Privatization Watch – 05/2018 | PSI

Posted on September 13, 2018 in Story 890 view

Privatization Watch Newsletter - All issues

Finance got bailed out, we got sold out.
That’s what’s happened in the last ten years. #10YearsOn

After the crash, governments bailed out the banks but didn’t fix them. Finance has refused to change its ways. The people – and our public services – have paid the price.

Change Finance - #10YearsOn

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We’re saying no more. We need to send a message to politicians, banks and institutions everywhere that this won’t stand says Change Finance, a citizens’ movement from more than 11 countries and 5 continents (and growing), including charities, campaigning groups, think tanks, environmental groups, religious organisations and trade unions, who represent millions of people across the world.

Across regions, citizens will be participating in a day of action. Which is where you come in. With people like you standing alongside us, we can take a stand and be heard.

It starts on September 15th – the 10-year anniversary of the collapse of the US investment bank Lehman Brothers and the start of the crisis.

www.changefinance.org

 

 

History of privatization in Africa

Photo: PSI/Shutterstock.com

To coincide with Prime Minister Abiy Ahmed’s visit to the U.S., during which concerns were voiced about his stated intention to engage in widespread privatization of state-owned enterprises, Ewnetu Haile takes a look back over the recent history of privatization in Africa, periodizing it and offering some suggestions as to why it slowed or ground to a halt in the past. “Unsuccessful privatization programs are associated with high levels of corruption, poor value for money to the tax payer and increasing levels of inequality. On the contrary, the [LSE] paper notes, positive indicators for success would include strong government ownership of the process, well-designed and sequenced reforms, the implementation of complementary policies, the creation of regulatory capacity and good corporate governance structures, attention to poverty and social impacts, and strong public communication.” He adds that “privatizing health care and public transport may not be as successful as the profit motive is less important than public interest.”

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Botswana

Responding to President Mokgweetsi Masisi’s statement that he intends to slash the civil service and engage in widespread privatization of public enterprises, Topias Marenga, general secretary of the Botswana Public Employees Union, says “reducing the size of the civil service would be ‘a major blow’ and the benefits of privatization remained unproven. ‘The problem with our leaders is that they are under the sway of the International Monetary Fund, which wants the public service wage bill cut down by 5 percent,’ he said by phone. ‘Our problem is that we don’t have effective platforms to discuss these matters with government as equal social partners.’”

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Egypt

President Sisi says privatization has always been on the state’s agenda. “The state has long thought of the privatization of public sector companies at some point in time, and this is very good, and there was an idea that there would be a form of balance between the public and private sector.” The privatization drive may be spurred on by a draft law drawn up by the minister of public enterprise, Hisham Tawfik, allowing the private sector for the first time to own shares in public sector holding companies. [Business News Europe/bneIntellinews, 8 August 2018].

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Ethiopia

Public services unions and civil society organizations are shut out of the government’s new ‘Privatisation Advisory Council’. “A look at the advisory council’s list of members shows why we should be worried about conflicts of interest. Kassahun Kebede is the Managing Partner of Cepheus Growth Capital Fund, a private equity fund focused primarily on investments in Ethiopia. Eyesuswork Zafu and Aynalem Megersa are board members of two private banks that could potentially be involved in the privatization process. These kinds of banks often facilitate payments, provide loans or may have existing relationships with the enterprises. Abebe Aemirosellasie, another member, is a director of the International Monetary Fund’s African Department. International financing institutions often provide loans, negotiate funding conditions and impose restrictions on governments. Their objectives are not always aligned with the government’s aim and do not necessarily take into account the impacts of the structural adjustments they often advocate.” The government was tendering for advice from global business consultancies including McKinsey and PwC, the country’s information minister told Reuters in July. McKinsey is currently dealing with a major scandal in South Africa over its practices there, including charges of corruption for its alleged role in a “five year looting spree” of government structures.

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Ghana

Parliament has approved the concession agreement between the government and the consortium of investors led by the Manila Electric Company for private sector participation in the Electricity Company of Ghana (ECG). “Ghana and the United States of America, acting through the Millennium Challenge Corporation (MCC) entered into a Millennium Challenge Compact which among others spelt out the involvement of private players in ECG. ECG will grant a concession to a private investor or operator to manage the operation of the distribution business, including financing and procuring new investments, or partial or full privatization.” Opposition leader Haruna Iddrisu “called for a guarantee of tenure and employment security for the workers of ECG, saying the country must jealously guard their employment security. He said the House should also be informed of how much each of the partners in the consortium is contributing by way of investments to the arrangement.”

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Ghana

Ghana agrees to toe the IMF line after its “bailout programme” ends. “As the country attempts to keep spending under the control, it is implementing policies to make it more attractive for private investors to participate in the development of roads, railways and ports, said [Finance Minister Ken Ofori-Atta].”

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Kenya/Ethiopia​

Days after Kenya and Ethiopia announce plans to consider airport privatization, the International Air Transport Association (IATA) warns African government about the pitfalls of privatization. IATA recently reported that privatization is more expensive for travelers and does not meet the superior efficiency claims of its promoters. In the Philippines, airport privatization has displaced workers.

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Namibia

The government is seeking advice and assistance from Jamaica as it contemplates establishing a ‘public-private partnership’ for an operator of its new container terminal at Walvis Bay. The move to set up a PPP follows pressure from the World Bank to let a private company run the facility. 

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Nigeria

Despite widespread opposition from civil society and community organizations, the Lagos state government has shortlisted four private, for-profit companies for its ‘public private partnership’ program for the water sector. The government has denied it is bent on privatization, using the usual argument that P3s are not privatization and that they are only at the budding stage. “The Nigeria Labour Congress and some of its affiliate organizations including the Amalgamated Union of Public Services; Joint Action Front; as well other groups like the Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN) had during the World Water Day written to the government to consider its actions in the water sector to avert further protests.” ERA/FoEN has produced a detailed report on alternatives to water privatization. The Lagos State chapter of the Amalgamated Union of Public Corporations, Civil Service Technical and Recreational Services Employees (AUPCTRE) has also opposed privatization.

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Nigeria

Kemi Busari of Premium Times has written a two-part, in-depth exposé of the failed concessioning of Osun MKO Abiola Airport despite billions of taxpayers’ Naira poured into the ‘public private partnership,’ which has now been terminated. “None of these requirements, according to our findings, was fulfilled in the AWOL concession. Investigations revealed that in the case of MKO Int’l Airport, ‘No advertisement, no bid opening, evaluation or approval’ was carried out. Rather, the state government bequeathed the contract to the favored AWOL.”

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Nigeria

Led by the Nigeria Union of Electricity Employees (NUEE) and its Secretary General, Mr. Joe Ajaero, electricity workers shut down Ikeja Electric over meter hoarding, worker mistreatment, and to demand a review of the privatization programme “without further delay” for “having failed to deliver on its promises.” The “enraged” electricity workers, who barricaded the IE headquarters, “had alleged, among others, the arbitrary dismissal of workers without consultations with the union, poor welfare, uneven salary structure, adoption of anti-labour policies and frustration of the implementation of service conditions.”

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Nigeria

The government has posted a Request for Expressions of Interest by private investors for “core investor sale of Yola electricity distribution company (Yola DISCO).” The deadline is 26 September 2018.

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South Africa​

Reacting to President Ramaphosa’s bombshell announcement that the government plans to lay off 30,000 public services workers, the Congress of South African Trade Unions (COSATU) says it will not vote for the ANC in 2019 if government goes ahead with the job cuts and privatization of state-owned enterprises. COSATU General Secretary Bheki Ntshalintshali said “the privatization of SOEs that has been proposed by some in government and inside the ANC will adversely affect the state’s capacity to: provide basic services to the poor; provide for infrastructural development; intervene to restructure the economy to ensure growth and employment creation.” COSATU believes privatization will lead to job losses [and] “it will foster the casualization of labour, with more and more workers being hired on limited fixed-term contracts of employment. It will also remove workers from the bargaining units established over many years in the public sector, generally leading to a reduction in incomes, benefits and job security.” 

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South Africa​

An EU directive has handed over control of visa issuance to private interests and effectively moved the Schengen border into South Africa. “This and subsequent directives have effectively led to the privatization of immigration control with airlines outsourcing the task of screening, before departure, both the validity of the travel documents and the trustworthiness of the travel intentions of their passengers, to private ground handling companies such as Checkport which belongs to the HNA Group-owned Swissport International Ltd.”

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South Africa​

Irvin Jim, the General secretary of the National Union of Metalworkers of South Africa (NUMSA), says adoption of the Independent Power Producer model, which is being promoted by BRICS New Development Bank (NDB), amounts to “the privatization of Eskom by other means and we reject it in its totality. We cannot allow the grid and the supply of electricity to be placed in private hands. We have learnt many hard lessons in the past about privatization. It ultimately worsens conditions for workers and their families, through increased tariffs and retrenchments.”

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Zimbabwe

The government has announced it will privatize and merge parastatals. “Larger parastatals and manufacturers including vehicle assembler Willowvale Mazda Motor Industries, Chemplex Corporation and Deven Engineering are set for partial privatization. The Civil Aviation Authority of Zimbabwe is to be “unbundled into a regulatory and airports authority” while the current recapitalization program for the National Railways of Zimbabwe is expected to continue.”

 

 

Public Service Association of NSW President Kylie McKelvie talks about why the privatization of disability services is “the cruelest cut of all.”

The Australian Council of Trade Unions (ACTU) says “the improvements that will be delivered by the NDIS must not be used as an excuse by State and Territory Governments to privatize their existing disability support systems and abrogate their duty of care to people with disabilities. By retaining a role in the direct delivery of disability services, people with disabilities will have more choice of providers to meet their needs. Jobs must be safeguarded, and rates of pay, conditions, entitlements and transfer payments for staff who move to a non-government provider must be guaranteed.” Labour has committed to removing the arbitrary national disability insurance scheme staffing cap, which disability advocates say forces the scheme to rely on contractors and outsourcing, leading to delays and confusion.

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Australia

Nadia Rodriguez, a member of the New South Wales Nurses and Midwives’ Association, and an enrolled nurse at Shellharbour Hospital, where she has worked for 18 years, says “nurses are very over-worked.” NSW opposition leader Luke Foley has questioned the government’s budget promises, saying “now that the government has at least temporarily walked away from their privatization plans, they need to spell out what exactly $251 million will deliver here, then we’ll be in a position to respond.”

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Australia

The Australian Unemployed Workers’ Union (AUWU) applauds the launching of “a Senate Inquiry into Jobactive (the $7 billion privatized employment services system). We’re encouraging all people with experience of this system to share their stories with the Senate.”

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Australia

Private, for profit interests are continuing to move in on land registries. Macquarie Infrastructure and Real Assets is putting in a bid for Victoria’s land titles registry, along with NSW’s land registry contractor First State Super. “It’ll be interesting to see how quickly bidders move on to Western Australia,” says the Australian Financial Review, “which is the next state on the land titles privatization program. WA recently rejected a proposal to sell its land titles registry but will run an auction to commercialize its automated online platform Advara. UBS, Flagstaff Partners and Minter Ellison are running Victoria’s auction. RBC Capital Markets is advising the First State consortium, while Macquarie Capital and Credit Suisse are working for MIRA and its partners.”

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Australia

The Community and Public Sector Union (CPSU) says a parliamentary inquiry has exposed the big multinational consulting firms for milking the public services dry. “The scrutiny comes at the same time as departmental submissions to the Turnbull Government’s APS Review have confirmed the Government’s illogical cap on Commonwealth staffing numbers is driving costly outsourcing to consulting firms and through contractors and labour hire arrangements,” says CPSU.

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India

Privatization of public services hurts women’s access to public spaces, so protests against the Brihanmumbai Municipal Corporation’s privatization plans are growing. “Research conducted by the Gender and Space project, of which I [Shilpa Phadke] was a part, between 2003 and 2006 on women’s access to public spaces in Mumbai, published in the book Why Loiter?, demonstrated unequivocally that public transport—the city’s network of BEST buses, suburban trains and the links between the two—made Mumbai the friendliest, most accessible city in the country for women. A decade later, we are seeing the gradual erosion of BEST services and the Brihanmumbai Municipal Corporation’s articulation of its intent to hand over operations to private agencies and sell bus depots to real estate developers. In short, to unravel a system that works, and works brilliantly.”

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India

Hundreds of unemployed medical technicians led by the Congress’ students’ wing clashed with police in Odisha against the privatization of diagnostic services in government-run hospitals. “The government has decided to privatize diagnostic services at a time when most government-run hospitals lack adequate technicians. Our degrees are of no use as most of us continue to be unemployed despite being graduates. Students from private colleges are taking our jobs,” said Liza Patnaik, who was protesting against the government’s decision.

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India

Thousands of people in the tiny Himalayan state of Sikkim have taken to the streets to demands better public health services. Sagar Sharma a member of the Sikkim Progressive Youth Forum,said that commercialization and privatization of the district hospital, Geyzing should not be encouraged. He shared that due to lack of medical equipments and medicines in the hospital, the people are compelled to take the services of private diagnosis centres and medical shops opened nearby the hospital. He alleged that due to shortage of medicines in the hospital the private medicine shops are doing brisk business.”

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India

The Mazdoor Kisan Sangharsh Rally will assemble in Delhi on September 5 with a list of demands by working and low income people, including an end to public services privatization. “Selling off public sector units to private sector for cheap prices is a well-established policy of all neo-liberal regimes. The preceding Congress-led UPA government had in its ten years of rule sold off some Rs 1.08 lakh crore worth of public sector assets. But this policy has been taken to a new level by Modi sarkar. It has sold off more than what the Congress did in 10 years.”

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India

The Supreme Court laments “the scarcity of doctors and the unfortunate privatization and commercialization of the noble medical profession.

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India

After plans are dropped to sell the government’s majority equity stake in Dredging Corporation of India (DCI), three ports look to invest in the company. “Three state-owned major port trusts have not only saved Dredging Corporation of India Ltd (DCI) from going into private hands, but are also set to give assured business to the public sector dredging contractor by reverting to the nomination method of awarding contracts. Earlier this month, Visakhapatnam Port Trust, Paradip Port Trust and New Mangalore Port Trust agreed to buy a controlling stake in DCI in a deal brokered by the Shipping Ministry.”

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India

The University Grants Commission has notified new rules that allow public-private-partnership entities to assess and accredit educational institutions, “prompting criticism from academics who say the policy would lead to sale of accreditation grades.” Rajesh Jha, a member of Delhi University’s executive council, said: “The government is trying to promote privatization of higher education. It wants top colleges to take autonomous status to start self-financing courses. It wants to give institution of eminence status to Jio Institute, which is yet to be set up. Now it is involving private entities in accreditation also.”

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India

The Tamil Nadu Government Employees’ Association, in association with youth organizations such as the Students Federation of India, are protesting against Staff Rationalisation Committees. According to the protesters, the committee which aims to identify ‘redundant’ jobs and ones that can be outsourced, was nothing but a euphemism for job cuts and privatization of various services.

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Indonesia

In Jakarta, a women’s movement is leading the fight against water privatization. Peoples Dispatch spoke to Dinda Nuur Anisaa Yura from Solidaritas Perempuan (Women’s Solidarity for Human Rights) about the movement against water privatization. “If the RCEP [Regional Comprehensive Economic Partnership, a mega free trade deal] comes, then there will not only be two companies to control the water resources, but it will further privatize water in Indonesia. There are very few communities who can still access water for free now and in the future, with RCEP and other trade agreements, we will have much less access to water resources as all of it will be grabbed [by corporates] and it will cost us our sovereignty.”

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Pakistan

The new Prime Minister Imran Khan will be opening negotiations with the IMF, “seeking up to $12 billion in loans that could require privatization of some national assets.”

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Philippines

Airport privatization is displacing workers. The Workers Association of the Diosdado Macapagal International Airport (SMDM) “urged all their 340 members to join activities aimed at pressuring the BCDA to disclose its plan for workers who would be affected by the privatization.  SMDM president Manuel Bañez said even the CIAC board of directors are being left in dark on the issue. “This is unusual because BCDA president and chief executive officer Vicencio Dizon and Transportation Secretary Arthur Tugade are chairman and vice chairman, respectively, of the CIAC board of directors.” He said both officials were absent during the last board meeting.

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Philippines

The House of Representatives has urged President Duterte to stop selling off public hospitals to the private sector. “The recommended ban on the privatization of public health facilities covers the four specialty hospitals in Quezon City, namely the National Kidney and Transplant Institute, Philippine Heart Center, Lung Center of the Philippines and Philippine Children’s Medical Center. The bill also mandates that 90 percent of the facilities’ bed capacity should be allotted to poor patients.” The House approved the bill on its third reading by 218-0-0.

 

 

Hospital privatization has been blocked in New Brunswick. The New Brunswick government officially rejected the Sodexo takeover of management of food, cleaning and patient portering services in New Brunswick hospitals. “After petitions, rallies, meetings, citizen advocacy, our efforts to halt privatization have been successful,” said Norma Robinson, President of CUPE 1252, the New Brunswick Council of Hospital Unions

Photo: PSI/Shutterstock.com

Photo: PSI/Shutterstock.com

Argentina

The government will allow companies whose officials are named in a corruption probe to continue work on existing projects and to bid for new ones. “Faced with the threat of a recession in the second half of the year, the government plans to push forward with President Mauricio Macri’s $35 billion infrastructure agenda, including public private partnership projects. Dietrich delivered the message to nine banks, including HSBC and ICBC, in a meeting earlier Friday. The corruption scandal that has enveloped the country won’t halt that process, he said.”

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Antigua and Barbuda

Attempts by the neoliberal government of Antigua to dispossess and enclose Barbuda, where traditional communal land rights have persevered till this day, are continuing, but not without vigorous resistance from Barbudans themselves. The Latino Media Collective spoke with Dr. Matthew Quest about the struggle for social and environmental justice in Antigua & Barbuda.

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Brazil

Brazilian Supreme Court Justice Ricardo Lewandowski has scheduled a public hearing for Sept. 28 “about an injunction he issued in June that mandates that all sales of state-controlled companies must first be approved by Congress. Lewandowski will allow 57 people to speak in the hearing, according to documents seen by Reuters. Union leaders will feature among the speakers.”

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Brazil

Foreign private equity firms and corporations are circling Brazil’s public assets in the energy sector, including Singapore sovereign wealth fund GIC, Blackstone Group, France’s Engie SA, and Royal Dutch Shell.

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Canada

The Ontario Council of Hospital Unions (OCHU) warns that the province’s hospitals’ hallway medicine and bed crisis will deepen under Premier Doug Ford’s public service ‘efficiency’ program and promised tax cuts. In a new report, Hallway Medicine: It can be fixed, OCHU closely analyzes the issues, including how privatization is harming service delivery. “Privatization constantly bedevilled the previous Liberal government. Private physiotherapy clinics had to be defunded after the health minister revealed that the ‘existing 94 clinics have had an unlimited ability to bill the government and have become very creative in the way they bill.’ P3 problems: An initial report by the Auditor General showed that the first privatized “public private partnership” (P3) hospital (the Brampton Civic) came with hundreds of millions of dollars of extra costs. That was ignored by the government and so the next Auditor General reviewed the next batch of P3 hospital projects and showed that the next P3 hospitals came in $8 billion over the cost of a public sector comparator.”

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Cayman Islands​

The law governing ‘public-private partnerships’ has been tightened up. As a British Overseas Territory, Cayman falls under the jurisdiction of the UK but enjoys independent law and policy-making. “To start, PPPs require ‘a sound appraisal underpinning the proposed project before the financing means has been determined’, proving that the project is necessary. Additionally, a positive evaluation from the public sector comparator is required or that ‘a financial appraisal demonstrates improved value for money against a conventionally financed alternative’. PPPs should show better results than any other procurement method. A ‘long-term affordability case [which] has been assessed and agreed by the appropriate technical experts retained by the Cayman Islands Government’ is also required. This is in line with Cayman’s government policy to adopt private sector techniques into public management, such as introducing business cases [and] contract management.”

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El Salvador​

The battle over water privatization vs. a constitutional right to water is coming to a head in the legislature with competing proposals. “We don’t want the abuse of water to be legalized,” said Oscar Ruiz, a representative of the United Community Association for Water and Agriculture (ACUA). Together with affected residents, Ruiz recently filed a complaint in an environmental court over a dried-up lagoon in an agricultural community where water-intensive sugar cane plantations guzzle resources. “Communities are practically being left without water.” A key point of contention is over who will control the board to regulate water, and in particular the role of private interests in the Corporation of Municipalities (COMURES). “Many assume COMURES, a non-governmental body currently dominated by ARENA, would select one representative from each of the major parties, the FMLN and ARENA. Critics argue that in practice, the seat for ARENA would secure an additional business-friendly vote, tilting the board in favor of private interests.”

The legislature is moving toward a final bill. “Discussion on the bill was suspended for a few weeks while the members of the committee held hearings with representatives of NGOs, business associations and academic institutions to listen to their opinions on the bill.” Representatives of different churches in El Salvador have urged Congress to pass a law that prohibits water privatization, saying water is a public good and a fundamental right of humanity.

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Mexico

With Andrés Manuel López Obrador due to assume the presidency on December 1, trade talks with the United States, which are now in their second month, have entered a tense period as the President-elect’s representative push for him to have the power to manage the privatization process for Mexico’s energy sector. “During an interview in July, Jesús Seade [AMLO’s chief trade negotiator] defended what some have characterized as AMLO’s ‘Mexico first’ energy position by arguing that the president-elect was seeking solely to ‘revise’ energy contracts ‘for any cases of corruption.’ He said all current contracts with U.S. companies would ‘absolutely’ be honored but energy deals would be re-examined to ensure ‘that there’s nothing illegal.’ ‘Otherwise, no reversal at all,’ he said during the interview. ‘And then moving forward, I think he wants to go slow because at the same time he wants to strengthen the Mexican oil company, PEMEX, and that’s a very natural thing.’

AMLO’s incoming hydrocarbons secretary, Alberto Montoya, said in an April presentation at the Escuela de Formación Política Carlos Ometochtzin that the previous administration’s energy privatization program “amounts to ‘a betrayal of our country’ and the conversion of Mexico into an ‘economic colony’ of the United States. (…) Asked by an audience member whether he thought Mexico could realistically undo the reforms, Montoya replied, ‘We not only can, but we must,’ adding, ‘this is not an option.’”

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Paraguay

Journalist Celso Guanipa Castro asks if anything will change under President Mario Abdo Benítez, who has completed a tour of the USA where he met with Treasury Secretary Steve Mnuchin, Secretary of Commerce Wilbur Ross, IMF Executive Director Christine Lagarde, and with the president of the Inter-American Development Bank (IDB) Luis Alberto Moreno. “Mario Abdo weathered the internal contradictions in his party, especially with Cartes, always supported by the U.S. embassy, which appears to support the new government. For social movements, it will be the continuation of the submissive, anti-national and anti-popular governments; servile to the interests of the U.S., transnationals and the International Monetary Fund, which has already begun to tighten against workers’ rights with the privatization of social security, among other reforms required for the next two years.”

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United States​

American Federation of Teachers President Randi Weingarten and Chicago Teachers Union Vice President Jesse Sharkey applaud the Chicago Teachers Pension Fund for adding for-profit prisons to their list of prohibited investments. There has been a wave of pension actions against firms seeking to profit from Trump administration’s shameful immigration and mass incarceration policies.

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United States​

At their national convention in Pittsburgh, thousands of postal workers rallied against privatization. “The rally, organized by the American Postal Workers Union, protested a forthcoming report from the White House that will likely recommend the privatization of the Postal Service, which critics say has lost money and struggled with the rise of electronic communication. The union argued that privatization would bring an end to universal service, leading to higher prices, unequal treatment of Americans in rural areas and an undoing of the agency’s heritage.”

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United States​/Puerto Rico

Cathy Kunkel of the Institute for Energy Economics and Financial Analysis, worries that privatization without regulatory oversight of the island’s electricity system will just open up opportunities for corrupt, politically driven business deals. “In a report that Kunkel helped author, the IEEFA was particularly dubious that a new private owner, absent robust regulation, would voluntarily shift toward renewable fuel sources: Why would you pave the way for distributed forms of energy generation, like solar, when they compete with the centralized power grid you’ve just bought?” See the report, PREPA Privatization Law Invites More Contracting Scandals.

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United States​

Nearly one year after Hurricane Maria devastated communities across the island, protests against disaster capitalism privatization continue. Teachers have gone on strike to protest the privatization of the educational system and its accompanying mass school closures. “We are not objects,” said one parent. “We are not furniture that can be moved from place to place. We are not boxes to be consolidated. We are human beings who cannot just be uprooted without consequence. Our children have already been traumatized by the hurricane, and now Secretary Keleher is traumatizing them all over again.”

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United States

Teachers and support staff speak out on how allowing for an unlimited number of privately operated charter schools in California is taking funding from students and forcing cuts to staff, classes, and maintenance at traditional, neighborhood schools. Visit howmuchcharterscost.org and read In the Public Interest’s new report, Breaking Point: The Cost of Charter Schools for Public School Districts.

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United States​

Backed by a coalition of environmental, religious, and labor advocates, Baltimore Mayor Catherine Pugh has signed a landmark charter amendment proposal banning the privatization of the city’s public water system, setting the stage for an electoral showdown when the issue is placed before voters in November. Supporters are confident the measure will pass. AFSCME Council 67 President and International Vice President Glenard Middleton testified before the city council in support of the ban. In the Public Interest’s Jeremy Mohler writes, “Baltimore’s leaders just showed what many call political will, a rare commodity in the age of endless tax cuts. Pushed by organized residents and groups like Food & Water Watch and Communities United, they’re laying the groundwork to truly fix the city’s crumbling infrastructure rather than use the smoke and mirrors of privatization.”

 

 

 

The collapse of a bridge section in Genoa, which resulted in the deaths of at least 43 people, has raised questions about inadequate infrastructure investment in Italy and its deteriorating roads and bridges—and about road privatization, ‘public-private partnerships’ and long-term concessions. Writing in Jacobin, David Broder exposes the long history of corporate and political corruption, austerity mania and cover-ups that have eroded Italy’s privately-managed public infrastructure. “The bulk of Italy’s road infrastructure dates back to the 1960s and 1970s, including the Ponte Morandi. Since 1999, when it was sold off by Massimo d’Alema’s center-left government, the motorway network has been under the control of private interests. This was an act of asset stripping, as well as a reflection of the cult of ‘public-private partnerships’ so dear to Tony Blair–era European social democracy. As Five Star (M5S) leader Luigi di Maio himself pointed out after Tuesday’s disaster, the deal resulted in Italy having among the highest road tolls in Europe, managed by cost-cutting firms who pay low taxes in Luxembourg.”

Photo: PSI/Shutterstock.com – Giovanni Cardillo

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France

Private investment groups are lining up to launch multibillion-euro bids for a stake in the operator of Paris Charles de Gaulle and Orly airports, among the first of France’s planned privatizations for 2019. “For now ADP, energy group Engie and lottery monopoly FDJ are the main companies targeted. Three consortiums have been forming, people close to the matter said, identifying the lead player in each as U.S.-based fund Global Infrastructure Partners (GIP), French group Vinci and Australian fund IFM. Milan-listed Atlantia has also been considering taking part in the ADP auction at the helm of a fourth consortium. However, such a plan could be thwarted by this week’s collapse of a motorway bridge in Genoa, which left 38 people dead, bankers and analysts said.”

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Italy

Elisa Moretti, an activist for Potere al Popolo (Power to the People), writes “the Genoa bridge collapse is Italy’s Grenfell—and the government is too busy scapegoating migrants to get to the bottom of why it happened. (…) However, it is hard to see how failings will be prevented in the future unless the logic of privatization is challenged. Italy has a history of poor infrastructure, bad urban planning and weak regulation, but privatization means that when disasters such as the collapse of Morandi Bridge happen, blame can simply be laid with the contractor and the problem of broader reform avoided.”

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Italy

Labor, civil service and retiree leaders call for a mobilization “of the entire Polesine from September and throughout the fall to focus attention on the problems of the social and health sector, with particular emphasis on the abandonment of Rovigo hospital as a hub for the region, with consequent risk of creating deficiencies for some high specializations. And attention to the growing push towards privatization, which could also involve general practitioners, as well as investment in the health professions and reform of the IPAB, public institutions of assistance and charity.” CGIL Secretary Fulvio Dal Zio, Secretary General FP CGIL Rovigo David Benazzo, Daniela Argenton, Secretary General SPI CGIL Rovigo, and others, have proposed opening “a phase of joint operations.”

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Malta

Reports that a malfunctioning privately-operated helicopter contributed to the death of a patient again raise questions about the privatization of Malta’s hospitals. “Gozo hospital authorities are denying claims by a Nationalist MP that a man died due to delays caused by a fault with the Steward Health Care medical evacuation helicopter in Gozo. (…) Steward Health Care, which runs Gozo General Hospital, was caught in the midst of accusations by the Nationalist Party against the government ever since it was announced that Gozo General Hospital, Karin Grech Rehabilitation Hospital, and St Luke’s Hospital were leased to Vitals Global Healthcare in a highly controversial agreement. The claims include staff shortages, with the PN’s organ alleging that the hospital has poor care and management conditions. The government has repudiated the majority of these accusations.”

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Norway

The municipal employees’ union, Fagforbundet, has reported the Aleris Ungplan and Boi private care company to the authorities for possible breaches of labour, health and safety, tax and even criminal law. The union has taken up cases for several workers who have been denied their rights on pay, sick pay and pensions and forced to work excessive hours. The cases mainly involve workers who were taken on as “consultants” rather than employees so that the company could avoid paying pension, sickness and other costs. The company is a subsidiary of a major private sector health and social care provider, Aleris, and Fagforbundet says this is one of the worst cases of social dumping in the welfare sector it has seen and also wants action by regional government which is responsible for health and social care provision.

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Spain

The official auditing body, the Cámara de Cuentas, has challenged the privatisation of hospitals in the Madrid region, arguing that there has been no evidence provided for any increase in efficiency or improvements in healthcare arising from the privatisation. The preliminary report, obtained by El Diario newspaper says that there has been no analysis of the efficiency and effectiveness of the privatised services in comparison to direct provision by the public sector.

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United Kingdom

As austerity chokes an English county and drives public services outsourcing, revolt is in the air even from local Tories. “The outsourcing experiment collapsed last year, before it had fully started. By February, the council realized it had no way out, issuing a formal notification of de facto bankruptcy. In response, Conservative leaders in London dispatched government inspectors. (…) Ms. Smith and other local Conservatives said the inspectors’ report was unfair, and that the national government was wrongly scapegoating the council. She said other Conservatives, locally and in London, grew irritated with her insistence that insufficient funding was the core problem. ‘They wanted me to shut up about us being underfunded,’ she said.”

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United Kingdom​

Shocking conditions are revealed as the government steps in to take over a prison, HMP Birmingham, from the private contractor G4S, which has faced multiple scandals. The failures of privatization “have long been evident. But in 2018, with the renationalization of Birmingham Prison and the East Coast Main Line, they have become undisguisable.” In March 2011, officials boasted that the privatization of the prison to G4S would “would deliver ‘innovation, efficiency and better value for money’ without ‘compromising standards.’ Seven years later, such lofty ambitions appear risible.” Nor are problems confined to Birmingham. “Britain’s ‘inhumane’ prisons are crumbling, with a backlog of 80,000 repair jobs. (…) Latest figures show around a third of repairs are contracted out to private firm Amey. Almost all the rest were under Carillion and now handled by Government. Shadow Justice Secretary Richard Burgon called it a ‘disaster’ of privatization. He said: ‘It’s the disastrous effect of the Tory privatization obsession. The contract for maintenance works, worth hundreds of millions, failed to deliver savings promised.’”

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United Kingdom​

Haringey Council scraps its controversial £4bn housing joint venture with a private company in favor of going its own way and forming an all-public enterprise. At the heart of the dispute was the refusal of the public to countenance the transfer of public land to the joint venture. “The scheme was also criticized by Labour leader Jeremy Corbyn who argued for communities to have much more of a real say in developments in their local areas.  Many Labour candidates last May were emboldened by the approach of the party’s leader and opposition to the HDV became a driving force of the campaign, so much so that local people elected a new political leadership in Haringey as a result.”

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United Kingdom​

The “shambolic” outsourcing of NHS back-office tasks to Capita may have “put patients at risk of serious harm,” MPs say. “The NHS supply chain also suffered massive disruption through regular but unpredictable shortages. And the company showed little interest in solving problems, with the committee accusing NHS England of ‘maximizing financial savings’ at the ‘expense of service quality.’ PAC chairwoman Meg Hillier branded the situation a ‘complete mess.’ She said: ‘It is clearly unacceptable that poor procurement should put patients at risk of harm and undermine the ability of GPs, dentists, opticians and pharmacists to do their jobs. ‘NHS England needs to rethink its approach to outsourcing and invest time in getting its contracts right.’”

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United Kingdom​

Labour leader Jeremy Corbyn has called for an end to the privatization of asylum and refugee accommodation as he met asylum seekers in Glasgow. “I also heard of the horrors of how Serco having been changing the locks on people’s doors as they go out in order to evict them. That is inhumane and completely wrong, and I make the plea now to Serco, change your attitude and policy as of now on this matter. (…) I think outsourcing is wrong and unnecessary, and better-run by the public sector.”

 

 

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