| Allan Wilson:
I agree with
members who have said that today's debate is apposite because of the four
consecutive Tory Governments' years of neglect of public sector infrastructure.
That neglect was driven by the ideological right, with its philosophy that
the market would provide, irrespective of the social and economic consequences
for our traditional manufacturing base. The frontiers of the state were
driven back for ideological as opposed to economic reasons. The principal
casualty of that philosophy was capital investment in our public infrastructure.
However, the crumbling public infrastructure not only created a society
of haves and have nots and widened the gap between those who were dependent
on public services and those who could afford private schooling and health
care, but impaired economic performance, with periods of boom inevitably
being interspersed with periods of bust.
The Tory response
to that was PFI, which was simply an adjunct to the party's ideological
predisposition to privatisation. It was not new thinking: the levering-in
of private sector finance to rebuild a crumbling public sector infrastructure
was first suggested by John Prescott when he was the shadow transport minister.
He argued, in anticipation of the privatisation and break-up of the rail
network, that public control and accountability could be retained and private
sector investment secured in a partnership between what was then British
Rail and the private sector.
John Prescott's
proposal would have kept the national rail network within the public sector;
it would have delivered—without affecting the PSBR—the necessary large-scale
capital investment that everyone agreed was necessary to make the rail
infrastructure competitive with road and air alternatives; and it would
have given a return to private sector companies that had invested in the
rail network. His proposal would have precluded the need for privatisation,
which the self-styled radical right argued was necessary not simply for
ideological reasons, but for economic reasons.
PPP was an alternative
to privatisation and would lever in otherwise unavailable capital to buttress
the wider social inclusion agenda, the agenda of the left: new hospitals,
new schools and warm housing.
Fergus Ewing:
As Allan Wilson is an extremely clever chap,
does he agree that the main objection that we have to PFI is that, as a
way of financing projects, it is more expensive by 5 per cent than Government
borrowing? It costs more and Labour is wasting public money.
Allan Wilson:
PFI can be more expensive. That is why we take a pragmatic approach to
PFI, based on the merits of individual projects. I will explain later how
PFI can also be more efficient and more cost-effective.
When Labour
defeated the ideological right, we were able to supplement our traditional
ideological commitment to the NHS, comprehensive state education and social
housing with private sector investment in public sector infrastructure.
We got that investment not as a means of privatising the services but as
a way of improving the services. As a consequence, Labour is delivering
better schools, new hospitals and better housing. Unlike the Tories, Labour
is not privatising key areas—areas such as clinical services and the state
education service are excluded from the PFI process. The private sector
can sometimes operate more efficiently than the public sector—Crosshouse
hospital is an interesting example of that.
Bruce Crawford:
Unison, a trade union with which Allan Wilson
was closely associated, recently said that it -
"notes with
concern the Scottish Executive's continued reliance on Private Finance
Initiative which is economically flawed and poor value for money for Scotland's
taxpayers, since it will cost more in the long run than to fund capital
projects."
Does Allan Wilson
agree with that?
Allan Wilson:
If Bruce Crawford knew anything about what
he is talking about, he would understand that, within Unison, I argued
against that policy. I did so because—if Mr Crawford is interested at all—Unison
positioned itself incorrectly in that debate. Unison's principal objective
is to defend the rights of the workers who are involved in the public sector
and to ensure that they are protected and enhanced. It is not a self-styled
guardian of the public sector ethos—that much is clear.
As ever, the
nationalists want to have their cake and eat it. That is why, as Mike Watson
and the banks have said, its proposals have been correctly described as
unworkable—superficially interesting, perhaps, but unworkable nevertheless.
Perhaps that describes nationalism in general: superficially interesting,
but unworkable.
To
read this debate in full, click here
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