Thursday, 10 January 2008

Public and Private – Please do not Mix Mr Cameron

In the public sector, by due process of democracy, politicians are elected, majority parties form governments, ministers are appointed by a party elected party leaders (prime ministers) and ministers run departments to spend tax payers money. The government, and hence the ministers and the departments are accountable to the electorate via the ballot box. Opposition parties are able to challenge on a weekly basis (question time) the decisions made by the prime minister and his or her ministers. Guided by party policy, declared in a manifesto, ministers and or officials in a department can be held accountable and ultimately may loose their jobs if the wrong decisions are made or behaviour deemed unacceptable. The whole system is designed to achieve the best interests of the taxpayer, in terms of how our money should be spent. Government also proposes new legislation and deals on an hour by hour basis with both internal and external (foreign) issues that may arise, such as natural disasters, war, terrorism, and defending our borders against a foe. Success or failure is judged by how successfully the government meets the will of the people, collectively by a democratic system.

The private sector is regulated by legislation developed by various elected governments over a period of decades such as the companies act. It is, however, a completely different system. In this system everyone is accountable to the shareholders. The driving force is profit. Please let us not confuse this. The success or failure of a company is ultimately judged purely by profit. The ultimate threat to those running either publicly quoted or private companies is that the company may fail financially. If no profit is made, or insufficient investment is made by the share holders backing a new venture whilst it is being developed to profitability, financial liability will exceed assets and this will become evident in the accounts a company is required prepare under the companies act. If a company fails, the shareholders loose their money, the company is sold or closed, creditors may never get paid and jobs may be lost, in that order. In particular, the shareholders are motivated to ensure that the executives they employ to run their company do a good job in creating the profit, and it is the shareholders who decide whom they employ.

So when fines are imposed on an organisation, the effects are quite different under the two systems. Fining a company for misbehaviour or poor performance will affect the share holders first and foremost. The company in question may have to be closed, if the fines are large enough or frequent enough. Fining a part of government funded organisation however has no such effect. It merely reduces the funds available that may be needed to tackle the problem. No shareholders are penalised. No threat of closure exists.

So, Mr Cameron, when you propose that NHS trusts are to be fined for allowing MRSA infections in patients to occur, what exactly do you expect to happen? Who are the shareholders who will suffer personally as a result of the mismanagement? When did an NHS trust close and all the business go to competitors because of financial pressure as a result of such fines? The whole concept of private/public partnerships is totally misconceived. This is a good example of why. Please get your thinking straight.

Also when asked, you were unable to say how, realistically, you could tell if such an infection were brought into the hospital by the patient, or acquired by the patient whilst in hospital. Your off-the-cuff reaction was that “surely modern technology could be used to check each patient when they arrive by screening them”. Just think about that for a moment. What are the costs? What is the bureaucratic burden? What a complete and utter waste of time and money!

I’m only glad that the democratic system kicks in here, so that the holders of such poorly thought out thinking will not find themselves in power in our government! At least I hope that is the case. All systems are fallible.

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