10 Propositions on Privatisation

Prepared for a BBC News 24 debate with Tony Benn (on the 20th anniversary of the BT privatisation) 3 December, 2004

Background: In the past 20 years British provision of phones, gas, water, airlines, rail, electricity and waste has all been put in the hands of private firms. In many cases, the previous state assets were sold to the private sector, sometimes very cheaply.

1 Privatisation has meant that consumers buy many better quality goods and services more cheaply from highly-motivated people.

2 Privatised firms have been able to operate and compete amongst other corporates much more effectively than the old state entities could have done.

3 Privatised rail firms have been able to carry more people even more safely than was the record of the state entity, even whilst investing huge sums of money (much of it private) in hugely-disruptive infrastructure work.

4 It is socially cheaper to pay profit and interest than to impose the economic damage of taxation and bureaucracy to achieve the same ends.

5 Privatisation has increased the quality of regulation, by freeing the regulatory body from the obligation to fund the new requirements (as was the case when Government both regulated and provided the services).

6 We should privatise health, education and pension provision. The problem with these services (as in many of the others) is how to fund access (the "universal right" problem) for the feckless and the unfortunate. The service itself needs to be provided by the most efficient and responsive known entity: the private firm.

7 We should privatise the BBC. In the digital age there is no case for a regressive ("poor-bashing") form of funding for a service whose provision is unbremarkable when compared with its commercial "competitors" and whose sole justification might be elitist excellence. (Radio - not being so readily chargeable - might make a slightly different case to TV.)

8 Privatisation is to be celebrated in the Third World, where state provision leads to poor and expensive services. Again the problem of providing services to the poor is easier - not harder - under privatisation (because the service itself is more cheaply and accountably provided).

9 Privatisation helps people acquire the dignity of being customers rather than the morally debilitating role of dependent.

10 Private firms have provbed that they can develop the "pro bono" professionalism and even the "quasi-judicial" role of the responsible bureaucrat. Outsourcing of official and semi-official work can be done well.
11 Even core state activities such as the use of force can be privatised. Gaols, soldiering and security are all proving that firms can do these jobs well, and perhaps better than the state.