Outsourcing Public Services -- The Answer to Our Economic ills?

The temptation to outsource servces in a recession is huge with potential savings from lower unit costs offering a huge incentive to policy makerts who need to make significant revenue savings. Whether it is computing,finance,grass cutting or waste disposal the lure of outsourcing will be difficult to resist.


What can we outsource?

Public services have had a variable press; some are very good but expensive to run whilst others offer poor customer quality and are also not as cheap to deliver as they should be. The public sector is not blameless because it has often failed to innovate in its service delivery and has frequently appeared remote from its service users. Standardised services which are not sensitive to individual need have often been delivered with little thought of the consequences for users,whose needs are not fully met.

There are exceptions to this, personal budgets in social care and the whole agenda of personalisation is a move in the right direction, where individual social care needs are more likely to be catered for. Pooled budgets in health and social care can combine the funding of different service streams to offer a better rounded public service offering to users.

The private sector can assist in this process as long as the profit  motive does not become a too dominant factor in the public service delivery equation.Outsourcing probably needs to be replaced by collaborative relationships with the private sector to jointly develop public services. The latter is a real challenge because the cautious culture of the public sector has made it difficult for public services to innovate without an external stimulus. My own experience of outsourcing has been that the private sector partner kept sending us variation orders for work we allegedly had not specified the contractor to carry out. The latter was not much fun and that picky outsourcing culture should be left behind in favour of greater collaboration.

But will it work? In these straitened times the public sector really has limited alternatives to this approach.