It’s like when you need new shoes as a kid but your dad says he’s got no money but yet spends 4 nights a week in the pub and up grades his car every 3 months but he’s got no money for shoes🤯 Why does our government act like an abusive parent?? Because they don’t care about you!!
The fact that PFI deals are expensive for the taxpayer *is the point*! They are about a transfer of taxpayer cash to the wealthy, not about some sort of efficient way to fund public projects.
We have been brainwashed to accept that the private sector is always more efficient than the public sector. When the facts/statistics proved otherwise, we find excuses or accept illogical explanations for the people representing the interests of the private sector. Are we capable of being rational in the face of continuous Capitalist propaganda?
But those 'wealthy' do the same- most large companies sell and lese back their buildings. The difference is that the manage to lease/repair contract. Which government is rubbish at. The civil service cannot fail, so there is no incentive to do a good job.
@@Tensquaremetreworkshop Where is the incentive for a private water company to do a good job? Can we stop purchasing their products? Is there a row of taps in every home that we can choose from? If they do a bad job, can the government just shut them down? Or do we taxpayers have to pay off the debts and keep things going? Same applies to all essential utilities. If they win, they win, and if they fail, they HAVE TO BE bailed out, because their services are essential to life.
Strangely, it is what most companies do. They sell and lease back their buildings. Because they can get better returns on that capital (ROI). Could it be that private companies are much better at managing maintenance contracts? Ahh, there lies the difference...
@@harrisonbergeron9746 It is normally done for two reasons. 1) The ROI in the building can drag on their numbers. They can employ that capital more efficiently elsewhere 2) It is not the focus of their business. Contracting out the elements of your business that is not focused on your products removes distractions. You employ one 'expert' person, the facilities manager, and he manages the contracts for all of this. Something the government (any government) is very bad at.
The MOD don't take care of maintenance on their own estate assets. Vivo are the contractor and, guess what, they repair nothing and just take their cash
@@Zerpentsa6598 you actually got them to come out and change it? I've been waiting 5 months for them to repair two lights. My favourite recently was after the storms some subcontractor tree surgeons had to deal with a fallen tree and there were four Vivo worker in two vans sat watching them. I wonder how much they billed for that.
@@JSmith19858 Sounds like they are waiting for the annual lifecycle charge to the public department so they can charge under that rather than their own pocket similar to another different contractor under PFI that I've dealt with to paint rooms.
Another question is, why are we buying back rather than simply taking back, given that the pfi rip off merchants have been fleecing taxpayer for 27 years?
Exactly! Or, could have paid 1 billion, or half billion, said take it or leave it. You know the answer. Because the money goes to line the pockets of the banksters and their mates. Corruption Corruption Corruption
@@tetraquark2402How is it worse than Putin? He is a practical man despite being a violent one. It is better than Putin as long as nobody "falls" out a window and it's all done legally.
You are doing that because your nation is not good enough to be an autarky of which the second you start nationalizing any company, every company is gonna shit themself and leave. Your nation cannot survive without the trade with others as you produce insufficient food, manufactured goods, and fuel to support yourself as a service economy. Therefore, just taking stuff will destroy your nation and impoverish millions as capital flight ruins you
I’m right with you Richard 45 years of privatisation has not and will not work. The country is poorer for it, but the powers to be still pursue this line just take water off wall which is a branch of the government has granted the water authorities to raise the bills to pay, and I don’t think it’s to pay for infrastructure projects ring fenced as I said, I think it’s to continuously pay high salaries to CEOs and shareholders. Instead of taking it all back in the house. Privatisation does not work and the proof is there.
It could have worked but for the greed of Capitalists/politicians who thrive on the System which do not hold them accountable. Do we need a revolution to put an end to this?
@@adamiskandar5107it could never have worked. The very idea behind privatisation isn't for it to work, it is for the owning class to extract money from the working class. ...but as such it's been a roaring success.
Because, given modern monetary theory, taxation is primarily a form of social control. Friendly reminder that Labour and Conservative are equally part of the military-pharma-industrial complex establishment who need war and sickness to continue expansion. If you frame government in traditional terms of them trying to benefit the populace, their policies and actions seem bizarrely incompetent, where the reality is that the UK government have already transitioned to become an arm of a system of global stakeholder capitalism. The people are simply not stakeholders in this system and the gloves are off for exploitation. Basically, we are all Africans now.
I am rather concerned that you might be into something there! However, Africa is a very big place and some African countries are set to do a lot better than we are moving forward.
I agree. To break that IMO requires a government to re-enforce its own control and stop pretending that it is at the mercy of financiers. It isn't. It can achieve that via its central bank or it can use existing process of gilts, but lower bases rates and require institutions to hold those gilts at certain ratios.
@xueya2188 exactly 👍 we are being farmed by psychopaths that will ever see you as human beings but rather like cattle to be milked for every penny you can produce for them.
Nicely done Richard nicely done. If only we could put this to them in a way they cannot wriggle away from it and they have to listen to the people and I would say listen to somebody like you
Can we have a video on Bliar's PFI deals for new hospitals please. And why he's never been held accountable for wasting hundreds of billions of pounds of taxpeyers' money. Or put on trial in The Hague for war crimes.
Those of us working on PFI schemes in the late 1990's/early 2000's were amazed the then Labour Gov't continued with and expanded PFI's when they were known to give poor value for money in the long term.
That’s Labour for you (us) nothing learned. I can’t believe they are back in government after the Blair/Brown years. The Tories badly let us down too. Time for a change methinks.
@@user-qg2bt2qt9l Agreed but New Labour used it indiscriminately. I appreciate that lessons have been learned as a result of the pitfalls realised (Kings Fund etc) but there has been talk of using PFI for the planned Thames Crossing. We are still paying tolls for the Dartford Crossing as Gordon Brown would not allow the toll to be lifted after the project had been paid for.
Spot the clue in the words "long term" and don't just blame the Tories, Labour couldn't wait to spend noth sea oil revenues fast enough. Our sovereign wealth fund went down the welfare state toilet. Now we throw money around that we borrow, £100 billion interest a year isn't it? Don't spend it on Brits though, spend it on foreigners.
I was working as a quantity surveyor during the late 1980’s and early 1990’s on Property Services Agency was in charge of maintenance on these type of properties and many other government properties. The system was not perfect but worked reasonably well, although there was some embarrassing financial irregularities that I helped uncover plus any delays or poor work was blamed on the Government. This system had two very important failures as far as Margaret Thatcher was concerned, which was the growing power of the PSA, who as many government departments at the time spent as much time growing their departments as focusing on their remit, and this compounded by the fear of these irregularities and some poor work getting covered in the press. What better way to deal with it than disband the PSA and make the new system very attractive to private companies, both issues resolved at a stroke. I attended many meetings / seminars at the time where it was clear the costs would be significantly higher and the loss of control very damaging but the political benefit was considered much more important. There was an enquiry about the financial issues but it was well known the political issues were the real driver behind much of what took place. The first step in 1998 was making the PSA bid for work against private companies, and eventually in 1993 John Major abolished the PSA and introduced his raft of privatisations and other PFI schemes on the same premise. If the issues had simply been financial irregularities they could have been resolved by prosecutions and court cases but that wouldn’t have resolved the blame game and the political power plays. Its clear this hasn’t worked out well, but the politicians at the time knew it wouldn’t, but it did take the heat off the government for many years, until the problems that were obvious to people in the various industries at the time, have become too serious to cover up any longer.
@@davideyres955 But they're making money by doing this: The cost associated with borrowing the money will be less than the money saved by bringing the houses back under government control.
Mrs Thatcher famously said "there is no government money". Truth is there is only government money. The government can change laws and produce the sovereign currency.
There is no government money. What there is, is government wealth which brings power A pound is worthless to an American in france Get euros by selling car part manufacturering to france. A trade agreement with an american to give them euros in exchange for dollars is worthwhile
Yes but it needs to pull that money back through tax. Because the tax system is fundamentally unfit for purpose, sterling has lost 98% of its value since 1950. Dishonest politicians have been listening to the advice of fools.
There is no government money means the government doesn't produce anything, it only takes what private citizens and companies have produced and redistributes it. Money is a commodity used as an intermediary in most transactions which has alternative uses, currency is just a unit of account.
We were also paying for the maintenance, on top of all the rent. This makes more financial sense than selling them ever did, and more than keeping the rental agreement..
The full story to your comment is they were sold by the Tory government to private equity for £1.6 billion who, since 1996, have charged the government a total £6.5 billion in rent under that 1996 PFI contract. Simply closing down a very bad deal.
I could scarcely believe it when Starmer said the quiet part out loud and actually BRAGGED about doing deals with Black Rock; one of the most notorious asset strippers on the planet. Rotten PFI and PPP deals have saddled NHS hospitals, schools and other public projects with billions of pounds worth of debt for years to come. Every one of these needs to be unwound. Will it cost a lot? Very likely, but it needs to be done! These deals are insanity. They're just a ruse to take public debt off the books to make the figures look good, but if these projects were done with public money in the first place, they would have worked out a helluva lot cheaper! Now we have hospitals drowning in debt because of dodgy PFI loans. As I understand it, once the loan is paid off, those that loaned the money effectively owns the hospital, school...whatever! Is that correct? I'm fairly sure it is. Neoliberals have such an aversion to the idea of public funding (at least they pretend to) they come to insane ideas like this.
Not only is government managed and owned cheaper because of lower interest rates as you state but also there is no need for profit as is required in the private sector. PFI stinks.
This needs to be done in the NHS and in military for things like recruiting. For some baffling reason recruiting is done by a private firm and has not once hit it's target for the number of recruits. Simply because they take so lomg to process them more than half drop out of the process. Yet they make hundreds of millions a year for being failures
Yes it stands out a mile, anyone can see the government can get money when ever they need it and waste it on things of no benefit to the public. You have explained the mechanics of how its achieved, great and easy to comprehend explanation, thanks. It will be back to business " we got to get the deficit down" and " we just put 6 billion aside for Ukraine " it all makes sense now.
I don't think so. But not for the reason you think. It can't do that because it's bad PR. The curtain would be drawn back and the whole truth of the matter would be exposed. The route to that end has to be circuitous and obfuscating so that 'normal' people do not realise what's going on. Especially because the vast majority of people think governments run economies like their own household budget. So, every time the government said "there's no magic money tree" - it was actually lying. Not only is it magic but it's the greatest illusion on earth. Problem is all economies rely on energy. And we are using up the earths resources faster and faster. In fact we are in overshoot. See "Staving Off the Coming Global Collapse"
@downshift4503 Exactly meaning they can buy all idle labour. So the rate of unemployment is a policy choice. As the British government can buy anything for sale in its own currency. Which is a lot contrary to what you imply with the word only.
@@taipizzalord4463 I agree, but I am sympathetic that the available skilled labour might not be available to achieve their goals. You probably saw recently published how many builders, roofers, etc are required in order for this (I assume) council house building target to be met. The answer is right in front of the governments nose. Housebuilders have already built houses for sale. It doesn't need to compete against the house builders for resources. If the priority is social housing then buy the new build houses that are for sale and rent them out. It can even implement long term "right to buy" if it continues the exercise and drip feed new properties into the private sector via the public sector.
One can always find any amount necessary when one has a fiat currency system and can create one's own money. The cost is borne elsewhere in the system, almost completely unseen.
They can always go to the City, but what happens when the City loses confidence? Wasnt this the situation in Spain, Greece & Italy and Germany had to bail the whole lot out because the Money Markets said No?
The original deal was struck in 1996 when the Conservative government sold 55,000 houses for an average of £27,000 per property. The MOD then rented them back in a bid to save money. The 1996 deal is estimated to have cost taxpayers £7.8b with many houses in unliveable conditions. The Conservatives started the buy back process in 2022, labour are just finishing the deal. It will actually save money by not having to pay rent to a private foreign company and will allow housing standards to be raised.
So what your saying is Labour will claim credit for something the tories did and knock a big hole in there claim to have created one and a half million homes in five year
I'm sorry but you can expect labor to undo every injustice commited within this country given they only have a limited budget. They'll try and deliver on their current manifesto and campaign promises and when they run again in the next election cycle they can deliver justice for waspi women. Its weird how everyone expects labor to do the impossible with f**k-all finances (especially given they started with 22 billions less that what's they expected). You were complicit when the tories pillaged the country but now act smug when Labour are actually trying to scrape things together
I should imagine that because of the scale of this buy back and borrowing, this whole deal has been in-train for some considerable time and probably before Labour came back into power.
When I was a young man back in the early 80’s I worked for The Midland Bank, I seem to remember that they lent a lot of money to African and South American governments on the basis that they would always be able to repay the debts, by raising taxes if necessary. It turned out you can only squeeze people so far before they overthrow their governments and default on said debts. One of the main reasons there is no longer a Midland Bank.
@ yeah, as I remember (it was a long time ago), they had to repay in Sterling or Dollars so they couldn’t just print that, as I stated the prevailing economic theory at the time was all governments could always increase taxes if necessary. Perhaps there is a moral to this story that our Government should listen to.
@@stevelongden7368 "The Financial Curse" is an interesting read and I recall covered the Midland Bank of that era. Sounds like you have first hand experience of it.
@ unfortunately yes, they also bought an American bank (Crocker?) without seemingly doing any due diligence and it turned into a money pit that they had to sell at a massive loss not long after. The sale to HSBC soon followed
To add insult to injury, the MOD will spend vast sums of money for the supposed upkeep of the properties. The MOD knows how to waste vast sums of money!
*BAN PRIVATE LANDLORDS* do exactly the same with every privately rented house over the next 10 years...!!! Freez rents and let the money go INTO the economy and not INTO the bank accounts of PE and wealthy pensioners...!!!
The reason this 6 billion was possible is because it is backed by the value of the assets purchased. That is a problem of services vs asset. They could use this to buy other assets like rail networks, power companies and so on.
It wouldn't surprise me if the maintenance ends up back with the same contractors. The mod will contract out the maintenance (as it contracts out pretty much everything) and the existing company will know exactly how to write the tender to get the contract. Soo a nice £6B bonus for the shareholders & everything carries on unchanged.
Great questions! As a forces child, my family lived in a series of RAF houses throughout all my childhood, most on which were in not very good nick. The government did not manage to find the money or the desire to make good. Similar with the trains and the utilities. Why now privatise Royal Mail, while taking rail companies back into Government control - far more people use the post than can use trains.
Sorry, but where have you been for the las13 years? Royal Mail was privatised in 2011,under the Coalition Government of the Cons and the Lib Dems. Vince Cable, has a lot to answer for.
If only people didn’t vote against Brit interests in 2016 we would still be part of a particular group of countries where we wouldn’t have a problem sending those people back to France
Will that be them buying back the MoD houses they flogged off cheap ten years ago for a vastly inflated price? I wonder who sits on those boards. Follow the money.
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It was borrowing that was seen as unsustainable that made investors nervous causing the pound to crash that brought the Truss government down. Perhaps Starmer sees this as a necessary evil and are holding back from borrowing in order to prevent a similar outcome. After all, if the Tories gets back in, they're just going to sell assets off again. Is what I think.
You are close to the core issue in politics - almost nobody, nobody, knows what money actually is. And if you can't define money, you cannot understand politics. Every time the government says there is no money, it is lying, tricking people into believing money is a resource (it is not) or that a country´s economy is comparable to a household economy (it is not).
Great video and discussion. Just wondering if there’s a risk reward factor in borrowing too much from the city to mitigate against the government having to print more money to honour its debts which could presumably lead to the value of the pound falling ? Or is it the city are happy to lend against tangible assets like property but not so keen on none tangible assets like winter fuel allowance etc ?
Also £6 billion for 166,000 houses works out at £36,144 per house. Why are they so cheap? Are there further hidden liabilities in the deal that has not been disclosed?
The Winter Fuel Allowance was not allocated efficiently or effectively. Efficient use of tax receipts doesn't give money to those who don't need it. So any government should ascertain a civilised standard of living for pensioners and people on benefits, and those who are above that standard should not get it. The problem is that the government standard of living for pensioners is too low. And that's an inherited problem, that can't be fixed anytime soon. The Cost of Living in the UK is going up strongly, and pensioners are not all loaded, but some are. And it unfair just to discribute limited funds willy-nilly. The basic living needs for pensioners needs to be addressed in a way that is clear and understandable. Nobody understands pensions at all. That's why the winter fuel allowance was poliiticised and paid as a bribe, but a serious number of pensioners were still needing to choose between heating or eating, whilst those who didn't need it, were getting it anyway. That should not be the case. That the state pension is still to low to live on, is another inherited situation, and pension Credit is still too low. That's the real issue, and for that you can blame a long line of givernment back to Thatcher who fiddled the National Insurance Fund and broke the link with wages. Google 'The Rape of The National Insurance Fund" by the late Tony Lines, and you'll see why pensions and the NHS ended up being squeezed for cash. The report is still online, and it ties into the Waspi Women as well. And the amount lost if adjusted for inflation are eye-watering. The fact is, the problem is too big now for any quick and easy fix, and it's only going to get worse. Political opportunism is only possible where people don't know what's really happened over nearly 5 decades. And labour can't fix it, because the accumulative problems has wrecked the potential for real growth in the UK.
@CuriousCrow-mp4cx perhaps a little precis would have sufficed...and would have been improved by addressing the question I posed. I will rephrase to see if you catch my drift. You granny doesn't charge your mum to look after you. Your mum doesn't have to pay a commercial nursery. The government benefits bill goes down accordingly. With me so far? Now, you won't hear that any more than you will hear that your mum was the person putting in the hard labour on your birthday, or that she was Santa. The expectation that women will sacrifice their time and effort without thanks is endemic. You couldn't afford to pay a granny the hours she has dedicated to get a grandchild, so it is ignored. Until now. Whilst the money is given to house their grandchildren destined to be used as cannon fodder. Five decades my arse. Men have been at this patriarchy lark for thousands of years. Tickety tock. Gen X is retiring.
PFI Schemes are the equivalent of taking out a mortgage to buy a single meal. PFI Schemes need to scrapped with existing PFI Schemes converted to design, cost and build only with maintenance, running the buildings and ownership transferred to the public sector.
Excellent clarity of message , now it would be very interesting to put actual names with these deals , you have named the defence minister who has done a sensible thing and we know Starmer comes over all giggling girl when dealing with Blackrock etc . When ghoul’s like Mandelshon get yet another chance to knoble the UK , I think how masochistic can the British people be. Keep up the important work.
Presumably when you do PFI deals it's easier for people to line their own pockets. But when it comes to foreign governments or companies like BlackRock it's never just about money.
Labour (in name only) couldn't find the money to buy the Royal Mail and won't take water companies back into public ownership but somehow manage to buy houses back for the MOD. Their priorities are a bit mixed up, aren't they?
PFI is privatization for rentiers and conveniently does away with overheads and capital outlay, or, privatization of profits, nationalization of costs.
UK National Debt in 1998 [Brown] £350Bn by 2020 [Sunak] £2.10Tn - it's accelerated under all Tory chancellors. Tories always borrow more and pay back less. In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget) and by 2008 it had fallen to 2.1% nearly 50% reduction. The Tories last administration increased the national debt more than every Labour government combined. What is also conveniently forgotten is that Labour ran a surplus between 1998-2002 an achievement almost unparalleled in modern history in the UK.
People have short memories, you willl always pay more tax when the Tories are in power, don't swallow the tory propaganda that Labour are the party of high taxes !!!
It's a matter of priorities, top of the list is refugees, foreign aid, anything that is for non UK taxpayers, working class British people are not at the bottom of the list, they aren't even on the list.
There's a global issue here about debt generally, which is why I follow Dr. Murphy from here in Canada. Most people have no idea WHO their countries own money to, how easy it is to borrow, or what the consequences of public debt are. Canadians and Americans never ask the simple question, 'if every nation has public debt, who do they owe it TO?' Shouldn't there be some creditor nation that's rolling in debt repayments and has cash to spare? The major reason why every discussion about deficit and debt on this continent dies still-born right at the start, because everyone who talks about it, except a few specialists, are incapable of thinking about public debt without assuming it's the same as personal debt, and works the same way when it doesn't. In this case the debt generated by borrowing from London is an INTERNAL debt and operates very differently from someone getting a bank loan.
Because they tell the bank to print it , why do you think inflation is so high ? The only factor that raises inflation is government spending which lessens the value of pound …in so raising prices and receiving less
It’s like when you need new shoes as a kid but your dad says he’s got no money but yet spends 4 nights a week in the pub and up grades his car every 3 months but he’s got no money for shoes🤯
Why does our government act like an abusive parent??
Because they don’t care about you!!
Or the people who go to the food bank covered in tattoos in 150 quid trainers and a 200 pound coat.
@@TheCornish123456What an idiotic remark.
@@TheCornish123456
How many have you seen that ere like that and do people's circumstances not change?
@@ruthguthrie1099 more than a few.
@@TheCornish123456you clearly don’t work at food banks.
The fact that PFI deals are expensive for the taxpayer *is the point*!
They are about a transfer of taxpayer cash to the wealthy, not about some sort of efficient way to fund public projects.
Exactly this.
We have been brainwashed to accept that the private sector is always more efficient than the public sector. When the facts/statistics proved otherwise, we find excuses or accept illogical explanations for the people representing the interests of the private sector. Are we capable of being rational in the face of continuous Capitalist propaganda?
But those 'wealthy' do the same- most large companies sell and lese back their buildings. The difference is that the manage to lease/repair contract. Which government is rubbish at. The civil service cannot fail, so there is no incentive to do a good job.
Used extensively by Bliar to channel taxpayers' money to his cronies.
@@Tensquaremetreworkshop
Where is the incentive for a private water company to do a good job?
Can we stop purchasing their products? Is there a row of taps in every home that we can choose from?
If they do a bad job, can the government just shut them down?
Or do we taxpayers have to pay off the debts and keep things going?
Same applies to all essential utilities. If they win, they win, and if they fail, they HAVE TO BE bailed out, because their services are essential to life.
Thanks Richard. PFI stinks doesn’t it? And always has. Always.
Strangely, it is what most companies do. They sell and lease back their buildings. Because they can get better returns on that capital (ROI). Could it be that private companies are much better at managing maintenance contracts? Ahh, there lies the difference...
Used by Bliar to defray taxpayers' money to his friends for decades.
And always will
@@Tensquaremetreworkshop or maybe they do that to 'avoid' paying tax, maybe?
@@harrisonbergeron9746 It is normally done for two reasons.
1) The ROI in the building can drag on their numbers. They can employ that capital more efficiently elsewhere
2) It is not the focus of their business. Contracting out the elements of your business that is not focused on your products removes distractions. You employ one 'expert' person, the facilities manager, and he manages the contracts for all of this. Something the government (any government) is very bad at.
Thank you so much, for expressing simply & logically, what so many of us intuitively knew.
It's because the debt on the PFI doesn't go onto the balance book immediately. It makes some numbers look better than they truly are.
The MOD don't take care of maintenance on their own estate assets. Vivo are the contractor and, guess what, they repair nothing and just take their cash
Vivo charges the MOD, i.e. taxpayers over £500 to change a light bulb.
@@Zerpentsa6598 you actually got them to come out and change it? I've been waiting 5 months for them to repair two lights. My favourite recently was after the storms some subcontractor tree surgeons had to deal with a fallen tree and there were four Vivo worker in two vans sat watching them. I wonder how much they billed for that.
@@Zerpentsa6598 can that be true?
@@JSmith19858 Sounds like they are waiting for the annual lifecycle charge to the public department so they can charge under that rather than their own pocket similar to another different contractor under PFI that I've dealt with to paint rooms.
Another question is, why are we buying back rather than simply taking back, given that the pfi rip off merchants have been fleecing taxpayer for 27 years?
Exactly! Or, could have paid 1 billion, or half billion, said take it or leave it. You know the answer. Because the money goes to line the pockets of the banksters and their mates. Corruption Corruption Corruption
Under some circumstances, I would agree with that statement but how is that any better than what Putin does.
@@tetraquark2402How is it worse than Putin? He is a practical man despite being a violent one. It is better than Putin as long as nobody "falls" out a window and it's all done legally.
I would say that the most likely reason is that it's illegal. Do you want the government to behave like the Mafia?
You are doing that because your nation is not good enough to be an autarky of which the second you start nationalizing any company, every company is gonna shit themself and leave. Your nation cannot survive without the trade with others as you produce insufficient food, manufactured goods, and fuel to support yourself as a service economy. Therefore, just taking stuff will destroy your nation and impoverish millions as capital flight ruins you
I’m right with you Richard 45 years of privatisation has not and will not work. The country is poorer for it, but the powers to be still pursue this line just take water off wall which is a branch of the government has granted the water authorities to raise the bills to pay, and I don’t think it’s to pay for infrastructure projects ring fenced as I said, I think it’s to continuously pay high salaries to CEOs and shareholders. Instead of taking it all back in the house. Privatisation does not work and the proof is there.
It could have worked but for the greed of Capitalists/politicians who thrive on the System which do not hold them accountable. Do we need a revolution to put an end to this?
Blame Thatcher for this, she started the ball rolling.
It wouldn't be any better if thengov owned everything, it would just cost more and still be a crap service
@@adamiskandar5107it could never have worked. The very idea behind privatisation isn't for it to work, it is for the owning class to extract money from the working class.
...but as such it's been a roaring success.
@@billB101the idea was they would have to make a profit if not nationalised. So they put prices up and closed things down making people jobless!
Why is Labour still doing bad PFI deals? Corruption. These deals will benefit their rich donors. Simple.
Your argument and explanation is one that most sane people would agree with, unlike Lamont and Major who started this ripoff.
Because, given modern monetary theory, taxation is primarily a form of social control. Friendly reminder that Labour and Conservative are equally part of the military-pharma-industrial complex establishment who need war and sickness to continue expansion. If you frame government in traditional terms of them trying to benefit the populace, their policies and actions seem bizarrely incompetent, where the reality is that the UK government have already transitioned to become an arm of a system of global stakeholder capitalism. The people are simply not stakeholders in this system and the gloves are off for exploitation. Basically, we are all Africans now.
I love the fact that you equate ordinary UK citizens to Africans. It should provoke people to rethink their priorities.
I am rather concerned that you might be into something there! However, Africa is a very big place and some African countries are set to do a lot better than we are moving forward.
I agree. To break that IMO requires a government to re-enforce its own control and stop pretending that it is at the mercy of financiers. It isn't. It can achieve that via its central bank or it can use existing process of gilts, but lower bases rates and require institutions to hold those gilts at certain ratios.
Feudalism by another name
@xueya2188 exactly 👍 we are being farmed by psychopaths that will ever see you as human beings but rather like cattle to be milked for every penny you can produce for them.
Nicely done Richard nicely done. If only we could put this to them in a way they cannot wriggle away from it and they have to listen to the people and I would say listen to somebody like you
❤❤❤❤❤
Can we have a video on Bliar's PFI deals for new hospitals please. And why he's never been held accountable for wasting hundreds of billions of pounds of taxpeyers' money. Or put on trial in The Hague for war crimes.
It is true that Blair embraced PFI financing. However, the tories wasted more money on them than Labour did.
Great video Richard;-) The problem is we have Red Tories or Blue Tories both are the same shite
Those of us working on PFI schemes in the late 1990's/early 2000's were amazed the then Labour Gov't continued with and expanded PFI's when they were known to give poor value for money in the long term.
That’s Labour for you (us) nothing learned. I can’t believe they are back in government after the Blair/Brown years. The Tories badly let us down too. Time for a change methinks.
@@arthurdixon5890PFI was a Tory initiative - all parties are going to use it irrespective?
@@user-qg2bt2qt9l Agreed but New Labour used it indiscriminately. I appreciate that lessons have been learned as a result of the pitfalls realised (Kings Fund etc) but there has been talk of using PFI for the planned Thames Crossing. We are still paying tolls for the Dartford Crossing as Gordon Brown would not allow the toll to be lifted after the project had been paid for.
Spot the clue in the words "long term" and don't just blame the Tories, Labour couldn't wait to spend noth sea oil revenues fast enough. Our sovereign wealth fund went down the welfare state toilet. Now we throw money around that we borrow, £100 billion interest a year isn't it? Don't spend it on Brits though, spend it on foreigners.
I was working as a quantity surveyor during the late 1980’s and early 1990’s on Property Services Agency was in charge of maintenance on these type of properties and many other government properties. The system was not perfect but worked reasonably well, although there was some embarrassing financial irregularities that I helped uncover plus any delays or poor work was blamed on the Government. This system had two very important failures as far as Margaret Thatcher was concerned, which was the growing power of the PSA, who as many government departments at the time spent as much time growing their departments as focusing on their remit, and this compounded by the fear of these irregularities and some poor work getting covered in the press. What better way to deal with it than disband the PSA and make the new system very attractive to private companies, both issues resolved at a stroke. I attended many meetings / seminars at the time where it was clear the costs would be significantly higher and the loss of control very damaging but the political benefit was considered much more important. There was an enquiry about the financial issues but it was well known the political issues were the real driver behind much of what took place. The first step in 1998 was making the PSA bid for work against private companies, and eventually in 1993 John Major abolished the PSA and introduced his raft of privatisations and other PFI schemes on the same premise. If the issues had simply been financial irregularities they could have been resolved by prosecutions and court cases but that wouldn’t have resolved the blame game and the political power plays. Its clear this hasn’t worked out well, but the politicians at the time knew it wouldn’t, but it did take the heat off the government for many years, until the problems that were obvious to people in the various industries at the time, have become too serious to cover up any longer.
If an individual did a deal like that they wouldn't be accused of incompetence they would be accused of corruption.
Yep. That's exactly what it is: a Kleptocracy!!
How come Labour can find money when it wants to?
But in the video he stated they didn’t, they went to the city of London. Something that will cost us more in the long term.
@@davideyres955 But they're making money by doing this: The cost associated with borrowing the money will be less than the money saved by bringing the houses back under government control.
PFI, government contracts, rail franchises, etc its easy money 💰 for the corporate donating classes
Mrs Thatcher famously said "there is no government money". Truth is there is only government money. The government can change laws and produce the sovereign currency.
There is no government money. What there is, is government wealth which brings power
A pound is worthless to an American in france
Get euros by selling car part manufacturering to france.
A trade agreement with an american to give them euros in exchange for dollars is worthwhile
Yes but it needs to pull that money back through tax. Because the tax system is fundamentally unfit for purpose, sterling has lost 98% of its value since 1950. Dishonest politicians have been listening to the advice of fools.
All tax is derived from the private sector . Public sector jobs effectively pay no tax .
There is no government money means the government doesn't produce anything, it only takes what private citizens and companies have produced and redistributes it. Money is a commodity used as an intermediary in most transactions which has alternative uses, currency is just a unit of account.
It is money laundering from public to private pockets.
How come all governments can always find money for wars ?
The crime syndicate works in mysterious ways.
😅😅😅
We don't need told in Scotland how bad PFI is and it was Labour who forced it on us.
Sold them for 1.6 billion, bought them back for 6 billion, good job we got people like these ,to look after our money!!!!!!!!!!
We were also paying for the maintenance, on top of all the rent. This makes more financial sense than selling them ever did, and more than keeping the rental agreement..
The full story to your comment is they were sold by the Tory government to private equity for £1.6 billion who, since 1996, have charged the government a total £6.5 billion in rent under that 1996 PFI contract. Simply closing down a very bad deal.
@@onandon-nq1zw Now now, don't you go ruining a good echo chamber with facts.
Take note ... Sold by the Tories for peanuts !!!
@@onandon-nq1zw And Labour will fill them with illegal migrants so still a bad deal.
Thank you for explaining this so concisely.
I could scarcely believe it when Starmer said the quiet part out loud and actually BRAGGED about doing deals with Black Rock; one of the most notorious asset strippers on the planet. Rotten PFI and PPP deals have saddled NHS hospitals, schools and other public projects with billions of pounds worth of debt for years to come. Every one of these needs to be unwound. Will it cost a lot? Very likely, but it needs to be done! These deals are insanity. They're just a ruse to take public debt off the books to make the figures look good, but if these projects were done with public money in the first place, they would have worked out a helluva lot cheaper! Now we have hospitals drowning in debt because of dodgy PFI loans. As I understand it, once the loan is paid off, those that loaned the money effectively owns the hospital, school...whatever! Is that correct? I'm fairly sure it is. Neoliberals have such an aversion to the idea of public funding (at least they pretend to) they come to insane ideas like this.
As you have been repeating many times, the government never has a black hole.
They can always find money when they want to, especially for projects in London.
For exactly the same reason politicians can find money when they need to spend it.
Not only is government managed and owned cheaper because of lower interest rates as you state but also there is no need for profit as is required in the private sector. PFI stinks.
Excellent as always Richard.
This needs to be done in the NHS and in military for things like recruiting. For some baffling reason recruiting is done by a private firm and has not once hit it's target for the number of recruits. Simply because they take so lomg to process them more than half drop out of the process. Yet they make hundreds of millions a year for being failures
Across the board, contractors overcharge on public sector contracts. It's culpable fraud on both parties.
Yes it stands out a mile, anyone can see the government can get money when ever they need it and waste it on things of no benefit to the public. You have explained the mechanics of how its achieved, great and easy to comprehend explanation, thanks.
It will be back to business " we got to get the deficit down" and " we just put 6 billion aside for Ukraine " it all makes sense now.
Labour just found over £20,000 a day in to pay for the new Labour peers' daily expenses claims.
So the government can spend an unlimited amount of money... If only that was taken to its logical conclusion.
I don't think so. But not for the reason you think. It can't do that because it's bad PR. The curtain would be drawn back and the whole truth of the matter would be exposed. The route to that end has to be circuitous and obfuscating so that 'normal' people do not realise what's going on. Especially because the vast majority of people think governments run economies like their own household budget. So, every time the government said "there's no magic money tree" - it was actually lying. Not only is it magic but it's the greatest illusion on earth. Problem is all economies rely on energy. And we are using up the earths resources faster and faster. In fact we are in overshoot. See "Staving Off the Coming Global Collapse"
they can only use that £ to buy things that are for sale.
@downshift4503 Exactly meaning they can buy all idle labour. So the rate of unemployment is a policy choice. As the British government can buy anything for sale in its own currency. Which is a lot contrary to what you imply with the word only.
@@taipizzalord4463 I agree, but I am sympathetic that the available skilled labour might not be available to achieve their goals. You probably saw recently published how many builders, roofers, etc are required in order for this (I assume) council house building target to be met. The answer is right in front of the governments nose. Housebuilders have already built houses for sale. It doesn't need to compete against the house builders for resources. If the priority is social housing then buy the new build houses that are for sale and rent them out. It can even implement long term "right to buy" if it continues the exercise and drip feed new properties into the private sector via the public sector.
The real truth is what sort of government you wish for. The one that is accountable to the people or the one protecting the rich elites?
I found 50p down the back of my sofa once.
Because they will have friends in certain institutions doing the work , is my guess , and a little bit of cake may fall off the table .
that money isn't for the people it's for the riches war.
PFI deals worked for the few. But not for the many......
Yet Wes Streeting said he wants more PFI in the health service.
One can always find any amount necessary when one has a fiat currency system and can create one's own money.
The cost is borne elsewhere in the system, almost completely unseen.
They take it from their £22Billion Stash!!!!!
They can always go to the City, but what happens when the City loses confidence? Wasnt this the situation in Spain, Greece & Italy and Germany had to bail the whole lot out because the Money Markets said No?
The government always finds a way to help rich people
Becuase politics is full of cronies ? Eg 32 billion track and trace .
Why do journalists not challenge this? Or are they mostly all financially illiterate? Thank you for explaining so clearly.
The original deal was struck in 1996 when the Conservative government sold 55,000 houses for an average of £27,000 per property. The MOD then rented them back in a bid to save money. The 1996 deal is estimated to have cost taxpayers £7.8b with many houses in unliveable conditions. The Conservatives started the buy back process in 2022, labour are just finishing the deal. It will actually save money by not having to pay rent to a private foreign company and will allow housing standards to be raised.
So what your saying is Labour will claim credit for something the tories did and knock a big hole in there claim to have created one and a half million homes in five year
selling houses at the bottom of the market, major was as bad as the gordon brown bottom in gold
Could have done this for the WASPI women!
Why, they was given enough notice,
Exactly what I thought...
@@xlp3t3r exactly
@@Darren-i1w Then why did Rachel Reeves campaign to do exactly that?
I'm sorry but you can expect labor to undo every injustice commited within this country given they only have a limited budget. They'll try and deliver on their current manifesto and campaign promises and when they run again in the next election cycle they can deliver justice for waspi women.
Its weird how everyone expects labor to do the impossible with f**k-all finances (especially given they started with 22 billions less that what's they expected). You were complicit when the tories pillaged the country but now act smug when Labour are actually trying to scrape things together
I cannot understand why Labour are going in for PFI and worse its with the most cut throat of American businesses!
Follow the money and you will find the answer.
They always find money when it comes to funding foreign wars
Funding foreigners full stop.
There is this sofa in number 11 and she pushed her hand down... And £6bn is such a trivial amount 🤣🤤
I should imagine that because of the scale of this buy back and borrowing, this whole deal has been in-train for some considerable time and probably before Labour came back into power.
Thats doesnt matter its all labours fault, everything is labours fault now, when the tories get back in, it will be there fault
So was Waspi compensation, and todays scandal the blood products compensation.
When I was a young man back in the early 80’s I worked for The Midland Bank, I seem to remember that they lent a lot of money to African and South American governments on the basis that they would always be able to repay the debts, by raising taxes if necessary. It turned out you can only squeeze people so far before they overthrow their governments and default on said debts. One of the main reasons there is no longer a Midland Bank.
problem there is that those countries are likely borrowing something that they can't create. Not the same here in the UK, USA etc.
@ yeah, as I remember (it was a long time ago), they had to repay in Sterling or Dollars so they couldn’t just print that, as I stated the prevailing economic theory at the time was all governments could always increase taxes if necessary. Perhaps there is a moral to this story that our Government should listen to.
@@stevelongden7368 "The Financial Curse" is an interesting read and I recall covered the Midland Bank of that era. Sounds like you have first hand experience of it.
@ unfortunately yes, they also bought an American bank (Crocker?) without seemingly doing any due diligence and it turned into a money pit that they had to sell at a massive loss not long after. The sale to HSBC soon followed
To add insult to injury, the MOD will spend vast sums of money for the supposed upkeep of the properties. The MOD knows how to waste vast sums of money!
what about the pfi schools and hospitals, championed by new "labour"?
The magic money tree strikes again
Great question, but don't forget about all those freebies given to Starmer and his team; neither the BoE nor the City could compete with that.
*BAN PRIVATE LANDLORDS* do exactly the same with every privately rented house over the next 10 years...!!! Freez rents and let the money go INTO the economy and not INTO the bank accounts of PE and wealthy pensioners...!!!
The reason this 6 billion was possible is because it is backed by the value of the assets purchased. That is a problem of services vs asset. They could use this to buy other assets like rail networks, power companies and so on.
The Skye Bridge was a ridiculous PFI contract. £5.20 to cross each way until the Scottish Government came along and bought it from Bank of America.
4:45 not to mention that when the government does it nobody takes a profit to line the pockets of shareholders!
It wouldn't surprise me if the maintenance ends up back with the same contractors. The mod will contract out the maintenance (as it contracts out pretty much everything) and the existing company will know exactly how to write the tender to get the contract. Soo a nice £6B bonus for the shareholders & everything carries on unchanged.
The shareholder to though, don't they? They can can either get dividends, or sell them, right?
@ dividends are an annual payment to shareholders, usually paid out of profits.
Gordon Brown should not have used PFI but he did lots of times.
We won't wait another four years he be gone Christmas booted out
The Bank of Ingland fired up the money printing machine & voila!🤪👍
Great video
Good to see the uniparty got elected.
It's like being in an abusive relationship that restricts access to money and choice.
Great questions!
As a forces child, my family lived in a series of RAF houses throughout all my childhood, most on which were in not very good nick. The government did not manage to find the money or the desire to make good.
Similar with the trains and the utilities.
Why now privatise Royal Mail, while taking rail companies back into Government control - far more people use the post than can use trains.
Railways are part of a wartime infrastructure.
Sorry, but where have you been for the las13 years? Royal Mail was privatised in 2011,under the Coalition Government of the Cons and the Lib Dems. Vince Cable, has a lot to answer for.
Brilliant video. It would be great if the wider population were provided this information in this format. Keep going 👍
I'm sure these will be converted into temporary migration accommodation in quick succession.
If only people didn’t vote against Brit interests in 2016 we would still be part of a particular group of countries where we wouldn’t have a problem sending those people back to France
My thoughts as well
Presumably the City would not have loaned on the building program in Rwanda so this will be cheaper ?
Will that be them buying back the MoD houses they flogged off cheap ten years ago for a vastly inflated price? I wonder who sits on those boards. Follow the money.
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"We have no money, just trust us bro." - UK government
It was borrowing that was seen as unsustainable that made investors nervous causing the pound to crash that brought the Truss government down. Perhaps Starmer sees this as a necessary evil and are holding back from borrowing in order to prevent a similar outcome. After all, if the Tories gets back in, they're just going to sell assets off again. Is what I think.
You are close to the core issue in politics - almost nobody, nobody, knows what money actually is. And if you can't define money, you cannot understand politics. Every time the government says there is no money, it is lying, tricking people into believing money is a resource (it is not) or that a country´s economy is comparable to a household economy (it is not).
We all need to get them out
Great video and discussion. Just wondering if there’s a risk reward factor in borrowing too much from the city to mitigate against the government having to print more money to honour its debts which could presumably lead to the value of the pound falling ? Or is it the city are happy to lend against tangible assets like property but not so keen on none tangible assets like winter fuel allowance etc ?
It can create as much money as it needs it doesn’t need to find it we are no longer on the gold standard !!
Also £6 billion for 166,000 houses works out at £36,144 per house. Why are they so cheap? Are there further hidden liabilities in the deal that has not been disclosed?
I'm sure we all know who will be housed in this accomodation!.
Moreover, who is going to fill these houses, and what inferences can be drawn by the comparison between pensioners and military personnel?
The Winter Fuel Allowance was not allocated efficiently or effectively. Efficient use of tax receipts doesn't give money to those who don't need it. So any government should ascertain a civilised standard of living for pensioners and people on benefits, and those who are above that standard should not get it. The problem is that the government standard of living for pensioners is too low. And that's an inherited problem, that can't be fixed anytime soon. The Cost of Living in the UK is going up strongly, and pensioners are not all loaded, but some are. And it unfair just to discribute limited funds willy-nilly. The basic living needs for pensioners needs to be addressed in a way that is clear and understandable. Nobody understands pensions at all. That's why the winter fuel allowance was poliiticised and paid as a bribe, but a serious number of pensioners were still needing to choose between heating or eating, whilst those who didn't need it, were getting it anyway. That should not be the case. That the state pension is still to low to live on, is another inherited situation, and pension Credit is still too low. That's the real issue, and for that you can blame a long line of givernment back to Thatcher who fiddled the National Insurance Fund and broke the link with wages. Google 'The Rape of The National Insurance Fund" by the late Tony Lines, and you'll see why pensions and the NHS ended up being squeezed for cash. The report is still online, and it ties into the Waspi Women as well. And the amount lost if adjusted for inflation are eye-watering. The fact is, the problem is too big now for any quick and easy fix, and it's only going to get worse. Political opportunism is only possible where people don't know what's really happened over nearly 5 decades. And labour can't fix it, because the accumulative problems has wrecked the potential for real growth in the UK.
@CuriousCrow-mp4cx perhaps a little precis would have sufficed...and would have been improved by addressing the question I posed. I will rephrase to see if you catch my drift.
You granny doesn't charge your mum to look after you.
Your mum doesn't have to pay a commercial nursery.
The government benefits bill goes down accordingly.
With me so far?
Now, you won't hear that any more than you will hear that your mum was the person putting in the hard labour on your birthday, or that she was Santa.
The expectation that women will sacrifice their time and effort without thanks is endemic.
You couldn't afford to pay a granny the hours she has dedicated to get a grandchild, so it is ignored.
Until now.
Whilst the money is given to house their grandchildren destined to be used as cannon fodder.
Five decades my arse.
Men have been at this patriarchy lark for thousands of years.
Tickety tock.
Gen X is retiring.
PFI Schemes are the equivalent of taking out a mortgage to buy a single meal.
PFI Schemes need to scrapped with existing PFI Schemes converted to design, cost and build only with maintenance, running the buildings and ownership transferred to the public sector.
Neoliberals are so expensive! 🤑
Excellent clarity of message , now it would be very interesting to put actual names with these deals , you have named the defence minister who has done a sensible thing and we know Starmer comes over all giggling girl when dealing with Blackrock etc . When ghoul’s like Mandelshon get yet another chance to knoble the UK , I think how masochistic can the British people be. Keep up the important work.
They've got £9 billion in reserve for a rainy day.
Borrowing to invest vs borrowing to spend. If it is one off costs it is much more sensible than costs that will occur every year.
Probably found it down the back of the fridge, it's nearly always there?????
Presumably when you do PFI deals it's easier for people to line their own pockets. But when it comes to foreign governments or companies like BlackRock it's never just about money.
Just print money 💰💰 ... Derrrr
Labour (in name only) couldn't find the money to buy the Royal Mail and won't take water companies back into public ownership but somehow manage to buy houses back for the MOD. Their priorities are a bit mixed up, aren't they?
Crazy world.
PFI is privatization for rentiers and conveniently does away with overheads and capital outlay, or, privatization of profits, nationalization of costs.
Greed, the gift that keeps on giving 😢
They always have money for the Agenda. The dichotomy illustrates the purposes of the Agenda.
UK National Debt in 1998 [Brown] £350Bn by 2020 [Sunak] £2.10Tn - it's accelerated under all Tory chancellors. Tories always borrow more and pay back less. In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget) and by 2008 it had fallen to 2.1% nearly 50% reduction. The Tories last administration increased the national debt more than every Labour government combined. What is also conveniently forgotten is that Labour ran a surplus between 1998-2002 an achievement almost unparalleled in modern history in the UK.
But the government doesn't need to balance the books, and certainly doesn't need a surplus.
@@helenheenan3447 Where did I say it *needed to* ?
@@helenheenan3447 My point is that there is a popular misconception that the Tories are good for business. Only if you are in their club.
People have short memories, you willl always pay more tax when the Tories are in power, don't swallow the tory propaganda that Labour are the party of high taxes !!!
It's a matter of priorities, top of the list is refugees, foreign aid, anything that is for non UK taxpayers, working class British people are not at the bottom of the list, they aren't even on the list.
Excellent video. I would love to see you on Navarra media or Owen Jones's channel. Your content would be really useful in educating those audience.
She must of found the money behind her sofa
There's a global issue here about debt generally, which is why I follow Dr. Murphy from here in Canada.
Most people have no idea WHO their countries own money to, how easy it is to borrow, or what the consequences of public debt are. Canadians and Americans never ask the simple question, 'if every nation has public debt, who do they owe it TO?' Shouldn't there be some creditor nation that's rolling in debt repayments and has cash to spare? The major reason why every discussion about deficit and debt on this continent dies still-born right at the start, because everyone who talks about it, except a few specialists, are incapable of thinking about public debt without assuming it's the same as personal debt, and works the same way when it doesn't.
In this case the debt generated by borrowing from London is an INTERNAL debt and operates very differently from someone getting a bank loan.
Because they tell the bank to print it , why do you think inflation is so high ? The only factor that raises inflation is government spending which lessens the value of pound …in so raising prices and receiving less