Privatisation of public utilities..good or bad?

[cmonstanley]

bad bad at least the profits or money spent went to many not the few thatcher cronies ..the tories played with words if you cant see that now your off your head ie when they wanted to spend money on something motorways etc it was called investing when it came to a public owned company it turned into subsidized..so really the public was hoodwinked,while they were preaching lets make britain great in theory they were doing the opposite by smashing the only infrastrucure britain had now we are clueless wayward nation with nothing for the future except another recession and the only people who are looking forward to that are the scavengers who always make money out of other peoples misery.sorry folks but this is modern day britain that the thatcherites created..

[polly]

I think that this winter will see many peopel who currently think that privatisation of basic services was good change there minds.
As prices spiral out of control this country will see that it needs to be in control of fuel prices rather than paying over inflated prices to Fat Cats

As for public transport that has never worked properly since being privatised. The previous nationalised transport was not perfect but at least it was a service.

[andrewb]

Originally Posted by Mancie

Has privatisation been good or bad for the economy and the consumer?..what were the reasons for the Tories privatising gas, electric, water, railways ect?
Now was it just for the good of the nation, or a way to restrict union powers..or a means to fend off political criticism when price increases are in the offing?... or just a means of repayment to multinational companies that have funded the party into power?
Or was it a good thing for the country?

Privatisation has been fantastic. They privatised them because government is terrible at running business. It is much better if business can compete because the consumer wreaks the benefits. If you think a nationalised monopolistic energy company would provide cheaper prices in today's climate then you're sadly mistaken. The problem we have is that 90% of oil producing companies around the world are nationalised state run monopolies that are incredibly big, bloated and inefficient providing me you and everyone else with massive prices to pay.

Take petrol. Its already sky high and government think its a fantastic idea to sky rocket it by taking 80% of your money in tax. I hate tax - government are terrible at spending your money, they waste, waste and waste some more.

The railways I have always seen as a monopoly. Competition does not work there. When I go to the train station, I get on Northern Rail, every time. I have no choice in the matter. Without competition privatisation does not work, its just as bad as a state monopoly.

[cmonstanley]

ye right a country with no infrasructure and only answers to the chosen few fat cats thats right privatisation is good for the few how many billions are wasted being payed to shareholders rather being invested back into the infrastructure...thats good yes good for the chosen few and not the public at large,this is the best time to invest whaen people are looking at alternative ways of travelling but what do the privatised companies do?they raise the prices to keep their shareholders happy who are mostly foriegn companies .they are traitors to the infrastructure of this country thats very tory aint it doesntmake sense.tell the public they are proud to be british and in fact they would destroy britain for the chosen few and a quick buck..

[g jones]

Originally Posted by andrewb

Privatisation has been fantastic. They privatised them because government is terrible at running business.

That is such a simple dogmatic statement. British Coal was cheaper than any other coal in Europe for years until Thatcher brought in Mr Private Sector Supremo Ian McGregor and the cost rocketed.

Airports made £millions and TSB was a successful GOVERNMENT OWNED high street bank. Electric and Telephone made huge profits and didn't charge any more than now. Laissez-faire in Health Care is very costly. Market Forces and multiple providers in Social Services have been removed to lower costs and offer a better service and CCT added layers and layers of bureaucracy.

BwD have ended a big private contract because public sector can provide it cheaper and better.

The local Tories refuse to privatise for the same reasons. Every time they look at it they pull away. Benefits, Council tax, Market Hall, Refuse Collection, Trade Waste, Leisure (twice).

Its not just who runs it. Its how they think about things. Thatcher sold all our oil to Private Sector and it was sold for $1 a barrel. That old lefty Tony Benn said NS oil should have been state owned to protect it for future generations. I think Benn's idea in 2008 beats Thatchers hands down.

I work in the Private Sector so I see it from both sides.

[andrewb]

Originally Posted by g jones

That is such a simple dogmatic statement. British Coal was cheaper than any other coal in Europe for years until Thatcher brought in Mr Private Sector Supremo Ian McGregor and the cost rocketed.

It might have been, but it was still cheaper to import coal all the way from Australia.

Originally Posted by g jones

Its not just who runs it. Its how they think about things. Thatcher sold all our oil to Private Sector and it was sold for $1 a barrel. That old lefty Tony Benn said NS oil should have been state owned to protect it for future generations. I think Benn's idea in 2008 beats Thatchers hands down.

Your hatred of the woman seems to blind you from the facts. Can you tell us just how much taxation the private companies involved in energy are paying? If it equates to $1 a barrel I'll eat my hat.

[den the menace]

i see from your profile andrew that you are a young man of 20, so therefore you have only limited knowledge or experiance of what life was like for the majority of working people in britain before the tories came to power with that evil perverted woman as their leader. ill hazard a guess and say if you were put out of work by a deliberate consequence of conservative policy you may possibly look at things from a different perspective. the present conservative shadow cabinet is comprised of mainly ex public school boys/girls who had the good fortune to be born into familys of wealth and privelage.

let me ask you a question, do you realy believe that these people at the top of the pile are interested in improving the lives of the masses, if you do, im afraid you might be in for a shock or two when they take control after the next election. ive never met you but i cant help but get the feeling that you may be a rather nieve young man who may have possibly come into contact with some local conservatives who endlessly spout the mantra of hardwork and thrift and all these people on the social are nothing but layabouts etc. etc.

please dont think that im preaching the politics of envy, nothing could be further from the truth, my father was a self made man (a bookmaker) and my eldest son was privately educated, and even now i socialise with people from a very wide social spectrum. but im still a socialist, will you be a conservative 40 years from now? only time will tell.
dennis.

[blazey]

I use the trains a lot and trains are rarely late, and if they are it is only ever by a few minutes. Also, train journeys aren't that much more expensive than public transport and it still beats petrol costs any day.

Being young, I haven't got anything to compare it to unless I look at past statistics, but what seems to me is that it isn't BAD at the moment, it just isn't as good as it was decades ago and that is to be expected really.

I don't think it is something worth complaining about because nothing is going to be done it, certainly not by Labour, so we might as well just get on with our lives. It could always be worse.

[Eric]

Seems like this thread has nothing to do with economics and a hell of a lot to do with politics .... the right lines up in support of private enterprise and the left behind some measure of public ownership. And then there are the unquestioned assumptions, the main one being that business is more efficient at running things like railways and public utilities than government is. And not only railways and utilities: many on the right are touting privatization of health care in order to improve efficiency! This when many sources in the US report that in the private health care system, about 30% of the money paid by the patients goes to administrative costs ... a proportion vastly higher than in govt. run systems, including those in the US, which are far from the most efficient.

[jambutty]

You have to ask yourself why the 3 utilities and public transport were privatised in the first place. Badly run and inefficient they may have been plus whatever profits were gained were siphoned off by the government, so there was nothing in the kitty for repairs and re-investment etc. The government’s answer – get the public to pay for a service.

Under public ownership we had the Gas Board, who was responsible for procuring the gas, distributing it and billing for it. One company did it all. We had an Electricity Board and Water Board.

Now we have Centrica to supply the gas and various companies to distribute it. Two companies (two lots of workers wages) plus shareholders instead of one and no shareholders.

It was the same for public transport. A company runs the tracks and stations and various operators pay to use it/them. Then they got subsidised too and it was argued that the subsidy went straight to the shareholders. Guess who paid? Me and you. Well you actually ‘cos I don’t use the railways or buses.

We have several bus companies running a town service that was covered by the local authority and all wanting to make a profit. I understand that there is a government guarantee that they will not run at a loss, meaning that they are subsidised by us the taxpayer.

This privatising concept has even spread to council housing. Some time ago the Blackburn with Darwen council sold off the bulk of their “housing for rent” stock to a newly formed company Twin Valley Homes at a knock down price. As a small aside, guess who became the CEO of TVH? Why none other than Phil Richards who also happened to be the top man with the council in charge of housing. He was also charged with the task of conducting many meetings with the tenants to persuade them that the TVH route was the way to go. During one such meeting I asked him who the CEO of TVH would be. I’ve never seen a person go so red so quick but he didn’t answer my question other than the CEO will be appointed in due course. As an even smaller aside, Phil Richards was and maybe still is a top flight football referee who once refereed the FA Cup Final.

However in spite of my objections to the change Phil Richards and TVH have shown the local authority how to run some 8,000 homes for rent where the refurbishment plan is going ahead at a pace and annual rent increases are being kept down to the absolute minimum – just 1% above inflation I think it is. TVH needs that to pay off the $110 million loan that is being used to pay for all the improvements.

My one bedroom ground floor flat with a garden at the back costs just £59.47 per week. In 10 years my flat will earn TVH £29,735. It is unlikely that any of that money will be spent on my flat because it was recently re-furbished to modern standards that should last at least 10 years. Using my flat as a yardstick for all 8,000 properties, in ten years the rent income would be £237,880,000, which is more than enough to repay the loan and have a lot left over to finance the next 10 years. Now do the maths for the average rent of $70.

Why couldn’t the Blackburn with Darwen Borough Council have done the same? Simple - any revenue generated from rents was used for other things so there was nothing left for repairs etc. so the council borrowed $100 million from the government.

My point is that with the same personnel in place and the utilities in public ownership as none profit making companies, like TVH, the same profits would be made and those profits could be used to keep the prices down and still have something left over for re-investment.

Imagine if the current private utility and public transport companies were non-profit making companies like TVH.

[yerself]

Originally Posted by blazey

train journeys aren't that much more expensive than public transport

I may be missing something here, but aren't trains public transport?

[garinda]

Originally Posted by yerself

I may be missing something here, but aren't trains public transport?

Yes, unless you're the Queen, and you have your own private train.

[g jones]

Originally Posted by andrewb

It might have been, but it was still cheaper to import coal all the way from Australia.

Your hatred of the woman seems to blind you from the facts. Can you tell us just how much taxation the private companies involved in energy are paying? If it equates to $1 a barrel I'll eat my hat.

Australia subsidised coal too though their open cast mines did mean they were able to produce cheap coal. But as Blue going green I thought you would have been in favour of local suppliers LOL!!!! In the end the public sector outperformed the private sector by IIRC about 25% of the cost per tonne.

I don't hate Thatcher as I am more interested in the future than the past. I loathe how she wrecked our country.

Taxation revenues from Oil are irrelevant other than bailing out failed Conservative economic policies of the early 80's. Tony Benn's assertion was about reduced supply in future years. A nations wealth, not a few shareholders gold plated profits. We are now a net importer of fuel thanks to failed Conservative policies and we're all paying the price in our bills, just as Benn predicted.

Cameron and Co will wreck this country. You can't promise tax cuts, maintain current spending and ride out a world downturn. Only a clown reckons he can square all three. Looks like as the post above said, we're heading for more Conservative economic misery.

[andrewb]

Originally Posted by g jones

Cameron and Co will wreck this country.

Too late I'm afraid.

[steeljack]

Originally Posted by jambutty

My one bedroom ground floor flat with a garden at the back costs just £59.47 per week. In 10 years my flat will earn TVH £29,735. It is unlikely that any of that money will be spent on my flat because it was recently re-furbished to modern standards that should last at least 10 years. Using my flat as a yardstick for all 8,000 properties, in ten years the rent income would be £237,880,000, which is more than enough to repay the loan and have a lot left over to finance the next 10 years. Now do the maths for the average rent of $70.

.

I'd be intersted in knowing how many tenants of council (social) housing , are actually paying fair market rents out of their own pockets , without recieving any support from social services/Govt.benefits/ or other forms of support not available to the general population .

note. not aimed at old folks/pensioners........totally agree they should be in smaller units ....freeing up existing housing space for young families