Public and Commercial Services Union

“The notion that privatisation leads to greater efficiency and the transfer of risk, the government’s two key arguments, now lies in tatters, yet the government remains dogmatically attached to its failed neo-liberal ideology of privatisation, liberalisation and deregulation”.
- John McDonnell MP, chair of PCS parliamentary group.

The privatisation and outsourcing of public services has been a constant threat to those services and the staff who deliver them for more than two decades now.

First pursued by Conservative governments in the 1980s and 1990s, the programme and ideology of privatisation has, if anything, accelerated under Labour since 1997.

The private finance initiative

This policy, always flawed, is further undermined by the Labour government’s preferred model of delivering private finance into the public sector - the private finance initiative (PFI).

Under PFI, private contractors pay for the construction cost of building projects in the public sector, and lease the finished project back to the public sector for periods of up to 30 years.

PFI is attractive to the government because PFI contracts take the cost of borrowing off the public sector balance sheet, thus improving the government’s finances.

However, this is an ephemeral saving, whittled away over time.

Because the cost of borrowing is much higher in the private sector annual expenditure on PFI is higher than if projects were funded through conventional means. In addition, as contracts are of approximately 30 years duration, PFI locks future governments into huge, on-going spending commitments.

A pro-private sector policy has now become the default position of the Government when faced with restructuring and reforming the public sector.

PCS challenging privatisation

PCS has sought to challenge that position on the national policy level through reasoned and evidence-based critiques submitted to public consultation exercises, academic and trade union seminars, and other policy forums.

On the local level, there are a number of things that PCS representatives can do to ensure that members faced with transfer to the private sector are protected, from fighting the original proposal to ensure the work remains in-house, through intensive negotiations with bidders for the contract to ensure that good terms and conditions are maintained, to organising robustly to ensure that if a transfer does proceed PCS still represents members in the commercial sector.

This toolkit is designed to help PCS representatives through these stages of dealing with privatisation and outsourcing, providing links to useful information, and practical suggestions and advice.

For those seeking more detailed legal or technical information, further guides are available from PCS legal services and PCS policy, research, information and bargaining support (PRIBS).

Representing members interests

PCS has great experience of campaigning against privatisation and protecting members interests before, during and after their transfer from the public sector to private sector. The aim of this toolkit is to help PCS representatives:

• Identify risks to members being transferred
• Challenge assumptions about the benefits of transferring services from the public sector to the private sector in order to ensure outsourcing is stopped or at least minimised
• Understand what they could and should expect from consultation during any transfer negotiations or process
• Be centrally involved in the process of assessing bidders for contracts
• Ask and assess the answers to key questions relating to a transfer, including TUPE, to protect members current and future terms and conditions
• Know where to go for help during this process
• Represent the interests of members before and after a transfer.