Nationalisation vs. Privatisation
There is a big debate as to which is the best for the NHS. Nationalised industries are funded by the government and tax payers money and do not strive to make a profit. However privatised industries were previously owned by the government but are now in the private sector and therefore have different aims and objectives for example making a profit.
privatisation does not have to mean complete private ownership of an entire industry. Here are some examples of privatisation and how some weren’t completely “sold off”
-BT (government retained 49.8% of shares)
-Jaguar Cars (sold from British Leyland)
-Railtrack and train operating companies (franchisees)
There are reasons for both nationalisation and privatisation
Reasons for Nationalisation
- political
- post-war reconstruction
- public interest - liquidation
- employment
- Monopoly power and ‘natural’ monopolies -excessive profits will be regulated.
Reasons for Privatisation
- A dislike of public ownership
- Aim to make a profit rather than just offer a service.
Stakeholders
Without realising most people throughout the world are stakeholders in different things. They either are stakeholders or were at some part of their life. You can be a stakeholder just by purchasing something from a local shop, you are a customer. You do not only have to be a stakeholder by just being a customer there are many other things that could make you a stakeholder. These things include:
- Customers
- Employees and managers of the business
- Shareholders
- The local community
- The government
Each business has stakeholders in some form. Different businesses have different ones depending on the type of sector they work in and the materials they produce.
Here is a spider diagram of some of the stakeholders that the NHS is likely to have.
Why each of these is a stakeholder
General public
These will be interested in the NHS because they are the people paying taxes in order to receive treatment through the NHS. if health care was provided in a pay as you need style service then it could prove costly and wouldn’t be suitable to people who are poor. For example if you were to fall ill and needed treatment then you may not be able to afford the treatment needed to make you healthy again. Basically the general public is paying for the treatment and that is why they are a stakeholder because they want to see their money well spent.
Local community
The local community are interested in the area they live in and what happens in those surrounding areas that affect the way that they live their life. For example if a huge super hospital were to open in a low employment rate area then it would have positive effects on the employment as their will be numerous posts available.
Suppliers
The suppliers supply the hospitals with all of the necessary equipment such as heart monitors, defibrillators etc. without them then hospitals would struggle to run effectively. Suppliers will be interested in the NHS because they are the source of income for them, without that contract then it could lose the suppliers a lot of potential money. For example if the way that the NHS was run changed then the new owners may decide to change suppliers.
Private healthcare i.e. bupa
Private healthcare is growing rapidly throughout the UK. More and more people are paying to go private with companies such as BUPA who promised to cut waiting lists and offer better treatment. At the moment the NHS are making numerous redundancies and therefore these private healthcare businesses will be interested in ‘poaching’ these recently redundant staff to work private for them. This also extends to sometime these private hospitals tempting existing NHS doctors to go private in return for a higher wage. Another interest that private health care has in the NHS is waiting times and lists. If they are long then they can use this as a feature as to why people should go private and pay for care rather than wait for the NHS.
Local and central government
Banks
The banks supply money to the NHS, it is vital to them that they get the money back that they lent. Therefore they are interested in how well the NHS is operating to forecast how long and how easy it will be to get this money paid back. The NHS need to ensure that they look to be running efficiently to reassure the bank into lending more money because hospitals are constantly needing more and more money to be spent on refurbishing and renovating outdated hospitals and to purchase all of the latest equipment to provide better care.
Local and central government
These are interested in the NHS the same way as the general public is. They supply the NHS with money to fund the whole business and to be able to provide a health service to the whole of the UK. The government acts as a byway between the hospitals and the general public and inform us of the things that are going on in the NHS
Consultants/Doctors
These are the staff that work at the hospital who provide taxpayers with the care they need. They work in hospitals on a day to day basis and are vital to ensure that the NHS runs efficiently and effectively. Doctors and consultants are irreplaceable in today’s standards and are becoming scarce. Therefore it is unlikely that they would be made redundant. However with the state of the NHS at the moment, they may not be able to afford to replace and people that decide to retire. Therefore the interest that these stakeholders have in the NHS is basically because they are the employer and the people supplying them with a wage.
Management
The managers are the stakeholders that have a real say as to how the NHS is run. As well as the government, managers have control over what happens in the NHS. It is up to management and the government how taxpayers money is spent; if it is spent inappropriately then it could cause uproar in the general public because their money isn’t being spent properly.
Overseas visitors
Overseas visitors includes people visiting the UK for a holiday. They would be interested in the type of care that they are likely to get if they were to fall ill on holiday. Because the NHS isn’t private then they would treat overseas visitors. However if the UK had a totally private care service then visitors would have to take out a private health care plan just to visit the country which wouldn’t encourage people to visit the country.
Nurses/Ancillary staff
These are the staff in the hospitals that are generally working under the doctors and keep the hospital running and ensuring that everything is in good working order. This stakeholder will be most affected if redundancies were announced as they are the most vulnerable, because they are not all needed in the eyes of the NHS.
Conflict between stakeholders and financial performance
Here is what could happen if the NHS became a private company. A scenario could be if the managers/government announced redundancies because they are having a staff refit for the new ownership.
Announce redundancies -
Conclusion
The NHS is currently in a major predicament and is undergoing major changes. This includes privatising some hospitals; which in turn affects the stakeholders of the NHS. in my opinion all of the stakeholders in the NHS are influential to the running of the hospitals throughout the UK. They can all affect the way that the NHS is run by changing the way that they act and way that they think. For example if employees i.e. doctors, nurses and ancillary staff were all persuaded to work for private health care companies for a higher wage then the NHS would be left with an employee shortfall that would leave them unable to effectively treat patients. This in turn would cause the government (which in my opinion is the most influential stakeholder because they are the people that set up the NHS and have the biggest say in how it is run) to stop and think that they must be doing something wrong for all of these employees to leave. Furthermore, if this crisis of doctors and nurses leaving results in deaths because of there not being enough people to treat patients, then it could cause bad publicity towards the NHS because people are dying because of the problems being caused. To sum up, I think the most influential stakeholders are the doctors and nurses and the government, because they are the people that cause the greatest problems if they were to change the way they act. Having said this I also believe that the nurses as a stakeholder are the most vulnerable because at the moment the NHS cannot afford to pay every nurse and are therefore making redundancies, thus causing unhappy stakeholders in both the nurses and the general public who may receive inferior treatment because of these cutbacks.
