Living off the state

No, I’ve not joined the long list of politicians taking a pot shot, for party political advantage, at those who need welfare support to get by. Indeed, as regular readers of this bogsite will know, I’m very much in favour of universal basic income (UBI) to tackle poverty and reliance on benefits once and for all.

This post is actually about companies who get government/public sector money to run public services or provide goods and services which the public sector requires.

That our government is mired in all sorts of controversy regarding contracts being handed out to companies, sometimes without a proper tendering process, seems sadly to be an everyday thing these days. The connections between some MP’s and companies is often rather obvious yet it keeps on happening and there’s no proper/effective scrutiny/remedy to it.

The irony of all this for me is that often the politicians with worrying connections to benefiting companies will stomp about, at elections times in particular, calling for more openness and efficiency in what the UK Government, its agencies and local councils are doing when it comes to spending public money.

My view is that as a country we have lost our way with regard to who gets to do government/public work and how they’re selected to do it. Interestingly, there have been contracts where informed observers have said that the work could well have been done more cost effectively by the civil service/NHS/councils etc. However, huge sums of money get thrown at consultants and companies some of whom don’t have any prior expertise in the work they’re getting contracts to carry out!

The present approach flows from a dislike of ‘big government’ yet often it seems that by reducing the capacity of the public sector the work which can no longer be done ‘in house’ then costs a huge amount more to buy in. Frankly, it makes little sense to me. Surely governments of all colours should want the functions of the public sector to be carried out in the most cost effective way not the most expensive way!

There must be many companies across the UK who significantly rely on public sector contracts to stay afloat, pay their staff and give dividends to their shareholders. My fear is that we have governance by consultants who can always find a way to screw more money out the public sector and the pockets of taxpayers.

I’ve never been a fan of privatisation as I’ve seen too many failures by councils and government. A better way to encourage innovation and efficiency in the public sector would be to limit outsourcing to mutuals, cooperatives and not for profit companies so that the greed to feed off the public purse is very much reduced and hopefully eliminated.

The control of what MP’s and senior public sector employees can be involved in in terms of company directorships and their connections with others who control companies needs to be much tighter too. Anyone who works for the public sector or who is elected to run it needs to be clearly unconnected with suppliers to the public sector. As soon as such connections are established and verified, by a powerful and independent watchdog, the person/s involved should be removed from office. No ifs, no buts, no 2nd chances and no power to veto the outcome by political leaders.

We need to have confidence that our public services are being run efficiently and by people with the expertise to deliver top quality outcomes. Whilst we feel that politician A’s brother/sister or best mate got the contract to do the work we won’t have such confidence and we could well be getting inefficient and costly services which don’t serve our needs. This is not rocket science, it’s about openness and transparency in all that is done with taxpayers money.

And just as I finished this posting what pops up on my Twitter feed but Layla Moran MP saing this – ‘One of the basic pillars of democracy is that taxpayers can see how their money is spent. As private firms continue to land public contracts worth hundreds of millions of pounds behind closed doors, people’s trust in Govt is reaching an all-time low.’

Why Co-Ops and Mutuals are the way forward

I have always thought that the UK economy had wrongly left the route of mutuals and co-ops too far behind in the blind rush towards capitalism. Here’s an interesting take on how we can regain our love of co-ops and mutuals written by Richard Warren for the Lib Dem Voice web site.

The Co-Op Museum in Toad Lane, Rochdale.

The Co-Op Museum in Toad Lane, Rochdale.

Lib Dems: The Co-operatives Party
By Richard Warren

Theresa May’s plan to introduce worker directors onto company boards is a start, but she still has a long way to go to catch up with liberal thinking: Jo Grimond advocated worker-owned firms more than 50 years ago, and she hasn’t reached that point yet.

But the Lib Dems need to be more consistent and outspoken in support for worker-owned firms and other types of co-operatives, too. Over the decades, we’ve had the occasional burst of enthusiasm, such as when Nick Clegg called for the creation of a “John Lewis economy” in 2012, but it doesn’t appear to be integrated into our policy-making as it is over at the Co-operative Party. It ought to be for the following three reasons:

First, by supporting co-operatives we can create a coherent, credible, principled centre-left alternative to Corbynite state socialism that might help us find common ground with some Labour and Co-operative Party supporters. Significantly, the Co-operative Party is increasingly keen to distinguish itself from Labour now, and shares some of our views on key issues. As Labour MP and chairman of the Co-operative Party, Gareth Thomas, says, the co-operative movement is pro-business and pro-EU; so are we.

And, of course, by supporting co-operatives we reinforce our claim that we are now the party of business, not the Tories.

Second, mutuals work. Twice as many cooperatives survive their first five years than other types of businesses. What’s more, co-operatives are efficient providers of low rent homes and successfully develop human-scale regeneration projects.

Third, if the rise of the SNP and the Brexit referendum have told us one thing, it’s that people want more control over their lives. Looking to break-up the United Kingdom or have Britain reject collaborative working with our European neighbours are, of course, wholly destructive. Much better and more meaningful to give people a greater say over their affairs by looking for ways to extend mutualisation in more areas of our daily life: more housing co-operatives to help ease the housing shortage by providing low rent homes, and more businesses owned by their workers and even their customers to sell honestly-made goods and services at honest prices in an honest way. And, of course, to pay a decent salary.

Indeed, support for co-operatives could form part of a policy package aimed at giving people more power over their lives. Other components could include our continued support for proportional representation.

Co-operative ownership comes in many guises. Which is best, if any, is something to discuss. Companies don’t necessarily need to be wholly owned by their workers and customers: The Co-operative Party is arguing for carers, care recipients and their families to be represented on the boards of private companies providing social care, for example.

Co-operatives themselves are looking for their voices to be heard more loudly, and some feel both the Labour and Co-operative Parties have let them down in recent years. We would be doing them, ourselves and the country a service if we gave them a home in our party.

* Richard Warren is a journalist who is a member of the Liberal Democrats.

Rochdale Pioneers Museum

I lived in Rochdale as a lad in the 1960’s (went to Lower Place Primary School – lived on Weston Avenue) and had a vague memory of the Toad Lane Co-Op shop/museum so last week Sheila and I travelled over to Rochdale from our Merseyside home to have a look at it and learn more about the Rochdale Pioneers.

The Toad Lane Shop/Museum of Rochdale Pioneers with the Baum pub nextdoor

The Toad Lane Shop/Museum of Rochdale Pioneers with the Baum pub nextdoor

The staff were very friendly and took a real interest in us; we had a great time looking around. They even recommended a great real ale pub for us to get an evening meal and it was right next door!


Rochdale has changed one hell of a lot since my childhood days but we enjoyed our visit and being a Liberal I am of course very supportive of Co-Op’s and mutuals. I would recommend a visit to the museum and indeed The Baum pub!

The photo is amongst my Flickr shots at:-

What will be left of the public sector after this!

Robert Peston has the story on the BBC web site – see link above

I am grateful to my old chum Roy Connell for bringing this item from the BBC web site to my attention. Having worked in the public sector all of my employed years I am, like Roy, rather worried about where this latest slash and burn policy will lead.

I have never doubted that the public sector once had its fair share of fat that could be trimmed but neither have I ever doubted that the public sector is vital for a functioning and progressive democracy. Anyone who thinks that the private sector can deliver all public services is living in cloud cuckoo land as the pressure to make money will always trump good services.

The missing link here for me is the lack of drive towards service delivery methods that really could work and potentially reduce costs as well. I refer to mutuals and co-operatives of course run by the people who work for them. I have banged on about them many times before but these days only Liberals and some real socialists still see them as a vital way forward as Tories and the new Red Tories lurch further towards privatisation.

Nationalisation – RMT Union pushes for it to happen to the collapsed City Link Company

As a liberal I am genuinely open minded as to the best ways of running companies, enterprises, public services etc. As a trade unionist I am also well aware that the leaders of the UK trade union movement think that most if not all enterprises should be run by the state or by local councils. As socialists these trade union Barons oppose the capitalist system and believe everything should be in common ownership.

Trouble is that trade union members, and I suspect this is by a considerable majority, do not support their leader’s common ownership aspirations. Such has always been the dilemma for the labour and trade union movement and it’s probably at the heart of the dysfunctional nature that trade unions and indeed the Labour Party are prone to exhibit.

But, is it credible to nationalise a parcels company like City Link? In asking this question we have to try to put to one side the terrible way the employees of this failed company have been treated over the Christmas/New Year period. Indeed, you could say that this failing company has exhibited what could be called the worst face of capitalism.

There are clearly many other such parcel delivery companies trading in the same way as City Link although obviously, it would seem, more successfully. So how would nationalising City Link work in practice as the Government could, by implication, be going into competition with the other companies in this sector? At this point you start to scratch your head because surely the only sensible thing to do in following this socialist ideal would be to nationalise the whole sector!

Ed Miliband would not nationalise City Link or the delivery sector because to do so, or to even talk about it as a possibility, would certainly seal the Labour Party’s demise in a similar way to when they self destructed during Michael Foot’s time as Leader.

I actually have every respect for true socialists and count some amongst my friends but they are trying to change an economic system from black to white and it simply is not going to happen. As an aside, a conversation with a Labour Party friend of mine was revealing recently he told me that he was a capitalist. Thereby hangs another big dilemma in that many Labour Party members are not socialists.

But why not suggest that the company, or what may look to be viable parts of it are floated off as mutuals or co-operatives owned by the workforce. Surely such a move would be a more practical solution if the owners of the company’s assets would allow this to happen.

As my colleague Iain Brodie Browne has said many times we have missed a trick by not embracing the mutual and co-operative route to create sound enterprises. Indeed, there has been a failure across the whole political spectrum to both promote mutuals/Co-ops and to put in place a legislative structure that could positively assist their creation and the sustainability of them.

Sorry, nationalisation would simply not work with City Link and it is an unfortunate distraction from a trade union movement, which as I have said many times, has failed to find its place in this period of austerity and financial instability.

As a foot note, I would add, this does not mean that I can’t see a place for nationalised companies because in our railways I can see a strong argument for them being run, again, in that way.