Paying more with privatization | National Union of Public and General Employees

Paying more with privatization

“When people pay taxes, they want the money to go to public services, not to push up corporate profits or executive bonuses." — James Clancy, National President of the National Union of Public and General Employees (NUPGE). 

Ottawa (13 Feb. 2015) — A recent Global News report revealed that privatizing food services in Saskatchewan correction facilities will increase costs.

Using data from provincial justice ministries and Statistics Canada, Global found that where food services in correctional facilities have been privatized those provinces are paying more. In Alberta, the cost is 59.4 per cent higher, while in B.C. the cost is 41.4 per cent higher.

Higher costs pay for $1.7 billion in corporate profit

That’s no surprise. With privatized services, the public are paying for things like corporate profits and CEO's salaries.

Compass Group Canada, the company that operates food services in correctional facilities in Alberta and B.C., had an after-tax profit of $1.7 billion in 2014. Its CEO was paid $12 million. And people in Canada, and in other places where Compass operates privatized services, paid for those profits and CEO compensation.

“When people pay taxes, they want the money to go to public services, not to push up corporate profits or executive bonuses," said James Clancy, National President of the National Union of Public and General Employees (NUPGE).

Privatizing correctional food services puts safety at risk

As a fact sheet by the Saskatchewan Government and General Employees' Union (SGEU/NUPGE) points out, higher costs aren’t the only reason to keep food services in corrections public.

There have been serious safety issues in many places where food services have been privatized. In a correctional setting, workers in food services are working with inmates in high-risk environment. Public employees get training, and have experience. People working for private contractors can’t count on getting that training and higher staff turnover in privatized services means they often don’t have the experience.

Private companies cutting corners on food and hygiene also affects safety. In the United States there have been several violent incidents sparked by the poor quality of food or inadequate portions provided by privatized food services.

Nova Scotia residents should be wary

Compass Group also wants to run food services at Nova Scotia hospitals. If having Compass Group providing food services in corrections costs more than providing them publicly, there is good reason to question whether privatizing food services at other public institutions will save money. 

Corporate confidentiality means information about the real cost of privatized services is often kept secret. This means that when it is possible to verify the information used in a comparison of the cost of public services with privatized ones, we need to pay close attention.

More information:

NUPGE on privatization

NUPGE

The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE

 

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