The Transport Minister in Finland has been busy spinning off different parts of Finnish basic transport infrastructure into separate companies, saying that this will result in more efficient management and result in better long term planning.
The government has produced papers on the creation of such companies under the shared ownership of the government and the municipalities, both of whom have important roles in planning, building and maintaining the basic services. The present right wing government has stated that the basic services produced by these companies will produce better long term planning rather than relying on ever changing public budgets.
Although it is true that rail and road networks have suffered from stop-go budget funding, there can be no doubt that efficient infrastructure management over the decades is very sensitive to the cost of long-term funding, and here the public sector is by far the cheapest source of funding.
Efficient management of basic infrastructure also requires that the public sector needs to have excellent engineering and project management skills because they must plan and negotiate with private sector suppliers and builders of this infrastructure. There must be a proper balance between the two because the big construction companies pay millions to their senior management. That does not necessarily attract the best people – just look at Boeing, Deutsche Bank, CitiBank, Royal Bank of Scotland, etc all of whom have been involved in these big projects.
Finland has managed to secure the employment of many excellent engineering and financial specialists to manage public procurement of these basic services. The planning and funding are subject to the normal and necessary political and public scrutiny. That is what voters who are also taxpayers are entitled to expect.
The spinning off of different parts of basic infrastructure parts into separate companies should not hinder this scrutiny, and public financing should also remain as the main source of finance. Attempts by bank lobby groups to spin off financing to themselves with public sector guarantees must be avoided. But when the same Transport Minister is joining the board of the largest Swedish Bank one can only think that the bank and the Minister have other plans for feathering their own nests!
Ministers should be restricted from such appointments positions for several years. Political appointments were said to be stopped in promises made during the 2015 election, but they continued like the plague…