They really struggle to understand that all businesses have departments that consume money and departments that generate profit (cost centres and profit centres); not every part of the system makes money, but the parts that do (Sales) need the support of departments that don’t (Human Resources, Accounts, Legal) - get the balance right and you have a resilient organisation that will do well.
Public spending and the public sector are a bit like the cost centres of a business. Having high quality public education, healthcare and transport creates and supports an environment in which free enterprise has access to a skilled, healthy and mobile workforce; the profits naturally follow. Balance that properly with appropriate taxation and the system trundles on…
Absolutely agreed! I feel this is especially visible with the public transport sector. The British government seems convinced that buses and trains ought to be profit-making on their own, to the point that “unprofitable” routes get cancelled, cutting off entire communities from the nearest town. When in reality, public transport should be considered a cost centre, which “loses” money when run, but enables profit elsewhere. I actually wonder whether the widespread issues of town centre demise would still be a problem if there was adequate public transport to make going shopping locally quicker than waiting for Amazon to deliver it, and shops with businesses in them would surely be better for the economy than empty shops…
They really struggle to understand that all businesses have departments that consume money and departments that generate profit (cost centres and profit centres); not every part of the system makes money, but the parts that do (Sales) need the support of departments that don’t (Human Resources, Accounts, Legal) - get the balance right and you have a resilient organisation that will do well.
Public spending and the public sector are a bit like the cost centres of a business. Having high quality public education, healthcare and transport creates and supports an environment in which free enterprise has access to a skilled, healthy and mobile workforce; the profits naturally follow. Balance that properly with appropriate taxation and the system trundles on…
Absolutely agreed! I feel this is especially visible with the public transport sector. The British government seems convinced that buses and trains ought to be profit-making on their own, to the point that “unprofitable” routes get cancelled, cutting off entire communities from the nearest town. When in reality, public transport should be considered a cost centre, which “loses” money when run, but enables profit elsewhere. I actually wonder whether the widespread issues of town centre demise would still be a problem if there was adequate public transport to make going shopping locally quicker than waiting for Amazon to deliver it, and shops with businesses in them would surely be better for the economy than empty shops…