There's a lot of good common sense in what Keith wrote on his experience
with NHS. Good common sense isn't always the way that privatization and
government contracting out proceeds, however.
My experience as a government sub-contractor was that the small firms and
non-profits that I worked for did the job better and more cheaply than the
government conceivably ever could have. I received good pay for challenging
but interesting work.
Sometimes the process for awarding contracts seemed as though it was custom
designed to ruin the small contractors. A costly bidding process would be
followed by months of unjustifiable delay in awarding the contracts
("nothing happens" during July, August and December; "nothing can happen"
until the start of the fiscal year; "everything _must_ happen" before the
end of the fiscal year...).
Stipulated service delivery dates are retained even though the delay in
awarding the contract has eaten up half the time scheduled to do the work.
No problem -- four months of 70 hour weeks can easily win back those
previous four months of enforced idleness.
One of the reasons the small firm I was with could provide service more
cheaply is that we chronically under-bid "to get our foot in the door". The
unspoken expectation was that once we had made ourselves indispensible to
the contracting agency we could pad the contracts out a bit more. That
happened once and the company almost choked on the revenue.
Eighteen months of bloated revenues left the company with too high operating
expenses just at a time when the boss's marriage was crumbling and a new
competitive regime was emerging. The new regime? Small components of BIG
firms started bidding against us in a market niche that the company had been
cultivating for a decade. Unlike us they weren't doing it for the money.
They were doing it to "establish relationships". Price Waterhouse and
Deloitte Touche could well afford to discount their consulting services. We
couldn't.
Another wave of "competition" came from a freshly minted crop of
severence-packaged government senior managers. The idea was these folks
already had the relationships and could help win a contract in border line
cases where competitive cost and quality of work were not decisive. I almost
puked when my boss started wooing one of these window-dressing mandarins.
Someone was going to have to "add the value" that this senior manager was
allegedly being paid for and it obviously wasn't going to be the person
being paid for it.
. . . and then there is that sly euphemism, "redundancies," peeking out from
the bottom line of Keith's privatization panacea. Let's assume that, as
Keith suggests, 2/3 of the white collar work force is redundant. Let's
further assume that cuts can be made without a great deal of disruption to
service. Now what do we do with all those PEOPLE whose jobs were redundant?
Surely Keith doesn't mean to suggest that the people themselves are
redundant and can be shipped off to an incinerator like so many mad cows. I
believe the classic argument is that they will simply go off and (out of
necessity) find something more useful and productive to do and they will do
it more cheaply. There is, after all, "not a fixed amount of work to be done."
I won't appeal to Keynesian, historical or other demonstrations that such an
outcome is improbable (to say the least). That would be too simple. Instead
I will ask: WHO DECIDES? Who decides who's job is redundant and who stays
on? That is the crux of the matter. The word "redundancy" has a
pseudo-objective connotation to it as if the decision will be made -- or
even can be made -- on the basis of purely technical criteria.
This brings us back to Keith's complaint. His complaint is entirely
justified. Keith is being treated (or not being treated as the case may be)
AS IF he and his condition are _redundant_. The "who" who has decided the
priorities of the NHS has decided that excessive credentialism and
protective practices are more important than Keith's health, peace of mind
or convenience.
Keith would have us believe that competition, bankruptcy and the threat of
failure will weed out the distortions introduced by favoritism and vested
interests. Excuse me? Competitive firms in the real world succeed by
trumping competition -- by cultivating favoritism and vested interest.
Keith Hudson wrote,
>So that's my example from my limited experience of the NHS. I have little
>doubt whatsoever that the total cost of the NHS, due to inefficiency, and
>being mainly labour-intensive, is probably two or three times more than it
>needs to be. I have chosen "two or three" times not only based upon my
>limited experience in the NHS as described above but also from what is
>clear from the privatisation of many state industries in the last 20 years
>in the UK -- and also from improvements in efficiencies within private
>industry (such as I experienced in engineering) -- where the cost of white
>collar overheads, after successive redundancies, are typically reduced to
>33% of the previous.
Tom Walker
Bowen Island, BC
604 947 2213
