Diversification being key in these difficult times, I’ve entered the Extraordinary World of Banking. Towards the end of last year I acted as spokesman to a group of disaffected Scottish businessmen who took the Government to the Competition Appeal Tribunal over the swallowing-up of HBOS by LloydsTSB, which Gordon Brown had engineered.

While the takeover was seriously and indisputably anti-competitive, Lord Mandelson had stated that there was “no alternative” to waiving competition law – as Brown had put it to “ripping-up” competition legislation to create a superbank – in order to maintain that wonderful thing, “UK Financial Stability”. Of course this seemed ironic to us, as what had destroyed “UK Financial Stability” was, and is, exactly that: inappropriate deregulation, the encouragement of super-corporates and policy focussed on the interests of a reckless business elite.

A macrocosm – as I was to find-out – of my wee world of architecture.

Our case seemed, to me, to founder upon what might be described as the Rock of Lord Mandelson’s Integrity: as the Treasury’s lead Q.C. put it to the Tribunal’s panel of High Court Judges, if our case was to be believed “… you will be stating that Lord Mandelson deliberately misled the House”. Perish the thought.

At the height of our attempt to keep HBOS independent I received a disquieting-ironic email from a childhood friend who has risen to the top of the New Labour machine: “We must meet soon… lots to talk about, not least your campaign to have HBOS nationalised”. I doubted that New Labour were, out of Socialist zeal, hatching the cunning plan for the nationalisation of the banking sector that then unfolded; and it must be impossible to find anybody who now believes that the takeover was the right move, for HBOS, LloydsTSB or the UK (and its “financial stability”) as a whole – who would not admit that it would have been better if our challenge had succeeded? No less than the head of the Financial Services Authority, Lord Turner, stated that he believes that there were alternatives and it seems that, instead of HBOS sliding alone into nationalisation – where it could have become a lean and effective Bank of national reconstruction – the vast, monopolistic behemoth that is LloydsTSB/HBOS headed there, to hobble us all.

These are big matters. The issues that underpinned our challenge, of reduced competition for business loans and development funding, that are inevitable with one Bank monopolising so much of the market, are smaller, though significant for all businesses, including Architecture. But it is interesting how big and small issues are aligned, and our competition concerns have turned out to be the tip of the iceberg.

I don’t disagree as to the necessity of using public money to retain sound Banks. But that is not what has been achieved, and it is difficult to overstate how dysfunctional the banking system now is. In the building and development sector, for instance, we face the prospect of much-needed regeneration – much needed economic activity – collapsing because its funding has been pulled by publicly-owned Banks, who’s preference will be to direct new funding, provided by us, the public, into new projects that will have their risks substantially-underwritten by Government asset-protection guarantees – by us.

In general, it’s hard to see how a free market can function effectively with the presence of these dysfunctional semi-state monopolies; though, perversely, there is no chance the public – providing the capital and taking the risk – will gain from their advantage for, as Economist Joseph Stiglitz says, the current situation is “… far worse than nationalism: it is the privatising of gains and the socialising of losses”.

Such a concept is familiar to us architects from the sorry hell that is the Private Finance Initiative (PFI) and the Public Private Partnerships (PPPs) that go with it – the privatisation of the provision of public buildings and public infrastructure. Ultimate failure – such as when the Metronet London Underground or West Lothian College PPP consortia went under – is always underwritten by public money. The same thing happens at small scales too, when PPP “whole-life” privatised repair-regimes fail for Schools who’s PPP Contractor will not repair their leaking roof unless the School proves that it was not caused by vandalism, which their PPP Contract does not cover. As ever, books, teaching posts and pupils suffer.

We need to be clear that the primary reason the Government has engineered these methods of financing projects to be the only realistic game in town, is ideological. All the rubbish design (school-rooms without proper natural light), casino financing (projects costing up many times what they should) and sustainability double-speak (old, graceful schools and hospitals with lifetimes left in them landfilled, to be replaced with shiny-new shoeboxes, because their modest repair costs would not have made enough money for the PPP consortia) is justified by the primary fact that the public interest, and the responsibility of Government for caring for it, is bundled-up and passed to Bankers, and the lawyers, accountants and others that are parasitic upon these process.

Trading in PPP derivatives directly mirrors the wider financial market, with the bundling-up and trading-on of investment and risk into secondary and tertiary markets: financial pyramids built on exploiting the public interest. We might hope that PPP, as the chosen method of financing public works, has been brought down by the wider crisis; but, incredibly, the Government persists, pouring more of our monies, over-and-above the primary Bank rescue packages, down the throats of their PPP consortia, then begging them to re-start fleecing us. The pressure on those Local Councils with access to money, to do the same, is intense.

Behind the scenes work continues on the great, Thatcherite, neo-liberal Privatisation Project. I’m not sure of the current situation in England and Wales but in Scotland the HUB Initiative – initially Scotland’s version of the LIFT Project for Primary Health Care delivery – seems like it’s being designed to carve-up the whole of Scotland into a very few super-regions, where one super-contractor might deliver all public services, and presentations by civil servants emphasise “deal-flow” and promise “a continuing feast” for the private sector. What is particularly remarkable is that this comes from an SNP Government whose electorate, when surveyed by the BBC, placed the need to “ensure that all state schools and hospitals are built and run by public bodies rather than private companies” at the very top of a list of 25 policy issues, and whose manifesto rejected PFI and PPP.

With the bundling-up and privatising of the public interest goes the attempted transfer of risk. PPP tries for this – with, as noted, us as ultimate guarantor – but the body-politic is wholly-infected by this culture. Any project, building or otherwise, involves risk, and any successful project achieves that success by carefully managing the risk: by investing in a good team, a robust cost-plan and responsive and responsible procurement processes. But Government fears and loathes the responsibility this involves, and all public actions, at all levels, are now governed by their “risk-averse” culture. Public bodies are required to tie themselves up in Byzantine contortions, trying to shift risk off their desks; but risk doesn’t sit well passed-to Contractors who have no reason, ability or incentive to weigh the public good, and it tends to ping about expensively between parties before ending up in dispute (as is, I assume, the fate of the £512 million Edinburgh tram contract, who’s enabling works sit stalled out my office window while parties wrangle).

All this is made worse by Competitive Tendering regulations, led by the European OJEU processes, which indulge in a frenzy of auditing and validation and creativity-sapping, risk-averse compliance, discouraging freshness and innovation and encouraging the engagement of corporate monopolies which churn out the same “safe” old stuff – with maybe just a wee bit wonky glam, to make an iconic p.r. image.

Such bureaucracy fits with the wider Government culture, of a displacement activity where the avoidance of shouldering real responsibility – of governing – is “compensated” for by micro-management, furthered by much more bureaucracy. The commissioning of buildings is horribly burdened by skiploads of good-practice box-tick, and a mind-numbing rush of well-intentioned, self-important advisory bodies, who tell us how to do our jobs. (At one recent presentation in the North East of England I was shown the “Matrix” of the 30 quangos and other organisations who were there to “help me” make a decent building. My heart still sinks at the memory).

It’s a circus. When I am asked to explain why Britain’s new buildings tend to look like dumb, craft-free shoeboxes – with more or less “bling”, “sustainability”, “urbanism”, “tradition”, “wow-factor” or whatever nailed to them – I explain that all the creative capital is spent on the circus. We all know this. By the time we get to actually craft a building we are likely to be exhausted: spent and wasted by the ugly dance we have clumped-out, at the instruction of the professionals whose jobs, standing and enrichment are guaranteed by its clumsy performance.

I don’t suppose that it is much different for anyone these days: if you are selling, say, a computer system to a Local Authority or a Health Board, a horrible, dispiriting proportion of the project’s time, effort and value, disappears into the deal, and the professionals that are parasitic upon it.

I don’t, actually, particularly blame these professionals. I don’t even really care about Sir Fred Goodwin, or all the Knighthoods and Baronetcies (not, I think, any guarantee of the worth of a person). Reckless Fred and his friends have behaved exactly as our successive Thatcherite Governments have encouraged them to behave. (I also know many decent bankers, lawyers and others who are puzzled and pained by their professions’ elevation and empowerment.) This crisis has arisen out of Anglo-Saxon neo-liberalism, and the blame for it lies with a Government whose “moral compass” is drawn to little but the worship of the most reckless of business models, and whose economic policy has been founded on little more than a property bubble and financial services derivatives.

So what might come out of it – and how might we climb out of it? There has been much talk of the opportunity for a Keynesian public works programme that would rebuild our degraded public infrastructure, taking advantage of keen tender prices and helping reflate the economy. But such policies require us to have sound Banks and ours are, as we know, dysfunctional. Of equal significance, the commissioning of public work requires sound procurement policies, and our Government’s reckless privatisation, disgraceful risk-aversion and boxtick micro-management bureaucracy makes commissioning public works a nightmare. I don’t doubt that this goes some way to explaining why Britain’s new buildings and infrastructure are, relative to our direct competitors, horribly slow and extraordinarily expensive: vastly, nationally wasteful of our time and money.

What needs to come out of this crisis is a reconsideration of the correct balance, and application, of public responsibility, and of private initiative. A Government needs to look after the health and happiness of its people, not pay Bankers and Lawyers to do it; and it needs to let us get on with business, without forever telling us how to do it.

Of course, our public institutions had become very poor at commissioning public work, and their morale has taken a battering from the centre. But that makes it all the more important to rebuild confidence and rediscover the art of good public procurement. There are, hidden under the PPP dungheap, public procurement success-stories, and the models that produced them need to be examined. And we should also look to the private-sector – the real “private sector”, not the one conjured by the Banks. For instance, the private school system in Britain tends to produce rather wonderful schools: they borrow money, employ the best architects they can, put their pupils’ interests first and build schools that are far quicker and less expensive, providing far better learning environments, than the State’s sorry “privatised” attempts.

It’s not, at the end of the day, too difficult: public procurement led by a direct client-architect relationship with, say, the learning experience of a pupil, or the recovery time of a patient, leading the process; and with the risks of the process properly and robustly managed, on behalf of the public.

Sadly we have little immediate prospect of a Government who will grasp this; but this does not mean that we as architects, and our Professional Institutions, can’t make a significant difference by demanding it of Government, on behalf of the public, as our professional status and moral sense must tell us to do.

In 2009 Malcolm Fraser acted as spokesman for the Merger Action Group of Scottish businessmen who took the Government to the Competition Appeal Tribunal over the Government's alleged "ripping-up" of legislation and failure to heed anti-competition warnings when it enabled the acquisition of HBOS by Lloyds TSB in 2008. Fraser was interviewed twice on Newsnight Scotland and once on Newsnight UK-wide.

The Tribunal, sitting in London before three High Court Judges, ended in moral victory and technical failure, as set-out here.