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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