Yet another privatisation disaster is looming. This time, an outsourcing giant is in trouble. But given the history of privatisation in the UK, should we be surprised?
As BBC News reported, Interserve has said it’s looking for a rescue deal. It has £500m of debt which it’s been struggling with. BBC News reported that:
It would be second rescue deal for Interserve, with the company refinancing its debt in March.
Its troubles have been blamed on cancellations and delays in its construction contracts as well as struggling waste-to-energy projects in Derby and Glasgow.
Interserve claims its prospects are improving, and says it will increase profits this year.
But the stock markets weren’t convinced, as its share prices dropped 70% from Friday’s value in early Monday trading. Interserve does various jobs for the government, including meals in hospitals, construction, and probation services. Meanwhile, some politicians seemed unconcerned by Interserve’s woes. Because on 10 December, the Labour-led Welsh government said it had awarded the company a £25m hospital project.
Social media speaks
Twitter was scathing about the chaos at Interserve:
Interserve: Major government contractor 'seeks second rescue deal' struggles with £500m of debt https://t.co/K3Bb0ZIxA5 Interserve works in prisons, schools, hospitals and on the roads.
Neoliberalism is working fine, nothing to see here, what finance curse?
— Rick B (@TenPercent) December 9, 2018
Unite the Union leader Len McCluskey summed it up:
The model for providing public sector infrastructure and services is broken. Big business has no business with our NHS, our schools, our prisons, our infrastructure and public services. #Interserve #Outsourcinghttps://t.co/Eg0gNITBK5
— Len McCluskey (@LenMcCluskey) December 9, 2018
And Simon Bye asked the question that’s probably on many people’s lips:
I don't understand why public money paying for a service and a profit is more efficient than public money providing the service. Apart from the fact it's easier for a politician to blame the company for treating its staff like shit…#Interserve https://t.co/bPXIlZI8HF
— ⛄🎄☃️ Simon Bye ⛄🎄☃️ (@UB5simon) December 10, 2018
But we should not view the chaos at Interserve in isolation. Because years of privatisation has shown just why this model is past its sell-by date.
End this madness
At the start of the year, construction giant Carillion collapsed. It provided services across the public sector – from prisons to hospitals and schools. Meanwhile on our railways the privatisation chaos is constant. There’s notorious Southern Rail, never far from the headlines, and the East Coast Mainline where Richard Branson & Co bailed out of the contract, losing the taxpayer billions. The Department for Work and Pensions outsources fit-for-work assessments to companies like Independent Assessment Services (known as Atos) and Maximus. But these too have been dogged by scandal; not least the furore surrounding their assessors asking people why they hadn’t ‘killed themselves’, yet.
All this goes on while the taxpayer forks out for the chaos. Labour has called on the government to ban Interserve getting any more contracts; despite its Welsh counterparts still giving the company work.
But surely the bigger question should be: ‘When will we see a ban on ALL private companies getting government contracts?’. Because the only way to end this chaos is to stop these crony capitalists having any public money at all.
Featured image via Interserve – YouTube
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