Prescotts views

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http://www.gofourth.co.uk/a-public-and-private-success" onclick="window.open(this.href);return false;

A public and private success
There's a great deal of controversy at the moment about the use of private money in publicly owned companies.

Critics of Public Private Partnerships claim that it is outright privatisation which undermines the provision of the public service. But as the song goes: ‘It ain't necessarily so.'

I faced many of the same arguments 11 years ago when I was Secretary of State for Transport, when one of my responsibilities was for air traffic control.

In 1998 the Labour government decided to convert National Air Traffic Services (NATS) into a Public Private Partnership (PPP) to allow the private sector to bring in investment and business experience to modernise our air traffic control system.

We wanted private firms to share the risk, provide a better strategic approach in the day-to-day running of NATS as well as ensuring better value and an improved service for the taxpayer.

The proposals saw NATS remain 49% owned by the Government with the employees holding 5% and the private strategic partner (which was the Airline Group - a consortium of the major airlines including BA, bmi and Virgin Atlantic) with the remaining 46%.

A stakeholder panel was set up to bring together the Government's representatives and the private strategic partner, with an input from customers and the staff through consultation.

The Government retained the golden share, keeping NATS both publicly owned and publicly accountable with a statutory provision that would give us direct powers to take over full control in an emergency.

I remember the arguments against this PPP very well. It would not be in the public interest, the number of air traffic controllers would be slashed, planes would literally fall out of the sky and publicly owned bodies should not have access to private finance.

In fact many of those who argued against PPP then are against private funds coming into Royal Mail now.

So I thought I'd pop into the House of Commons library and see how NATS has faired since it became a PPP in 2001.

Performance has improved dramatically. The average delays per flight attributable to NATS were cut from 109 seconds in 2000-02 to 27 seconds in 2007-08 - a 75% reduction.

It's become profitable. In 2000-02 turnover was £553m with a loss of £80m before tax and net assets of £81m.

But by 2007-08, turnover increased by more than a third to £743 million with a profit of £67m before tax and an eightfold increase in net assets to £666m.

Now that it's a PPP, it doesn't receive a penny of public money and in fact now returns a profit for the taxpayer.

In 2007-08 we received £17.5 million back in tax from the profits and it's been profitable for the last five years.

And the threat of massive job cuts failed to happen - there were 5,652 in 2002 and 5,138 in 2008. And the employees have benefited with free shares. Two allocations have given those who took both, a total of 1,1,02 shares, worth about £2,700.

The Airline Group runs the day-to-day management of NATS whilst the Government has three non-executive directors to ensure the best interests of the British public are served.

The strategic partner meets periodically with the shareholders and our representatives to review the development of the company. But the Airline Group exercises independent commercial judgement on issues of performance and resources, working to the agreed strategic plan.

So to recap, NATS performance has improved, it's become profitable, staff are better off and now the taxpayer makes money from it!

This is but one model of PPP but it shows how successful they can be and it is consistent with Labour's manifesto and policy commitments since 1997 to public private partnerships.

The bodies remain publicly owned and publicly accountable, meeting public service obligations without further public investment.

These strategic partnerships with the private sector have created 225 separate projects worth £60b - that's new hospitals, new schools and new houses.

We were able to deliver them quickly so they could meet the desperate need for modernisation as soon as possible. Not put off until we could find the money from future taxation.

So let's have an intelligent debate about the Royal Mail and Post Office, which are already involved in different types of public private partnerships.

The real issue is how we modernise and keep a universal, publicly owned and publicly accountable post service.

you can answer John via his facebook page good ahead and give him some feedback!

[TrueBlueTerrier]

http://www.guardian.co.uk/politics/blog ... royal-mail" onclick="window.open(this.href);return false;

Born-again blogger John Prescott has some interesting things to say about Peter Mandelson's part-privatisation plans for the delivery service

I see from the Observer that John Prescott, now pushing 71, has been chosen as "the unlikely leader" of Labour's internet campaign when the general election finally comes, steering the party's "virtual battlebus" round the country just like in the old days.

Don't knock it. Hard-to-keep-down Prescott connects with the kind of trade-union, blue-collar voters whom Tony Blair (another techno-primitive during his decade in office) often struggled to reach. Why, according to the Observer, the born-again internet nerd from Hull has 3,700 friends on Facebook.

Which may be what makes his latest manoeuvre potentially interesting. In his Go Fourth blog this morning, Prezza alerts ministers – and rebel Labour MPs – to the prospect that he may be getting on the warpath again in the controversy over the part-sell-off of the Royal Mail.

What he's done is to remind them of his own role a decade ago in fixing a public-private partnership (PPP) deal over the sale of the National Air Traffic (control) Services system (Nats), based at a fancy new centre at Swanley, if you recall.

A consortium of airlines and others bought 46%, the government kept 49% (plus a controlling golden share) and the employees got 5%. The result of better management? Fewer delays for flights – that's an environmental plus too – and as Prescott points out a profitable operation. Oh yes, and those predicted mass sackings didn't happen either.

So a mixture of private money and public ownership. What's this got to do with the here-and-now?

Up to 150 Labour MPs, not to mention the Communication Workers' Union, are up in arms against Peter Mandelson's plans to sell up to one third of Royal Mail.

Most likely such a slice would go to a successful European mail company such as TNT (its employment practices have come under attack) which would inject both capital and better management into the ailing system.

Experts say the Royal Mail has had a rough time from Postcomm, its regulator, and has been treated unfairly in relation to private sector competitors. So, in a part of the Mandelson deal that doesn't get so much publicity, regulation will be handed over to Ofcom, with the universal flat-fee principle for mail delivery, the same stamp from Cornwall to the Shetlands, safely entrenched in the process.

In fairness, the Mail's critics say that Postcomm had little choice but to force the pace of liberalisation ie opening up the mail to competitors and hammering the Mail on price and access, because all sorts of reforms were blocked by union action, often at local level in breach of done deals.

Ministers in successive governments dithered – even Mrs T hesitated to tackle a service with "Royal" in the title – while problems mounted.

Not so long ago the Mail had what was called a "negative external financial limit", which meant the opposite of financial limits then imposed on publicly-owned enterprise. Instead of getting an annual subsidy it had a profit target to pay into the Treasury coffers. Labour types were proud of the fact. But with hindsight it may have drained energy as well as money from the system.

Anyway, apart from recommending slowcoaches (like myself) to catch up on Jon Stewart, host of The Daily Show on US TV, giving a serious roasting to a loud-mouth, know-nothing financial "analyst", I have one more transatlantic tip from my weekend's e-studies.

In the usual deluge of emails was one that flagged up the name of Seymour Hersh, the veteran American investigative reporter, the man who broke the My Lai massacre story in Vietnam (1969), much else besides, including Abu Ghraib. He's still motoring hard, though he's 13 months older than Prezza: 72 in April.

This report is of a conversation about "America's Constitutional Crisis", staged at the University of Minnesota, deep in the American heartland, with Walter "Fritz" Mondale, Jimmy Carter's vice-president and the man defeated for the White House by Ronald Reagan in 1984.

I covered that campaign and formed the strong opinion that Mondale was a decent and intelligent man who would have made a good president. But his "Norwegian charisma" (as the joke went) was no match for the wily, sunny disposition of a popular incumbent president.

I also spoke on the phone a few times to Hersh, who was admirably modest and helpful to a foreign correspondent he didn't know. Not too much ego there, I thought.

So when Hersh and Mondale talk about unaccountable government of the Reagan-Bush variety you sit up and take notice. Hersh draws attention to something called the joint special operations command, which he calls "an executive assassination ring, essentially", accountable only to Mondale's successor-but-four, Dick Cheney.

Bad stuff and another hot potato sitting in the Obama in-tray to be sorted out when the president has a spare afternoon. We may have to wait a while.

[TrueBlueTerrier]

http://www.guardian.co.uk/politics/2009 ... ing-labour" onclick="window.open(this.href);return false;

John Prescott has been chosen as the unlikely leader of Labour's general election campaign on the internet, as the party prepares to launch a low-budget battle for a fourth term in government.

Despite being seen by some as a joke figure after a series of embarrassments during his time as deputy prime minister, Prescott's rehabilitation at the head of Labour's internet assault on the Tories has been sanctioned by Gordon Brown.

Prescott, a veteran of traditional, on-the-road campaigning who famously thumped an egg-throwing heckler during the 2001 campaign, has told friends that he sees his new role as driving Labour's "virtual battle bus".

The former cabinet minister has surprised the party's high command by helping to raise Labour's profile on the web with his own blog and by establishing a formidable presence on the networking sites Facebook and Twitter.

Prescott now has more than 3,700 personal friends on Facebook and another 1,600 who follow him on Twitter. While the former cabinet minister decides the content of his blogs, his son David, a former journalist, finesses his entries before they appear.

Tens of thousands signed his petitions to cut bankers' bonuses and force banks to hand on interest rate cuts within days of them appearing.

Last night Alastair Campbell, former director of communications under Tony Blair, who also has a large following online, said it was clear Prescott was succeeding in motivating Labour supporters online in a way nobody else could. "You cannot imagine a cabinet minister getting the huge support he did for a campaign on bankers' bonuses. What JP has shown is that he has an ability to cut through to voters that needs harnessing. Because he is no longer a cabinet minister, he can be a bit edgier. It is about making it fun. It is part of modern campaigning."

While staying broadly loyal, Prescott has been prepared to speak out against aspects of Labour policy, including proposals to part-privatise Royal Mail.

Brown is understood to be relaxed about Prescott's independence because he is drawing huge numbers of people into the Labour "blogosphere", allowing the party to establish links with a bank of potential supporters.

Labour, which is still struggling to pay off a deficit of about £20m, sees low-cost internet campaigning as a cheap but effective way to reach mass audiences.

The party wants supporters to use its website to print off posters and leaflets, which they would then distribute to voters ahead of both June's European elections and the general election, expected next spring.

Prescott said last night: "I think the potential of using the internet in campaigning is remarkable. By using social networks such as Facebook and Twitter, we're reaching out to people, forming strong relationships and creating an online army for activism.

"The lesson I've learnt about our online campaigning is that a powerful pressure group of people can bring about change very quickly. It's cheap, it's fast and, more importantly, it's honest.

"I call it traditional campaigning in a modern setting."

Prescott's return has not been welcomed by all Labour MPs. One said last night: "Having Prescott is like going back 10 years. Once the novelty aspect has worn off it, we'll be left with another old man."

Labour had been worried that the Tories, with prominent and successful bloggers including former Tory candidate Iain Dale and the right-wing Guido Fawkes, as well as the ConservativeHome website, were dominating the political blogosphere.

In response to public anger over Royal Bank of Scotland's plan to pay £1bn in bonuses to bankers and traders, the Go 4th website, the home of Prescott's blog, championed a campaign called "No ifs, no buts: give up the bonus". Thirty-three thousand people signed up to the petition in just five days. Go 4th, which is funded by Labour, was then able to link back via email to the signatories and update them on the campaign, sending messages and videos from Prescott.

[johnsouthwales]

[POSTMAN]

The NATS thing in the 1st post,is that like,comparing apples to fecking oranges!!Or am i misreading it.

[apple]

ye that's what i thought, although they have had the private investment i think they have no competition?
they have used the money to modernise but still operate in a monopoly

[fmrPOSTIE]

Its not Swanley its Swanwick. NATS was my first job after leaving royal mail. A great company that has done well out of the PPP. It still has a "gold plated" pension 100% guaranteed by the Govt. :) Excellent buildings and working conditions too.

The pension cannot be downgraded either unless 100% of members accept. which as Paul Barron (CE of NATS) admits "is never going to happen".

This is probably the only case where PPP has worked.

[TrueBlueTerrier]

The NATS thing in the 1st post,is that like,comparing apples to fecking oranges!!Or am i misreading it.

Yes Apples and oranges as you say. Can't see NATS having to accept Virgin Flights in a DSA mode or just as they are about to land. NATS this is TNT(ATC) we have 3 heavies in bound. Under our contract they must land within 90 seconds of handover, please divert all your incoming flights that pay the full amount and let our DSA ones land for less and ultimately at a cost to you.