Thursday, May 8, 2008

Will New Labour ever learn: One more PFI project gone awry

In March it had been revealed that Billions of pounds of PFI projects, which includes the new Home Office building, have been moved to tax havens, perhaps on the Channel Islands.

90% of the UK registered company in charge of the completion of the said building, running the Private Finance Initiative, transferred the company’s accounts to avoid paying tax.

This project, and others alike, are all part of Gordon Brown’s trust in Private-Public Partnerships (PPP). Brown’s input – and consequent embarrassment – was to avoid risk in such projects, and alleviate responsibility on the taxpayer. However, it is the taxpayer who suffers most on two accounts; firstly, that while the taxpayer is obligated to pay on account of these flawed, capitalist beneficial projects, the companies themselves are given the charter to flee their accounts and avoid putting any money back into public service whatsoever.

Secondly, these projects are destined to fail, as was the case earlier this year with the London Underground project. Gordon Brown’s determination to impose a Private-Public solution on the Department for Transport cost the taxpayer £2bn, despite opposition from the then Mayor Ken Livingstone. The Department and Ruth Kelly agreed to pay off the debt owed by Metronet, the company charged with a £17bn upgrade of the tube network, which went into administration.

The Keynesian system which Brown seeks much faith in is so obviously at the detriment of the tax payer and public services in general. But what’s more is that Brown’s project shows the inherent charter for capitalists to, at their own legalised discretion, move would-be public money into an unaccountable domain.

Will this be another leg of Brown’s obvious Blairite legacy, along with the unique British nonsense of the non-domicile rule, where the super-rich can claim their domicile elsewhere and be alleviated UK taxation on their money (these issues even being looked down upon at by the Uber-huckstering of Germany and the United States). Are the symptoms of recession surrounding Northern Rock and the failed attempts in harmony between our Public Services and Private Initiatives not enough for the ex-Chancellor. It is time for better on Britain’s Public Services.

No comments: