Public private partnerships (PPPs) overseas have plunged schools and communities into debt, forced hospitals to close and cost taxpayers billions of dollars. Despite this track record the New Zealand government seems to believe it is a good idea for our schools.  PPTA News, the newsletter of the New Zealand Post Primary Teachers' Association, looks at how the love affair with private investment went sour with the hope that New Zealand can learn from other countries’ mistakes.

First came the flurry of press releases extolling the virtues of PPPs, then the creation of New Zealand’s first privately built prison was announced – and now the government is poising to let the private sector loose on our schools. Cabinet papers have revealed plans to build a school on crown land, which would be owned by a private company and leased back to the school’s board of trustees - a move PPTA president Kate Gainsford believes is short-sighted and dangerous.

Limitless potential for profiteering and of no real benefit to the taxpayer

“Governments can always raise money at a cheaper rate than private companies so there is no real benefit for the taxpayer and limitless potential for profiteering,” Gainsford said.

“I predict PPPs will follow on from leaky buildings and sub prime mortgages as the next taxpayer rip off.”

Under the PPP plan, private firms would design, build, maintain and own a school, while the government owned the land and the school’s board of trustees retained governance. The school’s owners could use the school outside normal school hours, and school boards would have to negotiate an “occupancy agreement” with the private owner.

Overseas experience is of extra cost to taxpayer and cuts to services

Minister of education Anne Tolley told The New Zealand Herald that similar partnerships had been successful overseas and could “cut costs, improve maintenance and allow greater community use of facilities.”

Overseas examples, however, have proved the opposite. Inadequately budgeted projects have lead to extra costs to the taxpayer, design problems, late delivery and cuts in services. In some cases loans are still being paid back to private enterprises, years after facilities have been forced to close.