Minister aims to deliver “prosperity and fairness”

25 February 2009

The second annual lecture organised by the Business Services Association put Secretary of State for Work and Pensions, Rt Hon James Purnell MP right in front of leaders of the business services and FM sector.

In the Cabinet War rooms beneath the Treasury, one of several government departments where facilities and business services are provided by the private sector, Purnell reflected on the “tired debate on the relative merits of public versus private” in the approach to the outsourcing and privatisation of services, and said that “the notion that the public sector does empathy while the private sector does efficiency is as outdated as it is facile.”

He predicted that an outcome of current economic difficulties would see “ A change in the balance between the market and politics.”

He recalled that since the fall of the Berlin wall and the demise of Soviet communism as an economic force, it had been difficult to make an argument for state intervention. He recognised that this period of ‘ free market fundamentalism’ had come to an end with the events of the last 12 months and the near collapse of the banking system. He said:

“With the credit crunch, that free market fundamentalism is now in retreat. Progressive ideas are on the up. The challenge is how do we combine markets and regulation to deliver prosperity and fairness. Those two ideas, the need for both markets and regulation, the idea that fairness and prosperity go hand in hand, are the founding ideas of New Labour. So, the challenge now is not to abandon those ideas. It is to apply them again to a fresh set of circumstances.”

He summed up in his approach in three key points:

“First, that notwithstanding understandable concerns about the pressures facing our services, the public sector can, and does, do an excellent job each and every day.

Second, that despite this, it is in no one’s interests to assume that the public or private sector provision is somehow inherently better by definition, as an article of faith. Instead, we need to use the principles of benchmarking, contestability and accountability to ensure we get the best out of all the sectors- private, voluntary and public.

Third, that government cannot and should not pretend that it can solve the credit crunch by itself. That it will be up to all of us, and that an organisation such as the BSA and your members have a key role to play.”

A full transcript of his lecture is on the BSA website
online