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Tory-led government to take a private company into public ownership


I’m sure that many of us who watched with great interest of BBC Question Time the amount od support of public services. speaker after speaker came out in support for our public services on “How wonderful the staff are they are the vanguard of the services they provide to the public.

How ever there is a dark side to public services that does not get as much attention like Adult & Childern abuses  which is normally reported by panorama which goes under cover to inviestigate.

There has been a number of  high profile cases such as Shoesmith, a number of cases in both London & Birmingham that has attacted attention in the media spot light.

Unusual though it would be for a Tory-led government to take a private company into public ownership, this appears to be the only solution for the care-homes company Southern Cross.

It wouldn’t be entirely unprecedented. Edward Heath’s government nationalised Rolls-Royce four decades ago, believing it unacceptable that such a totemic brand should be allowed to collapse.

The same government ditched its own “no state support for industrial lame ducks” policy, in light of the historic UCS shipyards work-in, restructuring the yards into two new companies and providing skilled engineering work for decades.

Southern Cross is not a famous-brand manufacturing company, but its impending doom is as much an emergency.

Over 31,000 mainly elderly residents of its 750 homes face an uncertain future, as do the 12,000 staff who work there.

Southern Cross has been staring into the abyss for three or four years, with falling occupancy levels due to local authority economies and the growing tendency to keep potential residents in their own homes for as long as possible.

Previously, Britain’s largest provider of care homes had enjoyed profits of tens of millions of pounds every year.

Its demise exemplifies the problems facing many private companies as a result of government public spending cuts.

Private firms offering a wide range of services remain profitable because of contracts provided by local authority and other public-sector companies.

When government spending is squeezed, the public sector cuts back on these contracts, having a knock-on effect on private-sector partners, their profits and employment levels.

Despite privateers’ rhetoric about the rigours of private-sector efficiency and cutting-edge management skills, public-private relationships are more parasitic than symbiotic.

Nowhere is this seen more clearly in the railway industry where, after 15 years of privatisation, the whole set-up is kept in operation by vastly higher state subsidies than were paid to British Rail under public ownership.

Private care homes were encouraged to expand and to replace local authority facilities by virtue of the hidden subsidy that saw councils and the NHS direct elderly people who needed residential care towards them.

While Southern Cross has a small percentage of private patients, around five-sixths of residents have had their fees paid by councils and the NHS.

The other major source of subsidy is from staff, such as those in the BBC-exposed Winterbourne View special residential home in Bristol where staff earn around £16,000 a year.

There can never be any acceptable excuse for incidents of humiliation or violence directed against vulnerable people, but the low pay and inadequate staff training speak of a regime of comprehensive neglect.

What is most worrying is that the Care Quality Commission (CQC) had previously given a clean bill of health to Winterbourne View, which raises questions about the value of its inspections programme.

Care Services Minister Paul Burstow’s decision to order a “thorough examination” of the role of the CQC and to recommend a series of unannounced inspections smacks of panic.

How does this square with the trend of reducing CQC inspections, which mirrors the reduction of health and safety visits to workplaces by HSE inspectors?

Have both these trends been influenced by ministers’ pledges to business to abolish red tape?

The situation in residential-care provision is clearly critical. The anti-public campaign must be reversed and the ailing Southern Cross company should be taken into public ownership.

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