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20/05/2003
CBI slams 'snail's pace' public service reform
The Confederation of Business Institute (CBI) has attacked the government over the "snail's pace" of its public sector reforms.
At the CBI annual dinner in London last night, Sir John told Chancellor Gordon Brown that the public investment programme had shown little return on the £6 billion annual rise in business taxes he claims the business sector has suffered since 1997.
Sir John accused the government of an "organisational inability to spend money efficiently and bring about change", and "political dogma" within the trade union movement which is causing paralysis.
The CBI has pointed to government figures showing public sector employment and output are going up at the same pace, suggesting productivity growth is negligible.
However, Sir John stressed that business was "fully behind" the government's bid to improve public services through investment and reform.
But he added: "At this event last year business was feeling bruised by the government's tax on job creation, the rise in national insurance. Since then our members have repeatedly expressed concern about the money being spent wisely.
"Business recognises that years of under-investment in public services have to be overcome before we can really make progress.
"Nonetheless, our assessment so far is there hasn't been enough to show for the funds being spent on our behalf. From transport to health services and local government, we are not getting bang for our hard-earned bucks. There is little sign of change on the ground.
"Public institutions are hamstrung by organisational inability to spend effectively, most strikingly on transport. Worse, the debate on using the private sector is bogged down in an internal family row in the Labour movement - even minor changes get branded as sinister privatisation plots."
Sir John also made a wider appeal, saying that privatisation should not be tarred by what happened over the railways – adding that the private sector should have a role in managing the NHS.
He concluded: "Chancellor, we in business are consumers, funders and providers of public services. We are four square behind your objectives. We urge you to ensure that this historic opportunity to deliver returns on our joint investment is not wasted."
(GMcG)
At the CBI annual dinner in London last night, Sir John told Chancellor Gordon Brown that the public investment programme had shown little return on the £6 billion annual rise in business taxes he claims the business sector has suffered since 1997.
Sir John accused the government of an "organisational inability to spend money efficiently and bring about change", and "political dogma" within the trade union movement which is causing paralysis.
The CBI has pointed to government figures showing public sector employment and output are going up at the same pace, suggesting productivity growth is negligible.
However, Sir John stressed that business was "fully behind" the government's bid to improve public services through investment and reform.
But he added: "At this event last year business was feeling bruised by the government's tax on job creation, the rise in national insurance. Since then our members have repeatedly expressed concern about the money being spent wisely.
"Business recognises that years of under-investment in public services have to be overcome before we can really make progress.
"Nonetheless, our assessment so far is there hasn't been enough to show for the funds being spent on our behalf. From transport to health services and local government, we are not getting bang for our hard-earned bucks. There is little sign of change on the ground.
"Public institutions are hamstrung by organisational inability to spend effectively, most strikingly on transport. Worse, the debate on using the private sector is bogged down in an internal family row in the Labour movement - even minor changes get branded as sinister privatisation plots."
Sir John also made a wider appeal, saying that privatisation should not be tarred by what happened over the railways – adding that the private sector should have a role in managing the NHS.
He concluded: "Chancellor, we in business are consumers, funders and providers of public services. We are four square behind your objectives. We urge you to ensure that this historic opportunity to deliver returns on our joint investment is not wasted."
(GMcG)
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