Saturday, 22 January 2011

The Evil of Profit-Making

The NHS is in the news, obviously.  There seems to be one comment that recurs frequently, that it is morally wrong for "companies to make a profit out of the NHS".

What strikes me as odd is that none of the interviewers ask "Why?".

Why shouldn't people make a profit out of the NHS?  Is it because there is something wrong about profiting from a service that is essential, a service without which people would die?  If so, we should nationalise the pharmaceutical companies, the hospital equipment manufacturers, the medical supplies companies.  All of these people make a profit from the NHS.

Continuing the logic, we should nationalise the food retailers, the farmers (to the extent they are not already), and the food distribution companies.  We should also re-nationalise the water companies and the energy companies.  All of these people make a profit from an essential service.

No doubt this is the real mindset of those who object to a profit being made.  I have a harder question for them, though.  If it is so wrong for a profit to be made from healthcare, why do we pay nurses a salary?  Surely they should give of their time for free, so that patients can be cared for?  They are making a personal profit, and they are at least partly motivated by this profit - just see how many would turn up if we stopped paying them.  Some might, but I doubt all of them would.  If a company sets up a diagnostic centre with the best and newest x-ray machines, CT scanners, and MRI imagers, and offers that to the NHS for a fee, why is it acceptable to pay the nurse who helps the patient onto the scanner bed, but not OK to pay the investor who funded the scanner in the first place?

We could take this further.  Among the left, there is an almost fetishistic approval for "not-for-profit" companies. But do the staff of these companies work for free?  No - of course not, it is just that the company does not distribute a return to outside shareholders.  In other words, all the company's income is used to pay overheads and provide the staff with an income.  But the same is true of my firm; we are a partnership, so after payment of our overheads and the fixed salaries of the employed staff, all the remainder is distributed between the partners.  The accounts officially show a profit, but only because the partners take no formal salary.  There is no difference of principle between us and a not-for-profit company, except that lefties don't seem to like me.  Perhaps I make too much non-profit?


  1. "Continuing the logic, we should nationalise the food retailers, the farmers (to the extent they are not already), and the food distribution companies."

    I've no doubt whatsoever that's their long-term goal, so I'll forgo the usual Don't give them ideas!!' here... ;)

  2. Great post.

    The whole "this is privatisation by the back door" cry is a load of nonsense anyway, unless the left is suggesting that GPs are "private" compared to PCTs which are "public".

    I was very pleased to discover from my "wouldn't it be nice" soft-left GP friend that his practice is going hell for leather to become one of the big players in the new system. I will give him every nudge and assistance I can!

  3. We all make a profit when we sell our labour for wages. If we didn't make more doing this than working for ourselves, we wouldn't bother. Only charity work is the other way round, and sometimes I'm not to sure about that!

  4. Shall we discuss how the level of profit is influenced by who holds the power in these relationships and how this usually evolves to a level of 'exploitation'? No, ok, let's not*. More important things to do. ;-)

    *first track of 2011. If you were waiting, I hope it is worth it. Alternatively there is this. Check out those lyrics.