Under the previous, coalition government, local authority outsourcing of services doubled. The value of local government contracts keeps increasing and contract periods keep getting longer. Meanwhile, as a consequence of the coalition government’s Open Public Services reform programme, councils are under pressure to outsource, while deep cuts force them to consider it a way of cutting costs.
None of this is popular with the public. In polling commissioned by campaign group We Own It, 61% of the population thinks that local and central government should run services in-house as the default. Only 21% want to see more outsourcing.
That’s hardly surprising when you consider the recent scandals over outsourced services. In 2013, the Serious Fraud Office launched a criminal investigation into G4S and Serco, both large outsourcing companies, over allegations they overcharged on government contracts to provide electronic tagging of prisoners. At the end of last year, the government was found to be paying Serco £1m to run an empty secure children’s unit for seven weeks. And in September, G4S lost the contract for running a young offender facility, after it was graded as inadequate amid concern over the degrading treatment of detainees.
A comprehensive review of the research finds that there is no empirical evidence that the private sector is more efficient. Research also suggests that many authorities take services in-house as a way to cut costs and improve quality. Although outsourcing might mean cheaper services in the short term, there’s a knock-on effect on morale and the quality of service provided, and in the longer term you lose flexibility and control.
We Own It campaigns for public services – waste services, children’s services, parks and libraries, social care – that put people first. Our new campaign, Our Services Our Say, calls on councils to support principles of transparency, accountability and people before profit in public services, and tell us how they will put these into practice locally.
We’re suggesting a new process for public service commissioning. Private providers should be subject to freedom of information requests, while public service contracts, performance and financial data should be publicly available – a proposal that is supported by 67% of the population.
We also call for public consultation over public services, especially before any outsourcing of services or privatisation of assets takes place. We think the public should have the right to recall providers who do a bad job – and while this couldn’t apply to existing contracts, it could be introduced for new ones.
Under our proposals, the public interest case would be made for any privatisation or outsourcing. There would always be an in-house bid on the table (or a reason given if there isn’t) and social value would be the priority.
This campaign aims to stop out-of-control outsourcing, but it’s also a way to give the public a say. We all pay for public services and we all use them on a daily basis.
We already have broad support and on Wednesday, Liverpool city council became the first council to pass a motion in support of the campaign. This council has already cancelled its street-cleaning contract, bringing the service back in-house. We would like there to be national legislation – a public service users bill – to make these common sense ideas a reality. In the meantime, we hope councils will lead the way.
Cat Hobbs is the director of We Own It.
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