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"It is crystal clear in its analysis and in its rejection of a model that has been proven NOT to work."—Rosa Pavanelli, General Secretary of Public Services International
Geneva (29 Oct. 2018) — A new report on Extreme Poverty and Human Rights finds that "widespread privatization of public goods in many societies is systematically eliminating human rights protections and further marginalizing those living in poverty."
Public Services International (PSI) welcomes this ground-breaking report. "It is crystal clear in its analysis and in its rejection of a model that has been proven NOT to work. PSI has repeatedly called to put a stop to these funding mechanisms by the international financial institutions before they increase inequalities even further. This report will certainly be helpful in pushing for an open debate at the UN on the impact of privatization and whether PPPs are truly fit for purpose," says Rosa Pavanelli, PSI General Secretary.
No regard shown for impact of privatization on human rights or on the poor
Philip Alston, the UN Special Rapporteur on extreme poverty and human rights, criticized the extent to which the World Bank, the International Monetary Fund, and even the UN itself have aggressively promoted widespread privatization of basic services, without regard to the human rights implications or the consequences for the poor. He also criticized human rights groups for not responding strongly enough to the resulting challenges.
“Privatizing the provision of criminal justice, social protection, prisons, education, basic healthcare and other essential public goods cannot be done at the expense of throwing rights protections out of the window,” Alston said.
“States can’t dispense with their human rights obligations by delegating core services and functions to private companies on terms that they know will effectively undermine those rights for some people.”
He noted that while proponents present privatization as a technical solution for managing resources and reducing fiscal deficits, it has actually become an ideology of governance that devalues public goods, public spaces, compassion and a range of other values that are essential for a decent society.
“While privatization’s proponents insist that it saves money, enhances efficiency, and improves services, the real world evidence very often challenges or contradicts these claims,” Alston said.
Place priority on profits instead of human rights
Privatization is premised on fundamentally different assumptions from those that underpin respect for human rights, such as dignity and equality, he said. It inevitably prioritizes profit, and sidelines considerations such as equality and non-discrimination. Rights-holders are transformed into clients, and those who are poor, needy, or troubled are marginalized or excluded. Human rights criteria are absent from almost all privatization agreements, which rarely include provisions for sustained monitoring of their impact on service provision and the poor.
“Existing human rights accountability mechanisms are clearly inadequate for dealing with the challenges of large-scale and widespread privatization,” Alston said. “The human rights community can no longer ignore the consequences of privatization and needs to radically reconsider its approach.”
Human rights actors should start by reclaiming the moral high ground and reasserting the central role of concepts such as equality, society, the public interest, and shared responsibilities, while challenging the assumption that privatization should be the default approach.
“The human rights community needs to develop new methods that systematically confront the broader implication of widespread privatisation and ensure that human rights and accountability are at the centre of privatization efforts,” Alston said.
There appear to be no limits to what states have privatized, he said. Public institutions and services across the world have been taken over by private companies dedicated to profiting from key parts of criminal justice systems and prisons, dictating educational priorities and approaches, deciding who will receive health interventions and social protection, and choosing what infrastructure will be built, where, and for whom, often with harsh consequences for the most marginalized.
“There is a real risk that the waves of privatization experienced to date will soon be followed by a veritable tsunami,” Alston said.
Privatization of social protection often leads to a focus on economic efficiency concerns that aim to minimize time spent per client, close cases earlier, generate fees wherever possible, and cater to those better-off, pushing those with less resources and more complex problems to the margins.