Select Committee to examine Blair's PPP initiative

Tony Blair's plans to make greater use of the private sector to reform public services are to be questioned in an influential House of Commons inquiry.

The Public Administration Select Committee is to investigate whether the Prime Minister's flagship private-sector reforms will undermine the public-sector ethos.

The wide-ranging inquiry will also look at whether there are "clear principles" behind the Government's plans and whether Ministers are answerable to Parliament.

The inquiry, to be launched this autumn, will question whether employees of private companies have the same motivation as doctors, nurses and other public-sector employees.

Reform of the health service, Railtrack, the London Underground and the use of private firms to run schools will be examined.

MPs will also consider private finance initiative (PFI) schemes and the use of insurance, contracting out and partnerships with private schemes.

They will question whether the greater use of private sector companies will require "new forms of accountability".

Business and union leaders, including Digby Jones, the director-general of the CBI, are to be asked to give evidence later this month about whether there is a potential conflict of interest between using more private money in public services.

The inquiry will ask whether central government has clear principles and an effective strategy for reforming public services. It will also look at whether the government needs to have a strategy at all, or whether it would be better to let public bodies make their own arrangements for improving services.

The inquiry could prove embarrassing to the Prime Minister, who has made the shake-up of public-sector services a key aim of his second term.

Tony Wright, the Labour chairman of the select committee, will examine whether there is "sufficient coherence in the accountability arrangements for public services" and "what measures should be put in place to ensure better accountability".

The committee has already advised that a public sector code be established. It will examine whether "greater private sector involvement is compatible with a public sector ethos".