Is Ireland ready for more privatisation?: YES


At a time when the public sector is draining the State’s coffers, William O’Brien argues in favour of more privatisation.


The voices calling for the privatisation of public sector services are being drowned out by a cacophony of cane-wielding senior citizens, placard-bearing students and the gamut of Irish society who feel that universality is right not a privilege.

The cause of the pro-privatisation faction was dealt a blow recently with the dissolution of the Progressive Democrats who were the ideological force behind the privatisation agenda. This agenda has suffered the ire of many who see any attempt to privatise free public services as an attack on their basic human rights. In Ireland the social welfare mentality prevails.

Part of the reason behind the rejection of the Lisbon Treaty was the argument, fuelled by those on the Left, that a ‘Yes’ vote would herald the end of publicly financed hospitals. At a time when the public finances are stretched to their limit it is right to begin debating the merits of privatisation instead of dismissing them out of hand as profit before people.

The suggestion that Europe, posed some sort of threat to the quality of our own system was ridiculous. Scaremongering has become the rationale for the existence of the political parties where outright opposition to any government proposal is a natural reflex rather than a weighted judgment.

The current financial crisis has also perpetuated the myth that private is bad and public is good. The social welfare model of government which many European states adhere to is very much in evidence in the Irish health sector. Ideologically, however, Ireland has been much closer to Boston than Berlin. Does this then mean that Ireland should follow the American model with no provision of free health care or the Scandinavian model which has the best healthcare system in the world but with a concomitantly high tax rate?

The Irish hospital system already operates on a two-tier level which is weighted heavily in favour of the public sector despite the fact that over 50 per cent of the population have access to health insurance. Indeed, Ireland has one of the highest levels of private health insurance consumption in the OECD.

The privatisation of health services would not represent an abdication of responsibility on the part of the Government for the health of its citizens, but rather a rational decision based on financial considerations and the economic health of the state.

The argument that if the state absolves itself of the responsibility to protect its members, rights become more contingent; and in a commercial system the right to education and healthcare would be contingent on an ability to pay is based upon a false premise. Rights to free health care and education are based upon a state’s ability to raise revenue to pay for them. The state can clearly no longer afford to provide these without raising taxes to exorbitant levels and while raising taxes at such desperate time would be political suicide for the Government, the only alternative is to cut spending on other major projects.

The free-for-all system in operation at the moment is unsustainable and its continued provision is detrimental to the future of the state. That privatisation institutionalises and perpetuates socioeconomic inequalities is also erroneous. These inequalities exist throughout Irish society and privatising the health sector will do little to alter this status quo.

“The free-for-all system in operation at the moment is unsustainable”

A balance must be struck between a health service that stops the drain on public finances through increased privatisation whilst at the same time provides for the most vulnerable in society who simply cannot afford either health insurance or the costs involved in ensuring their good health.

A private health sector with vigorously enforced public regulation may provide a new dynamic and alleviate the state of some of the financial burden it continues to carry. Privatising many of the services offered by the Department of Health would lift a tremendous burden off government finances and loosen up the purse strings for other infrastructural projects. That people should be treated on the basis of their needs rather than their income is morally sound but economically unsustainable.

For a government struggling with its finances, the welfare state remains the great unopened oyster. There is billions to be made from the selling of state-organised enterprises and divvying up the cost of maintaining the health sector. Propping up these organisations divests much needed funds away from vital capital-intensive infrastructure projects which only the Government can provide. Without the sources of revenue needed to finance them these projects will fall into abeyance and the country will once again lag behind our European neighbours in terms of development.

There are those that still lament the privatisation of Aer Lingus and Eircom – moves that made flights and phone-calls cheaper and certainly, in light of the problems now affecting the aviation industry, relieved the Government of one Trojan horse.

Semi-controlled bodies such as the ESB, Coillte, Bord Gáis and the VHI should also be considered for privatisation. Denis O’Brien has argued that the orderly privatisation of these businesses – all of them with considerable growth potential – would raise substantial funding for other public-sector projects that are in need of further expenditure, health care, education, research and development. The public transport system, for many the bane of their daily lives, should be privatised as soon as possible. For too long have CIE and Dublin Bus been the very paragons of tardiness and inefficiency.

Privatisation is not about profit before people – it is about profit and people. Profit is not intrinsically evil despite the reputation done to it by the financial sector. It can be used to provide better hospital services, better educational facilities, cheaper energy prices and cheaper air prices. Ultimately, privatisation is about providing a better standard of living for everyone.

People are not commodities but when it comes to their health and the health of the Irish economy, it pays to go private.