Could privatisation curb big-spending departments?

David Cameron wants private companies to bid to provide public services. This is how it might work...


What could be privatised?

Many would argue that Michael Gove, Education Secretary, has already set in train a privatisation of the schools system. Every state school is being encouraged to become an academy, free from local education authority control and able to run their own affairs like independent schools. He is also setting up a national network of "free" schools run by parents, teachers, faith groups and charities. Freedoms include buying in their own services instead of relying on the local education authority. In the university sector, ministers anticipate a growth in the number of private universities offering degree courses following the introduction of a "market place philosophy" with fees of up to £9,000 a year.

A privatisation too far?

What might be a step too far is to allow firms to make a profit out of running schools. Existing universities – noticeably members of the Russell Group, which represents 20 leading research institutions – may also go private if they are refused permission to charge the maximum £9,000 fee. Any that did goprivate would be free from any obligation to take instudents from disadvantaged backgrounds, which could cause an outcry. Richard Garner


What could be privatised?

Andrew Lansley's NHS Bill ushers in reforms so great they have been famously described as visible from the moon. One of the main aims is to shake up the service, and stimulate innovation, by allowing "any willing provider" to compete for business. Companies such as Bupa or Boots could bid to run services for diabetics, say, or to provide dermatology clinics in the high street. Boots could even put GPs in its stores. Hospitals could be taken over and run by Bupa, provided it could do so at NHS prices for NHS patients. Whoever provides the service, the bottom line is that treatment should remain free to NHS patients

A privatisation too far?

What has angered and upset medical organisations such as the British Medical Association is the emphasis in the Bill on the extension of competition and the involvement of the private sector, which remained restricted under Labour. Under Andrew Lansley's plan, the NHS could become a commissioning organisation and regulator, giving up its role as a provider of services. Critics fear this is a huge gamble which could lead to a fragmented service – and once driven through there would be no going back. Jeremy Laurance

Law and order

What could be privatised?

Eleven of the 139 prisons in England and Wales are run by three private companies – G4S Justice Services, Kalyx and Serco – and the number could increase as Ken Clarke and his team look for ways to reduce the Ministry of Justice budget. Parts of the probation service are to be removed from the state sector. Private firms and voluntary groups are to be asked to run bail hostels, while the Government has announced plans to sell off the Community Payback scheme, under which offenders avoid jail by working in their neighbourhoods. Mitie, Sodexo and Serco have been listed as preferred bidders.

A privatisation too far?

David Cameron made clear yesterday that the judiciary and the security services would remain in the public sector. The reason for this is plain: administering justice and keeping the country safe are among the core reasons for the state's existence. The Prime Minister did not give a similar guarantee to the police. Downing Street insisted that the police service was not about to be privatised, but its future shape remains a grey area. Could some backroom functions – such as IT – be contracted out? Or could forces be encouraged to sell their services to each another? Nigel Morris


What could be privatised?

Iain Duncan Smith's Department for Work and Pensions is already enthusiastic about opening up its activities to outside groups. Last November, it announced details of its work programme, which will see private companies and voluntary organisations paid up to £14,000 for every long-term unemployed person they get back into work.

The DWP has also contracted out its pilot scheme to assess whether claimants of incapacity benefit are fit to work to the medical services company Atos Healthcare.

Initial results from the schemes in Burnley and Aberdeen suggested that two thirds of those claiming long-term incapacity benefit were fit to work. But critics said that the company had an interest in ensuring that as many people as possible were found to be fit for work.

A privatisation too far?

There are few political sacred cows for the Conservatives in the world of benefits. In principle they would have no problem in privatising job centres as well as all payment and assessment systems. Payment by results is the name of the game – but even if the results prove elusive they may end up paying anyway. Oliver Wright

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