Privatisation ‘undermines trust in governments’

Privatisation is a major reason why Australians are increasingly distrustful of governments according to a leading social policy expert.

Australians have “had a gutful” of privatisation, which partly explains their increasing distrust of governments and both major parties, says Eva Cox, a prominent sociologist, author and social commentator.

“It’s quite clear from recent elections that people have become more distrustful of governments than they’ve ever been,” she told The Lamp.

“One reason is that both major parties have been down the track of privatisation and it’s hard to find any area in which privatisation has improved things.”

Ms Cox gave evidence to the People’s Inquiry into Privatisation which she said was long overdue.

“We have assumed for the last 20–30 years that the private sector is better than the public sector in dealing with problems yet there has been very little analysis of whether or not privatisation actually works,” she said.

“It is an ideological belief that the private sector has to be more efficient than the public sector. In some cases it is but in many cases it is not.

“The big expansion of the public sector post World War II in health care, Medicare, public schools and universities, was driven by the idea that you could use the public sector to create a better society. Governments owned a lot of assets and charged relatively small fees.

“However in the 80s and 90s governments started selling everything off. We stopped being citizens and became customers and now everything has got to make a profit.

“The profit motive has undermined the idea of what public services are about and also undermined people’s faith in government.

“In the past you could actually see what government money was being used for. Now there are fewer and fewer examples of that.

“People are told to take out private health insurance because you can’t trust the public system and if you want things done in a hurry you get it done privately and queue jump.

“The TAFE system has been ripped off enormously by a lot of bad providers. In childcare costs have gone up astronomically since it began to be treated as a commercial service rather than a community service.

“Bus routes used to be worked out on the basis that people needed them. Now you have bus routes taken off because they don’t offer a profit.

“We now have to pay to drive on roads and people are asking, ‘Why are we paying taxes because the government doesn’t seem to be doing very much for us anymore.’

“There is increasing inequality and a disappearing public sector and the result is people are deeply disappointed with the democratic process generally and major parties in particular.

“People need a sense that the government is there for them but they see the government is only there for big business.”

Ms Cox said she hoped the inquiry would provide ammunition for a movement to help restore a balance between the market, government and the community sector.

“For the last 20 years nobody has tried to control the market. It has taken over other sectors, is out of control and thinks it has the right to do anything.”

Cost cutting plagued privatised hospital

A Port Macquarie nurse tells how a privatised hospital sought to cut costs by eroding nurses’ working conditions.

Port Macquarie Base Hospital nurses had to fight against the widespread introduction of unregulated Assistants In Nursing (AiNs) during a decade-long failed privatisation experiment, the People’s Inquiry into Privatisation has been told.

NSWNMA branch president Ken Procter said attempts were made to employ large numbers of AiNs under the guise of this being an innovative model of care.

A Liberal/National Coalition government opened Port Macquarie Base Hospital with a private operator in 1994.

Problems that plagued the hospital under private ownership included funding for elective surgery running out before the end of the financial year and very long waiting lists for surgery.

The private operation model ended in failure and the government was forced to buy back the hospital in 2004.

The NSW auditor-general cited the hospital as an example of the public sector being left to shoulder the risk, saying: “The government is, in effect, paying for the hospital twice and giving it away.”

Ken worked at the hospital throughout the privatised period. In a submission to the inquiry he said staff who transferred from Hastings District Hospital were ‘guaranteed’ that their public award entitlements would continue.

However, this was “interpreted by the private management to their best advantage”.

“While wage rates were protected, other public award conditions were not as secure as we were led to believe.

“For example, we missed out on the rollout of Department of Health funding for 10-hour night shifts as we were considered a ‘private’ hospital.

“The flat management structure of the privatised hospital meant that nurse and midwifery unit managers had additional tasks added to their workloads.

“In 2004, when the hospital came under public management, we were well behind in the numbers of nurses and midwives in consultant and education positions.”

He said fewer allied health staff were employed under private management, forcing nurses and midwives to take on additional tasks to cover for these staffing shortfalls.

“Recruitment and promotion in the public service has a level of transparency that is absent in the private sector. Private management favoured appointment of staff with the right corporate mind set.

“Even on the day to day staffing of wards, when you have nurses and midwives employed under both public and private awards, pressures to reduce wage costs inevitably influenced who was offered additional or overtime shifts.

“Private management sought to reduce the number of staff employed under the public award.

“Tactics employed at Port Macquarie included using requests for variation in hours of employment to shift staff onto new contracts under the private award.”

Ken said Port Macquarie Base Hospital still suffers in comparison with peer hospitals due to the legacy of the decade of privatisation which came to an end 12 years ago.

“This is particularly felt in the inadequate numbers of allied health staff and the level of services provided by the contracted pharmacy, radiology and pathology providers.”