Thursday, 13 August 2015

Privatisation is theft

Did you know rail services in Scotland are operated by the state?  No?

You thought British Rail had been privatised between 1994 and 1997, and that the ‘franchise’ in Scotland was now operated by a private company called Abellio? 

Well, actually, you are correct.  However, Abellio is a subsidiary of Nederlandse Spoorwegen, which operates rail services in the Netherlands and is owned by the Dutch government (owned by the state on behalf of the people of the Netherlands).  In other words, train services in Scotland are operated by the state, just not the British state.  

The reality is that the UK government privatised our publicly-owned rail services – because, they argue, the private sector does the job much better than the state – but those services are now being operated by the Dutch state, which is pocketing the profits. 

Effectively, fares paid by Scots to travel on Scottish train services are subsidising state-owned train services in the Netherlands. 

You may also have thought the nuclear industry had been privatised.  Again, you are right, and it was done because, we were told, the private sector is more efficient than the state-owned public sector and would be better at running nuclear power stations, with the added bonus that privatisation would save money for UK taxpayers.

Today, nuclear power stations, like Hunterston ‘B’ in North Ayrshire, are operated by a private company called EDF.

However, EDF stands for √Člectricit√© de France, which, as the name suggests, is an electricity company based in France. 

Until just over a decade ago, EDF was the nationalised energy provider in France, owned by the French government on behalf of the people of France.  In 2004, following a European Union Directive on ‘competition’, France agreed to turn EDF into a Limited Liability Company and float it on the Paris Stock Exchange.  Today, though, 85% of EDF remains owned by the French state.

A 2013 report by the UK Parliament’s Environmental Audit Committee indicated Britain’s ‘privatised’ nuclear industry receives a £2.3-billion subsidy every year from UK taxpayers. 

The ‘privatised’ nuclear industry operates atomic power stations, pocketing any profits, but in addition to operational subsidies, UK taxpayers also pay the multi-billion-pound cost of dealing with the highly-toxic legacy of nuclear power-generation - nuclear waste remains radioactive and poisonous for hundreds-of-thousands of years.

Also privatised by UK Governments was the domestic energy sector.  Again, the rationale, so we were told, was that private companies would operate more efficiently in providing electricity and gas to our homes and businesses.

Tory and Labour politicians now tell us that ‘competition’ is key to ‘consumers’ of gas and electricity receiving the best deal.  Currently, around 95% of people in the UK receive their gas and electricity from one of six private companies – British Gas, Npower, SSE (Scottish and Southern Energy), Scottish Power, E.On, EDF. 

An independent analysis by the Competition and Markets Authority showed the ‘Big Six’ energy companies had increased their income by ten-fold between 2007 and 2013 – from £110-million to £1.1-billion.  Over the same period, a typical household bill for gas and electricity increased by 45%.

In 2014 the BBC reported individual profits recorded by the ‘Big Six’ in the previous financial year:

British Gas - £571-million
Npower - £134-million
SSE - £318-million
Scottish Power - £128.5-million
E.On - £296-million
EDF - £92-million loss (for domestic supply).

Had the provision of electricity and gas been retained in the public sector, such profits could have been used to deliver better and much cheaper utilities for the public.  Instead, shareholders of the private energy companies grow rich, while, in Scotland, around 2,000 pensioners die every winter simply because they are poor and can’t afford to heat their homes.

In the late 1980s the UK Tory Government privatised the Scottish Bus Group, which included Western Scottish, and de-regulated the bus industry.  Since then, private bus companies no longer provide a ‘service’ unless the route generates a profit or is subsidised from the public purse.  Some communities no longer have ‘public’ transport links, while others see bus services terminate in the early evening.

Private bus operators in Scotland currently have around 1.2-million passengers – the elderly and disabled - whose fares are paid by the Scottish Government through the National Concessionary Travel Scheme.  Of course, when I say the Scottish Government pays the fares, I mean Scottish taxpayers: the yearly cost to the public purse is £250-million.

That cost noted, it should be recognised the National Concessionary Travel Scheme is actually one of the Scottish Government’s best initiatives, with users saying free bus travel helps them financially, gives a greater sense of independence, reduces feelings of isolation and gives more confidence in their ability to travel.  However, how much better – and more efficient – would the scheme be if the annual public contribution of £250-million was re-invested in a state-owned and operated bus service, rather than further-inflating the bank accounts of multi-millionaires like Sir Brian Souter, owner of Stagecoach,

Then there is the banks, the private banks that collapsed the entire national economy.  Remember, the argument against public ownership (nationalisation) is that private companies are more efficient and run things better than the public sector.

The UK Government used public money – our money – to bail-out private companies.  The London-based National Audit Office has recorded that the amount of public money used to bail-out private banks peaked at £955-billion.

Last month the UK Government decided to sell 5.4% of the stake our money bought in the private company Royal Bank of Scotland (RBS).  In total, our money bought 85% of RBS: effectively the bank was nationalised and last month’s sale was the Tory Government beginning the process of re-privatising RBS.  The sell-off raised £2.1-billion, which represented a £1-billion loss for taxpayers.

There is so much evidence that proves private companies do not run services and industries better than the public sector.  The classic must surely be healthcare.  Look at our publicly-owned National Health Service.  It may have problems in some areas, but contrast our provision with the privatised healthcare delivered in the United States of America.  In the US if you don’t have private health insurance, you don’t get the healthcare you need.

In England the Tories have already embarked on the process of privatising the NHS, which, of course, has a knock-on impact on health services in Scotland, despite the determination of the SNP Government to keep our NHS in public ownership.

Nationalisation is not some socialist utopian dream, it is simply taking public control of services and industries so they can be run to meet the needs of the people, instead of to maximise profits for a small group of already-wealthy individuals and hedge-funds that own shares in private companies.

Nationalisation is the process by which we can deliver the best outcomes for society.

When we finally elect politicians prepared to put the needs of the people before the profits of multi-national corporations, we should pay no compensation to the shareholders of private companies when we re-nationalise services and industries.  Electricity, gas, rail, buses and other former public assets belonged to us, the people.  UK governments had no right to sell them.

Private companies bought stolen goods and if they want to argue about the matter, they should take it up with the people who sold them the stolen goods – Margaret Thatcher, John Major, Tony Blair and Gordon Brown.

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