Category Archives: Government

Secret State 24: HS2 overbudget revelations

Two ‘hidden’ reports see the light of day – how many more are buried?

In July, Andrew Gilligan reported that the HS2 high-speed rail project is “highly likely” to go as much as 60% over budget and cost “more than £80bn”. A Cabinet Office report by the government’s Infrastructure and Projects Authority (IPA), classified as “official-sensitive” and “not for publication”, described the scheme as “fundamentally flawed” and in a “precarious position”. A group of Conservative MPs, led by Jeremy Lefroy the MP for Stafford, mounted a new bid to cancel HS2.  

Is Britain’s own “deep state” once again covering up mistakes and denying access to critical documents (Carne Ross)?

Yesterday the FT reported that an official report by consultants PwC covering the second phase of HS2, from Birmingham to Leeds and Manchester, has been kept secret for the past two years. It alleges that Britain’s new £56bn high-speed rail line will cost taxpayers 25% more than similar schemes in other countries. The project was compared with more than 32 other high-speed rail projects, including the 621km Madrid-Barcelona line and the 301km Beijing-Nanjing line.

Since 2016 the management of HS2, which answers to the Department for Transport, has refused to publish the report, despite freedom of information requests from Lord Berkeley, a transport expert.

He said. “The fact that the government is embarrassed by their findings should not be a reason to withhold publication.” The findings included the following factors:

  • HS2 will have 25 stations — far more than equivalent schemes abroad — and they are more likely to be in city centres.
  • The 10-year hiatus between the UK’s first high-speed line and HS2 meant that the UK did not have the “base, industry and knowledge to deliver the project easily”.
  • The UK has a higher population density than some equivalent countries and so has had to pay higher land values, greater compensation and carry out more extensive environmental mitigation,

The benefits of HS2 are becoming harder to discern

The Treasury’s own Infrastructure and Projects Authority has given HS2 an “amber/red” rating for each of the past six years, meaning there is a “high risk” of it not delivering value for money.

A recent report by the European Court of Auditors (ECA), which monitors value for money, found that high-speed trains rarely run at the speed they are designed for, with most running at just 45% of top speed, with none running above 250km/h. The study of 10 European lines found that the decision to “build high-speed lines is often based on political considerations, and cost-benefit analyses are not generally used to support cost-efficient decision-making.”

The ECA found that only one of the 10 routes, from Paris to Lyon, have been profitable if construction costs were taken into account.

 

 

 

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Universal credit is NOT an incentive to work for the single able-bodied: 63p of every pound earned is clawed back

Focussing on undue delays causing hardship, highlighted on this site, The Times and the FT in 2017 asked ‘is universal credit – to date – a disaster?’

The FT today says “Universal credit is a plum example of how not to reform public services. The theory was broadly sound: the simplicity and real time data of the universal credit would ensure people were always better off in work. The reality, however, has proved calamitous”.

Conservative and Labour politicians, such as Jacob Rees-Mogg, Johnny Mercer, Gordon Brown and Frank Field, are now demanding that the government reconsiders the national rollout.

John Major has warned that UC could lead to a repeat of the poll tax debacle of the early 1990s, which saw riots against the then Conservative government.

A reader with a postgraduate degree was asked to look at these sections on a government-recommended benefits calculations site:

Work allowance for Universal Credit (Ed: able-bodied & childless need not apply)

If you/and or your partner are in paid work, you might be able to earn a certain amount before your Universal Credit is affected, this is called the work allowance. Your work allowance will depend on whether you are single or part of a couple and whether your Universal Credit includes amounts for housing costs, children and/or limited capability for work. The table below shows the different levels of monthly work allowance.

Universal Credit earnings taper rate

The Universal Credit earnings taper is a reduction to your Universal Credit based on your earned income. The taper rate sets the amount of benefits a claimant loses for each pound they earn. The earnings taper rate is currently 63%. This means for every pound you earn over your work allowance your Universal Credit will be reduced by 63 pence. To work out the earnings taper that applies to your award:

  1. Take your total monthly earnings figure after tax, National Insurance and relevant pension contributions have been taken off
  2. Deduct your monthly work allowance, which is the amount you can earn without your benefit being affected (if you are eligible for one)
  3. Apply the taper rate by multiplying the remaining earnings by 0.63

This is the amount that will be taken from your Universal Credit maximum amount when calculating your award.

Even the post-graduate reader found these instructions ‘far from simple’ and in no way producing a simpler and more effective system.

Esther McVey, the work and pensions secretary in charge of the scheme, confirmed last week that families will be poorer under UC. She did not deny reports that millions of families could be up to £200 a month worse off when it is fully rolled out.

The chairman of the Commons work and pensions select committee has described the project – running well behind schedule – as a “shambles, leaving a trail of destruction” and in its assessment this year, the National Audit Office doubted whether the system would ever deliver value for money.

Last year Leigh Richards commented on last November’s news: “ Even Scrooge might have balked at Universal Credit”.

The current Universal Credit system is NOT ‘fit for purpose’

 

 

 

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Can Britain afford to offshore ship building?

Cammell Laird, working to full capacity in 2012

Though Cammell Laird’s Birkenhead shipyard won two contracts this month, worth a total of £619 million, to provide spares, repairs and do maintenance work for the Royal Fleet Auxiliary over10 years, news of plans to axe about 40% of the workforce (290 jobs) by the end of March 2019, was given to union representatives and workers today (11th October).

The Unite union is demanding that Cammell Laird sets out the business case for cuts which will see the loss of vital skills and ‘backdoor casualisation’ of the workforce. It fears that the proposed job losses will undermine the shipyard’s ability to fulfil new contracts.

Unite’s assistant general secretary for shipbuilding, Steve Turner, said: “The loss of jobs at Cammell Laird would see skills gone for a generation and be a further blow to the UK’s shipbuilding industry . . . it is clear that the government must and can do more to support UK shipbuilding jobs. This must include the government stepping in and supporting the retention of skills and jobs while shipyards like Cammell Laird wait for new contracts to come on stream”.

Instead of ‘offshoring’, the government should be handing contracts to build the Royal Navy’s new fleet solid support vessels and a £1.25bn contract for Type 31e frigates (maritime security-focused platforms) to UK shipyards, using British made steel as part of an industrial strategy that supports jobs and communities across our four nations.

https://www.savetheroyalnavy.org/fleet-solid-support-ships-an-important-part-of-the-naval-logistic-chain/

Yesterday it was reported that MPs had urged civil servants (defence officials) to pick a UK company for the £1billion contract for three Fleet Solid Support vessels for the Royal Fleet Auxiliary. Commons Defence Committee chairman and senior Tory MP Julian Lewis feared that foreign firms subsidised by their governments could undercut British rivals.

Penny-wise, pound foolish?

The MoD’s director general for finance told MPs the department’s biggest concern was “what will deliver the greatest value for money”- meaning the lowest bid – a narrow perspective. But as Labour MP John Spellar pointed out, the Treasury would benefit from tax revenue ploughed into public coffers if the work was carried out in the UK  –  “a significant return” – which would be multiplied by work given to British steel and component manufacturers.

Steve Turner said that a failure to have these ships made in Britain would be ‘a gross betrayal of UK ship workers and regional economies, putting at risk manufacturing skills vital to our country’.

 

 

 

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Broken Britain 19: poor redress for war veterans damaged by government policy

At last, the case of people whose health has been seriously damaged caused by infected blood bought by a government agency is coming to the fore. But the plight of farmers, whose health suffered because government compelled them to use organophosphate sheep dips, is yet to be addressed – many affected veterans and farmers have died after long suffering.

OP-affected Richard Bruce writes: Dr Davis and Dr Ahmed wrote some informative papers on the subject. One may be read here: https://psychcentral.com/lib/what-is-functional-magnetic-resonance-imaging-fmri/

Allowed to sink into obscurity

In 1996 Defence minister Nicholas Soames confirmed that many of the soldiers returning from the Gulf War reporting fatigue, memory loss, weakness, joint and muscle pain and depression – a condition now known as Gulf War Syndrome, had been exposed to some sort of organophosphate pesticide.

From the archives:

1999: the US Government accepted that their veterans’ illnesses were mostly due to service in the Gulf. Of their 700,000-plus troops deployed there, 88% became eligible for benefits through their equivalent of the Veterans Agency and 45% had by then sought medical care. The US Government also accepted the extremely serious consequences of using organophosphates.

2000-2001: the UK government funded more research into the effects of organophosphate exposure and poisoning. The results of some studies provided support for the poisoning hypothesis but the research was delayed by the FMD outbreak and only completed in 2007.

2004:  A study published in the British Medical Journal: ‘Overcoming apathy in research on organophosphate poisoning, concluded that high rates of pesticide poisoning in developing countries and increasing risk of nerve gas attacks in the West mean effective antidotes for organophosphates should be a worldwide priority.

2008: the American government concluded an intensive study into the cause of “Gulf War Syndrome” Their $400,000 study found that OPs had causal responsibility for the harm inflicted. This finding was reported to the British Government by the Chief of Defence Staff [RAF].

Conflicts of interest: those campaigning for a ban on organophosphate pesticides have to face opposition from the agro-chemical industry, whose representatives sit on expert committees advising governments on pesticide safety.

As the Countess of Mar explained: There seems to be a nucleus of about 25 individuals who advise on a number of committees. The scientific community is very close-knit and because the numbers of individuals in specialties is small, they will all know one another. They are dependent upon one another for support, guidance, praise and recognition. If they wish to succeed, they must run with the prevailing ethos of their group, department or specialism Hansard 24 Jun 1997: Columns 1555-9

The Scotsman reported the findings of the 2004 independent inquiry into illnesses suffered by veterans of the first Gulf War which was headed by the former law lord Lord Lloyd of Berwick, called on the Ministry of Defence finally to recognise the existence of a “Gulf War syndrome”. It said that it was clear the cocktail of health problems suffered by an estimated 6,000 veterans were a direct result of their service in the 1991 conflict and urged the MoD to establish a special fund to make one-off compensation payments to those affected.

Is the long and inhumane delay due to the fact that the establishment of a link between Gulf War Syndrome and organophosphate poisoning would cost the MoD vast sums in compensation?

 

 

 

 

 

The Financial Times offers two perspectives on the shadow chancellor’s economic proposals

Earlier this month the FT warmed to the shadow chancellor. Following Jim Pickard’s first respectful report on any aspect of Labour policy, an article, by Jim O’Neill, chair of the Chatham House think-tank and former Treasury minister, had the headline, “The UK opposition steps into an economic void left by a government grappling with Brexit”.

 

Following a couple of caveats, O’Neill writes: “In at least six policy areas, which Mr Corbyn and his shadow chancellor John McDonnell are treating as priorities, businesses and the government need to catch up (detail here)”.

  • The first area on which Labour sees clearly is Britain’s productivity crisis.
  • Second is the orthodox belief that lower corporation tax will magically boost investment spending.
  • Third, risking large amounts of money on fixed investment no longer appears attractive.
  • Fourth, businesses need to rediscover profit with purpose.
  • Finally, there is the housing crisis.

But today there was a decided change of direction – had the editorial board been leant on?

THE EDITORIAL BOARD: Labour’s economic plans have serious flaws: shadow chancellor John McDonnell is ignoring the realities of modern business. The following – mainly speculative – points fail to convince:

  1. Mr McDonnell’s most eye-catching announcement was a compulsory share ownership scheme. Employee ownership and other profit-sharing schemes are by no means outlandish. Many businesses already choose to run them in order to recruit and motivate their workforce. There are also sound political reasons to give employees a greater share of ownership and a bigger voice on boards after a decade in which wages have remained stagnant in real terms. But companies should not be coerced into taking such action.
  2. Mr McDonnell claims these proposals are designed to tackle Britain’s productivity crisis – the evidence for this is sketchy and outdated.
  3. It could increase the cost of capital and deter investment.
  4. As the scheme would bear only on employers with more than 250 workers, it could also disincentivise growing businesses.
  5. There is a real danger that Labour’s prescriptions may end up only harming the patient.
  6. Businesses (and many voters) are concerned that the proposals on the table may only be the tip of Labour’s interventionist ambitions.
  7. With Brexit representing a step into the unknown, however, the UK needs to preserve business and economic stability, not further radical experimentation

Then a reversion to something approaching approval

“Nationalisation, dilution of shareholdings, workers on boards, sweeping trade union powers — John McDonnell’s economic prospectus for Britain is the Labour party’s most radical in several decades. The shadow chancellor further developed the party’s socialist credentials in his address to its conference in Liverpool on Monday. He senses that the appetite for change is great enough to take Labour into office on a hard-left ticket at the next election”. And: “Labour’s policies do speak to the mood of many voters. Many Britons believe inequality is growing, public services are collapsing and the excesses of capitalism need taming”.

Though not as wholehearted as the conclusion of former Treasury minister O’Neill:Dealing with the UK’s deep-seated economic problems requires sustained thinking and attention, not just occasional lip service. The Labour Party has stepped into the vacuum left by the government and appears to be offering the radical change that people seek.

End note: email from Moseley hit harder than the editorial board: 

  • Looking forward to a rise in the number of companies with 249 employees, if any stay in the UK, should the nightmare come about at the next election ( Ed: as share ownership proposals apply only to companies with over 250 employees).
  • The shadow Treasury team admits that private, unlisted companies could not be compelled to hand out dividends to workers. In theory that could incentivise public companies to delist from the stock market.
  • The next problem is that foreign-listed companies will not be obliged to hand equity to their UK workforces. Again, that could provide an incentive for London-listed companies to switch their listings to an alternative financial centre such as New York or Frankfurt.
  • Nor is it clear how the British government could force an overseas company with a London listing to comply with the scheme if most of its workers are abroad.
  • One group of workers who could feel aggrieved by the proposals are those in the privatised utilities such as rail and water. Labour is determined to nationalise the utilities, and admits that — as state workers — staff would no longer be eligible for the share scheme. At present a third of employees in United Utilities participate in their employee share scheme, as do two thirds of South West Water employees and 70 per cent of Severn Trent’s UK employees.
  • Another complication is that some companies could find alternative routes to rewarding shareholders, for example by carrying out share buybacks instead of dividends.

 

 

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Reinsurers: heed industry thinktank as droughts, floods, hurricanes and wildfires escalate

 

After a year of disasters (documented in detail here), the reinsurance industry travelled to Monte Carlo for its annual get together  (8-14 September).

Hurricane Irma was accompanied last year by Hurricanes Harvey and Maria, along with earthquakes in Mexico and wildfires in California. In all, there was $136bn of insured losses from natural and man-made catastrophes in 2017 according to Swiss Re, the third highest on record.

A report, “Climate Change and the Insurance Industry: Taking Action as Risk Managers and Investors”, was written by Maryam Golnaraghi, Director, Extreme Events and Climate Risk research programme for The Geneva Association, which is described as the industry’s leading thinktank.

It notes that following the adoption of the Paris Agreement, there has been a burst of initiatives and activities across a wide range of stakeholders to support the transition to a low-carbon economy (mitigation side).

Latest developments include:

  • growing but highly fragmented and in some cases conflicting climate policy and regulatory frameworks at national to local levels and across regions;
  • innovation in clean and green technologies, with some gaining market share;
  • rising interest in green financing, with efforts to reduce barriers to green investment on the part of shareholders, asset managers, standard-setting bodies and rating agencies, and growing demand for low-carbon commodities.

As well as building financial resilience to extreme events and other physical risks by providing risk information, improving distribution channels and payout mechanisms, Ms Golnaraghi reports that the insurance industry is supporting the transition to a low-carbon economy through its underwriting business, investment strategies and active reduction of its carbon footprint.

 

There is no reference to this support in the FTs report of the insurance industry’s response to escalating disasters, summarised as:

  • ‘a wave of merger and acquisition activity’ as insurers and reinsurers reconsider their business models,
  • some are ‘bulking up’,
  • others have decided to get out.

Reinsurance companies should call for immediate greenhouse gas mitigation efforts, as climate change continues to progress and extreme weather is becoming more frequent and dangerous and heed the Environmental Defense Fund warning that if these are not ramped up, last year’s unprecedented disasters may soon become the norm.

 

 

 

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Populus poll: public sensibly ignoring anti-Corbyn headlines

Brexit, Boris and Trump head the Populus poll which asked which news story, political or otherwise, the public have paid most attention to during the course of that week.

Will Clothier, a senior research executive at Populus, reports in The Times that no more than 5% mentioned the antisemitism story at any point in the past month. In fact, it has never been mentioned by more than 5% since hitting the headlines months ago. He comments (ruefully?):

“ . . . right now this simply is not a big story for most people”

Brexit was outdone though in the second week of the month by one of its architects: the former foreign secretary. His comments about the burka made him the most memorable story of the week for 27% of people.

In August, with Trump’s former campaign manager and his personal lawyer both implicated in financial crimes, the president became the British public’s top story of the week for the second time this year on 20%.

The public may well have seen through the barrage of baseless allegation and innuendo in reports permeating mainstream media. Is their ‘hidden agenda’ now so obvious to the 95% – and even counterproductive?

 

 

 

 

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Media 93: MSM downplays Britain’s role in the latest Yemeni killing & the BBC omits UN experts’ charge

Today, the BBC reports that UN Group of Regional and International Eminent Experts on Yemen will present a report to the UN Human Rights Council next month. It says that the experts believe war crimes may have been committed by all parties to the conflict in Yemen.

Yemeni government forces, the Saudi-led coalition backing them, and the rebel Houthi movement have made little effort to minimise civilian casualties and there have been attacks on residential areas in which thousands have died. The warring parties are also accused of arbitrary detentions, torture, enforced disappearances and recruiting children.

But the BBC failed to mention that the Group of Experts’ report notes that coalition air strikes have caused most direct civilian casualties. The airstrikes have hit residential areas, markets, funerals, weddings, detention facilities, civilian boats and even medical facilities.

Yemenis dig graves for children in the wake of the latest air strike

Lest we forget, the remote-sounding Saudi-led coalition is supported by UK arms sales (including cluster bombs manufactured in the UK) and technical assistance.  British military personnel are complicit – deployed in the command and control centre responsible for Saudi-led air strikes on Yemen, giving access to lists of targets.

The Saudi-led coalition struck last Wednesday and Thursday. Following the attacks on Wednesday, four families in northwestern Yemen, who had decided to leave their homes to avoid such danger, were in a vehicle when airstrikes hit again.

Though Britain’s mainstream media fully reported the killings of 9th August, a search finds no reference to those on the 24th.

CNN did full justice to this atrocity, recalling also that earlier this month, a Saudi-led airstrike hit a school bus carrying scores of boys in Yemen. The attack killed 51 people, including 40 children, according to the Health Ministry. CNN has established that the bomb used in that attack was a 500-pound (227 kilogram) MK 82 bomb made by Lockheed Martin, one of the top US defence contractors.

CNN adds: “There have been growing calls in the US Congress for Saudi Arabia, a key US ally in the Middle East, to do more to prevent civilian deaths in Yemen, where three years of conflict have taken a terrible toll”.

The latest news: yesterday, Barbara Starr, CNN Pentagon Correspondent, reports that the Pentagon has issued a warning to Saudi Arabia that it is prepared to reduce military and intelligence support for its campaign against rebels in neighbouring Yemen if the Saudis don’t demonstrate they are attempting to limit civilian deaths in airstrikes – adding “It is not clear if President Donald Trump, who views the Saudis as an essential ally, would agree to a reduction of support”.

 

But, like the proverbial three monkeys, the failing British government hears, sees and speaks no evil.

 

 

 

 

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Conservative commentator: ‘Cosying up to big donors’ is not a ‘good look’: many a true word spoken in jest

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In the Times today, Tim Montgomerie,  co-founder of the Centre for Social Justice and creator of the Conservative Home website warns: “Tories must beware cosying up to big donors . . . the dependence of the party on chief executive chequebooks is bad politics and makes it vulnerable to populist entryism”

He cites the persistence of Jeremy Corbyn’s support despite the media onslaught, commenting that voters who are desperate for a new economic settlement seem (bewilderingly) willing to forgive or at least overlook (alleged) weaknesses that would have been electorally fatal until recently.

He points out the surge in revenue from Labour’s half a million or so members, which means that the party is getting almost as much money from individuals as it receives from the unions and continues: “The Tories enjoy no such diverse spread of funding”.

While “Corbyn’s coffers” were filled with £16 million of funds from individual supporters, the 124,000 Tory members contributed less than £1 million to their party’s treasury. Over £7 million came from ‘high-net-worth donors’ and big gifts came from dining clubs, at which rich individuals are able to sit down with Mrs May and other cabinet ministers. Montgomerie continues:

“Chasing high rollers has at times led the party to become entangled with former associates of Vladimir Putin. That is not a good look”.

Mrs May’s successor and the nation’s prime minister will be chosen by party members but Montgomerie sees the danger of ‘entryism’. Arron Banks, the businessman who financed Nigel Farage’s Brexit campaign has launched a drive to recruit 50,000 Ukip-inclined supporters to join the Tories.

The support for capitalism is not what it was and deservedly so

Montgomerie advocates building a broad and diverse membership which understands that things are different from the 1980s, when Margaret Thatcher reaped great political rewards from being close to the nation’s wealth-creators:

  • The banks have paid an estimated £71 billion in fines, legal fees and compensation since the 2008 crash.
  • Inflated house prices owe much to the power of a few major builders to restrict the supply of new homes.
  • The service of some privatised railway companies is poor.
  • The pay awards enjoyed by many leading chief executives are unjustifiable.

He adds that the Tory mission today should be the protection of the “little guy” from any concentration of power, whether in commerce, media or the state

He comments “There are some signs that the government gets this”; the apprenticeship levy for example, which is attempting to address “the decades-long failure of British industry to invest in the skills of their workforces”.

Montgomerie concludes that British politics is not corrupt but distorted

By accepting funding and spending so much time with donors from the City and with property developers, the Tories are in danger of being held back from building an agenda that is less southern and more focused on consumer empowerment than producer privilege.

He and his ilk are incapable of understanding the persistence of Jeremy Corbyn’s support despite the media onslaught. Those voters who are ‘desperate for a new economic settlement’ also recognise the character of the man, whose policies are based on justice, not perceived electoral advantage.

The last word is given to Andrew Scattergood (FBU) who sees more clearly than Montomerie: “Jeremy Corbyn has, since first elected as leader, established himself as by far Labour’s best leader, perhaps since Keir Hardie, representing the aims and values of the vast majority of the party membership”.

 

 

 

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A final nail in the coffin of successive governments’ love affair with PFI?

Keep Our NHS Public Birmingham (KONP) says, “It looks like we’ve won our campaign for a publicly-funded (non-PFI) Midland  Metropolitan Hospital in Smethwick/West Birmingham!”

The construction of the Midland Metropolitan Hospital in Smethwick collapsed after Carillion crashed spectacularly in Jan 2018 leaving the hospital half built. Then the bankers behind the ‘private finance initiative’ pulled the plug on the deal.

KONP Birmingham immediately organised a protest outside the hospital site demanding that the Treasury, health ministers and the Government should fully fund the hospital and run it properly under government and NHS control! Supporters included Birmingham TUC (BTUC), Unite the Union West Midlands, Unite the Community Birmingham, West Midlands Pensioners Convention and Birmingham Against the Cuts.

A month later, the Sandwell and West Birmingham Hospitals Trust Board voted to tell the Government that the only viable option for the completion was direct government funding, a full vindication of the KONP Birmingham campaign argument.

The Government and Hospital Trust has now reached an agreement to finish construction work with the Government providing funding for the remainder of the building work at Midland Metropolitan Hospital – which will see the new hospital built by 2022.

Birmingham Against The Cuts (BATC) says: “We believe that the Midland Met fiasco is a final nail in the coffin of successive governments’ love affair with PFI /2”

BATC gives a very cautious welcome for a publicly funded Midland Met Hospital in Smethwick/West B’ham (no PFI!) and expresses its  continuing concerns:

Firstly, there is a delay in starting completion until early summer 2019, partly because the half built hospital was rotting away without any protection for 6 months and an additional £20m worth of work will have to be done from this September.

Additionally, the Hospital’s Trust Board Chief Executive has been dropping in phrases to his announcements such as “making cost improvement programmes above national norms”, “limited reconfigurations”, etc, which reflect the concern in Dr John Lister’s 2016 review (right) of the privately financed hospital published by KONPB and BTUC when the Midland Met was first mooted.

Keep Our NHS Public Birmingham Secretariat will continue campaigning to defend the NHS and BATC will share news of government cuts, the implications and alternatives.

 

 

 

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