This is an important story reported in the Huffington Post. It’s well worth a read. Check it out!
This week the austerity story has moved-on. We have now seen in this article and in the UK, huge wastage in the public sector, at the same time as draconian austerity measures; this means that citizens of both Spain and the UK are facing a double crisis, first the cuts and then the loss of value-added.
This crisis in value-for-money, is especially worrying as many economists like Paul Krugman and the IMF are calling for increased short-term borrowing and immediate investment in infrastructure for a good dose of Keynesian medicine. Sadly, the austerians will argue that the public sectors in both Spain and the UK are incapable of spending money prudently; of course, they have powerful point.
Personally, I think that part of the answer is to overhaul procurement in the public sector which compares very poorly to the private sector; many of the weaknesses come from EU bureaucracy. Also labour markets are far too rigid and there is an urgent need to open them up to competition from independent professionals.