Private sector companies driven by “corporate profit” should not be given government contracts, the Labour policy coordinator Jon Cruddas has said in a new book.
Setting out his plans for Labour in Blue Labour: Forging a New Politics, due to be published next month, Cruddas says government should focus on forging ties with “ethical enterprise” rather than outsourcing services to private firms.
In a chapter entitled ‘The Common Good in an Age of Austerity’, which has been seen by The Telegraph, Cruddas writes: “[There should be] no more outsourcing of relational services to those parts of the private sector that are driven purely by corporate profit rather than a social purpose.
“It is quite staggering that some £10bn of public contracts – of taxpayers’ money – are allocated to some 20 private companies.”
He adds: “Rather, we need to forge cooperative ties with ethical enterprise – such as cooperatives, mutuals, and social businesses.”
Research published last week showed that local government outsourcing contracts signed in 2014 were worth a total of £606 million, with a 60% / 40% split between business process and ICT outsourcing deals.
Overall, the average value of local government outsourcing contracts increased by 15% year-on-year to £30.3m during 2014.
