New Labour, Network Rail and the third way

Abstract

Purpose -The paper aims to examine the role, funding and status of Network Rail, a very significant example of New Labour's attempt to operationalise the "third way". The analysis of Network Rail is used to critique the "third way" approach to policy-making in Britain. Design/methodology/approach -The paper examines Network Rail, and the significant changes that have occurred since its creation, in the context of the claims originally made for the company by Transport Secretary Byers. It employs critical financial analysis and non-financial performance indicators to examine the "third way" approach to rail privatisation, drawing on the work of its leading supporter in the UK, Giddens, and its leading critic, Callinicos. Findings -The paper demonstrates that Network Rail is an expensive mechanism for channelling public money to private companies. It argues that the "third way" is really a smoke screen for the neo-liberal ideology, behind which there is a continuing transfer of wealth from taxpayers to the private sector.Research limitations/implications -The paper focuses on one significant example of the "third way" approach to policy making. It demonstrates the strength of the neo-liberal ideology, particularly the belief in the value of privatisation, in the UK. Practical implications -The findings of the paper have implications for public policy and for those affected by rail privatisation, including employees, passengers and taxpayers. Originality/value -Researchers and practitioners working in the area of public sector management and reforms should find the paper of value.

Prison Privatization: The (Ir)Relevance of Accounting

“…She argued that their "contribution has been concerned largely with the reporting changes resulting from privatization … and regulatory issues" ͑Shaoul 1997a, 383͒. To some extent researchers have explored this gap over the last ten years, but there is still little known about the role of accounting within decisions to privatize, the quality of the data that is used to justify the decision, and the way accounting information is used between parties ͑the government, private organizations, and citizens͒ in the development of public policy ͑such as Edwards and Shaoul 2003;Funnell et al 2009;Jupe 2009a͒. Many of these challenge the core claims made by the proponents of neoliberal theory through an exploration of the "realities" that emerged ͑Edwards and Shaoul 2003;Harvey 2005͒. The claim that private ownership leads to the efficient allocation of resources was explored extensively by Martin and Parker ͑1997͒ when they studied 11 newly privatized companies 1 in the U.K. to conclude that the evidence was mixed as would be expected-certainly their research indicated that the reality was far less clear than the theory.…”

“…Although much effort has been mounted to ensure that this view appears natural and self evident ͑with market testing, performance management, public audits, and assessments of risk, see Craig and Amernic ͓2004͔͒, there is now considerable disquiet over its underlying purpose and privatizations' more vested intent ͑Shaoul 1997a; Edwards and Shaoul 2003;Froud 2003;Cahill 2009;Jupe 2009a͒. It is also important to note that the notion of efficiency itself has appeared uncontroversial, but is in fact ambiguous and ill defined ͑Shaoul 1997b; Andrew and Cahill 2009͒. According to Shaoul ͑1997a͒, accounting researchers have contributed little to the analysis of privatization as a policy choice.…”

“…Government functions that were once the exclusive territory of the state have also been subject to neoliberal policies that have seen them outsourced and privatized ͑Andrew 2007; Funnell et al 2009͒. Much has been written about the newly configured public sector and its management and there is a significant body of literature that engages with the many and various forms of privatization that have occurred within the public sector over the last 30 years ͑Lawrence 1999; Ursell 2000; Crompton and Jupe 2003;Andrew 2007͒. The public sector has undoubtedly been transformed, but there is still considerable debate about the benefits of such transformation and the role that accounting has played within the process ͑Carnegie and West 2005; Watkins and Arrington 2007;Benito et al 2008;Jupe 2009b͒. This paper is positioned within this broader literature, and the processes described are understood within the context of neoliberalism ͑Campbell and Pedersen 2001 ;Harvey 2005͒.…”

“…During this period, privatizations, new styles of public management, and the reconfiguration of the state, capital, and the community have been publicly articulated as universally beneficial. However, there is mounting disquiet and concern about the actual benefits that have emerged from this form of capitalism ͑Andrew 2007; Heron 2008;Jupe 2009b͒. Neoliberal policies have defined much of our expectations and experiences of public life and we have become less sure of the legitimate roles of government, corporations, and the community ͑Funnell et al 2009͒.…”

The privatization of British Energy: Risk transfer and the state

“…In this case, however, there were two very significant concerns which determined the Government's unavoidable response: the company's significant contribution of one fifth of the electricity supply; and concerns should the safety of nuclear power stations be threatened. The Blair Government could have renationalized British Energy in order to remove uncertainty about its future and to secure the electricity supply but, as in the case of Railtrack (Jupe, 2009a), chose not to. Its preference instead was to adopt a complex "third way" approach which relied upon large public subsidy to retain the company in the private sector.…”