Corporate Watch presents a handy guide to the swarm of acronyms that hide the corporate-crawlies that have infested the UK public sector.
Privatisation (Amer: privatization), transitive verb:
1.the process of transferring property from public ownership to private ownership; deregulation of a state supported sector
2.the shafting of public services in pursuit of profit
ALMO(s): Arms Length Management Organisation(s) Not-for-profit companies set up by a local authority to manage former council housing, ALMOs have been given the all clear by pro-privatisation accountancy multinational KPMG. Alarm bells ringing yet?. The government promise to 'reward' councils who use ALMOs by wiping out their debt. An ALMO company, which, like PFI contracts, can last for up to 35 years, remains owned by the local authority and managed by an unpaid board of directors. Unlike PFI, ALMOs are not strictly privately financed, however, there is an encouragement for local authorities to borrow from the private market and to seek partnership with private companies. This leads to worries that ALMOs will end up being accountable to the bank rather than the local authority. There has also been concern about ALMOs being privatisation by stealth and the Defend Council Housing campaign have stated that ALMOs are a 'two-stage strategy to privatise council housing.'
DBFO: Design-Build-Finance-Operate DBFO contracts were launched by the Highways Agency in 1994 to build public roads using private finance. Most of these roads are A roads and have a 'shadow toll' for the user as the cost comes out of public taxes. DBFOs are another form of PFI and contracts have a 30 year life span. According to the Highways Agency, there are 11 DBFO contracts; eight of these have been constructed. DBFOs were the subject of Corporate Watch's first publication - the Destroy Burn Fell Obliterate handbook written for anti-roads campaigners in the mid '90s.
LIFT: Local Improvement Finance Trust LIFT is a cross pollination of PFI and PPP (qv). It is a 'hybrid' government initiative aimed at directing investment into community healthcare. LIFTs have a complex structure. Over fifty schemes have already been rolled out in the UK. At the 2006 Conference of the NHS SOS campaign, Rachel Aldred, an academic at Goldsmiths University, warned that LIFT presented a 'grim future for the NHS'.[1] Aldred also produced a report for UNISON pointing out six key areas for concern: bureaucracy; care for profit over that for patients/staff; inflexiblity; conflicts of interest; lack of value for money[2]. This scheme should be looked out for by anti-privatisation campaigners as it seems to be one of the emerging new breeds of PPP/PFI.
PFI: The Private Finance Initiative PFI is a form of PPP (qv). It was launched in 1992 by the Conservative government. Rather than abolishing it when they came to power in 1997, the Labour government has embraced, enhanced and enlarged it. PFIwas intended to encourage cooperation between the public and private sectors, the main aim being to provide aspects of service (be it food, IT etc) for the public sector using private company 'expertise'.[3] It was also designed to encourage competition and 'choice'. Under the Private Finance Initiative, a consortium of companies is given the contract to design, build, finance and operate a public work such as a school, a hospital or a road. The consortium raises the funds to do this from bank loans and through shareholders. The work is then rented back to the government or local authority. As Unison points out, PFI does not represent any new finance because all the money is eventually paid back, plus the interest on the bank loans and more for shareholder profits. PFI contracts can last up to 35 years - so even if the initial costs of a project are paid back within a few years, the consortium will continue to be paid for the duration of the contract, and thus continue making profits from taxpayers' money. The private consortium is likely to have come together specifically for the bid, and typically includes a building company, a bank and a facilities management company. Accountacy firms (such as PriceWaterhouse Coopers and KPMG) and lawyers have a large interest in PFI and stand to gain huge profits as contracts and negotiations are bounced back and forth between companies.
PPP (or P3): Public Private Partnership PPP is a system in which a government service or private business venture is funded and operated through a partnership of a government body and one or more private sector companies. In some types of PPP the government uses tax revenue to provide the capital for investment but with the operations run jointly with the private sector or under contract. In other types of PPP such as PFI (qv) capital investment is made by the private sector on the strength of a contract with government to provide agreed services.
PUK (including PfS and PfH): Partnerships UK The mother of all private public partnerships. PUK was formed in 2000 out of HM Treasury, set up to bridge the gap between public and private sectors. PUK is a PPP (qv) in itself and there is an emphasis on private companies having the majority stake of contracts. Partnerships UK Plc has an annual turnover of £12,394. It has two subsidiaries: Partnerships for Health (PfH, turnover £8,196,152) and Partnerships UK Finance. Shareholders include Serco, Barclays, Abbey National and HSBC. References
[1] Rachel Aldred, 'LIFT: Big Business and Primary Care', speech at NHS SOS Conference 25/03/06
[2] Rachel Aldred, 'PFI Report for UNISON', In the Interests of Profit At the Expense of Patients: an examination of the NHS Local Improvement Finance Trust (LIFT) Model, analysing six key disadvantages, January 2006
[3] Highways Agency, www.highways.gov.uk/roads/3008.aspx
1.the process of transferring property from public ownership to private ownership; deregulation of a state supported sector
2.the shafting of public services in pursuit of profit
ALMO(s): Arms Length Management Organisation(s) Not-for-profit companies set up by a local authority to manage former council housing, ALMOs have been given the all clear by pro-privatisation accountancy multinational KPMG. Alarm bells ringing yet?. The government promise to 'reward' councils who use ALMOs by wiping out their debt. An ALMO company, which, like PFI contracts, can last for up to 35 years, remains owned by the local authority and managed by an unpaid board of directors. Unlike PFI, ALMOs are not strictly privately financed, however, there is an encouragement for local authorities to borrow from the private market and to seek partnership with private companies. This leads to worries that ALMOs will end up being accountable to the bank rather than the local authority. There has also been concern about ALMOs being privatisation by stealth and the Defend Council Housing campaign have stated that ALMOs are a 'two-stage strategy to privatise council housing.'
DBFO: Design-Build-Finance-Operate DBFO contracts were launched by the Highways Agency in 1994 to build public roads using private finance. Most of these roads are A roads and have a 'shadow toll' for the user as the cost comes out of public taxes. DBFOs are another form of PFI and contracts have a 30 year life span. According to the Highways Agency, there are 11 DBFO contracts; eight of these have been constructed. DBFOs were the subject of Corporate Watch's first publication - the Destroy Burn Fell Obliterate handbook written for anti-roads campaigners in the mid '90s.
LIFT: Local Improvement Finance Trust LIFT is a cross pollination of PFI and PPP (qv). It is a 'hybrid' government initiative aimed at directing investment into community healthcare. LIFTs have a complex structure. Over fifty schemes have already been rolled out in the UK. At the 2006 Conference of the NHS SOS campaign, Rachel Aldred, an academic at Goldsmiths University, warned that LIFT presented a 'grim future for the NHS'.[1] Aldred also produced a report for UNISON pointing out six key areas for concern: bureaucracy; care for profit over that for patients/staff; inflexiblity; conflicts of interest; lack of value for money[2]. This scheme should be looked out for by anti-privatisation campaigners as it seems to be one of the emerging new breeds of PPP/PFI.
PFI: The Private Finance Initiative PFI is a form of PPP (qv). It was launched in 1992 by the Conservative government. Rather than abolishing it when they came to power in 1997, the Labour government has embraced, enhanced and enlarged it. PFIwas intended to encourage cooperation between the public and private sectors, the main aim being to provide aspects of service (be it food, IT etc) for the public sector using private company 'expertise'.[3] It was also designed to encourage competition and 'choice'. Under the Private Finance Initiative, a consortium of companies is given the contract to design, build, finance and operate a public work such as a school, a hospital or a road. The consortium raises the funds to do this from bank loans and through shareholders. The work is then rented back to the government or local authority. As Unison points out, PFI does not represent any new finance because all the money is eventually paid back, plus the interest on the bank loans and more for shareholder profits. PFI contracts can last up to 35 years - so even if the initial costs of a project are paid back within a few years, the consortium will continue to be paid for the duration of the contract, and thus continue making profits from taxpayers' money. The private consortium is likely to have come together specifically for the bid, and typically includes a building company, a bank and a facilities management company. Accountacy firms (such as PriceWaterhouse Coopers and KPMG) and lawyers have a large interest in PFI and stand to gain huge profits as contracts and negotiations are bounced back and forth between companies.
PPP (or P3): Public Private Partnership PPP is a system in which a government service or private business venture is funded and operated through a partnership of a government body and one or more private sector companies. In some types of PPP the government uses tax revenue to provide the capital for investment but with the operations run jointly with the private sector or under contract. In other types of PPP such as PFI (qv) capital investment is made by the private sector on the strength of a contract with government to provide agreed services.
PUK (including PfS and PfH): Partnerships UK The mother of all private public partnerships. PUK was formed in 2000 out of HM Treasury, set up to bridge the gap between public and private sectors. PUK is a PPP (qv) in itself and there is an emphasis on private companies having the majority stake of contracts. Partnerships UK Plc has an annual turnover of £12,394. It has two subsidiaries: Partnerships for Health (PfH, turnover £8,196,152) and Partnerships UK Finance. Shareholders include Serco, Barclays, Abbey National and HSBC. References
[1] Rachel Aldred, 'LIFT: Big Business and Primary Care', speech at NHS SOS Conference 25/03/06
[2] Rachel Aldred, 'PFI Report for UNISON', In the Interests of Profit At the Expense of Patients: an examination of the NHS Local Improvement Finance Trust (LIFT) Model, analysing six key disadvantages, January 2006
[3] Highways Agency, www.highways.gov.uk/roads/3008.aspx
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