2. 1 PUBLIC PRIVATE PARTNERSHIPS (PPP) PUBLIC PRIVATE PARTNERSHIPS (PPP) INTERMEDIATE MODERN STUDIES GOVERNMENT AND DECISION MAKING IN SCOTLAND

3. 2 CONSERVATIVE POLICY 1993 – Conservative government introduces the Private Finance Initiative (PFI). This means a big role for private companies in building new hospitals and wards in the NHS.

4. 3 LABOUR POLICY 2000 – Labour government introduces the Private Public Partnerships (PPP) to build new hospitals and schools. This replaces the Conservatives’ PFI.

5. 4 Labour - PPP Labour regards “partnership” as extremely important with involvement from both public and private sectors.

6. 5 What is a PPP? Any collaboration between public bodies, such as local authorities or central government, and private companies tends to be referred to as a PPP. Any collaboration between public bodies, such as local authorities or central government, and private companies tends to be referred to as a PPP.

7. 6 WHY PPP?  Many local councils do not have the money to pay for big projects like rebuilding schools.  These services have to be paid for.  One way of solving this problem without receiving more money from the government or increasing council tax is to form PPPs.

8. 7 How does PPP work?  Money from the council and from a private company is pooled to finance large scale spending projects.  The council then pays back the money to the private company (interest is added on).

9. 8 EXAMPLE OF PPP  All Glasgow secondary schools have been either refurbished or rebuilt with PPP money.  St Andrew’s Secondary is an example of a PPP.

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11. 10 BRAINSTORMING Construct a mindmap, which lists the advantages of being in a PPP school

12. 11 Arguments FOR PPPs  Many schools would not have been rebuilt or refurbished – local councils argued that money would not have been available otherwise.  PPP is a fast, effective – and in the short term at least – cheap way of getting new facilities built.

13. 12 Arguments FOR PPPs  In bringing the public and private sectors together, the government hopes that the management skills and financial acumen of the business community will create better value for money for taxpayers.  By getting money from the private companies for these essential projects – it saves the public suffering – eg council tax does not have to be raised to pay for them

14. 13 Arguments AGAINST PPPs  Critics argue that taxpayers will end up footing the bill for PPP. The ‘rent ‘ money to be paid back to the companies will have to be found.  In some cases the initial cost of the project has been paid back within the first few years leaving more than 20 years of profit for the company that owns the building.

15. 14 Arguments AGAINST PPPs  Private companies have been accused of cutting corners in order to maximise profits. Some schools have been built using cheap materials and cannot withstand the treatment they get on a daily basis.

16. 15 Arguments AGAINST PPPs  Many jobs have been ‘privatised’. In PPP schools, janitors are usually employed by the PPP company. Wages are often lower than when they were employed by local councils.  Some argue that it is the responsibility of the local council to provide schools. They should budget the money they receive from the government and council tax better.