And so to the big question. The one that has dogged us ever since the EU referendum and haunts every Brexiteer’s chlorinated daydreams. What is Britain for? Cliche-mongers will tell you that Britain lost an empire then couldn’t find a role. They are wrong. After careful study of recent newspaper articles, I have discovered just that new part – and today, dear reader, I am going to share it with you.
The British are now world-beaters at paying other people to rip them off. We are number one at handing over cash to “investors” who do no investing, to “entrepreneurs” who run monopolies – and who then turn around and tap us up for a bit more on the way out.
Consider two stories from the past few days. British Gas announces its electricity prices will rise by 12.5%, starting next month. Just as the cold nights start drawing in, more than 3 million Britons will find their bills are more expensive. Never mind that the competition watchdog judged last year that British Gas and other energy giants were taking well over a billion pounds a year through “excessive prices”. This privatised industry has a tradition of ripping off loyal customers to uphold.
Think about the scandal of people having to pay huge ground rentsjust to stay in their own homes. For years, big property developers have been flogging the freeholds on newly built estates to speculators, often based offshore, whose only relationship with the people living there is to hit them with ever-larger bills. Tens of thousands of families have been bundled up and turned into human revenue streams. Nor are they alone. Whether as taxpayers or consumers, pretty much everyone in Britain is now human feedstock for Big Capital.
This may not be how you see yourself. After all, you’re a customer and in our dynamic, choice-stuffed markets the customer is king. Except that the propaganda doesn’t match reality. If, like me, you live in London and use water, you are forced to give your business to Thames Water. The same Thames Water that is owned by a consortium of international investors, whose interests were until recently managed by Macquarie, an investment firm with headquarters in Australia. I have reported before on this arrangement, which ran from December 2006 until March of this year. Between 2006 and 2015, Thames Water divvied up £1.6bn in dividends to its small circle of shareholders, who in turn loaded up the company with billions in debt.
These “investors” were not doing much investing – indeed, they will shoulder neither the costs nor the risks of building London’s £4bn super-sewer. Much of the money will come from me and Thames Water’s 15 million other customers, through our bills. Between 2011 and 2015, the company paid no corporation tax at all. Someone bagged a bargain, and it wasn’t the taxpayer.
Think about the train operators that are subsidised to the tune of billions by public money – only to penalise the public with eye-watering fares and crap broadband. We pay them to rip us off. Ponder the new nuclear station about to be built by the Chinese and French at Hinkley Point, at an estimated cost to British households of £30bn. Neither David Cameron nor Theresa May would countenance the British government creating a new power station, but they will pay way over the odds for foreign governments to do so.
Want more examples? Think about the giant outsourcing industry, where a multinational such as G4S can fail to lay on enough guards for the 2012 London Olympics and charge taxpayers for phantom electronic tags on dead criminals – and still be put in charge of securing the Royal Mint.
In the early 00s, the Mail and the Express would bang on and on about “Rip-off Britain” and how booze and fags and Levi’s jeans were cheaper abroad. Right under their nose a rip-off industry was getting started in the form of the private finance initiative. Tony Blair saw the arrangement as a way of funding more schools and hospitals without raising taxes or taking on public debt. As York University’s Kevin Farnsworth points out, PFIs also served an ideological purpose. “Try getting change in… public services,” he once chortled to a conference of private equity financiers. “I bear the scars on my back.” PFI – putting the private sector in charge of providing public infrastructure – was one of his ways of getting that change.
Almost two decades later, we can see the results. PFIs have produced more fleecing than Millets. A PFI primary school in Middlesbrough, only opened in 2006, was demolished in 2015 because its foundations had been built on “defective fill material” – literally, dodgy ground. Children and staff moved to another site – nevertheless, payments on the contract had to be made. In Liverpool, a PFI school has been shut since 2014 – because there aren’t enough pupils to keep it open – yet taxpayers still pay £12,000 a day under the contract. These aren’t one-offs: they are inherent in the structure of PFIs, which dump all the risks on the public and hand the private sector all the rewards.
As the TES (formerly the Times Educational Supplement) found in April, one PFI school in Bristol that needed a new window blind will have to pay £8,154 for it. Another that had to install a tap is facing a bill for £2,211. Private companies get paid for the building, then get paid again for cleaning and maintenance and interest charges. Across the UK there are more than 700 PFI projects with a capital value of around £55bn. It is estimated that they will cost the public more than £300bn.
These are all examples of the public losing control – over our bills, over our taxes, over our water and trains and schools. Will freeing ourselves of the shackles of the European court of justice or EU state aid rules or any other Brexiteer hobbyhorse allow us to “take back control”? On the basics that govern our lives we have lost sovereignty. Brussels didn’t sell us down the river: Thatcher, Blair and Cameron did.
Leaving the EU won’t change any of this. Theresa May will continue to privatise chunks of the NHS. Philip Hammond will still flog Britain to foreign capital as a bargain basement of cheap workers and low taxes – one giant Poundland. And Britons will find more and more aspects of their daily lives picked over by big businesses for revenue streams.
• Aditya Chakrabortty is the Guardian’s senior economics commentator