UK corporate state: PPPs in Scotland

Michael Keaney michael.keaney at mbs.fi
Tue Nov 26 05:53:01 MST 2002


Defection threatens PPP schools
Trouble looms for Labour after losing majority on council

MURRAY RITCHIE
The Herald, 26 November 2002

SCOTLAND'S first councillor to defect from Labour to the Scottish Socialist
party has raised uncertainty across Renfrewshire about the future of its use
of public-private partnership schemes.

Labour-controlled Renfrewshire Council approved plans worth more than £142m
in August for a huge school building and renovation programme, not all of
which has been started and which could yet be delayed.

Other councils are already causing the Scottish Executive concern with their
reluctance to embrace PPP, while at least two - Clackmannanshire and West
Dunbartonshire - have abandoned plans for PPP (previously known as PFI, or
private finance initiative) projects.

Earlier this month, Falkirk Council threw down the gauntlet to the executive
on PPP in schools, producing evidence that a not-for-profit model offered
better value.

With Iain Hogg's weekend move to Tommy Sheridan's SSP, Labour's majority is
suddenly gone and the party is now dependent on the casting vote of the
Labour provost, John McDowell. The 40-seat council until yesterday was
controlled by 21 Labour councillors against a combined opposition of 19,
made up of 15 Nationalists, three Liberal Democrats and a Tory.

The new fragile arrangement seems certain to be tested, and councillors now
expect attempts to block the awarding of contracts next year. Hugh Kerr, SSP
spokesman, said last night: "We know other Labour councillors are
disillusioned, just like Ian Hogg. We are working on them. I am sure the SNP
is doing much the same."

Companies have been asked to submit business cases for PFI contracts for six
new schools and the refurbishment of nine secondaries and seven primaries. A
resolution in the reshaped council to cancel or postpone the work now stands
a fair chance of success if one more Labour dissident can be found.

Mr Hogg said: "The Labour group was mostly opposed to PFI. When the Labour
councillors voted two years ago on the principle, they rejected it by 15
votes to four - but when the Scottish Executive put on some pressure they
caved in. It was just blackmail. They were told by the executive if they did
not vote for PFI they would get no more government development money for
education - and tribalism overrides ideology with Labour."

He added: "I have been told that there are only two companies in competition
for the school contracts. I don't call that competition - I call it a
cartel. But the contracts cannot be signed until after the elections and
they must be referred to the new council."

Mr Hogg, a 34-year-old electrician, quit Labour after being a member for 19
years, citing many reasons including its championing of the Tories' policy
of PFI, the looming war on Iraq, talk of student top-up fees, and Labour's
treatment of the Fire Brigades Union.

"I am heartened that other Labour councillors might be following suit," he
said, inviting them to join in the anti-PPP movement.

He said he remained opposed to PPP and had abstained on a previous vote.
"When I asked to see the public sector comparator for the business plans, I
was asked to sign a clause of confidentiality. Then I discovered that I was
the only councillor who had even asked to see the document."

He will fight the Seedhill ward for the SSP in the east end of Paisley in
next May's elections. "In the Labour party, the local members don't have any
role to play now. They are treated by the leadership as no more than
cheerleaders. Tony Blair said when the party conference voted for an
investigation of PFI that its findings would be ignored."

Mr McDowell said: "I believe our PFI plans will continue after next year's
May elections. I will use my casting vote."

He said he was disappointed that Mr Hogg felt so strongly. "I have been in
the Labour party for 33 years and we have had our ups and downs, but we
still carry on and I argue my case from inside the party."

A council spokeswoman said a decision to block PPP would require a motion
before the full council and the suspension of standing orders to discuss it.

It would also require a two-thirds majority decision to approve blocking PPP
because it had been approved already within the previous six months.




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