They talk of charity, but business is their best friend
By Gideon Burrows
2nd December 2002
Perhaps more than any other industry, the “third sector” -
charities, not-for-profit organizations, community groups and social businesses
that now boast an annual income of nearly £16bn and well over 500,000 employees
should be the natural soulmate of a Labour government. Ministers say they want
more charities and social organizations to deliver public services - from home
help and housing to refuse collection and residential care. And the Treasury is
offering millions of pounds to encourage them.
Call it Tony Blair’s fourth way.
It is likely to be more popular than the private finance initiative, not least because the third sector helps the socially excluded. For example, Supercare, based in west London, employs disabled people to do cleaning and gardening for Ealing Borough Council, providing paying jobs that such people might not otherwise have.
The General Agreement on Trade in
Services (Gats) however threatens this revival for the voluntary sector. Huge
foreign companies want to bid for local authority contracts, and special
treatment for social organizations such as Supercare is unfair competition.
As with all WTO texts, arguments rage as
to the interpretation of what must be liberalized. In the worst case, anything
involving some form of competition - refuse collection, building, childcare,
home help, meals on wheels - would be thrown open to foreign firms. Government
leg-ups for voluntary groups face a challenge because super-rich multinationals
don’t get the same treatment.
There are strong arguments for a level
playing field in industries serving the public interest: the debate in the New
Statesman over the BBC licence fee is testimony to that. But it is only over
the past year or two that the voluntary sector has been invited to the game.
Now the pro-third-sector policies of an elected government and elected local councillors
could be overruled by an agreement drawn up by companies hungry for new
markets.
The government’s whole “best value”
regime, which rules over how local authorities purchase and provide public
services, allows considerations of community involvement to go into the
assessment alongside the simple cost in cash. Many elected local councillors
ask their officers to consider factors such as the environment and job creation
when making purchasing decisions. All this could be ruled illegal if ministers
allow Gats to creep further into public services. “Gats is being pushed through
with the momentum of big business, but the problems it throws up are not being addressed,”
said John Hilary, a trade policy adviser at Save the Children.
Thus, while the government welcomes the third sector with one hand, it uses the other to undo the good work done to support it. Ministers have privately admitted to charities that business will always come first. If the UK doesn’t open up its public services to foreign competition, then UK companies will find markets closed to them abroad. Step aside, social businesses, voluntary and community groups; business always was this government’s best friend.