Public Affairs

Temporary fixes

John O’Farrell of the Irish Congress of Trade Union (ICTU) believes that a culture of outsourcing throughout the public sector in the UK is chipping away at the services and creating a false economy.


As winter’s grip clings on, each January and February brings the annual search for snowdrops by the roadside, the charming trill of the first cookoo and which Accident and Emergency unit has the most distressing queue of aspiring patients. The regions and health trusts compete like a revival of ‘It’s a Knockout’, but we can always be sure that Northern Ireland will never disappoint the cynical.

As the BBC recently reported: “Northern Ireland has some of the worst performance figures in the UK. During the Christmas period, the number of patients seen in four hours in A&E departments dropped to 63 per cent…while the numbers waiting longer than they should for a routine operation have almost doubled in the past four years.”

One proposal to improve waiting times is to recruit from abroad. But Brexit and the subsequent devaluation of sterling have made the UK less attractive, so we must look farther afield, specifically to the employment agencies of Manila. 600 Filipino nurses are being sought to offset the shortage of 1,500 nurses in Northern Ireland’s hospitals.

This is where the public purse gets hit. An agency nurse costs the commissioning Health Trust up to four times the cost of simply hiring one full-time nurse and paying them directly. A £25,000 salary cost thus blossoms to over £100,000, a situation presently being investigated by the Northern Ireland Audit Office.

The incentives get more perverse. Full-time nurses are encouraged to go part-time and have no difficulty getting much better paid shifts as ‘self-employed’ or agency staff. Who can blame them? They have mortgages to pay, and seven years of a malignant public sector pay cap to make up for.

A similar situation has been rattling through the education budget. One in five education workers are ‘temporary’ staff. This startling statistic was unearthed by Lisa Wilson of the Nevin Economic Research Institute in her recent paper on precarious work in the public sector. In the past 10 years, the proportion of public servants who are ‘temporary’ or ‘self-employed’ has increased by a small proportion, but in education, temps have jumped from 13 per cent to 22 per cent.

Who are these temps? They fall into two categories, and one helps create the other. There are teachers who have done their 30 years and have taken their early retirement, and are then swiftly ‘rehired’ through agencies to do their ‘old job’. Again, perverse incentives are in play. As ‘self-employed’ or temps through agencies, the schools save on employers’ National Insurance contributions, holiday pay and pension costs.

However, this makes it harder for new teachers to break into a permanent job. This problem is rife in further education, and is at the root of the increasingly toxic atmosphere that passes for industrial relations in our colleges.

This is the problem with the culture of outsourcing which has prevailed throughout the public sector in recent decades. It is a false economy. It is not delivering. Billions are being syphoned off from taxpayers who think they are contributing to decent public services and are then shocked by the shoddiness of much of it, when they need it.

Most of us never have to stay in hospital for long before the age of retirement. Most of us never think about school after we leave it, apart from one year obsessing about inserting our offspring into a ‘good school’. An even smaller proportion of us ever see the inside of the messier end of the state: prisons, policing, dole offices and social work.

Then, the shoddy offices and dedicated but stressed-out staff get the blame for the whittling away from the quality of the services they provide. Which feeds the clichés about private sector discipline sorting things out. Well, we have tried that experiment and the shoddiness is the result.

Carillion crashed despite holding £16 billion in contracts. G4S, Four Seasons, Circle, Serco and the other giants of out-sourcing have long been exposed for cost-cutting at the expense of their staff and their service users. “The National Audit Office reckons contracting could account for £100 billion of UK public spending. But that it can’t give a single, accurate figure.” If you want the sordid details, look up the meticulously researched, or read Private Eye every fortnight.

In the meantime, we need to do two things. Use progressive taxation to provide reliable and universal services, delivered by decently employed professionals. The second is to invent a term which covers the staggering amount of cash wasted. ‘Millions’ are an accounting error. ‘Billions’ lost their meaning during the bank bailouts. ‘Trillions’ are beyond any comprehension. ‘Squillions’ don’t exist. How about ‘Carillions’?

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