In my opinion, a contemporary public sector leader should think very hard and analytically before assuming outsourcing is the most effective and efficacious way of either improving the quality or reducing the cost of public services.
I fully appreciate that this stance goes against the contemporary grain, given that many political leaders (both within the current Coalition Government andsome in the last Labour Government), as well as some public sector executives, have asserted that the business sector can save the public sector large amounts of money whilst at the same time improving the quality of provision.
Whilst acknowledging that there are clear differences between and within Whitehall departments and between local authorities or NHS trusts, in truth the narrative and justification for involving the business sector in public service delivery has never been consistent. I recall arguments such as the need to: increase capacity; reduce costs; leverage investment; address underperformance; source scarce expertise; transfer risk (although actually, ultimate risk is hardly ever transferable); tackle poor industrial relations (and sometimes to take on the trade unions); and in some specific cases, extending choice to service users. Sometimes it has been for ideological reasons.
The reality, however, is that evidence that outsourcing to the business sector is better (or worse) than retaining services within the public sector is often hard to prove, for it’s practically difficult to compare with an untested alternative. That said, what evidence does exist suggests at best a very mixed picture and nothing like as glowing a success as some marketing presentations or political promotions might suggest. Some early examples of success are not repeatable. Times and condtions have changed.
Read the rest over at Huff Post.