Friday, 10 July, 2020

During a global pandemic, we need real development, not dividends for corporations

Unsurprisingly, Covid-19 has shone a powerful light on society. In many ways, inequality itself is the virus and the pandemic is merely the latest in a range of catalysts that have exacerbated its impacts. One thing is for sure: those in the poorest communities are more at risk, as we know from the data here in the UK. We have all seen how vital our public services are to society’s health and wellbeing.

Health inequalities have been highlighted by Covid-19, as the links between low incomes, job insecurity, ethnicity, gender and poverty have all come under greater scrutiny. Access to education, one the key drivers of inequality, has also been under the spotlight – as we see the huge gulf between many of those in fee-paying schools where it’s more or less ‘business as usual’, and those with no access to broadband, devices or school support. It’s a recipe for a lost generation. 

But shocked as we are at what we see before our own eyes, here in the UK, with over four million children living in poverty, and demand at food banks increasing at a shameful rate, we must not forget what is happening in the global south. They are fighting the pandemic with both hands tied behind their backs, even as they fight a third enemy – profit-seekers.

Here in the UK, even the previous Chancellor of the Exchequer, Phillip Hammond, rowed back from Public-Private Partnerships. They put our public services in the hands of private companies, whose aim is to produce profit to give shareholders their dividends.

Clearly, this was a discredited policy, pursued by governments of all hues, and now deemed not fit for purpose (they spawned a multitude of failures you can read about in our report, Finance Development not Dividends). And yet this failed system is being exported to the global south, as part of our aid system, guarantees for companies building infrastructure are replacing direct aid, alongside a further financialisation of public services. Hospitals, schools, bridges are more are being built by private companies, seeking to make profit from some of the poorest people in the world to pay dividends to some of the richest people in the world.

In a time of global pandemic, access to public services that are free at the point of access is even more crucial. As revealed in our new report – summarising research from Global Justice Now and the National Education Union – DFID has spent millions from the aid budget on promoting and supporting privatised education in the Global South.

In Pakistan alone, over £100m was channelled through for-profit businesses to deliver education services since 2016. However, this financial extraction is only one of many extreme forms of inequality. The merger between the Department for International Development and the Foreign and Commonwealth Office will make scrutiny of aid far more difficult. It’s time to resist to the privatisation of public services around the world.

Dr Wanda Wyporska is Executive Director of The Equality Trust.

This blog was originally published in Left Foot Forward.