Bleeding the country dry

Southern Cross, the failing company behind many of the UK’s care homes has announced that it is to cut 3000 jobs. According to them, this will improve ‘staff effectiveness’ in its 750 homes: quite how this effectiveness will manifest itself is not explained but this claim might give us a clue;

Home managers, deputy managers and relief managers, activity co-ordinators and administrators will not be affected, the company added.

Unless Southern Cross is particularly top-heavy with senior management (and I’m referring to numbers here, not self-satisfied swillers), I think we can presume that the 3000 job losses will be amongst the lowly paid staff on the front line where they do the actual caring. In which case, ‘staff effectiveness’ is not going to be synonymous with better care.

Out of this mess, an unholy alliance seems to be developing between the company and the Trades Unions . The GMB’s General Secretary, Paul Kenny, has said,

“This is the trigger for the Government to step in with immediate financial support to ensure that Southern Cross continues to operate and continues to provide a home for 31,000 elderly and vulnerable residents looked after by 44,000 staff.

“The residents, their families and the staff demand immediate action from Government today.”

The GMB would not be doing its job if it had not requested government help but as taxpayers, we need to remember that Southern Cross would probably not have been in this position if the senior management and their banker backers had not stripped the company of its freehold assets. As there remains a duty of care on all local authorities to help re-house anybody displaced from private sector provision, we can be certain that once again, we have witnessed the privatisation of profit while all attendant risk and liability has remained the responsibility of the taxpayer.

As dismal as the prospect of maintaining the big state might be, it seems impossible not to take the view that privatisation of care has largely failed. It is surely intolerable that a few City sharks are able to grow fat on generous charges guaranteed by the taxpayer while leaving us in the position where the owners of a company can effectively walk away and abandon 31,000 vulnerable people and 44,000 staff. Such behaviour may not be illegal but it is certainly immoral. We were promised that the competitiveness of the private sector would lead to greater efficiency and lower costs: instead, we got minimum wages while fees and executive salaries have roared out of control.

Meanwhile, in a not dissimilar scenario, we have Vince Cable accusing the banks of refusing to lend to small businesses. Vince Cable’s solution is to penalise the banks with additional taxation. But you know who’ll end up paying that, don’t you?

When the banking crisis began, politicians were justifying their bail-outs with the line that a failed bank would irreparably damage the country. If banking is so fundamental to the stability of the country why do we permit banking to be in private hands; how can any country at the mercy of an unelected bunch of bankers ever be considered to be democratic?

Last but not least in this vein, we turn to the utilities. Scottish Power is raising energy prices yet again – this time up to a very significant 19%. We all know that all the other energy companies will follow suit in the not too distant future so where are the alleged benefits of privatisation? And the private water utilities are no better: once again, a few days of sunshine has led to talks of hosepipe bans but how many of the water utilities have fixed leaks – and how many have built sufficient new storage capacity? Our water charges regularly rise in excess of inflation, justified on the promises of new infrastructure but in a land of copious rain, we still have regular panics about water shortages.

I’ve long held the view that Margaret Thatcher’s ascent to power was precipitated as much by the dawning realisation that the Trades Unions had subverted democracy as it was by the so-called ‘winter of discontent’. We’ve now gone the full 180º and all power now rests in the hands of the international banking system and the Southern Cross style leeches that feed from it.

Would some re-nationalisation provide a partial answer?

The point is probably academic. The difference between now and 1979 is that we don’t appear to have any political grouping willing or able to break the stranglehold of the enemy within.

This entry was posted in Adventures in Time Travel, Politics, State v private and tagged , . Bookmark the permalink.

2 Responses to Bleeding the country dry

  1. AHLondon says:

    The problem is in partial deregulation, partial privatization. The government used to be supplier of said care. Now it is a buyer. The government is still the market. And the government has different incentives than private citizens. The government wants cheap beds for all. Individuals want the care. Shady bureaucrats or business owners can game the government more easily. Put another way, bad players will play, the issue is how best to contain them. Government ownership and/or regulation fails with steady regularity. A market without government interference catches problems more quickly, think Enron v. Freddie Mac. I wrote more here:

  2. Pingback: The complicity of the compliance industry | Adventures in Time Travel

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