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PSA launches awareness campaign to warn against PPP pitfalls

PSA MEDIA RELEASE

Feb 23, 2011

For Immediate Use

PSA launches awareness campaign to warn against PPP pitfalls

The Public Service Association launched an awareness campaign today in national newspapers and electronic media to warn New Zealanders against the pitfalls of public-private partnerships (PPPs) as the government here prepares to unleash the failed PPP experiment on New Zealand.

"PPPs have often been expensive failures in the UK and other countries so it makes no sense to adopt them here," says PSA National Secretary Richard Wagstaff.

"We're concerned that tax payer dollars that could be used to provide better public services will instead be funnelled into companies and provide fat dividends for largely overseas shareholders.

In Britain PPPs have resulted in taxpayers paying 229 billion pounds for facilities worth only 56 billion pounds. The British public has also paid for maintenance costs for schools and hospitals that have closed and footed the bill when the London Underground PPPs, worth 14 billion pounds, collapsed.

"It's inevitable that PPPs cost taxpayers more because the companies that win contracts have to borrow money at a higher interest rate than government," says Richard Wagstaff.

"That's not offset by more efficient operation because, despite popular belief, the evidence shows that the private sector is no more efficient than the public sector.

"There's also a risk that companies will go bust and the taxpayer will be left to pick up the pieces. There's been enough financial collapses in the past two years to justify that fear."

Read the text of our flyer here. Hear what David Hall, an internationally recognised expert in public service investment, privatisation, asset sales and public private partnerships, has to say about PPPs.

Why PPPs provide poor value for the taxpayer

http://www.youtube.com/watch?v=T6An73hg_E0&feature=player_profilepage

Why PPPs were introduced - so governments could be seen to be reducing government debt by passing off expenditure as private debt

http://www.youtube.com/user/NZPSA?feature=mhum#p/u/1/V0kkHaFVRRM

Is efficiency and innovation greater in the private sector than in the public sector? The evidence suggests otherwise.

http://www.youtube.com/watch?v=2RjhXgDojEE

ends

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