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Discuss the implications that the move from public to private sector has…
Discuss the implications that the move from public to private sector has had on the balance of employment in Civil Engineering, for engineers in particular and society in general.
INTRODUCTION
Private Finance Initiatives (PFI) – A way of funding capital investments without immediate recourse to the public purse. Contractors are contracted to design, build, and sometimes manage new projects.
Public Private Partnerships (PPP) – Umbrella for initiatives that involve the private sector in the organisation of public sectors.
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PUBLIC TO PRIVATE
Traditionally the major civil engineering client has been the government. Government employed Engineers designing and managing projects.
Priorities on public sector funded/designed/managed projects may be different to private sector projects. Private companies primary objective is to make money, public sector's primary objective to get a good quality project implemented (?).
With financial considerations not the main objective public bodies will, arguably, waste money. With employees of private companies more accountable (eventually to shareholders etc) theoretically less money will be wasted, resulting in cheaper all round solution for the government.
Government does not have to fund major projects, therefore reducing borrowing requirements.
Employment of private companies removes risk from the government and places it with the private company.
Result is an increase in private companies designing building funding and operating projects (Private Finance Initiative PFI/DBFO or similar).
Creation of regulator roles to ensure that monopolies are not created and the government is not held to ransom by the private operators.
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PRIVATE SECTOR
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Specialists in both design and construction, geology etc
ENGINEER
Need to keep up to date with changing techniques as specialists no longer able to sustain an entire career; CPD assists
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Transfer of risk to private sector, thus engineers need to understand all consequences of actions – contractual, financial, etc. – over whole life
EMPLOYMENT
With PFI projects it is no longer necessary for public bodies to employ as many engineering personnel.
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Commercial awareness far more important (?) Private companies have a responsibility to make profit and therefore engineers need to be financially aware to allow this to happen.
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CONCLUSIONS
Perception that public money is now ending up in the pockets of highly paid directors of private companies. This may be true but, if it is less money than wasted when projects were under public sector control, it is then more money should be available for other public services.
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