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17 January 2018

PMQs review: Jeremy Corbyn takes aim at the “broken system” of outsourcing

The Labour leader declared of Carillion and others: “These corporations need to be shown the door”. 

By George Eaton

In some weeks, one can never guess what subject Jeremy Corbyn will lead on at Prime Minister’s Questions. But there was no surprise today. The collapse of Carillion, which has made the government appear both dogmatic and incompetent, is ideal political territory for Labour. 

As expected, Corbyn used the occasion not merely to denounce Carillion but the entire model of outsourcing. “This isn’t one isolated case of government negligence and corporate failure,” he declared. “It’s a broken system.” Corbyn took aim at Virgin and Stagecoach for their “spectacular mismanagement” of the East Coast Mainline, at Capita and Atos for “wrecking” the lives of the disabled, and at G4S for failing to provide Olympics security. “These corporations need to be shown the door,” he concluded. “We need our public services provided by public employees with a public service ethos and a strong public oversight.” (That’s this week’s viral video taken care of.)

Theresa May retorted by noting that a third of Carillion contracts were awarded by the last Labour government. But Corbyn’s party is, of course, a very different beast. May accused Labour of opposing not “just a role for private companies in public services, but the private sector as a whole”. Corbyn, she warned, would impose “the highest taxes in our peacetime history” (one might note that Margaret Thatcher maintained a top income tax rate of 60 per cent until 1988; Labour’s top rate would be 50 per cent). 

In the circumstances, May will be satisfied with her performance. She repeatedly emphasised that the government was a “customer” of Carillion not its “manager” (though the public may not sympathise with that technical defence). Corbyn rightly noted that “it looks as though the government was handing Carillion contracts either to keep the company afloat…or was just deeply negligent of the crisis that was coming down the line”. But May confidently replied: “I am happy to answer his questions when he asks one – but he hasn’t”. Though this risks appearing arrogant to viewers, Corbyn struggled to pin May down on this issue afterwards. 

The Prime Minister left the chamber having avoided any hostages to fortune and any obvious errors. But on the issue of outsourcing (private gain, public loss), and the rising discontent with market failure, the Tories risk being stranded on the wrong side of the argument. 

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