The value of the public sector

The modern Labour Party was established in 1918 with a socialist constitution embodied in Clause IV, which would one day be removed under Blair’s leadership. The socialists of the Independent Labour Party had done their work. Although their party continued to exist separately, and was affiliated to the Labour Party, its purpose was in question and it was destined to wither away. It is remarkable that even so-called “moderates” of the Labour Party of 1918 were committed to the public sector.

There was a general agreement that nationalisation, or taking capital into public hands, would ensure the implementation of matters of public interest as against the need for private profit. There was an understanding that too much money was going into private hands as profit. Further, there was an understanding that public ownership introduced economies of scale, rather than have services to the public provided by a variety of private companies. Finally, it was recognised that through public ownership improved working conditions could be maintained, which would have the knock-on effect of driving up standards in the private sector.

It might be thought that all this remains true today, but everything has given way to an ideological belief in free-market capitalism, shared to their shame by New Labour. So ideology has given us hugely expensive hospitals etc built by private companies under the PFI programme. Many of our services are provided by a variety of private companies with huge administrative costs in consequence. These costs are rarely discussed.