Labour’s public-private plans are just a return to the dreaded PFI era

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https://morningstaronline.co.uk/article/labours-public-private-plans-are-just-return-dreaded-pfi-era

Shadow Chancellor Rachel Reeves in the shadow of Tony Bliar.

SOLOMON HUGHES warns Reeves’s proposed national wealth fund hands City financiers control over billions in public money for big business — and we get… to pay!

HOW will Keir Starmer’s Labour try to “grow the economy?” The short answer is it is going to try to use public money to persuade international investors to put cash into “growth” industries.

It’s the return of the public-private partnership. The big danger is that, like Labour’s last public-private partnership, the private corporations will get all the growth, while the public sector gets ripped off.

The main economy-grower Starmer is promoting is Rachel Reeves’s proposed national wealth fund. It will invest in key industries like “green energy” and other modern manufacturing sectors.

There is a strong Labour case to run a national bank investing in key industries: the 1945 Labour government set up two such banks, the Industrial and Commercial Finance Corporation and the Finance Corporation for Industry, which lent growth capital to small- and medium-sized industries or larger manufacturing firms respectively.

Labour argued that the City avoided investing in these crucial sectors, exacerbating the 1930s Depression. Both government-founded investment funds were very successful. Jeremy Corbyn’s Labour proposed similar publicly owned national investment banks.

But Reeves’s plan makes public money subordinate to private investment. She told the last Labour conference: “For every pound of investment we put in, we will leverage in three times as much private investment.”

Labour plans to invest £7.3 billion in the fund, and so attract around £22bn private “co-investment.” Reeves says private money will be attracted because the government cash will be “encouraging and derisking investment” from international finance: investors will assume that if the government has a stake in, say, a car battery factory, that it is a “sure thing” and won’t be allowed to go bust or lose money for shareholders.

But what happens if the publicly backed investments hit trouble? Say the car batteries come out too expensive, reducing profits, or need extra investment to fix production problems — will the private investors insist that the public investor take the losses? And if the profits are bigger than expected, will both parties benefit equally?

There are some major signs Reeves’s deals will favour the big private investors. First, because it is putting in more of the money, they can call more of the shots. This is not really a national wealth fund because most of the money will not be national.

https://morningstaronline.co.uk/article/labours-public-private-plans-are-just-return-dreaded-pfi-era

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Morning Star: Our NHS at 75: we have still faith, now we need to fight

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People on Warren Street in London, ahead of a Support the Strikes march in solidarity with nurse 11 March 2023
People on Warren Street in London, ahead of a Support the Strikes march in solidarity with nurse 11 March 2023

https://morningstaronline.co.uk/article/e/our-nhs-at-75-we-have-still-faith-now-we-need-to-fight

Image reads Accident & Emergency, A & E

Today the NHS is in a deep crisis. Its millions-long waiting list condemns patients to seriously delayed treatments, often painfully, sometimes dangerously. Its hospitals are so overloaded ambulances line up outside, waiting hours to discharge patients.

Those who can afford it are going private: the number paying for private hospital treatment has risen by nearly a third since 2019.

This raises demand for trained medical workers in the private sector, with reports earlier this year that doctors were being offered £5,000 to recruit NHS colleagues to undertake private work, accelerating a vicious cycle in resource competition when the NHS already carries over 100,000 vacancies.

The logic is towards a two-tier healthcare system in which those who can pay get faster treatment while the “universal” health service is reduced through under-resourcing to basic cover for the poor.

Preventing this means challenging the two main drivers of NHS decline: underinvestment and privatisation.

NHS sign

Since Tony Blair first introduced private provision within the NHS, the service itself has become a lucrative source of private profit. Extortionate PFI contracts, state collusion with big pharma over drug prices and reliance on private providers all waste NHS money.

The last risks turning our health service into a commissioner rather than a provider of services, a brand name that masks a for-profit health system.

That betrayal of Bevan’s vision is the current prospectus from both Tories and Labour. Saving the NHS means building a mass campaign for real solutions to its twin crises: a serious increase in investment, and an end to all private-sector involvement.

https://morningstaronline.co.uk/article/e/our-nhs-at-75-we-have-still-faith-now-we-need-to-fight

Continue ReadingMorning Star: Our NHS at 75: we have still faith, now we need to fight

Our NHS can’t afford privatisation – why MPs must back the NHS Bill this Friday

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Continue ReadingOur NHS can’t afford privatisation – why MPs must back the NHS Bill this Friday