Can PPPs stay afloat when facing a wave of public spending cuts?
Free healthcare is drowning under the recent wave of public spending cuts in Europe. Prospects for improvement in some countries seem slim – particularly when faced with an ageing population of increasingly chronically ill citizens. Is there a solution?
Could management by the private sector or outright privatisation provide the magic solution that will introduce gains in efficiency in the system? Calls, in some quarters, have become insistent. Enthusiasts make a fair point – but are they blinded by the prospect of profits and oblivious to the minefield that is working with a public payor? For many, the experience and risk involved is becoming increasingly not worth it.
It’s true that in some European countries, operator-PPPs are run successfully, but this is seldom without opposition as is the case in the Nordic countries. But attempts to import this model to countries like Poland or Spain – where the political wind is blowing in a different anti-private healthcare direction – have been disastrous. It is easy for private players to enthusiastically jump onto the PPP bandwagon when a favourable government steps in and offers them a carrot. What they don’t always realising is that they face poorly designed contracts that provide little legal certainty – and that the next government may carry a stick.
The results are clear to see. PPPs can be left discredited. They can cease to look like a viable option and fall down a well of partisan politics never to come out again.
PPP enthusiasts should be the first to warn on the risks. Early experiences can easily end up in fraud and favourable treatments. And if the only gains in efficiency come from cuts in labour costs, the otherwise conservative medical profession may rise up in anger. All of a sudden, the words of the Left – that companies shouldn’t make a profit out of public healthcare – carry a meaning that with proper organisation and a system that allows patients to benefit while some profits are made – they might not have. That anti-PPP slogans can yield good political results for some parties, whatever the strength of the argument, is a shame as it means future attempts to establish fruitful and mutually beneficial public-private participation is thwarted.
We would welcome your thoughts on this story. Email your views to Francesc Milla-Martinez or call 0207 183 3779.
