When universities get into bed with industry, can academic independence be guaranteed? asks Michael North

Michael Northm from The Times Higher Education Supplement quoted from an article by Glenn Rikowski about the Further Education White Paper, that is on The Volumizer, Glenn Rikowski’s web-log
Michael North says: “Glenn Rikowski, Senior Lecturer in Education Studies at Northampton University, says, for example, that the further education White Paper could lead to “struggles over the heart and soul of the FE sector”. Only a simpleton would expect this White Paper, or the schools White Paper of October 2005 or indeed any White Paper, to blurt out that ‘companies will take over failing colleges or schools’”, he says, “but the White Paper does seem to offer such openings for the private sector”. Rikowski suggests that the White Paper makes it possible for failing colleges – thought to represent about 2 per cent of the sector – and a potentially larger number of “coasting colleges” to be taken over by private companies if their provision does not improve within a year. He adds that if views such as Jackson’s prevail in Government, private companies could be invited to bid for contracts to run higher education departments, faculties or whole institutions.”
In The Times Higher Education Supplement, 7th April 2006, p.17

‘Contestability’ : buzzword that could open academy’s doors to private interest.

Overview of an article in the Times Higher Education Supplement, April 28 th 2006 citing Dr. Glenn Rikowski, Senior Lecturer in Education Studies, Northampton University.

By Paul Catherall.

This article, by Nic Parton outlines the emergence of ‘contestability’ in education and other public sectors, this is essentially the opening-up of state-run organisations and services such as FE colleges, Hospitals and Universities to private sector competition.

Examples of outsourcing within public sector organisations included the transfer of English language courses to the private company, Study Group International at the University of Northampton and the remodelling of some FE colleges as training providers for the private sector.

Di McEvoy-Robinson, a former FE college principal and director of Carter and Carter, a private training company comments:

“You could have an employee from age 16 following a straight line from apprenticeship to Further Education and on to a first degree, all the time working with the same commercial training provider.”

The new Government White Paper for Further Education raises the possibility that FE colleges will be scrutinised for performance, with underachieving colleges facing corporate competition to manage or deliver their services; analogies to this situation included private treatment centres in the NHS.

Dr. Glenn Rikowski observed that private sector involvement in FE colleges could potentially ‘spill over’ to Higher Education, with ‘ex-polytechnics …most likely to be ripe for change in that direction”.

It is clear from this article that there is a growing momentum in the language and policies of the present Government to facilitate private sector competition in UK public services, albeit under surrogate terms such as ‘contestability’.

Discussion of the UK Government’s Education White Paper, Higher Standards, Better Schools for All – More choice for parents and schools

On

The World Tonight

BBC Radio 4

Tuesday 25 th October 2005, at 10.00pm

(Tape Transcription)

Participants :

Robin Lustig: Presenter, The World Tonight

Dr. Ian Gibson: Labour Party MP

Jacqui Smith: Schools Minister

Jonathan Shepherd: General Secretary,Independent Schools Council

Dr. Glenn Rikowski: School of Education, University of Northampton

Introduction

It’s 10 o’clock. This is The World Tonight, with Robin Lustig. The government has published its long awaited Education White Paper, setting out its plans for sweeping reforms in secondary education. It wants independent schools to get more involved in state education, but why should they do something that might well lessen the demand for their services?

“There are Independent Schools as we have proved in the way in which we have developed partnerships anyway, who want to contribute. And if they can contribute to ensuring excellence for all our children, well they have a role to play.” (Unattributed quote: probably Jacqui Smith – Schools Minister)

[… Intervening news items …]

Robin Lustig : Yesterday, from the Prime Minister, the vision. Today, from the Education Secretary, Ruth Kelly, the detail. The Government’s Education White Paper sets out an ambitious programme of reform. Weak schools will make way for strong ones, the best schools will be able to expand, new providers will be encouraged to enter the state system to give all parents the kind of choices which until now only the well off have been able to afford. Independent schools will find it easier to convert into state schools, says a briefing paper, if they operate a fair admissions policy and if they give up charging fees. But will private schools want to get involved in the state sector? Is that, in fact, what the Education Secretary means, when she talks about diversity of school providers? The back bench Labour MP, Ian Gibson.

Ian Gibson : Well, I think she means certain schools which will charge ahead, get their money, have parents controlling them, and, er, decide on their own curriculum, and I think she means there will be other schools who are somewhat behind who may or may not reach that same level of excellence. Now, I don’t think it naturally follows that because you make some schools, er, charge ahead that these other schools will follow. They will just sink. And that is the problem that, hopefully Ruth Kelly will eradicate. But, it’s not guaranteed. The mechanism: how that’s going to happen.

Robin Lustig: Suppose there is a good private school just up the road from a less good state school and that private school says we are prepared to play our part in improving the standards in the state school through some kind of trust set-up, would you not be happy to see that given a go?

Ian Gibson: Well, I’d be surprised if they did say that, but if they did say that, it would be quite interesting, because they would start to worry, you know, if they are helping the state schools out, you know, what efforts should they be making to establish higher levels in their own school? So, who knows how they will think. I can’t see Eton, you know, teachers are teaching, and the pupils they are teaching, charging around that area, helping the other schools; not to say that they are bad schools, but, but you know, they will be in an environment of what was said today in the debate, ‘not competition, but contestability’. Very hard to see what that might mean.

Robin Lustig: The Labour MP, Ian Gibson. So, who then are these new education providers that the government wants to get involved in running state schools? Well, the White Paper refers to educational charities, faith groups and parental community groups. But what about commercial providers? The so-called Edu-Business companies, which already run some local education authorities and have responsibility for education infrastructure. Could they soon be running state schools as a commercial venture? Jacqui Smith is the Minister for Schools.

Jacqui Smith : What is made clear with the trust model is that we think there are lessons to be learnt from Academies, from specialist schools about the contribution that external partners can make to helping to drive improvements in schools. We are thinking about charitable trusts set up, perhaps, with educational foundations, with successful schools setting up trusts so that they can share good practice with others. Community organisations, universities, trusts linked to business but strictly not for profit, and with the intention of actually driving improvements in the education system.

Robin Lustig: So, strictly not for profit. So, those companies which are in the field that is now known as Edu-Business, the people who build schools, manage education services and so on, as a commercial venture. They’re not included?

Jacqui Smith : This is not about private sector involvement in education. This is about schools being able to gain external support to improve standards. That is what it is about.

Robin Lustig: What about an independent school which is run by a trust or a charity of some kind and it says, we are rather good at running schools, we’ll set up a couple more, but we will put them in the state system?

Jacqui Smith: Well, what we might want to see there is that independent schools, as they are with some schools already, helping to contribute their expertise, helping to drive management and improvements in maintained schools. That’s the sort of model that we’ve got in mind. We’re learning from experience here. What we see from Academies, from specialist schools, is that where schools are actually able to enlist the support of external partners, it can help to drive standards for every child. And that’s what we are concerned about with these reforms.

Robin Lustig: What do you say, though, to those who might suspect that independent schools would be most reluctant to cut off their noses to spit their faces in this way, because the better the state sector, the less demand there will be for their private services?

Jacqui Smith: Well, Robin if you are asking me, is it an intention to make sure that the state sector is excellent, that parents feel able to choose places in the state sector, that parents don’t think they’ve got to go private in order to get good quality, well that is a fundamental objective of this White Paper. But I think that there are independent schools as we have proved in the way in which we have developed partnerships anyway, who want to contribute to that and if they can contribute to ensuring excellence for all our children, well they have a role to play.

Robin Lustig: As you know, there are those who suspect that what this is really all about is the beginning of a process which ends with the privatisation of secondary education.

Jacqui Smith: Well, they are wrong Robin. What it is about is making sure that every young person in school gets the tailored approach to their learning that’s necessary to enable them to make progress. That each school gets the support, the flexibility where necessary in order to continue driving up standards, that local authorities have a new but key role in actually ensuring quality across the system, and that we get the sort of excellence that we begin to see developing in our school system, worked through to every child and every school. That’s what it’s about.

Robin Lustig: The Schools Minister, Jacqui Smith. Well, with me here now in the studio is Glenn Rikowski, who lectures on education at the University of Northampton, and we are joined from Tunbridge Wells by Jonathan Shepherd, who is the General Secretary of the Independent Schools Council, which represents more than 1200 independent schools. Ehm, Jonathan Shepherd, Chapter 2 of the White Paper contains the words that the aim is to ‘create a school system shaped by parents, who will encourage existing schools to expand and federate to meet demand and make it easier for independent schools to enter the state system’. Independent schools don’t want to enter the state system, do they?

Jonathan Shepherd: I think we are talking about a very small number of schools, particularly newly established independent faith schools. I think if the whole of the independent sector entered the state system, the country could not afford it, because we save more than 2 billion pounds a year for the Treasury.

Robin Lustig: It also wouldn’t be in the interest of independent schools, would it, because the better the state schools become, the less demand there will be for them?

Jonathan Shepherd: I think that we are all very concerned about some things in the state sector, because in maths and sciences and languages the state sector is not producing enough suitably qualified applicants and we have a strong social purpose. I do represent 1200 schools, as you’ve said, and more than 1000 of those are charities. We are working in partnership with the maintained sector already. I think the trust model gives our schools a chance to get more involved, to make more of a contribution and I am very sure that a lot of schools would want to do that.

Robin Lustig: Glenn Rikowski, do you think that this approach will lead to better opportunities for more children, in English secondary education?

Glenn Rikowski: I think that is hard to say. What I think the approach will lead to, or is paving the way for, is what I would call the business takeover of schools. I think that’s clear in what it says about federations. And if you put that on top of say, the 2002 Education Act, when that enabled, the legislation enabled, schools to set themselves up as companies, to trade with other companies, to trade on the stock exchange, and so on, one can see the general drift in terms of how the system…

Robin Lustig: But you just heard Jacquie Smith deny categorically that anything other than non-for-profit companies would be included in this kind of system.

Glenn Rikowski: Well, in the White Paper, they do say, it is said that, the trusts that are going to be set up will be non-profit making. However, one might want to make a distinction between the trusts and the individual schools making profits, and the companies that are running them for profit.

Robin Lustig: Because some companies might set up trusts?

Glenn Rikowski: They might set up trusts, but that’s not the key point. The key point is that there are some local education authorities being run by companies, and some individual schools being run by companies on contract, and profits are made by providing the service at less than contract price, which impinges on staff pay, conditions, the type of labour that is used. You know, can you bring in cheaper labour and so on. It is those kinds of things that I would be concerned about.

Robin Lustig: Alright. Let me go back to Jonathan Shepherd then. Do you believe that what seems to be part of the thrust here in the White Paper, the idea that the boundaries between independent schools and state schools can be blurred, that there can be a greater mix of the system, so that somehow you get them coming together in some way. Is that a realistic vision?

Jonathan Shepherd: Very much so. The boundaries have been becoming increasingly blurred over the past few years, and there is much more cooperation, there is much more realisation on both sides, that we are all in the same business of trying to educate children. I think the government needs to get quite a lot further. It talks a lot in the White Paper about parental choice – that all parents should have the chance to put their child in the school that they want. What we do know, what is absolutely clear, is that a huge majority of parents would like to include independent schools in the choices available to them. You are not going to get genuine parental choice, unless you bring independent schools into the mix. We would be delighted to get children from the disadvantaged areas, who are in the worst position, into our schools. And if it was only 20 into each of our schools, that is 24,000 children who are saved, in fact, from what might be a very bad education.

Robin Lustig: OK – so Glenn Rikowski. If there is, then, an opportunity, once these kinds of ideas are put into practice, for parents to have more of a choice as to where their children go and perhaps if there is a particularly good independent school up the road, at least to partake in some of what that school offers, to everybody’s benefit?

Glenn Rikowski: Well, just to respond to the previous speaker. First of all it seems to me that the government has got the independent school sector over a barrel, in so far as it’s more or less saying to them – you form partnerships with state schools or you will lose your charitable status.

Jonathan Shepherd: I think that is not true at all, if I can come in there. We have no, I mean, I talk to the government very often, we have no indication at all, that there is anything like that, we are very confident about our charitable status. We have a social purpose that has existed for more than 100 years, in many cases much more than that. We want to be part of the solution to the problems in the educational sector.

Robin Lustig: But you, Glenn Rikowski, think that there is an implied threat, do you?

Glenn Rikowski: Yes, yes I do. It comes from a number of directions. One is the General Agreement on Trade in Services, which is a World Trade Organisation agreement. Two years ago I had a conversation with Stephen Timms, who was then, I believe, the School Minister, and he was saying, Glenn you need not worry about the General Agreement on Trade in Services, it does not apply to state schools. Now, if you have a situation where state schools and private schools are intermingling, however you want to put it, and working with each other, that opens the whole of the state system more fully to the General Agreement on Trade in Services, which is about transforming educational services into internationally tradable commodities.

Robin Lustig: Let me come back to you then, Jonathan Shepherd, coming back to where we started, where the White Paper says that one of the aims is to make it easier for independent schools to enter the state system, you think this will only apply in a very small minority of cases, you do not see this as the beginning of the end of a separate, independent education sector?

Jonathan Shepherd: Certainly I don’t. And one our strengths is being independent. We can actually get some independent ethos into some of the main schools.

Robin Lustig: But the government keeps talking about independent state schools now.

Jonathan Shepherd: Well, they are trying to make, they are trying to give them more independence, with one hand. I welcome that. I think one has to look quite carefully at the small print, because the local authorities are going to be changing admissions and funding. They have to abide by the National Curriculum and teachers pay, unless they negotiate their way out of that. There are these parents’ councils, where there will be a lot of regulation. So, I think the government needs to be a bit bolder, if it wants schools to be independent that’s fine. It can’t tie them back at the same time. And I think it is in danger of doing that.

Robin Lustig: Alright. Jonathan Shepherd from the Independent Schools Council. Glenn Rikowski from the University of Northampton. Thank you both very much.

And educational reform is the subject of our online listeners’ debate. We have already had several interesting contributions from you. But if you would like to share your ideas with your fellow World Tonight listeners, then go to the website at bbc.co.uk/worldtonight. Click on – join the debate.

END.

Further information:

Schools White Paper: Highlights – links to documents relating to the White Paper:

http://www.dfes.gov.uk/highlights/article06.shtml

The White Paper – PDF and Word downloads from:

http://www.dfes.gov.uk/publications/schoolswhitepaper/

Press Release on the White Paper:

http://www.dfes.gov.uk/pns/DisplayPN.cgi?pn_id=2005_0124

The Prime Minister’s Presentation on reforming the school system:

http://www.number-10.gov.uk/output/Page8333.asp

Parliamentary Speech: Secretary of State for Education, Ruth Kelly, presents the White Paper to Parliament:

http://www.parliament.the-stationery-office.co.uk/pa/cm200506/cmhansrd/cm051025/debtext/51025-05.htm#51025-05_spmin3

The World Tonight

http://www.bbc.co.uk/radio4/news/worldtonight/

A biography of the presenter – Robin Lustig:

http://www.bbc.co.uk/radio4/presenters/lustig_biog.shtml

Ruth Rikowski

Glenn Rikowski

London , 29 th October 2005

The Flow of Ideas , the web site of Ruth and Glenn Rikowski, is at:

http://www.flowideas.co.uk

The Volumizer , the web log of Glenn Rikowski, is at:

http://journals.aol.co.uk/rikowskigr/Volumizer

Contact : Rikowskigr@aol.com

Transcribed by Ruth and Glenn Rikowski, 28-29 th October 2005

In Toni’s words:

CJSR radio interviewed me about Freedom to Read Week. The interview was an opportunity to talk about librarians as part of the Freedom to Read initiatives – but about librarianship in general. I was interviewed for aprox. 40 minutes…

The station got my name from U of A MLIS student James Reimer… who does volunteer work on behalf of the U of A School of Library and Information Studies’ “Future Librarians for Intellectual Freedom (FLIF)” student group.

The station was also aware of my role with CLA.

I spoke to such topics as: Freedom to Read Week; library associations,
such as CLA, ALA, and IFLA; the dilemma about what constitutes library
work and questions around so-called library issues vs. so-called
non-library issues; Internet access; Internet governance and censorship;
filters; family values and community standards; poverty and library policy
around the homelessness, living on fixed income, & no fixed address;
commercialization of public space and the library as part of public sphere; social exclusion; the power of publishers and then open access and library publishing; preservation of cultural record, the destruction of libraries (e.g., in Bosnia and Iraq) and obliterated memory; limited access to government information (Arar), technological capacity for mass registration and surveillance; academic freedom; Patriot Act and libraries; heightened legalistic atmosphere; .. and more.

The cartoons came up only briefly. But I had time to make points from
various angles including the democratic right to view and inform oneself,
tolerance, expressed questions around the motivations of the Danish editor; big picture context, incitement of extremism, hate, rights AND responsibilities, and high magnitude issues of peace and sustainable development.

About CJSR: “CJSR’s programming is a diverse mixture of news, current
affairs, and – of course – music. Since broadcasting its first minute of
music to the general public on January 7, 1984, CJSR’s programing offered
an alternative to mainstream radio. CJSR features the most eclectic
selection of music on Edmonton’s airwaves: folk, jazz, blues, rock,
reggae, hip-hop, techno, classical, ethnic, gospel and everything in
between. CJSR’s programming also focuses on issues that are either ignored
or marginalized by mainstream media. CJSR also broadcasts University of
Alberta Pandas and Golden Bears Sports. Our mission is to enlighten and
entertain our audience through high quality and diverse programming that
constantly challenges the status quo.”

Toni Samek (Convenor, CLA Advisory Committee on Intellectual Freedom

Transcript from You and Yours, BBC Radio 4, 12.04 – 1.00pm, Wednesday 17th October 2001

Participants: Liz Barclay (You and Yours) Winifred Robinson (You and Yours) William Yates (You and Yours) Barry Coates (World Development Movement) Nick Cohen (journalist on The Observer, and author of ‘Cruel Britannia’) Lord Newby (Liberal Democrat peer and Treasury spokesperson) Alex Nunn (Manchester University, and Association of University Teachers researcher) Ruth Rikowski (South Bank University, and Information for Social Change) Christopher Roberts (Chairman of the Committee on Liberalisation of Trade in Services, London)

You and Yours: Basic services like health care and education could be privatised and run by foreign multi-national firms, under a revised trade agreement being negotiated by the members of the World Trade Organisation. At least, that’s what anti-globalisation campaigners and public sector workers would have us believe. Free trade across borders has been seen by many as a key strategy in promoting economic prosperity. Historically, it has been products and goods which have been the focus of those determined to put an end to tariff and trade barriers. But now the so-called GATS agreement aims to do the same for the service sector. Some claim essential services could be forced to liberalise. If they did so, regulation of those services would effectively transfer from the British government to the World Trade Organisation, as Will Yates reports.

“I commit myself to be the Director General of all the contracting parties.” (Voiceover)

William Yates: When Renato Ruggiero became the first Director General of the World Trade Organisation 6 years ago, its brief, in the WTO’s own words, was to “help trade flow, smoothly, freely, fairly and predictably.” To that end, the WTO has two key tools at its disposable. The General Agreement on Trade and Tariffs (or GATT), and the General Agreement on Trade in Services (GATS). But neither has met with universal approval.

(Shouts from a recording of a demonstration/protest in the background)

“On the second day running there was mayhem on the streets of Seattle. Riot police fought a series of running battles with demonstrators.” (Voiceover by news reader)

William Yates: The riots at the WTO’s ministerial meeting in Seattle 2 years ago, and subsequent protests have given graphic evidence of the depth of feeling against what critics see as the organisations blind devotion to free trade. The focus of those protests has been the effect trade agreements have on the economies of Third World countries. Suggestion being that free and fair trade are effectively incompatible. But according to Barry Coates from the World Development Movement the effects of GATS will strike much closer to home.

Barry Coates: Services cover this incredibly broad range of things that we all depend on, for our health care, education, water supply, through to transport and communications, through to tourism and entertainment. And these services are going to be governed in future by a set of rules that are now being negotiated at the World Trade Organisation. And the kind of rules that, that they are developing are not well known to members of the public, or parliamentarians or others, but they could have sweeping impacts on the way that these services are organised and delivered. And particularly on the power of governments to be able to regulate those services in the public interest.

William Yates: Under GATS, governments are required to ensure that regulations on foreign companies are no more burdensome than necessary. The definition of what is ‘necessary’ will be defined and determined by the WTO.

Barry Coates: Services tend to be very highly regulated by governments because there are often issues of public interest. What this agreement does, it imposes a model of a kind of liberalisation which is hugely contentious not only in Britain as we see with the regulation of governance over the railways, over water supplies, over the underground in London. Em – and over air traffic controls. These kind of services are enormously contentious and what this GATS agreement does is, it locks in a certain kind of delivery of these that is primarily governed according to the unregulated rules of the market. And that’s not necessarily in the public interest.

William Yates: Concern about the effect GATS will have on public services in this country is growing. Earlier this year, 260 MPs signed an early day motion, calling on the government:

“To ensure that there is an independent and thorough assessment of the likely impact of the extension of GATS on the provision of key services both in the UK and internationally.” (Voiceover)

William Yates: A number of local authorities and public service unions have expressed similar fears:

“We look to the creation of the WTO, okay? Now, there are a variety of legal frameworks, developed within the WTO…” (Voiceover – anonymous)

William Yates: Alex Nunn lectures in politics at Manchester University and he is also a Consultant Researcher for the Association of University Teachers.

Alex Nunn: The problem is that the GATS agreement redefines public services – higher education, as one of those, as a product which is then to be bought and sold on a world market, rather than a public service which is for the benefit of the public. And the problem with that is that it offers the possibility of higher education according to the ability to pay. There are problems associated with academic freedom, with commercial sponsors controlling research, and that is already happening. For instance, there is a high profile case in Canada with an academic whose had a job offer withdrawn because a piece of research he did offended the department’s commercial sponsor.

William Yates: Many also fear for the future of our libraries, which this government has identified as vital to its ideal of easy access to lifelong learning. Ruth Rikowski lectures in knowledge management at South Bank University, in London. She is worried that big business will be given free reign to run our libraries as profit-making enterprises. And she believes that would harm the very people the library service was set up to help.

Ruth Rikowski: At the end of the day, a few years down the line, people will probably be paying to go into their public library service, or there will be a subscription. Maybe they will go into their library free but then they will have to pay to do searches on the Internet for information, or perhaps it will be both. I suspect it will be both in the end, because private companies are out to make, need to make money. So they need to maximise their profits, and poor people, unemployed, pensioners, children are going to be the ones that suffer particularly.

William Yates: And Barry Coates from the World Development Movement believes that scenario would be mirrored across the service sector. The market will dictate the level of service and the current providers will be unable to intervene on the publics’ behalf.

Barry Coates: What we’ll see is local authorities and others who are afraid of putting in place proper regulation in the public interest; because they think they might get challenged under GATS and get taken to the World Trade Organisation. And essentially lead to a situation as the American economist J.K. Galbraith has said, of ‘private affluence existing alongside public squalor’.

Liz Barclay: Barry Coates from the World Development Movement, ending that report. Lord Newby is a Liberal Democrat peer and Treasury spokesperson, Nick Cohen writes for The Observer and Christopher Roberts is Chairman of the Committee on Liberalisation of Trade in Services, in the City of London. Private affluence existing alongside public squalor. Public services are run for the benefit of the open market, rather than for the safeguard of the public interest. Is that a realistic view of the future of our public services, or overly pessimistic? Christopher Roberts.

Christopher Roberts: It’s certainly not only overly pessimistic, but actually untrue. Er, the General Agreement on Trade in Services, er, should help to strengthen services around the world, give governments and public authorities the opportunity to use all the latest skills and methods in developing public services. And I think we all stand to gain, by liberalising trade in services, just as over many years we have all gained by liberalising trade in goods.

Liz Barclay: Nick Cohen, your response?

Nick Cohen: Well, we already have our private affluence and public squalor. What this is going to do is just remove yet further our, our democratic rights, and once you’ve signed up to GATS and once you’ve said a service. And they define services incredibly broadly. Food, water, hospitals, education, the necessities of life, suddenly somehow become services, like er, you know, restaurants or hairdressing – you can’t get out of it. And then the World Trade Organisation, which is unelected, which meets in secret, which only listens to big business, will decide what regulations are, are too burdensome for business. And you will have no democratic choice to get rid of it. So if Wal-Mart wants to open massive stores on the green belt, er, it is quite conceivable that no elected politician will be able to stop them.

Liz Barclay: So, there is basic disagreement right from the start. Lord Newby.

Lord Newby: I think Nick’s being a bit pessimistic. I don’t think the existing GATS would allow you to do all of those things at all. Em, I do have concerns about GATS, er, and the way it might develop for a number of reasons. But they are not to do with the existing degree of private affluence and public squalor. That’s happened for a whole raft of reasons that are nothing to do with GATS. The problem in my view with GATS, is that, em, it is very heavily weighted towards an American-style legalistic system of regulation. And once you do that, you open the possibility of unintended consequences. This has already happened in my own experience, in trade, on the banana issue, and I think that that’s the real fear. Not that there is anything currently in GATS or anything that’s currently happened, that justifies some of the wilder accusations.

Liz Barclay: But we have the…

Nick Cohen: [Interrupting]… Okay, I’ve been accused of being ‘wild’ and over pessimistic. I’ll give you a concrete example, very quickly. Er, the California State government decided to ban a petrol addictive which it thought was dangerous. The Canadian company that made it sued under GATS: said it was ‘a burdensome regulation’. And so it forced the Californians, instead of just banning an additive, to require all petrol stations in California to dig up their storage tanks and re-seal at enormous costs to small businesses and the taxpayer, but of course was of benefit to the company. You know, these things are already happening.
Liz Barclay: Christopher Roberts, can I just bring you in here. ‘Unintended consequences’, I mean, we’ve rather signed up to an agreement and are now beholden to those lawyers that are now arguing legal definitions, rather than the elected representatives arguing public interest.

Christopher Roberts: Yes, well, first of all the GATS agreement is about liberalising trade. It’s not about regulation at all. That is a different question and the GATS agreement does not prevent governments from carrying on with regulation as they wish, under the normal democratic process. As to the question of democracy; I mean, the GATS agreement, like the wider World Trade Organisation, has set up a range of rules which governments have freely entered into, and when disputes arise they are disputes about whether those rules are being adhered to. And that is like the sort of case which arises in a court of law and not surprisingly is a quasi-judicial procedure. It’s democratic.

Nick Cohen: Well, it’s not democratic. Courts of law, for a start, meet in public. The World Trade Organisation GATS panels don’t.

Christopher Roberts: I would actually, I would personally accept the view that it would be better for greater transparency in the process of dispute settlement in the WTO. The, the opponents for that, curiously, are the developing countries.

Nick Cohen: But once your service has been opened up to GATS, and of course in Britain there is already private health and private schools, you then come back to the question of regulation, which er, er, my friend from the City tried to dodge. The GATS rules say very clearly that regulation will not be allowed if it is more burdensome than necessary. And who decides what a burden is? Whether planning laws, or health and safety laws, or environmental laws are a burden? The WTO: not your elected politician.

Liz Barclay: Lord Newby, that is a worry, surely.

Lord Newby: I think that is a worry, but I think Nick is exaggerating the scope of GATS at the moment. My understanding is that services provided by government, em, by the public sector, the GATS agreement as it currently stands are not covered. I can clearly see that once you start privatising public services, you then run into difficulties. But I think, em that’s as much as a problem about whether you should be privatising public services in the first place.

Nick Cohen: No, it is whether the market is opened up. And it is already is, in everything – even in prisons in this country.

Lord Newby: Nick, I’m not disputing the…

Nick Cohen: [Interrupting]… Just a second: can I just throw a quote at you from Dean O’Hare, who’s the President of one of the world’s biggest insurance companies (American, of course)? He says: “We believe…” (he is talking about GATS) “we can make progress and negotiations to allow the opportunity for US business, that’s private health care, to expand into the foreign health care market.” And the previous head of the WTO said: “The world has not taken on board just how important and how big this is.”

Christopher Roberts: Yes. I mean, Dean O’Hare can speak for himself, and it seems to me quite reasonable for service industries around the world to look for opportunities to develop their business in their own interest as well as those of the countries where they invest and develop. And from the UK point of view, it is hugely in our interest, with two thirds of our economy accounted for by services, to develop international trade in this area. Hugely important for our employment and for wealth creation here. So that’s not something lightly to be thrown away.

Liz Barclay: Give me an example of what you are talking about.

Christopher Roberts: The fact is that, er, financial services, for example, accounts for a million jobs here in the City of London. And we have a huge international business in financial services, and the sort of skills and knowledge which British banks and insurance companies bring to other countries around the world strengthens their economy. It’s good for us – sure. But it is good for these other countries as well.

Liz Barclay: Nick, there must be positives to this as well. I mean if we are in a situation where, for instance, skills are transferable across national borders, and you don’t have to, perhaps, retrain to be a doctor in this country, because we already know that their qualifications and technical standards are of such a standard that you can operate. Then surely that has got to be a good thing?

Nick Cohen: Well, of course. I wouldn’t deny that there will be benefits for British companies, particularly in the City, where the real pressure for this is coming from. Leon Brittain has gone from being trade commissioner to lobbying for the City. I wouldn’t deny it. Of course there are. But what we are being asked to do, in effect, is sacrifice across Europe, our social democratic health and welfare systems for trade opportunities in the Third World. Now, whether that will be good for the Third World or not is a very, very difficult problem to decide. It will be good in some cases, but the only Third World countries that really got out of poverty in the Far East, Japan and the Tiger economies, have done so by protecting their industries and not by opening them up to free trade.

Lord Newby: I must just take issue with him. How can he say that GATS is going to sacrifice our social and democratic traditions in health and education? I mean, there is no slight, I don’t think there is the single beginnings of an example of where that has begun to happen in Europe. And I don’t see how, under GATS rules as they currently stand, or are as they are envisaged, they are going to sacrifice the ability of European governments to have high levels of health and education provided by the state on the broadly similar basis as we’ve known it in the past.

Nick Cohen: I’ll just actually, er quoting, er, Pascal Lamy, the er, European Trade Commissioner, who succeeded Brittain, who was saying that, you know, these are areas ripe for liberalisation – health and education.

Christopher Roberts: At the moment, no country in the WTO has asked for any concession from any of its trading partners in the health area. That is a simple fact, as of now. Countries around the world are not looking to liberalise their health services.

Liz Barclay: But that is not to say that that might not happen. In this country we are quite far down the privatisation route. I mean, I suspect there was a time when nobody would have thought we would have privatised our telecommunications and our transport, for instance. Or, our water. So the day, it, it must be possible that the day will come.

Christopher Roberts: In theory, in theory yes, but it hasn’t happened yet. But to go back to the essential point, that, under GATS, governments retain their complete power to regulate.

Nick Cohen: That all sounds very reasonable, em, but, er, let’s take the case of bananas which er, his Lordship knows about. We had (Britain and France had) small Caribbean islands, populations descended from slaves our ancestors took there. We had an agreement to buy bananas from them to stop them falling into poverty. An American multinational which doesn’t even grow bananas in America, but pays money to both Republicans and Democrats, took us to the WTO. Suddenly decided that bananas were a service. As I said, it’s an imperial definition. They’ve lost their trade concessions. Now there is a public interest far, far above the trade interest in this. There’s a public interest in honouring agreements, but also in stopping those islands from becoming centres for drugs dealing, which will flood Europe and America with drugs. But the WTO said: “Oh! It’s a restriction on trade!” – and there it goes. You cannot let business determine what the public and the national interest is. There are higher interests. There are greater considerations, to be borne in mind. And that’s why we have elected politicians.

Liz Barclay: Christopher Roberts?

Christopher Roberts: No, I wouldn’t accept that the Americans dominate the scene. I think that, that underestimates the negotiating skills both of the EU negotiators and those from the developing countries. I spent two days in Geneva last week, talking to a range of developing countries, all of whom were very interested in the GATS; who have their objectives in areas like, like tourism and movement of persons.

Liz Barclay: Lord Newby, we’ve got no agreement round this table at all, it seems to me. How on earth are ordinary consumers supposed to understand how this will effect them?

Lord Newby: Well, I think the fact that we find it difficult to know how it is going to effect them, er, demonstrates the problem. The organisations that we are talking about, have become, em, almost like a sort of Byzantine court, in terms of er, rules upon rules, which are extremely difficult to be penetrated. And I think that, I agree with Nick that there needs to be a greater public input into the whole thing and I agree that the rules, the way that the rules need to be implemented need to be simplified. And I think that the British government and the EU governments, er, and the developing world governments, need to be very, very vigilant about future moves, and shouldn’t be rushing, er, to get to the next stage of implementation of rules.

Liz Barclay: Lord Newby, Treasury Spokesperson, Nick Cohen from The Observer and Christopher Roberts, Chairman of the Committee on Liberalisation of Trade in Services. Thank you all for joining us.

ENDS

20th October 2001

Michael Northm from The Times Higher Education Supplement quoted from an article by Glenn Rikowski about the Further Education White Paper, that is on The Volumizer, Glenn Rikowski’s web-log.

Michael North says: “Glenn Rikowski, Senior Lecturer in Education Studies at Northampton University, says, for example, that the further education White Paper could lead to “struggles over the heart and soul of the FE sector”. Only a simpleton would expect this White Paper, or the schools White Paper of October 2005 or indeed any White Paper, to blurt out that ‘companies will take over failing colleges or schools’”, he says, “but the White Paper does seem to offer such openings for the private sector”. Rikowski suggests that the White Paper makes it possible for failing colleges – thought to represent about 2 per cent of the sector – and a potentially larger number of “coasting colleges” to be taken over by private companies if their provision does not improve within a year. He adds that if views such as Jackson’s prevail in Government, private companies could be invited to bid for contracts to run higher education departments, faculties or whole institutions.”

In The Times Higher Education Supplement, 7th April 2006, p.17