1. another example is that contracts to deliver

1. Defined as the process of transferring an
enterprise or industry from the public sector to the private sector, privatisation
stills a topic of many discussions nowadays. Privatisation begun in UK since
the 1950’s. In this assignment the main point to explain is the possible impact
of privatisation on the UK economy. Two particular cases are the topic to
focus.  royal mail at first and the
council housing at second.

The royal mail

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Royal mail is a postal service and couriers company in the UK
established in 1516 this company provide mail collection and delivery services
throughout the UK. For most it history royal mail has been a public service.
However following the postal service act 2011 royal mail share were listered on
the London stock exchange in 2013 under the government minister Vince Cable.
The government initially retained 30% stake but later sold it in 2015 ending
almost 500 years public ownership.

One of the reasons why the government liquidate asset is because of poor
performance or poor management. Royal mail one of the oldest Government Company
in UK has enjoyed monopoly of the mail market for a long time but in a
capitalist economy it’s just a matter of time for the system to change
direction. On January  1, 2006, Royal
mail lost over four century monopoly and the British postal market was open to

 For example: The public is
already feeling the changes by paying more since Royal mail was
privatised. The first class stamp that was 62p in 2015 is 65p 2017 ending.
However in a privatised service, profits
must be paid to shareholders, not reinvested in better
services. Interest rates are
higher for private companies than they are for government.

And another example is that contracts to deliver public services are
agreed between private companies and government behind closed doors. There is
very little transparency, public accountability or scrutiny. The companies are
not subject to Freedom of Information requests because of commercial confidentiality.
When private companies fail to deliver, the public has no powers to intervene
and the government doesn’t always have the time or expertise to force them to
keep their promises.

Council housing

Built by the local authorities, Council houses are houses built for
public or social housing use. This case explained the impact that privatisation
had on council housing. Formerly the Council housing scheme in UK was designed
to provide the majority of rented accommodation in the country at a reasonable
and affordable rent to primarily working class people. However, like all
government institutions or businesses, the council houses were hit by different
politics. In august 1980, the role of council houses was to change to benefit
the new government of the Prime Minister Margaret Thatcher. This agenda
revealed how the council Houses were sold off through the right to buy scheme
to the Council tenants. They were given the right to buy in the housing act
1980 offering a discount price on their council house, from 33 up to 50% off
the market value depending on the time they had lived there, proposed as policy
by Prime Minister Margaret thatcher. Because of this kind of privatisation
Britain saw a decline in local authorities own council houses even though the
government and the local fought every year to meet the target of new build

However through this right to buy scheme many tenants have become house
owners and private landlords. Many private landlord don’t follow the local
authorities regulations and they don’t pay any taxes to Her Majesty’s Revenue
and Customs (HMRC)

This kind of privatisation has made a huge dent in the supply of council
housing. When it was introduced in the 1980 there were over 5 million
affordable homes in England, now there are barely 4 million. The number of new
affordable homes built each year can’t keep pace with the amount sold. In
2000-01, 53,000 homes were sold under the right-to-buy, but only 18,000 new
affordable homes were completed. This loss of affordable housing is now being
felt with a housing crisis in the south-east and record numbers of people in
temporary housing. Council homes were built as a benefit for the nation and not
the benefit of an individual family.

2. The NHS was formed with the principle that health
services would be available to all and financed through taxation. Diverse
are the opinions about the privatisation of the NHS. One major problem many
government institutions that used to have monopoly of their market faces in a
capitalist economy is poor performance and they are later open to competition
through diverse politics. The debate about the privatisation of the NHS has
been going on for a long time and carried two major arguments. For a while this
argument means different things depending on who you
ask. Some see privatisation as the opening up of NHS services to more private
competition. Others say the term should only be applied if Britain dismantles
the NHS completely.

–       The case for

In recent years two politicians  Daniel
Hannan and Douglas Carswell co -authors of these two books: Direct Democracy,
published September 29, 2011 and , The Plan:
Twelve Months to Renew Britain, published July 24, 2011 which says the NHS
“fails to meet public expectations” and is “no longer relevant
in the 21st century”. Hannan
and  Carswell call for the NHS to be
replaced by a new system of health provision in which people would pay money
into personal health accounts, which they could then use to shop around for
care from public and private providers. Those who could not afford to save enough
would be funded by the government. Both politicians went further to say
that people would experience an increase in the quality of care. They would
have the freedom to choose which hospital to attend and what treatment to have.

These arguments have been supported
by how the NHS used  to operate for
example many private companies have always played a role in the NHS, but
critics claim that their increasing involvement is evidence of growing
privatisation of care and is undermining the service’s core values. Private
provision of health care services has always been controversial, even though
some services, such as dentistry, optical care and pharmacy, have been provided
by the private sector for many years and most GP practices are private

–       The case against

The other side of the argument prove to be against Hannan
and Carswell opinion about the NHS, when Tony O’Sullivan, Chair of Keep Our NHS
Public and a consultant paediatrician closely involved in the Save Lewisham
Hospital campaign, told Our NHS open Democracy: “Successive governments have
changed the NHS from a public service based on social solidarity to a wasteful
marketplace open to competition and privatisation.”


Those against
privatisation argue that competitive markets shouldn’t be applied to
healthcare. This will result in providers chasing income more than prioritising
health, which will result in rising costs for treatment. Inevitably, the health
of patients across the country would suffer, fraud would be more likely to
occur, and the concept of universal care coverage would collapse. A privatised
NHS would benefit rich people who can afford luxury healthcare treatment, but
those without the ability to fund their healthcare would be forced to go
without, choose services that aren’t right for them or rely on a black market.
Essentially, the argument against privatisation is that it puts revenue, not
patients, at the centre of healthcare.

However public healthcare services
involve caring for people. But private companies make a profit from
public services by cutting corners or underinvesting. There is a conflict
between making a profit and taking the time to care. For example, private care
workers often are only allowed a short time to visit their service users.
They barely have time to do the basics because of the pressure the private
companies put on their workers and through these practices elderly and the
vulnerable service users are at risk of poor care. Privatisation often
means job cuts and more casual workers, who are paid less and have worse
conditions. Staff knowledge, skills and experience are lost, with an indirect effect
on service quality.


3. One
reason why many people like the UK is because of its conservative values and
among these values was the NHS. The NHS main principle is health service to all
rich or poor. This principle which I admire about this government institution is
the subject of privatisation.

My initial view of the NHS
privatisation argument is that as a single mother my son and I benefit from the
free NHS support which allow me to see a GP when needed without paying any fees
and part of my benefit is free medication when one was prescribe, but now my
main worry is that if the NHS is privatised. I don’t know how the new
healthcare system is going to beneficial or not.

As part of the working class
and looking at what’s happening to out-of-hours care already. The accident and
emergency services are facing scandals, one after another. All these problems
are the result of the fragmentation of the NHS. The privatised service, with
less qualified staff to cut costs, has seen an increase of 50% in the rate of
calls referred to A since 2010. When taking a look at few examples in other
country like Sweden. I find out that when the Swedish government put
competition in their healthcare system. The system saw the growth of privately owned
clinics in only rich areas and of the 196 new clinics that opened in Sweden,
all privately-owned, 195 were in wealthy areas. The newly privatised Dutch
system showed similar problems. The GP organisation tried to address it by
asking newly qualified GPs to take positions in rural practices. For this
“interference with the market” the national competition regulator
fined the GP association of millions of Euros.

In my opinion competition
puts revenue, not patients, at the centre of care. It’s a legal requirement for
businesses to maximise their profit, not patient wellbeing. This is why the
public or poor people like me consistently oppose privatisation; it converts a
public health service to a business. My view went further and I believed that the
public will pay more, both as a taxpayer and directly when they privatise NHS
services. In reality I have noticed how my water bills, energy bills, train and
bus fares keep on rising in real terms.


Even though previous British
government has clearly stated that they wish for the “privatisation of the
National Health Service”, none of them have the courage to see it through. But
nowadays many politicians wanted to replace the NHS with a medical insurance
system based on the American Medicare system because they thought it was the
best way to release the pressure on the government and leave the public that
put them into office to fund for themselves.  In a parliamentary debate often come various
issues surrounding the privatisation of healthcare and different politicians
often stated that “there is a crucial role for the private sector in supporting
the delivery of NHS care”. Although, some members were concerned about opening
up the NHS as a regulated market to private sector comes with some risk. As critics
maintain that a greater private involvement involves the risk of putting
profits before the interest of the NHS patients, encouraging conflicts of
interest between shareholders and patients


There are many entities
contributing to the delivery of the quality of healthcare received by patients.
Even though I support  a government
control NHS I also  knew there are many
operation in the healthcare that are carried out by the private sector such as dentistry, optical care and pharmacy and most GP practices are
private partnerships as mention above. The NHS was created to benefit the public or the nation and
not to become a business that the big corporation will cherry pick and neglect
those operations that are not bringing massive profit.