Privatization, The God that Failed (lesson from UK)


JF-Expert Member
Feb 26, 2014
Wakati ambapo naona Sera ni kubinafshisha na kuuza mali zote za State/ na kwa mwendo huu huenda hata TANESCO ikawa kwenye Pipeline ni vema tukaangalia waliotangulia walifanya nini na walifanikiwa vipi.

Kwa msaada huo ninaleta extract kutoka kwenye Gazeti la the Guardian kuona mtizamo wao kuhusu Privatization ya Mashirika ambayo yalikuwa Commanding Heights ya Uchumi wao.


The Guardian view on privatisation: the god that failed​

We were told privatisation would mean great services, savings for the government and an investment boom. It was a lie

Three ghastly faces of the UK’s privatised economy have been on show this week. On Wednesday, the energy regulator, Ofgem, was judged guilty of adding £2.7bn to household bills because it was so keen to create a competitive energy market that it did not properly check the slew of shaky outfits setting up as suppliers.

Now that 28 providers have collapsed, such light-touch regulation is producing costly chaos – not only for customers of Bulb and the others, but for everyone, because we will all foot the bill.

Earlier, Anglian Water announced that it would pay a £92m dividend to investors, despite the Environment Agency fining it for water pollution on three separate occasions in the past few months. And in the story of the week, the transport secretary, Grant Shapps, ducked out of talks with the rail unions, claiming it wasn’t his responsibility to negotiate. Yet the government not only owns the company that owns the tracks, tunnels and signals, but is also the paymaster for all the train operators.

These are three stories of privatisation provoking market breakdown, providing rewards for failure, and serving as the thinnest of veils for what is ultimately a publicly run system. This was not what the British were promised when ministers flogged off the family silver. During the tenures of Margaret Thatcher and John Major, the government went on a selling spree unmatched by any other industrialised economy. Telecoms, gas, electricity, water, airlines and trains: they were all bundled up and sold off. Other public goods were surrendered too, often for a song – the biggest example being nearly 2m council homes.

Each time voters were assured that privatisation would mean great services, savings for the government and an investment boom. The claims about services can be disproved by every story of raw sewage being pumped into rivers or of packed intercity trains.

The rhetoric of rolling back the state does not stand up well either: whatever her claims, Mrs Thatcher never actually cut the amount that the country paid in tax and, even before the pandemic, the size of the state – measured by government spending as a share of national income – was roughly in line with the 1970s. As for investment, that is also hard to justify.

Take the Thames Tideway super sewer, which is not being paid for by Thames Water’s owners – who have taken many millions out of the business in dividends – but largely by its customers in the form of higher water bills. Even before Covid, train operators have often taken government subsidy and provided little direct investment.

Privatisation is the god that failed. As an object of worship, it has proven expensive for the public and a bonanza for comparatively few investors, often overseas. And in key areas such as council housing, it has proven a singular disaster. Yet, remarkably, it is still the preferred solution of any Conservative government for everything from Royal Mail to housing association homes.

Perhaps the TV pundits sounding off about rail strikes this week could direct some of their ire not at the workers but at the owners and politicians who have created such a mess of a system, marked by shoddy service, naked profiteering and a complete lack of ownership. And perhaps the Tory politicians who sounded off about taking back control could be held to account for how their predecessors left the public with so little control.


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