Paying
for Scotland's Public Services
Building and running Scotland's public service
facilities has always cost large amounts of money.
Until recently this was largely obtained by public
authorities getting permission to borrow money
from the Public Works Loans Board and pay it hack
over a period of years.
The interest charged was usually lower than commercial
rates but permission had to be granted by the
Government.
This changed with the launch of the Private Finance
Initiative (PFI) in 1996/97. This initiative was
aimed at raising the finance for public sector
facilities from the private sector. In return
public authorities would 'rent' services (including
the staff) from the private sector and at the
end of the contract the private sector would still
own the facility.
A bit like paying off a 30 year mortgage and
the building society keeping your house!
PFI continues to be a favoured method of funding
public service facilities. It is part of the scene
in local government, the health service, higher
and further education, water and sewerage and
the transport industry.
Draw the Line
UNISON is clear that PFI is an expensive, bureaucratic,
inflexible and unaccountable way of running public
services. We call on the new Scottish Parliament
to draw a line under this system and to develop
new ways of funding essential service facilities.
This paper is produced as additional information
and should be read along with Serving Scotland
UNISON's manifesto for Scotland's public services.
The private sector has always had a role in public
service provision and UNISON does not wish to
cut this out. But until now the public sector
has always retained ultimate ownership and control
of the service.
Scotland's public services should be democratically
accountable, of the best quality and delivered
by a public service team. PFI cannot deliver on
any of these criteria and should be scrapped.
Giving people a say
in their services
Public service facilities should be built and
run because there is a need and use for them.
The local use of the services should be flexible
and be able to be changed as the demography and
needs of the users change. A legally-binding contract
over 20/30 years means that changes to the use
of a building are much more difficult to make
-meaning that local people's needs cannot he properly
taken into account.
Many public services used small schemes that
are less attractive to the private sector. This
means that authorities are under pressure to create
'bigger' projects than are actually required -
responding to commercial pressures - not local
needs.
Local people must be able to influence how their
services are run. The best way to facilitate this
is by the services being under democratic control
of elected representatives. If the service is
owned and run - and the staff employed by - a
private contractor; that direct democratic control
is at best diluted and at worst removed altogether.
Damaging Democracy
Even worse, democratic control and demand for
other services can be damaged by PFI. At a time
of restrictions and reduced funding - priorities
should he determined by need, not by the fact
that the payments to the contractors have been
ring-fenced' and cannot be cut - which is currently
the situation.
We think that the public should know how much
they are paying to build and run their services.
Under PFI the costs are not published until after
the contract has been signed - often not even
then! How can people make an informed choice about
how their services are provided if they are not
told the costs until too late?
Choosing Quality Services
The provision of public services facilities should
he paid for without the profit margin required
by the private sector. This means the public pay
more than necessary for the facility or that the
level of service provided is less. Either way
means the public service provides a better quality
of service for the money.
Quality services should be able to change with
changing circumstances. The drop in a school roll
for example can mean the development of other
extra-mural learning by other sectors of the population
or the community use of a school's facilities.
This is possible when the school is run by the
public sector.
How possible will it be to change inflexible,
legally binding contracts in a similar circumstance
- will taxpayers end up paying for services that
are not needed and being unable to afford new
services because of this?
PFI projects involve the authority in spending
large amounts of money on accountants, lawyers
and contractual negotiators. Money that could
be better used providing the quality services
the people of Scotland deserve last three years
Public sector staff are employed and, trained
and qualified to deliver the best possible services
direct to the public. PFI contracts mean that
staff are employed by a company who are in business
to make a profit. Service levels, qualifications
and training will be under threat as 'costly extras'.
Choosing teamwork
The best public services are provided by a public
service team employed, trained and motivated to
deliver these services. Under PFI this team is
broken up with some staff such as teachers and
clinical staff retained in the public sector,
but with support staff, janitors, cleaners, porters,
technicians etc working for contractors or a consortium
or even sub-contractors.
The end of the public service team is threatened
Conditions can also be properly delivered and
negotiated and in the public sector. As statutory
bodies they are also better at providing genuine
equal opportunities, training and fair treatment.
Private contractors have never had a sparkling
track record in this regard. Indeed the EOC has
already indicated that outsourcing in a previous
guise -CCT - discriminated against women in particular.
We would argue that this also unfairly affects
other groups facing discrimination such as black
people, disabled people and lesbians and gay men.
Serving Scotland
Our Scottish Parliament should demand;
 Financing of Scotland's public service facilities should remain in the public
sector
The abolition of the PSBR and the adoption of the General Government Financial
Deficit (GGFD) in line with other European Union
countries. This would help free up conventional
borrowing for investment.
(The decision of the Accounting Standards Board
that PFI projects should be counted against the
PSBR makes it imperative that alternative methods
of finance are adopted - if we are to achieve
the Maastricht criteria.)
The integration of services and co-ordination to identify alternative methods
of funding - the co-operation between the local
NHS Trusts, Grampian Health Board and the Scottish
Office in selling off surplus land to fund the
new Aberdeen Children's Hospital is an object
lesson - and the new Bo'ness Community Hospital
is similarly funded.
Where private sector cash is involved the financial details should be open
to public scrutiny and not hidden behind the cloak
of 'commercial confidentiality'. Recent moves
towards greater openness in the Health Service
must be extended to Local Government, Water and
Sewerage and Higher and Further Education, and
published before contracts are signed.
Alternatives to ownership and running of services by the private sector should
be investigated. Projects such as the English
Courts Administration, and suggestions in England
and Scotland for 'PFI without people' schemes
at least leave some control and accountability
with the public.
This minifesto and a full copy of Serving Scotland,
A manifesto For Scotland's Public Services, is
on UNlSONScotland's Website at http://www.unison-scotland
org. uk.
It is also available in different languages and
formats from UNISONScotland, 14, West Campbell
Street, Glasgow G2 6RX. tel 0141-332 0006, fax
0141 342 2835, e-mail c.bartter@unison.co.uk.
Photos by Alan Wylie, ex Royal Infirmary, by
Douglas Robertson
Published by UNISONScotland as part of its Serving
Scotland campaign, UNISON House, 14 West
Campbell Street, Glasgow G2 6RX. Tel 0141 332
0006.
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