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Issue #1678      March 25, 2015

Report shows privatisation doesn’t work

Shared services between the public and private sector, Public Private Partnerships (PPPs), or leasing or selling public services or assets to the private sector – these are all different names for privatisation in Australia. Under the title of PPPs, a new international report released today adds to the steadily growing pile of research showing that whatever the name, privatisation does not deliver for the community.

The Australian Services Union (ASU) has been campaigning against privatisation in its many guises for many years. More recently, research has been able to examine extensive patterns of privatisation over long periods of time, thus adding to the weight of evidence against moving public services and assets into private hands.

The new report from Public Services International (PSI) released last week, “Why Public Private Partnerships don’t work: The many advantages of the public alternative”, will play an important part in this debate.

“We welcome this new report from PSI and it will form part of our resources to fight privatisation in Australia,” said ASU assistant national secretary Greg McLean.

“This high level and independent report from academic David Hall, who I know has visited Australia a number of times and is familiar with our experience, is tremendous support for the ASU to receive for our work, as it has independently arrived at the same outcomes: that privatisation does not deliver the promised benefits.”

The report assesses the experience of privatisation in both industrialised and developing countries and contains a combination of 30 years of research by David Hall, who is a former Director of Public Services International Research Unit at the University of Greenwich in the United Kingdom.

The many case studies analysed show that privatisation has failed to live up to its promise. In most cases, it is an expensive and inefficient way of financing infrastructure and services, since it conceals public borrowing, while providing long-term state guarantees for profits to private companies.

“The report is very timely with privatisation having been such a significant factor in the Queensland election with the Newman government’s dramatic loss and currently in the NSW election campaign – politicians need to prick up their ears and listen,” said Greg McLean.

Voters are becoming much more informed about matters such as the ownership of public assets and the implications of selling those assets. They understand how revenue from publicly owned utilities, for example, is used to fund community services, education, hospitals, etc.

The public now asks questions about asset sales and they see that short term gains that one government may get don’t compare favourably to the long term benefits of retaining assets and the revenue streams they generate for the relevant community.

Privatisation is no longer done in private! The recent election results have sent a loud and clear message that Australians want a say about who provides our public services.

Next article – ABCC Bill

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