Resisting Shock Therapy

21 March 2013

By John Medhurst

The UK now has an extreme right-wing government that aims to transfer most of our public services to the private sector, using a variety of commissioning models and hybrid schemes to disguise a massive programme of privatisation.

The marketisation of the NHS is the most obvious threat. My own union, PCS, is facing outsourcing across the civil service – government debt collection (after cutting debt management staff in HMRC), Criminal Fine Enforcement, the National Benefit Fraud Hotline (to Vertex), JSA online (to Capita), the Equality and Human Rights Commission helpline (to Sitel, which does not recognise trade unions), DWP’s Crisis Loans and Community Care Grants (to local authorities, who may then outsource this crucial safety net), and the Forensic Science Service (a privatisation criticised by the police and the CPS).

There are many more.

In 2010 Osborne’s Treasury admitted that it was not looking to learn lessons from PFI failures, but was going to “help bring forward proposals for a new approach to using the private sector in the delivery of public assets and services”. The “new approach” was much like the old, extending to the first privatisation of an entire NHS hospital. Hinchinbrook Hospital was loaded with massive PFI debts, but instead of bailing it out the government gave it to Circle Healthcare, a so-called “Mutual” in which the staff has 49% share ownership. The hospital is now run for profit by a “joint venture” between Circle and a hedge fund registered in Jersey.

In its 2011 Open Public Services White Paper, the government claimed that “we will not dictate the precise form of these mutuals; rather, this should be driven by what is best for the users of services and by employees as co-owners of the business. Options include wholly employee-led, multi-stakeholder, and mutual joint ventures”.

No part of that is true. The first part of the civil service to be spun out as a Mutual was My Civil Service Pension (MyCSP), which administers over one and half million civil service pensions. It is now a Joint Venture with Equiniti Group, with MyCSP staff holding 25% shares. No other model was ever on offer. MyCSP staff were never asked for their views, and strike action against “mutualisation” was ignored.

But resistance is growing. The recently formed “We Own It” campaign was set up by anti-privatisation activists and has already attracted support and funding from unions, think tanks and other bodies. It seeks to make the case for public services to be in public hands, not just through defensive battles but by influencing broader political debate in favour of public ownership. Already the renationalisation of the rail network is being widely discussed. This would require massive campaigning pressure to achieve, but if it happened it would send a signal that the long privatisation experiment was beginning to be rethought and reversed.

In the meantime, direct action is still necessary, as the occupation at Sussex University demonstrates. It began when the Vice-Chancellor proposed to outsource building management and maintenance services, cleaning services, fire safety, laundry services, postal services, portering services, security services, waste disposal services, and catering operations. This would transfer 235 staff to the private sector. The plans were declared with no consultation with the NUS and scant communication with campus unions.

On 7th February over 300 students occupied the campus conference centre in protest. They bedded down and started a campaign that quickly went viral. Through Facebook, Twitter, Tumblr, and Youtube they got the message out about their action. When I visited the occupiers, it was clear they already had widespread support within the campus. Not only from the students – who stuck yellow paper squares on their windows as a signal their solidarity – but also from the staff and even the security guards hired by management to stand outside the doors of the occupied area, who the students told me were sympathetic to the cause. Thousands have now signed their Statement of Solidarity, including Noam Chomsky, Ken Loach, Owen Jones, Jonathan Miller, Mark Thomas, MPs Caroline Lucas, John McDonnell and Peter Hain, and many Sussex University academics as well as union officers and other sympathisers. It is now a global cause.

The occupation is a rallying cry to all who believe we cannot wait until 2015 in the hope of a better government. A lot of damage can be done in two years, and there is no guarantee that One Nation Labour will differ much from New Labour without continuous external pressure. That is why the Institute of Employment Rights has organised a major conference on 17th April in London on “The Public Sector: cuts, privatization and employment rights”, where speakers will provide information about proposals and legislative changes. Workshop groups will let delegates share information and experiences, and plan tactics to resist further privatisation in whatever guise.

In The Shock Doctrine, her powerful indictment of the “shock therapy” of mass privatisation in Russia, Yugoslavia, Mexico, Chile and the UK, social activist Naomi Klein concluded that “Information is Shock Resistance”. The IER will provide that information. It’s up to us what we do with it.