Corbyn accuses Government of negligence over Carillion collapse
JEREMY Corbyn has accused the UK Government of negligence over Carillion as he urged Theresa May to end the “costly racket” of private companies running services for the public.
The Labour leader said the ruins of the collapsed construction giant lay around the Prime Minister and he called for private firms to be shown the door.
Later his office made clear the party was proposing a very significant change of direction given the current use of the private sector to manage and provide public services had failed badly.
During a rowdy PMQs, Mr Corbyn said the system of using private contractors to manage public projects was broken and cited a number of examples of failure such as the management of the East Coast Main Line.
Noting that, in the last six months the Government had awarded more than £2 billion worth of contracts to Carillion even after its share price was in freefall and it had issued profit warnings, he told Mrs May that she and her colleagues “clearly have been very negligent”.
The PM, pointing out that a third of Carillion’s public sector contracts were let under the previous Labour Government, said: “We’re making sure in this case that public services continue to be provided, that workers in those public services are supported and taxpayers are protected. But what Labour oppose isn’t just a role for private companies in public services; it’s the private sector as a whole.”
Later Mr Corbyn’s spokesman said there had been an unhealthy relationship between the public sector and the private sector, which had not been a benefit to either the workforce or the public.
He added: “The collapse of Carillion is a watershed moment about how public sector provision has been handed progressively in larger and larger proportions to very large and increasingly powerful private sector companies, in which transparency and accountability is reduced, costs are inflated, huge quantities of public money are pumped into the private sector unnecessarily into very large bonuses and executive pay packages, in which the terms and conditions of tens of thousands of workers are reduced.”
The spokesman said there was a distinction between the public sector buying in services from the private sector, which had always taken place, and the management of vast public service contracts. A future Labour government, he added, would over time “bring public sector provision back into public control and full accountability”.
Meanwhile, a report today said taxpayers faced a bill to private contractors totalling £199bn for schemes under the controversial Private Finance Initiative such as the building of schools and roads.
The National Audit Office found 716 deals were currently operational under PFI and its successor PF2 with annual charges amounting to £10.3bn in 2016/17 and due to stretch into the 2040s.