The profit motive can protect the public

Published by The Daily Telegraph (20th June, 2017)

A few years back I boarded a flight from Djibouti to Somaliland. The Russian-made plane was five decades old. As I sat down, I found my seat was broken and flopped back. But at least I had a seat belt, unlike the passenger next to me. Or indeed, the caged chickens clucking anxiously in the aisle as we waited for takeoff. My nerves were not steadied by seeing the two young pilots chatting outside in shorts, shades and flip-flops.

Such flights would not be permitted in this country. The aviation industry may be highly competitive but it is also tightly regulated and permeated by a culture that views safety as paramount. Such is the sector’s success that a report last year found that the number of annual fatalities almost halved over two decades while the number of global flight hours more than doubled. This is a remarkable achievement.

So it was interesting to see Labour leader Jeremy Corbyn point to this industry as a model, contrasting it favourably with public sector failings exposed by the Grenfell Tower disaster. He praised the way airlines routinely find beds for stranded passengers, demanding similar support for victims of the fire. ‘It seems to be beyond the wit of the public services to deal with the crisis facing a relatively small number of people in a country of 65 million,’ he said.

He was right. The official response was disturbingly sluggish, excluding the heroic emergency services, while the aviation industry tends to perform well when hit by problems despite occasional headline-grabbing hiccups. Airlines know passengers can take custom elsewhere. In Europe we have lower fares and profits but better services than America, the result of regulators working hard to boost competition.

This shows efficiency, safety and decent service are not mutually exclusive, while the profit motive can protect the public. Yet suddenly the private sector is on back foot, under attack from both the Tories under Theresa May and from Labour under the hard-left Jeremy Corbyn. He has raised the spectre of nationalisation again for rail, while demanding ‘occupation’ of empty homes for Grenfell families. His sidekick John McDonnell blames ‘speculative gain’ for the housing crisis, not state failure to build enough new homes along with stifling planning restrictions on private firms such as the greenbelt.

Even the moderate left has been infected with antipathy to the private sector in housing, despite its leading members no doubt heading off to rented Puglian villas for their summer holidays. ‘Grenfell Tower will surely endure as proof there are some aspects of our lives that do not belong in the realm of profit,’ wrote one normally sensible Guardian columnist. This is the inevitable extension of hostility to the private sector in schools and health care, although there are more preventable deaths in a day in Britain’s health services than there are fatalities over the course of an average year in the worldwide aviation sector.

Both private and public sectors can make lethal mistakes. There is nothing intrinsically safe about the state, as seen with deadly failures under British Rail and more recently a series of shameful national health services scandals involving silencing of whistleblowers, shoddy management and bureaucratic inertia. Nor is there anything intrinsically risky about private firms, although there must be good regulation in areas of public safety. Sadly while the left promotes public handouts with fresh vigour the right seems to have lost any will to defend market forces.

There is one key lesson from airlines on safety: the laudable effort to develop a blame-free culture that encourages reporting of concerns. This was seen also by rail safety chiefs after the Ladbroke Grove rail crash left 31 passengers dead and 400 injured close to where that charred tower block now haunts Britain. Yet look at how posturing politicians instantly jumped on the Grenfell disaster with wild accusations and speculation.

Clearly there have been gross failures at Grenfell. But we do not know yet if the state, the local authority, the management group or private building contractors were culpable. Maybe they all made mistakes. Yet while Corbyn is right to highlight how airlines efficiently house delayed passengers, they also show profit-chasing firms can protect public safety – and the dangers of an ill-informed blame game, not least by politicians exploiting tragedy.


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