Beacuse we live in a world of monpolistic comeptition. In other words the level of capital needed, the corporate infrastructure, the track record, the regulatory and legislative requirements and the general credibility needed to bid for public services create entry barriers that effectively mean only a few large corporate entities can bid for the contracts. The same applies to banking, construction, transport etc which also have very high barriers to entry. It’s not a true market, which is why people like Richard Branson, Anita Roddick, Alan Sugar etc are rarities.

Councils already publish high-leel financial statements every year. I don’t see anything much wrong with them publishing more detailed information, but I don’t see it doing much good. It would generate a lot more noise than signal. An important function of the council’s bureaucratic infrastructure is in helping the people responsible for budget decisions to make sense of this mass of data.

If you want to cut waste and make council services more efficient, you need your council to impose a savings requirement in each budget (something of order 3%, say), using this to generate a sum of money that the council can use to fund its political priorities (which may be new or improved services, or cuts to council tax or service fees). This is basic good practice: if your council isn’t doing this, elect new councillors.

As for private bin collections, there are two ways to do this, and both are problematic. Having bin collections done by the council enables efficiencies and economies of scale: collections can be effectively coordinated, management can be lean. If you simply contract out the entire service to one private firm, those efficiencies can be preserved. however, the council loses operatonal control of the service, making it less responsive to user complaints, and it is hard to see where the profitability is going to come from without impacting on service quality.

If instead we open it right up, and have each household contracting with its favourite bin collection company, all those efficiencies and economies go out the window. It gets a lot more expensive. Also, while the council doesn’t need to pay for collections any more, it still has a duty to ensure that rubbish is collected. Civilisation is common defence plus waste management: people who don’t get their rubbish collected cause a public health hazard, and the council has to deal with that. This would require a lot of enforcement, which is a damned expensive thing to do. Contracting out the whole service is a poor solution, but opening it up to a free-for-all is just stupid.

“What’s missing in this discussion is true competition.

If we as the customers had a choice about who we pay for rubbish collection and schools etc then we would see a better standard of service.”

No, we would have three times as many rubbish vans traveling the same routes, clogging up the same roads, and costing, er, three times as much to collect the same amount of rubbish.

If we as the customers had a choice about who we pay for rubbish collection and schools etc then we would see a better standard of service. Obviously companies want to make profits but if they do that at the expense of service – they lose their clients. This drives what is known as – efficiency!

Here we get the government giving contracts to private companies for 3 years – on the basis of what – G-d only knows – and they make as much money off of us as they can in those three years because the contract can’t be broken and then after three years they call themselves something new and bid again! It doesn’t take a genius to figure out why its not working.

Chuck H is right – privatising isn’t about providing a better service. It’s about big companies getting hold of public service contracts and making money from those contracts by sweating the assets – usually by cutting salaries (a la Fremantle, Care UK, etc), and leave allowances, etc.

The argument from the ‘private is good’ crowd is that privatisation doesn’t have to equate to corporatism, where services formerly provided by monolithic state institutions are outsourced to monolithic private institutions (all of the downsides with less accountability). It is possible to imagine a world in which a larger number of small, competitive organisations would provide publicly-funded services and would make better use of innovation and adaptation to do so. The question to ask is “why does this never happen?”.

Chuck H is right – privatising isn’t about providing a better service. It’s about big companies getting hold of public service contracts and making money from those contracts by sweating the assets – usually by cutting salaries (a la Fremantle, Care UK, etc), and leave allowances, etc. Fair enough in some respects – that’s what companies do. The question is whether they ought to pursue that model in the public sector and whether we get better service provision as a result.

Out of interest, do you actually know what these do?

On health care, for example, the administration could develop the ideas advanced by Senators Robert Bennett (R., Utah) and Ron Wyden (D., Ore.) to encourage employers to raise employee salaries by an amount equal to the value of the health benefits they pay—and then to create a competitive national marketplace in which employees could buy health insurance plans for themselves.

Conservatives (and Wyden) want to emancipate as many insurers as possible to offer the widest diversity of plans, everything from barebones plans at rock-bottom prices to gold-plated service at full price, with insurers incentivized to deliver improving service at declining prices—much like markets for every other good and service.

Nowhere in the world has the market been able to provide health, education, pensions of social security for more than a small proportion of the population. The state has always had to step in to fill the vacuum, not through some ideological ambition, but because there is no alternative. The private companies now providing care are not working in a ‘market’, they are simply giving a substandard service at the taxpayers’ expense, while funds are siphoned off of funds to private shareholders.

I note that the contributor extolling the efficiency of private provision gave no examples.

Private provision of public services is cheaper and infinitely more efficient

If I could be so bold – “Bullshit” sir!

Like Adam – I would like to see you ‘proof’ of such a thing.

How much is spent on LEA staff and offices which could be spent on schools? Salaries of senior staff should be reduced. A chief executive is not worth more than £100-120k and none should have more than 25 days holiday a year and work less than 37.5 hrs a week.

An efficient and effective council employeed unit should be cheaper in the medium and long term than outsourcing .

What nobody seems to be able to explain to me is how this dream will a) improve public services and b) be cheaper for the people using those services.