Public Private Partnerships

Everyone welcomes last week’s decision by the American company McKesson to create over three hundred new jobs in Bangor.

The company, which provides an integrated human resources and payroll system for the NHS, is a testament to the way that the private sector can provide efficient services within the public sector.

The sad irony, though, is that whilst this business was rightly supported by grant aid from the Assembly Government, the same Labour-Plaid coalition has itself ruled out any involvement by the private sector in the NHS in Wales.

Such an ideological approach to the delivery of public services could, over the long term, have a serious effect on ability to provide efficient services not only within our health service but across a range of other areas. Certainly, there is growing evidence that the private sector can make a real contribution to ensuring that the Welsh budget goes a little bit further.

According to the CBI and other business representative groups, there is enormous potential for Public-Private Partnerships (PPP) in improving services by delivering efficiency savings.

Indeed, there is evidence that they can provide value for money for taxpayers, increase government transparency and financial accountability and encourage long-term collaboration through genuine partnering. Most importantly, at a time when the funding from the Treasury to Wales is reducing, enormous savings could be made for investment in front-line services.

In addition, there could be the leveraging of significant private sector investment for new projects and the opportunity to access private sector technical, management, and financial resources and expertise. Public sector managers could then focus on delivering their key services, rather than managing projects which take them away from their core business.

On the other hand, the trade unions have argued that PPPs result in higher additional costs due to private sector borrowing and a lack of consultation with public sector employees over the implementation of the scheme. There is also evidence of unfair contracts which load the risk in favour of business partners and no guarantee of quality buildings or service provision.

Of course, this moratorium on private involvement in the NHS has not stopped other parts of the public sector from working with businesses. Earlier this year, the Welsh Local Government Association agreed that private companies would have greater involvement in delivering council services, which could result in projects such as new schools being built through money provided from private funding.

Therefore, there are certainly opportunities for Welsh businesses to work more closely with the public sector, although to restrict this within the NHS, the largest organisation in Wales, does not make any sense at all.

Companies such as McKesson have shown that private sector involvement in the NHS can work and result in well-paid and skilled jobs. Hopefully, by providing millions of pounds in grants to support such a business in North Wales, the Assembly Government may finally appreciate that the private sector can play a major role in improving services in the NHS and, more importantly, can create wealth and employment in our economy as a result of such involvement.

Popular posts from this blog

THE IMPORTANCE OF FRANCHISING

THE IMPORTANT IMPACT OF STARTUPS ON THE WELSH ECONOMY

UNIVERSITIES NEED TO BE AT THE HEART OF THE ECONOMIC RENAISSANCE OF THE WELSH ECONOMY