Iron City
3rd Aug 2005, 14:52
Just saw a report from the U.S. Government Accountability Office (GAO) comparing pre and post privatization (or semiprivatization in the casse of the UK and FRG) of air traffic service provideers. It is a 50,000 foot view but provides some box scores (or league tables) for comparison and draws some general conclusions but no recommendations or determination of good or bad.
URL is http://www.gao.gov/cgi-bin/getrpt?GAO-05-769.
BEXIL160
3rd Aug 2005, 20:20
Fe City, thanks for the heads up. Looks to me very much like George W's spin doctors work.
Some, admittedly selective, quotes and comments:
In the UK, NATS reduced its net operating costs by almost $161 million
from 2002 through 2004, in part through direct management actions,
according to its audited financial statement. For example, it consolidated
two operations into one at a new air navigation services center, called the
Swanwick Center. According to NATS, after placing this new center in
service, it reduced its staff costs by nearly $20.1 million and its costs for
services and materials by about $18.5 million between 2002 and 2003.
Nope. Direct management actions? If only. LACC is still the London ACC only. TC (TRACON) does not arrive until 2007 (at the earliest). Opening Swanwick actually turned NATS from a Three Centre Operation to a FOUR centre operation. No reduction there I'm afraid.
The opening of Swanwick can in no way whatsoever be described as a glowing achivement. Way over budget, time scale, very POOR training and (at the time) little increase in traffic capacity over what already existed.
Some countries that commercialized their ANSP had difficulty retaining a
sufficient number of staff to carry out safety regulation.
and
CAA managers with
responsibilities for regulating the safety of NATS’s operations also raised
concerns about recruiting staff.
VERY TRUE. Without a robust regulator, with expert staff the privatised ANSPs could do very much as they please. Do they? Probably not, because corporate litigation disuades them somewhat.
Not mentioned anywhere is the REAL reason behind NATS part privatisation.
Money.
You see, Conservative Government spending plans before 1997 included £650m from the proposed sale of NATS, a sale that the then opposition, the Labour Party, was against. "Our Air Is Not For Sale" they assured all and sundry.
Then Labour come to power in May 1997. Gordon Brown, the chancellor, gets into the books and realises he HAS to stick with the previous governments spending / borrowing plan (Prudence, dear prudence.. remember?). Oops! In the small print is £650m from the sale of NATS, money already allocated elsewhere.
Suddenly "Our Air" is for sale again. John Reid (Transport Secretary) wheeled out to lambast all and sundry as to why this is a good idea without mentioning the big wedge of cash Gordon needs to balance the books.
Big Idea. Sell it on the idea that NATS desperately needs investment cash for "future projects". Not strictly true, but a good fudge. A simple re- write of treasury rules would have enabled NATS to borrow as much as it needed, at commercial rates, much as it does now, and still remained a public service provider
The only pressure to sell NATS was from the treasury, who had already spent the money from the sale. Don't let anyone tell you different.
............................
So, Privatisation, Good or Bad? The veritable Curate's Egg I believe.
Actually in NATS' case it seems to have worked out mostly for the better. Things actually get done now, and most of the pisspoor managers have gone, those that have truly f**ked up in past must know their cards are marked also. A Good Thing.
Bad things? Managers who have little concept of ATC (any aspect of aviation) dreaming about the future. Fortunately, most of them are fast learners.
Rgds BEX