Private Equity's Hidden Influence on UK Public Services
A Guardian investigation has revealed that private equity firms now control companies employing one in eight British workers, while £1 in every £11 spent on public contractors goes to such firms. The year-long project, involving more than 10 journalists, data analysts, and designers, mapped the opaque ownership structures of thousands of companies to uncover the scale of private equity's stake in Britain's essential services.
The investigation was sparked by an initial probe into the childcare sector in 2023, which data projects editor Carmen Aguilar García described as "challenging and a big team effort." Extending that work to the entire UK economy initially seemed unrealistic, but the team built a custom database of private equity-controlled companies, cross-referencing data from Companies House, PitchBook, and procurement data provider Tussell.
Methodology and Challenges
To avoid double-counting employees, the team deconsolidated large corporate structures. "We had to deconsolidate large corporate structures to avoid double-counting employees," said Carmen. The final figure of one in eight workers was derived by comparing deconsolidated employee counts with ONS employment data. The analysis also excluded venture capital and private credit companies, focusing solely on private equity.
Social affairs correspondent Jessica Murray received an anonymous tip from a children's home worker, which led to on-the-ground reporting. She found that official Ofsted inspections described some homes as "chaotic" with "high levels of distress." Murray noted that "a lot of those in power don't fully understand this world," with some politicians declining to comment because they felt unqualified.
Visual Explainer and Public Understanding
The investigation included a visual explainer using toy figurines to illustrate how private equity works, focusing on a fictional veterinary practice to show the impact of leveraged buyouts. Senior digital designer Prina Shah said the models "made the icons come alive" while helping readers grasp complex financial concepts. Visual projects editor Anna Leach emphasized that "business and finance are areas people are very affected by, but they often don't understand the intricacies."
The Guardian also published an expandable methodology section with each article to ensure transparency. The team used a Large Language Model to collect information on ultimate controlling parties, with five journalists manually verifying the results against annual accounts, company websites, and databases like PitchBook.
Impact and Industry Response
The investigation found that private equity's footprint spans nurseries, vets, shops, and other sectors. While the industry argues it can drive growth and efficiency, the report highlights concerns about debt-heavy financing models and regulatory gaps. The team stressed that private equity is not simply good or bad, and the articles include the industry's defence against criticisms. As Carmen concluded, "Resilience, adaptation and a problem-solving mentality are essential, but also believing that what you are doing is an important contribution to society."
