More privatisation chaos as another outsourcer is going down the pan

Interserve logo
Steve Topple

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?

Privatisation chaos

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:

Unite the Union leader Len McCluskey summed it up:

And Simon Bye asked the question that’s probably on many people’s lips:

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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