Since the days of Thatcher ‘cost savings’ has been a buzz-phrase that has been bandied about by politicians and captains of industry alike. Yes you can on occasions buy the same product or service cheaper (although face value isn’t always a correct measure), and yes you can occasionally change a working method to a more efficient approach, but it is my opinion that these are the exception rather than the norm.
There are some that say never trust any politician. I’m not that cynical, I’m sure that the majority are trustworthy upright citizens. But, what I will say is, don’t believe a politician that tells you they can make cost savings in government, because they rarely can. Think about what cost or efficiency savings really mean. They mean either just not doing the job or getting someone else to do the job for less money. Don’t forget that there are associated costs in taking this type of action:
- First there is the cost of the consultation with existing employees
- Then there is redundancy payments
- Then there is the cost of outsourcing the existing service, if applicable
- Then there is the new service to pay for, if applicable
- Plus, don’t forget that there’ll be the feasibility studies to be carried out prior to any changes and the inquiries after the changes to find out what has gone wrong. These all cost money
Another myth is that private companies can do the job better, for less money and make a profit. This is essentially cobblers, and involves the maths of cloud cuckoo land. I’ve been employed in private companies all my working life. Rarely are they efficient, nearly always they exploit. They make a profit by exploiting workers and suppliers alike. Morally it’s wrong, but putting aside the morals of worker exploitation it doesn’t make sense financially. Exploited worker pay less tax, will often need other social payments and benefits, and are less likely to take much pride in their work, especially if they have previously been employed at a higher rate or were on a more generous benefits package. You really do not get something for nothing
Cost savings = some poor sod losing their job and another poor sod being paid a pittance (that could well be the same person)
Efficiency savings = cutting corners and producing shoddy work
A similar principle applies when buying products/things.
The age old adage ‘you only get what you pay for‘ needs to be remembered more often than it is.