to get up have a bath, get dressed, have breakfast, talk to my DH, read the paper. There are so many things I do before I take recourse to GN.

maizie. Is that what it was? Just struck me as pointless remark.

Given the size of the Conservative vote, some of us here on GN must have voted Conservative. I am sure some have seen the error of their ways but I suspect that there are a lot of closet Conservative voters, and I doubt not some are posting on this thread.

I am going to do absolutely nothing to identify them and 'out' them, because in a democratic country I respect most people's political views and deplore those who write abusive language about parties they do not support, their politicians and their supporters. There is a fair mix of crooks and honest well principled people in all parties. I may not agree with people, but I see no need to abuse them.

Oh, I have a busy morning ahead so if I do not reply by return it is because I am getting on with all the other things in my life.

Like the rest of us, Monica. So pointless saying all that.
Don't worry, you won't be missed.

As we seem to be being sidetracked by the mundaine, how deep is your snow, Maizie? Have you been snowed in?

It was about 4/5 inches when it first lay but it's been beaten down now. We have never been snowed in, we live just off a main road & bus route; if it's really bad I have an ancient Landrover that goes anywhere

It's when it starts thawing and freezing that life gets dodgy. We have a big yard; the snow gets beaten down by vehicles and turns to ice - very slippery. Then it rains on top of the ice, but not enough to melt it - even more slippery. And, we're in a frost pocket so it takes ages to thaw...so, lethally slippery for days and days!

That's what it's like here.It's okay at the top of the hill, it's just getting down to the village centre. Very slippery where the ice has frozen under the snow.Thank heavens for deliveries.

I normally go to my son's for dinner on a Saturday night, but the last time I went it took me over half an hour to get back - usually ten minutes - and a man helped me across the road. Not going tonight.
At least neither of us live at Tow Law! I can never understand why the A68 is so bad. near there.

Back to Carillion.

"Broadly, the business has two parts: major capital contracts (building of hospitals, roads, railways and other major structures) and facilities management (buildings maintenance, security, catering, running prisons and so on).

Facilities management is predominantly, but not exclusively, for the government. Clearly, these latter jobs were originally undertaken by public sector workers until outsourced to private contractors.

In this area, it can be argued that the government has a choice as to whether it nationalises this work or continues to rely on private contractors. There is little doubt that private contractors are cheaper because the market to provide these services is highly competitive. But there are risks over the quality of work, failure to perform and, as in this case, liquidation.

There are plenty of businesses willing to provide these services, such as Serco and Sodexo. Retendering is likely to produce a low cost solution but the government should learn from its mistakes with the Carillion experience and make sure it gives the contract to a financially stable company, including substantial penalties for poor performance. "

From this article.
theconversation.com/carillion-qanda-the-consequences-of-collapse-and-what-the-government-should-do-next-90252

Do you think the government will realise at last that privatising some things like prisons and school meals is not going to work? Or is that just wishful thinking?
Do millionaire business people care?
Or even the people who vote for them?

Chit chat, cont:

At least neither of us live at Tow Law! I can never understand why the A68 is so bad. near there.

It's because Tow Law is situated very near to the top of the world, dj. The wind just howlsacross the exposed heights and creates dreadful snowdrifts on the roads...

It does offer some fabulous views, though, and it does have about 1 weeks worth of sunshine per year...

There is little doubt that private contractors are cheaper because the market to provide these services is highly competitive. But there are risks over the quality of work, failure to perform and, as in this case, liquidation.

There's the whole problem in two sentences... 'competitive' = corners cut wherever possible, particularly WRT staff pay and conditions

'Quality of work' poor because of poor quality staff, poor staffing levels, very tight time constraints and much, much more

I bet the companies' shareholders wouldn't work under the same terms and conditions as the employees have to...

'Quality of work' poor because of poor quality staff
I don't think that can be stated unequivocally as many of the people working for these contractors are highly qualified and highly skilled professionals, experienced and conscientious workers.

Can you explain the problems in the privatised prisons, then, Jalima?

"Carillion maintained approximately half of the UK's prisons and Young Offender Institutions, including Wormwood Scrubs, Pentonville and Feltham. Its responsibilities included cleaning, landscaping and catering.

The company was widely criticised by Independent Monitoring Boards across the country, which described Pentonville as "unsafe and inhumane", Winchester as "unable to function properly" and Wandsworth as "struggling to maintain basic standards".

Since the company's collapse, the Prison Officers Association (POA) said that the contracting out of services and maintenance in prisons was "a recipe for disaster", but their concerns were ignored.

General Secretary of the POA Steve Gillan said: "We need to know the contingency plans to keep our prisons operational. During the time Carillion had this contract the level of essential maintenance and work that is outstanding has spiralled out of control... due diligence was not undertaken.

"Today we face another real crisis due to poor management and privatisation". "

BBC report on Carillion.

The key word is unequivocally

Can you explain the term 'poor quality staff' to all the highly skilled and dedicated professionals working on many projects?
I don't think they would be very happy to be given that label.

I already posted (I think it was to Gracesgran) that I agreed it was not a good idea to out-source anything to do with the CJS.

I beg to differ on quality of work . My dad lives in a “close” of LA bungalows . Work started 5 years ago to modernise them all . The first 10 or so were done by the LA themselves and not only did they take forever ( you might recall my post some time ago about the council vans hiding behind my dads bungalow which is tucked in a corner out sight of the road ) the quality of the work is shockingly poor with meetings being held to voice complaints . My dad was fortunate to be at the end of the program to have his bungalow modernised which was done by private contractors. Excellent workmanship, clean tidy workers, fast and all together a million% better than the rest .

Chitchat continued.
I know what you mean about Tow Law, Maizie, beautiful views for a couple of weeks. I occasionally go along the A68 to Minsteracres, which is just over the border into Northumberland.
I went there before Christmas, and you have to ring them up to find out if they are open, or closed because of the ice. A penance for living in a beautiful part of the county.
I imagine they are closed now.
The Chronicle does have some fantastic photos in from the Dales, in compensation.

All the Carillion workers are being offered jobs by the councils or other companies which are taking over their work.
Builders don't normally work for either private or council all their lives.
So you can't say council bad, private good, gillybob.

Not only have these professional, skilled, hard-working people been let down by their greedy, ineffectual bosses and are facing an uncertain future, they are now being labelled on an open forum as poor quality staff
There are always some staff who are inadequate or lazy in the public sector too.

But to label all Carillion's employees thus without qualification is wrong and there is no defence for it.

I’m not saying council bad, private good or the other around just giving you an example of how my LA messed up the modernisation program in my dads close . It was too easy for the council workers to shirk and do as little as possible to the poorest of standards, taking as long as they could get away with .