ACTU People’s inquiry submission – summary of main points

• The People’s Inquiry is coordinated by Public Services International, various affiliates (the CPSU, CPSU-SPSF, ETU, ASU and NSWNMA), Per Capita and Action Aid Australia. The inquiry seeks to gather evidence from organisations, workers and members of the community about the impact of privatisation, and to hear what sort of society they want to live in.
• The ACTU’s submission to the inquiry questions the dominant paradigm around privatisation- that private companies are always more efficient and effective than public or community-sector organisations. The submission makes clear that Australian experiences of privatisation have proven this not to be the case over the last 40 years.
• Using both the Early Childhood and Vocational Education sectors as case studies, the submission outlines the myriad failings of for-profit privatisation, including mistreatment of workers, poor quality services, lack of effective transparency, poor resource allocation and higher costs for both government and service users.
• In the submission we argue that such outcomes are inevitable when for-profit providers are paid with public money to provide services. It is argued that this is due to provider’s preference for profit over quality. This reality is also accompanied by:
• Sharp practices – the deliberate gaming or rorting of a system by service providers
• Vendor dependency – when the bargaining power in a contract shifts toward the contractor and which is deliberately cultivated by for-profit providers.
• Concentration of service provision – the reduction in the numbers of service providers able and willing to participate in markets for particular government contracts over time. This is often actively cultivated by providers in order to create greater vendor dependency.
• The final section of the submission calls for the repair of the sectors already damaged by previous privatisation efforts and a re-examination of the reasons for further privatisation. It also calls for alternatives to privatisation, including the re-funding of the public and community sectors, to be considered.

If you have any queries relating to the submission please contact Chris Watts on cwatts@actu.org.au .