Latest article by John Blundell in The Scotsman

WE ALL have items in our mail that score high on the pleasure scale. At the opposite end of happiness are those buff envelopes from Her Majesty’s government.

Whether it be an income tax demand or any other distressing intrusion, HMG does not spread much joy.

Among the envelopes I am thrilled to see every month is one marked “Gardena, California”. It is a curious and energising newsletter called Privatisation Watch.

This upbeat publication scours the world for examples of where contracting out, opening to competition or outright sale of state assets turns dross into gold. The latest September issue amazed me with the details of the authorities in Iraq contracting a US firm called Skylink to run all of Iraq’s airports.

It was lucky the Prophet, peace and blessings be upon his name, lived before aircraft were invented… so his evangelists have no Holy texts banning flying, as they do debts or drink. It is plain, on first principles, that a modern airport contractor must be able to do better than Saddam Hussein’s system. I suspect a great deal of good things are happening in Iraq, but we only ever hear of bombs or bullets.

I praise Privatisation Watch not just for the good writing but also for the useful insights it offers every Scottish company. There can scarcely be a firm in Edinburgh that could not apply experiences from it.

We all know that everything Scottish local authorities touch is managed in a flawed and expensive way. Privatisation shows the diverse ways to remove all sorts of operations from municipal sloth.

It seems to me that all of Scotland’s universities are too much under the control of the Scottish Executive. They should be freed from their link to the state.

In Massachusetts, I read, Governor Mitt Romney is going to privatise the three universities under his aegis. Imagine if Heriot-Watt or Dundee liberated themselves from the armpit of the Executive.

The rest of the world has been watching Ken Livingstone’s experiment with tolls in inner London. In Privatisation Watch, we read how quite small US cities are learning to adapt road pricing ideas.

Make urban centres free in the small hours of the night and all freight transport becomes nocturnal – leaving the daylight streets flowing far more freely.

The French motorways, privately financed, are opening up remote corners. Imagine what a motorway to Oban could achieve for the Highlands and without any tax bill.

Now that the comedy of the Holyrood construction is turning into irritation, this merry newsletter catalogues the latest techniques for project finance and management‿ the key points are highly relevant: never leave it to civil servants or politics and keep the lawyers at a distance.

Everything Scottish local authorities touch is managed in a flawed and expensive way

Our leaders regard it as bold to sell off air traffic controls to NATS. The Americans show how controlling airspace can be done far more cheaply and safely than the European monopoly model. Of all the dark corners of the Scottish public sector, I rate the schools a prime target for liberalisation. Let local communities or teams of parents own the schools and boost standards. Privatisation Watch catalogues how schools are being weaned off state control in India, Africa and Latin America to great acclaim.

The voice of Scottish business is timid. We cannot look to the CBI or the Chambers of Commerce, or even the Institute of Directors, to lobby for radical ideas. They are in awe of Scotland’s establishment – or part of it.

In Washington they have just brought in new rules obliging major procurements to be put out to open tender – and often in fragmented form so the opportunity is open to smaller firms too.

In Canada they are gifting out the vast tracts of land and forest owned by the provincial governments. The analogy with Scotland’s ring-fenced Forestry Commission is stark.

Huge quangos such as Scottish Natural Heritage and Historic Scotland might learn lessons from elsewhere. The birds and the bees do not need to be nationalised. Neither does our heritage of old stones need to be entirely bureaucratic. What I find most exciting is the discovery by former civil servants that they enjoy life far better when they are free.

In every Scottish town hall those with good ideas are crushed as “troublemakers”.

Once they are contracted out, good suggestions are at a premium and are rewarded. It is fairly easy to measure the benefits of contracting out in balance sheet terms, but the heightened morale of staff is also wonderful to note.

My hunch is that most Scottish teachers would be revitalised if they had a meaningful share in their schools.

Human nature is universal. American schools that have been liberated are much happier places.

For the moment the National Health Service remains a British taboo. It is more akin to a religious body than a nationalised institution. But Privatisation Watch reveals just how wide a spectrum of choice in medicine can be created‿ better for patients and for the medics.

So, I commend this subversive newsletter. Every page has a surprise and every edition makes you realise how far we have to go in fighting the counter revolution against state provision.

To read Privatisation Watch online, visit

John Blundell is director general of the Institute of Economic Affairs.