Tony Blair’s Privatisation Move  Rejected By Labour Conference

Nagen Das

from London

LABOUR conference delegates inflicted a serious defeat on Tony Blair's privatisation policies at the annual conference of Labour Party held last week at Blackpool. It is only the second major conference defeat Blair has suffered since he became leader.  By a vote of 67 per cent to 33 per cent, the delegates called for an independent review of the use of private finance in public services - the government's Private Funding Initiative (PFI)  and the Public Private Partneship (PPP) schemes.

This modest demand was too much for New Labour leaders. It had become a symbol of the anger which millions of people feel about the rip-off firms that are making huge profits out of the National Health Service (NHS), schools and local government services.

The party leadership fought hard to defeat the motion. They lost the vote comprehensively, despite wheeling out deputy prime minister, John Prescott, Chancellor (finance minister) Gordon Brown and trade minister, Ian McCartney, to argue against the motion.

All three have at various points been seen as closer to "Old Labour" views than the coterie around Blair. Yet despite their speeches the "affiliated organisations" section of the conference (made up almost entirely of the trade unions) voted 92 per cent for the review.  When chief secretary to the Treasury, Paul Boateng spoke, parts of his speech were slow-handclapped, booed and jeered by delegates. There were shouts of "Sit down!" and "Rubbish!"

"His patronising and sneering tone summed up everything that is wrong with this government," said a delegate.  The defeat for the government is a clear sign of the growing divide between the party and the government (an oft repeated statement in India).  This defeat for Tony Balir and his team comes after two years.  The first came when the conference demanded a restoration of the earnings link for pensions. New Labour, of course, ignored that vote. The general secretary of the Unison public sector workers' union, Dave Prentis, opened this week's conference debate on PFI. "This is not about abandoning investment or putting jobs of building workers at risk, as some have cynically claimed," he said. "It's about why profits of 20 to 30 per cent are made from these PFI schemes, and what happens to workers pushed into the hands of private companies. We have low paid women workers eulogised from the platform by ministers, but under PFI they are sold on as commodities to the lowest bidder."

Several delegates claimed that without PFI the government would fail to build the hospitals and schools that everyone wanted.  And Ian McCartney tried the outrageous trick of saying that using private companies represented a socialist move. "I joined the Labour Party because I wanted to get my hands on private capital. We are taking the money from City speculators and using it for schools and hospitals," he said. McCartney stood the truth on its head.

Under New Labour, private firms are pumping money from public services into their profits. Money that could be used for the benefit of everyone ends up enriching a tiny few. Mick Rix, general secretary of the Aslef train drivers' union, said, "If the government doesn't listen we'll all pay the price. "The public can see we are mortgaging our kids' future to make the fat cats fatter today."

Lewisham delegate Christopher Mills said that it would be wrong for New Labour to say "public good, private bad". He heaped praise on the success of the vast "Public-Private Partnership" project to rebuild Glasgow schools.  Nobody had told him that just a few days earlier Glasgow City Council had begun moves to renegotiate the whole contract.  The council has found that local communities cannot get proper access to the privately-controlled school sports and leisure facilities that form part of the project.

Bill Morris from the TGWU transport workers' union said, "If the public services debate is about anything, it is the future of the NHS. "We are told that we have to move on from the 1945 model of the NHS. "But I have no wish to move on from the principle of a publicly funded, publicly available service free at the point of use."

In a very effective speech, John Edmonds, the leader of the GMB general workers' union, said: "We have a dossier of PFI failures that stretch from here to the Edinburgh Royal Infirmary. That was seen as such a success that the prime minister was taken there to open it. Six days later the health board announced that because of cost overruns clinical and support staff were to be sacked. The directors of the top 15 PFI companies last year got increases of 32 per cent. I wish GMB members and the firefighters could get their hands on increases like that."