_ FEATURE

dogma of privatization that has become
the overriding factor for the Thatcher
government.

If it is passed, “it will create an explo-
sion of privatization by local authori-
ties,” Peter Willsman, research director

- for the 700,000-member National Union

of Public Employees, told the Tribune.

But it will have nothing to do with
efficiency and the only beneficiaries will
be a handful of private
Contractors — many of which donate to
the Tories, he said.

Willsman, who is also a Labour Party
Councillor on the London Education
Authority, said that NUPE, together
with other unions and local councils, is
Waging a vigorous campaign against the
bill which is seen as a direct threat to
local democracy.

Wherever the Thatcher government
has imposed its legislative regime of pri-
vatization for public services, the pattern
has been the same.

The government is now
Moving — for the second time — to
Privatize Britain’s water system and in
Preparation, local water authorities have
been compelled to limit borrowing and
to guarantee a minimum return on
Capital — forcing authorities to raise
Water rates.

“The financial targets ... clearly aid
Privatization,” the Labour Research
Department reported in May, 1986,

“they have made the authorities more
Saleable by increasing their profits and
Teducing their debts, and they have laid
the groundwork for operating water ser-
Vices for profit.”

In public transport, privatization
began. with legislation. in 1985.and the
Process, of'selling off the buses: to the —
Private sector is now roughly half com-
Pleted. The National Bus Company,
Which operates public transit in many
Major British cities outside London, was

- Split up into 72 separate companies for

Privatization, of which 43 have been sold

off. At Some time in the future, buses in
ndon as well as those in Scotland will
privatized.

But already there are the inevitable
Cuts in jobs, reductions in service and the
Corporate takeovers which make a
Mockery of competition.

“At first, there was a major influx of
competition i in some areas like Manches-
ter and Oxford,” said Keith Blackburn, a
Tesearcher for the Transport and General

Orkers Union. “Buses were racing to
Pick up passengers and there were some-
times several bus companies serving the
Same routes.”

That was only last October. Now, rid-
*Ts can wait for buses for long periods in
the early morning, late at night or on

Sundays, he said. “The most profitable

Period is from 7 a.m. to 7 p.m. — so
that’s when the service is concentrated.”

And the companies have moved to
Push the union out, using new mini-
Uses which can be driven by relatively
Unskilled drivers, whose licence require-
Ments are far less stringent. “And they
£arn on average 40 per cent less,” said
Blackburn.
The downward pressure on wages
pe cadicts one of the claims made by
© Thatcher government about
Privatization — that it has not cut
Wages, That has been true, by and large
in the manufacturing companies, such as
guar, where although there have been
favy layoffs, the workers who remain
ave managed to keep up their wage lev-
“ls and have even obtained increases.
But in the public sector, the effect of
Ompetitive bidding by private contrac-
°rs'has pushed wages down as pay lev-

_ “S and benefits are cut to retain

Contracts in-house.

jobs, paleo,

ith the pay cuts have gone job
losses — the TGWU has cal-
culated that 20,000 jobs have

been lost in public transport in
Britain since privatization began.

But even apart from workers’ consid-
erations, Blackburn emphasized, the real
question is: does the public benefit from
privatization? Do they get better, more
efficient service as the government has
claimed they would?

“The answer to that is an emphatic
‘no’,” he said.

“There’s no question, wherever there
has been privatization involving public
services, the record has been terrible,”
echoed Willsman. “It has invariably
resulted in cuts in services and cuts in
staff.”

But what about the overwhelming
public support that Thatcher claims for
her privatization program? That, too,
tends to evaporate under scrutiny.

A poll conducted for the Trades
Union Congress in October, 1986 by
NOP Market Research found that a
majority of people opposed private con-
tractors running services such as hospital
laundries and school meals and an even
greater majority — 71 per cent
— supported public ownership of essen-
tial services such as gas, electricity and
water. On British Telecom, 53 per cent
supported public ownership even though
the utility had been privatized two years
earlier.

“Thatcher isn’t a consensus
politician — she doesn’t listen to public
opinion,” Willsman noted. “‘She’s com-
mitted to privatization.”

Roy Jones, an industrial reporter for
the-British labour daily Morning Star,
who has covered’ the privatization pro-—
gram for several years, concurred.
“Thatcher isn’t concerned with reason or
logic — she’s into providing profits for
her friends, no matter what the conse-
quences.”

For the corporate sector, the conse-
quences have been significant — a new
surge of profits, which has seen expres-
sion in a flurry of takeovers by British
companies in the U.S. and Canada. For
those people who were able to buy
shares of privatized companies, there
have been quick profits from under-
valued stocks. The banks and investment
houses have benefited immensely from
substantial brokerage fees.

But for the majority of ordinary Brit-
ons, privatization has left a legacy of
reduced services, a declining industrial
base that Thatcher has done nothing to
revive — and the prospect of a fiscal cri-
sis when the money from the sale of the
country’s public assets runs out.

For people in this province, the lesson
is clear. There is no reason to think that
the “Thatcher model”, however modi-
fied, would yield any different results in
British Columbia.

Next week:
Selling
Britain’s
assets:
The share
handouts

. For months, the unions eee
British Telecom, backed by consumer
groups, had been stating their case about

staff cuts.

its phone links with the outside world
inadvertently cut — and later was over-

at Britain’s: newly-privatized telephone
_ company gained national, and even
_ international attention. _

ihe problems: have been there with
“the: ‘company since privatization and

ting it ready to sell off,” said Terry Wild

_ of the National Communications Union.

_ “But it has reached a crescendo in the last

few weeks. It’s Teally shown what
_happens under privatization.”

British Telecom’s chairman, Sir George

- quickly stepped forward to insist that the
problems were the result of a strike in
__ February and delays in se new
switching equipment. —
But no one has accepted that argu-
‘ment and despite the best efforts of the

(Oftel), British Telecom has become a

proposals go into effect.

_ BRITISH TELEPHONE BOOTHS ...

_ pany was re-structured, both to make it
_ more profitable for prospective investors

and tore-orient the company away from
__ provision of an integrated public service

phase-out of cross-subsidization of rates
was begun and the company was broken
up into separate divisions.
“Even before privatization, the feeling
was built up among workers and the
public that maybe things would be better
under private ownership,” Wild noted.
- But if anybody harboured such
notions, they would have quickly dis-
carded them once the company was sold
offin November, 1984. The phase-out of
the cross-subsidy — whereby profitable
services, such as long distance calling,
_ subsidize local service — was stepped
oP Rumen: in increases for local calls

__ job losses, faulty telephone boxes, poor _
_ directory assistance service and virtually —
unobtainable Mae services caused by

But i it wasn’t con Scotland Yard had.

__ charged forits calls — that the problems

_ even before as the government was get-.

_ Jefferson, resigned amidst the furore. He -
was replaced by Iain Vallance who |

- government and the ineffective watch- —
dog, the Office of Telecommunications -

high-profile demonstration of the folly of sia fuk 1987, er oe cae one in Hind

_ public sector. It will likely be compelled
_ to provide those figures in future as a
_ result of the public outcry, however.

__ blot on the Tories privatization portfo-
lio, it isn’t the only one. British —

repeat the pattern of the telephone util
ity, maintaining high rates despite falling

. ish Gas charges and prices in other west-
before privatization, the com- :

- to an enterprise i in which each division |
_ would pay its way. A program of sweep-
ing job reductions was initiated, the

British Telecom:
_ Putting profits
_ before services

and rentals as well as installation fees.
New charges were also introduced.

The tempo of the job cutting program
was also stepped up, and within 18
months of the privatization taking place,
nearly 11,000 workers lost their jobs. The

_ cut in the number of operators and main-
_ tenance workers was particularly acute,

according to the British Telecom Unions

_ Committee (BTUC), but there were also

cuts in research and development as well
as the elimination of the Buy British pol-
icy, further aggravating Britain’s indus-
trial decline.

“These job reductions are not the
result of technical change,” the BTUC
stated in a report published two years
after privatization. “They are part of a
sustained company policy to reduce staff
numbers because that is what the City
(the London financial community)
wants.” :
_ Certainly the city got what it wanted:
BT reported profits for the year ended
March 31, 1987 of £2.07 billion — an
11.7 per cent increase over the previous
year. But for phone users, British Tele-
com has chalked up a record worse than

any other public service.

According to Britain’s National Con-

sumer Council, service standards have
“significantly worsened” since the com- _

pany was privatized. Even Oftel, citing
its own survey conducted between April

Said Wild. Now ifs among tic worst

because of the reductions in operators.”
Worse, Britons may soon have to pay
extra for the service if British Telecom’s

Significantly, after it was privatized,
British Telecom discontinued publishing
its record of service performance, which
it had routinely provided while in the

But if BT has become the most visible

privatized last year, is

world gas prices and reducing service
while it turns in increased profits. “Since
privatization, the gap between what Brit-

ern countries has, if an , widened,”
the Chemical Industry Association
charged last month.

“TeauhiGars tu ostacn cee of
poor service,” said Financial Times
reporter Charles Leadbeater. “It is an
awful provider of services. They were
bad before but they’re worse under pri-
vatization.”

Both British Telecom and British Gas
are monitored — by Oftel and Ofgas,
respectively — but in both cases, “‘they’re
examples of how monopolies have cap-
tured regulatory agencies,” Leadbeater
noted. —

Oftel underlines the problem: its
director-general, Bryan Carlsberg, who
lunches with the company’s chairman,
told the British Observer Sept. 13: “I

think BT is perhaps like a supertanker, a

little hidebound by its own size, but very _

much better as a private company thana

staleeostegiied enterprise.”

PACIFIC TRIBUNE, OCTOBER 14, 1987 e 7