The mystery services you pay for and aren't allowed to know about

There is a vast range of stuff involving taxpayers’ money that taxpayers aren’t actually allowed to know. Why?

Here is brief assortment of things you aren’t supposed to know. The terms under which Circle Healthcare was contracted to take over an NHS hospital in November 2011. The date by which the NuGen joint venture was due to construct a new nuclear power station at Sellafield. How much the Lord Mayor of Chester spends on leasing a chauffeur-driven Bentley.

This isn't an exhaustive list, you understand: these are just a few of the incidences in which that will-sapping phrase "commercial confidentiality" has popped up in the news over the last few months – put there, no doubt, by journalists steaming from the ears at their inability to get hold of actual facts and figures.

This dreaded phrase comes from the Freedom of Information (FOI) Act, which makes clear that, while the public has a perfect right to know about most of what the government does, there are certain areas in which the powers that be are within their rights to keep schtum: anything, in fact, deemed “prejudicial to the commercial interests” of somebody or other.

The result of all this is that there is a vast range of stuff involving taxpayers’ money that taxpayers aren’t actually allowed to know. Want to see the un-redacted contracts under which outsourcing firms are running public buildings? Or what targets they have to hit, to claim their rather expansive bonuses? Tough. None of your business. Bugger off.

If the private sector feels at all concerned about the impression this is leaving, it’s hiding it well. In early September, the main business lobbying organisation, the CBI, put out a report calling for greater transparency regarding how services were performing. This, it argued, would make it easier both to spread good practice, and to highlight when things were going wrong.

The reason for this sudden commitment to openness is simple: it drives trust. The more information we have about how good private firms are at offering public services, the CBI thinks, the more comfortable we’ll all get with the idea. The report doesn't quite come out and say it, but it seems to be aimed at things like the Staffordshire hospital scandal; its subtext can best be summarised as 'Game on'.

Not everyone’s going to agree with that, of course, but most people, at least, would probably say this commitment to openness is to the lobby group’s credit. There is, however, a gaping hole in its argument: it only talks about one side of the equation. The report includes an airy promise that “citizens are entitled to know how taxpayers’ money is spent”; but it mentions commercial confidentiality only once, and that’s to say how important it is that the rules allowing secrecy stays in place. As far as the business lobby is concerned, we’re allowed to see what’s coming out of public services; we’re not allowed to see what’s going into them.

If pushed on the matter, the CBI’s wonks point out that financial arrangements within the public sector tend towards the opaque, too. And they argue that publishing contracts would stifle innovation. Commercial confidentiality works like a patent: no one’s going to spend money coming up with a cleverer way of doing things if they think their rivals will instantly nick it.

But even if every closed contract is hiding a wealth of innovation, which is frankly hard to believe, isn't it in our interests that their rivals can see this and start copying it? If the risk of financial transparency is that everything gets cheaper, then I'm not convinced the downside is quite as big as the CBI thinks.

The real reason commercial confidentiality persists lies elsewhere. Outsourcing firms may not want any pesky members of the Public Accounts Committee trawling through their contracts – but neither does the government. There are no clear rules setting out what can be classed as confidential, or when it can be overruled by public interest. There is, what’s more, plenty of anecdotal evidence to suggest that specific financial information sometimes stays hidden at official request. If you were the guy who signed the PFI contract that included a £300 fee every time a light-bulb needed changing, you’d want it hushed up, too.

But there’s a sort of Prisoner’s Dilemma at work here. Both outsourcing firms and public authorities think it in their short term interest to keep everything quiet – but both might benefit from a touch of transparency. If there was a public interest rule that meant any contract involving public money would be subject to FOI, then the government would probably benefit by getting products and services cheaper. But companies could benefit too: partly because they could see what their rivals were up to, but mostly because everything the CBI says about the value of trust is entirely true.

Fairly or otherwise, a lot of people remain convinced that outsourcing companies are all evil profiteers, growing rich off the backs of children or sick people. Some of them aren’t. Some genuinely believe they can provide better public services at lower cost. Were they to be more willing to prove it, we might start to believe them.

Want to know how much the Lord Mayor of Chester spends on a chauffeur-driven Bentley? Sorry. Image: Getty

Jonn Elledge is the editor of the New Statesman's sister site CityMetric. He is on Twitter, far too much, as @JonnElledge.

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Why Labour's dismal poll ratings won't harm Jeremy Corbyn's re-election chances

Members didn't vote for him on electoral grounds and believe his opponents would fare no better.

On the day of Theresa May's coronation as Conservative leader, a Labour MP texted me: "Can you imagine how big the Tory lead will be?!" We need imagine no more. An ICM poll yesterday gave the Tories a 16-point lead over Labour, their biggest since October 2009, while YouGov put them 12 ahead. The latter showed that 2.7 million people who voted for the opposition in 2015 believe that Theresa May would make a better prime minister than Jeremy Corbyn (she leads among all voters by 52-18).

One might expect these subterranean ratings to reduce Corbyn's chances of victory in the Labour leadership contest. But any effect is likely to be negligible. Corbyn was not elected last summer because members regarded him as best-placed to win a general election (polling showed Andy Burnham ahead on that front) but because his views aligned with theirs on austerity, immigration and foreign policy. Some explicitly stated that they regarded the next election as lost in advance and thought it better to devote themselves to the long-term task of movement building (a sentiment that current polling will only encourage). Their backing for Corbyn was not conditional on improved performance among the public. The surge in party membership from 200,000 last year to 515,000 is far more worthy of note. 

To the extent to which electoral considerations influence their judgement, Corbyn's supporters do not blame the Labour leader for his party's parlous position. He inherited an outfit that had lost two general elections, neither on a hard-left policy platform. From the start, Corbyn has been opposed by the majority of Labour MPs; the latest polls follow 81 per cent voting no confidence in him. It is this disunity, rather than Corbyn's leadership, that many members regard as the cause of the party's malady. Alongside this, data is cherry picked in order to paint a more rosy picture. It was widely claimed yesterday that Labour was polling level with the Tories until the challenge against Corbyn. In reality, the party has trailed by an average of eight points this year, only matching he Conservatives in a sole Survation survey.

But it is Labour's disunity, rather than Corbyn, that most members hold responsible. MPs contend that division is necessary to ensure the selection of a more electable figure. The problem for them is that members believe they would do little, if any, better. A YouGov poll published on 19 July found that just 8 per cent believed Smith was "likely to lead Labour to victory at the next general election", compared to 24 per cent for Corbyn.

The former shadow work and pensions secretary hopes to eradicate this gap as the campaign progresses. He has made the claim that he combines Corbyn's radicalism with superior electability his defining offer. But as Burnham's fate showed, being seen as a winner is no guarantee of success. Despite his insistence to the contrary, many fear that Smith would too willingly trade principle for power. As YouGov's Marcus Roberts told me: "One of the big reasons candidates like Tessa Jowell and Andy Burnham struggled last summer was that they put too much emphasis on winning. When you say 'winning' to the PLP they think of landslides. But when you say 'winning' to today's membership they often think it implies some kind of moral compromise." When Corbyn supporters hear the words "Labour government" many think first of the Iraq war, top-up fees and privatisation, rather than the minimum wage, tax credits and public sector investment.

It was the overwhelming desire for a break with the politics of New Labour that delivered Corbyn victory. It is the fear of its return that ensures his survival. The hitherto low-profile Smith was swiftly framed by his opponents as a Big Pharma lobbyist (he was formerly Pfizer's head of policy) and an NHS privatiser (he suggested in 2006 that firms could provide “valuable services”). His decision to make Trident renewal and patriotism dividing lines with Corbyn are unlikely to help him overcome this disadvantage (though he belatedly unveiled 20 left-wing policies this morning).

Short of Corbyn dramatically reneging on his life-long stances, it is hard to conceive of circumstances in which the current Labour selectorate would turn against him. For this reason, if you want to predict the outcome, the polls are not the place to look.

George Eaton is political editor of the New Statesman.