barry_x's review against another edition
4.0
I thoroughly enjoyed reading this book which highlights the effect of privatisation in Britain over the last 30 years or so. One of the things I found particularly interesting was just how relevant each chapter was today with what is happening politically and socially in the UK right now.
Each chapter focuses on a particular element of privatisation - the book doesn't cover every industry and doesn't go into depth of the history for every privatised industry. What it does is present case studies of the failures post privatisation and the impact it has on people today.
The chapter on the privatisation of Royal Mail is the first chapter and is of some professional interest to me as I have worked in the postal sector for 15 years and my organisation accesses downstream access providers (companies which collect and sort post then forward to Royal Mail for final mile delivery). I've seen significant changes in the postal industry and it's impact on society. The postal industry in the UK is designed for large business user mailers who can access the cheapest discounts by presorting their mail and optimising the mail piece formatting and addressing. Small businesses and the public consequently pay significantly higher costs. What happened in the UK is that the postal market was deregulated before Royal Mail was privatised. Effectively many small players quickly entered then left the market and what we've got left are the behemoths of the Dutch postal industry cherry picking large customers whilst Royal Mail have to maintain the Universal Service Obligation (deliver for the same price anywhere in the country and deliver to every address six days a week).
Traditionally high volume business mail subsidised personal mail which the whole country accesses. The end result will be the public will pay more for accessing postal services as Royal Mail no longer have custom from high volume mailers.
It's true that mail volumes have come down and Royal Mail have changed from a letter delivery company which delivered the odd parcel to a parcel delivery company which delivers the odd letter. However I recall a year or two ago when George Osbourne hailed TNT Post (now Whistl) for creating 2,000 jobs in Manchester. Meek makes a great point - mail volumes are dropping so this is not 'new' work. These 2,000 jobs are effectively going to put Royal Mail postal workers out of work. Working in Royal Mail today is relatively paid appropriately, has a reasonable pension and a strong trade union. It's a good job that serves a function and deserves to be paid.
Royal Mail do make a profit on downstream access mail so how are companies like Whistl making any money on mail they hand over - they don't have the technological advantage - it's simple, they cherry pick big customers and create efficiencies through minimum wage, limited unionisation and zero hours contracts. The 2,000 jobs hailed as job creation and evidence of the economy improving is little more than promoting a race to the bottom for the sector and devaluing the people who work in this industry.
Royal Mail was ridiculously undervalued when floated and cost the Treasury billions whilst the hedge fund managers made a killing. The future for the postal sector will be significant price rises, fewer deliveries per week and restrictions of service in rural and remote areas.
I read the chapter about Railtrack - the privatisation of the nations railway infrastructure one morning sat on a park near work, overlooking the train station which is a major stopping point on the West Coast main line. The West Coast mail line was in need of significant modernisation. When Railtrack was due to be privatised, due to desiring to be appealing to investors the cost of the work was significantly undervalued. Technology for signalling was recommended which would have reduced in significant staff reductions - of course it had not even been developed and their was no evidence it would work. They worked on a 'repair when faulty' maintenance program which suggested that no repairs would be required for 20 years! They signed contracts with rail providers guaranteeing speeds without any consideration of other users of the line. In effect the total cost was 1,000%+ over budget and required tax payer bailout, instead of taking 'two years' it took fifteen and the aims still have not been achieved. An extraordinary story of foolishness, dangerous group think and incompetence. Fascinating.
The next chapter relates to the privatisation of water and highlights Meek's position that anything that is 'necessary' is effectively a tax whether it is collected by the government or private business. Meek is consistent with this and actually makes a good point time and time again that the burden of tax hasn't gone, it's just passing from public to private hands. The story relates to Severn Water and how it failed to invest in critical flood defences which left a whole county without water for 10 days whilst making massive profits. Of course, since the flood was an 'act of God' of course the company didn't pay any compensation to customers. What is interesting is that people think privatisation creates competition which improves customer service, quality and reduces prices. In the UK your water is supplied by regional water companies and you have no choice on who to get water from. Of course, all the companies are now in foreign hands and dividends are going into pension pots of people around the world. This chapter reminds me of my younger days when annoyed at rising water prices I sent the Chief Executive of my water company for the air he was using. Water and Oxygen are essential for human survival so if a water company can be formed and charge me for the service why can't I charge them for air. They own water no more than I own air. Of course in the UK now we have seen the introduction of water meters that can lead to peoples water supplies being cut off.
The chapter on the electricity industry was decent. It highlights how the entire industry was dismantled and sold off piece by piece which created an unusual situation where the operation of the National Grid was a different company from the regional energy suppliers which were different companies from the suppliers of cables and infrastructure which were different from the owners of gas, nuclear and coal power stations.
Meek clearly joins the dots which shows how instead of creating competition to improve prices for customers we have companies who now own both the means of production (the power stations) and the suppliers which creates a situation where organisations can set the price of energy artificially and sell it back to us whilst reaping massive profits. Furthermore, the industry is effectively owned by massive European and Chinese companies. Indeed, the French nationalised energy industry owns swathes of the UK's industry and profits accordingly. Of course, the suppliers primary concern is profit which leads us to a situation where 30 years later we have power stations requiring to be replaced, investment in green technology is limited and we potentially could be heading to an energy crisis. Ultimately the nations energy supply and capacity is a government and long term planning responsibility, not to be at the whims of the shareholders. In the UK today, we no longer have the capability to build and manage power stations and no longer have the technical expertise to manage our own energy requirements.
The chapter on the back door privatisation of the NHS is again enlightening. I think it's important to recognise just a few weeks before a General Election that although the Tories will decimate the NHS it was Labour who ran with this ball. Who do you trust to run the NHS? None of the big two in my book. Much of the article focuses on replacement hips, the cost of them, the marketing of them and the devastating impact of market forces rather than care on patients. Interestingly I'm aware of the hospital mentioned. I have a good friend who had a knee replacement at the hospital and received exemplary care. Within the NHS it's true that an ageing population has created more demands on the NHS. Furthermore as medical expertise progresses procedures and treatments once considered a luxury are now expected. Ultimately we need to invest more in our Health Service if we want it to provide what we expect. We spend less per person on healthcare than 'better' systems like the French and US so it perhaps isn't as wasteful as suggested.
The final chapter on the sell off of Council Housing was great and an area of interest for me (and once again the Tories are touting 'Right to Buy'). There is a housing crisis in Britain. Many are living in overcrowded, poorly maintained properties. We have a chronic shortage of single bedroom homes as the demographics of our nation has changed. We have a chronic shortage of social housing and a market which makes it exceptionally difficult for first time buyers to get on the property ladder. What happened is the state gave generous discounts to people to buy social who then eventually sold to private investors forcing up rents. Councils then sold off their stock to housing associations which has created more insecurity for tenants. This has all led to a massive drop in the availability of affordable housing. Add to this the landlord class who buy up all the 'first time buyer' homes and we've created a situation where we once could house anyone and now we simply can't.
Each chapter focuses on a particular element of privatisation - the book doesn't cover every industry and doesn't go into depth of the history for every privatised industry. What it does is present case studies of the failures post privatisation and the impact it has on people today.
The chapter on the privatisation of Royal Mail is the first chapter and is of some professional interest to me as I have worked in the postal sector for 15 years and my organisation accesses downstream access providers (companies which collect and sort post then forward to Royal Mail for final mile delivery). I've seen significant changes in the postal industry and it's impact on society. The postal industry in the UK is designed for large business user mailers who can access the cheapest discounts by presorting their mail and optimising the mail piece formatting and addressing. Small businesses and the public consequently pay significantly higher costs. What happened in the UK is that the postal market was deregulated before Royal Mail was privatised. Effectively many small players quickly entered then left the market and what we've got left are the behemoths of the Dutch postal industry cherry picking large customers whilst Royal Mail have to maintain the Universal Service Obligation (deliver for the same price anywhere in the country and deliver to every address six days a week).
Traditionally high volume business mail subsidised personal mail which the whole country accesses. The end result will be the public will pay more for accessing postal services as Royal Mail no longer have custom from high volume mailers.
It's true that mail volumes have come down and Royal Mail have changed from a letter delivery company which delivered the odd parcel to a parcel delivery company which delivers the odd letter. However I recall a year or two ago when George Osbourne hailed TNT Post (now Whistl) for creating 2,000 jobs in Manchester. Meek makes a great point - mail volumes are dropping so this is not 'new' work. These 2,000 jobs are effectively going to put Royal Mail postal workers out of work. Working in Royal Mail today is relatively paid appropriately, has a reasonable pension and a strong trade union. It's a good job that serves a function and deserves to be paid.
Royal Mail do make a profit on downstream access mail so how are companies like Whistl making any money on mail they hand over - they don't have the technological advantage - it's simple, they cherry pick big customers and create efficiencies through minimum wage, limited unionisation and zero hours contracts. The 2,000 jobs hailed as job creation and evidence of the economy improving is little more than promoting a race to the bottom for the sector and devaluing the people who work in this industry.
Royal Mail was ridiculously undervalued when floated and cost the Treasury billions whilst the hedge fund managers made a killing. The future for the postal sector will be significant price rises, fewer deliveries per week and restrictions of service in rural and remote areas.
I read the chapter about Railtrack - the privatisation of the nations railway infrastructure one morning sat on a park near work, overlooking the train station which is a major stopping point on the West Coast main line. The West Coast mail line was in need of significant modernisation. When Railtrack was due to be privatised, due to desiring to be appealing to investors the cost of the work was significantly undervalued. Technology for signalling was recommended which would have reduced in significant staff reductions - of course it had not even been developed and their was no evidence it would work. They worked on a 'repair when faulty' maintenance program which suggested that no repairs would be required for 20 years! They signed contracts with rail providers guaranteeing speeds without any consideration of other users of the line. In effect the total cost was 1,000%+ over budget and required tax payer bailout, instead of taking 'two years' it took fifteen and the aims still have not been achieved. An extraordinary story of foolishness, dangerous group think and incompetence. Fascinating.
The next chapter relates to the privatisation of water and highlights Meek's position that anything that is 'necessary' is effectively a tax whether it is collected by the government or private business. Meek is consistent with this and actually makes a good point time and time again that the burden of tax hasn't gone, it's just passing from public to private hands. The story relates to Severn Water and how it failed to invest in critical flood defences which left a whole county without water for 10 days whilst making massive profits. Of course, since the flood was an 'act of God' of course the company didn't pay any compensation to customers. What is interesting is that people think privatisation creates competition which improves customer service, quality and reduces prices. In the UK your water is supplied by regional water companies and you have no choice on who to get water from. Of course, all the companies are now in foreign hands and dividends are going into pension pots of people around the world. This chapter reminds me of my younger days when annoyed at rising water prices I sent the Chief Executive of my water company for the air he was using. Water and Oxygen are essential for human survival so if a water company can be formed and charge me for the service why can't I charge them for air. They own water no more than I own air. Of course in the UK now we have seen the introduction of water meters that can lead to peoples water supplies being cut off.
The chapter on the electricity industry was decent. It highlights how the entire industry was dismantled and sold off piece by piece which created an unusual situation where the operation of the National Grid was a different company from the regional energy suppliers which were different companies from the suppliers of cables and infrastructure which were different from the owners of gas, nuclear and coal power stations.
Meek clearly joins the dots which shows how instead of creating competition to improve prices for customers we have companies who now own both the means of production (the power stations) and the suppliers which creates a situation where organisations can set the price of energy artificially and sell it back to us whilst reaping massive profits. Furthermore, the industry is effectively owned by massive European and Chinese companies. Indeed, the French nationalised energy industry owns swathes of the UK's industry and profits accordingly. Of course, the suppliers primary concern is profit which leads us to a situation where 30 years later we have power stations requiring to be replaced, investment in green technology is limited and we potentially could be heading to an energy crisis. Ultimately the nations energy supply and capacity is a government and long term planning responsibility, not to be at the whims of the shareholders. In the UK today, we no longer have the capability to build and manage power stations and no longer have the technical expertise to manage our own energy requirements.
The chapter on the back door privatisation of the NHS is again enlightening. I think it's important to recognise just a few weeks before a General Election that although the Tories will decimate the NHS it was Labour who ran with this ball. Who do you trust to run the NHS? None of the big two in my book. Much of the article focuses on replacement hips, the cost of them, the marketing of them and the devastating impact of market forces rather than care on patients. Interestingly I'm aware of the hospital mentioned. I have a good friend who had a knee replacement at the hospital and received exemplary care. Within the NHS it's true that an ageing population has created more demands on the NHS. Furthermore as medical expertise progresses procedures and treatments once considered a luxury are now expected. Ultimately we need to invest more in our Health Service if we want it to provide what we expect. We spend less per person on healthcare than 'better' systems like the French and US so it perhaps isn't as wasteful as suggested.
The final chapter on the sell off of Council Housing was great and an area of interest for me (and once again the Tories are touting 'Right to Buy'). There is a housing crisis in Britain. Many are living in overcrowded, poorly maintained properties. We have a chronic shortage of single bedroom homes as the demographics of our nation has changed. We have a chronic shortage of social housing and a market which makes it exceptionally difficult for first time buyers to get on the property ladder. What happened is the state gave generous discounts to people to buy social who then eventually sold to private investors forcing up rents. Councils then sold off their stock to housing associations which has created more insecurity for tenants. This has all led to a massive drop in the availability of affordable housing. Add to this the landlord class who buy up all the 'first time buyer' homes and we've created a situation where we once could house anyone and now we simply can't.
schopflin's review against another edition
5.0
Depressing but so well-written and full of so many eye-openers that I couldn't put it down. It helped me get my head around electricity and the current changes in the NHS, and want to know more about all the storied.
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