Privatization and Contracting Out

Methodology

Step One: Mini-Lecture- An Overview of Issues

Step Two: Work Group Identification of Major findings from the Readings

Step Three: Presentation of Brief Findings from Each Group (Two-Three Groups)

Discussion: Review of Syllabus

Overview

The Knowledge and Skills Base for

Domestic Service Delivery, International Assistance and Security

Models of Social Services Systems: The Context of Privatization and Contracting

OverviewConcepts: New Public Management Principles

Social Services- Delivery

Re-inventing Government- Customer vs. Citizen

Subsidiarity- Decentralization

Privatization: Private or Non-Profit Sector

Contracting Out- Extending Governance out of Government

Boundary Valuation Problem: The Key to Privatization

Service Delivery Systems and Categories of Service DeliveryIssue of “size”: hard services or soft with

capital or recurrent costs

Macro--Physical Services Highways, Sewerage Main Lines, Electricity Deconcentrated or Privatized

Micro--Physical Services Devolved or Delegated

Focus of Stimulus Spending-Jobs

Service Delivery Systems and Categories of Service DeliveryIssue of “size”: hard services or soft with capital

or recurrent costs

Social Services--Health, Education or Community Development (such as Social Funds)

Delegated or Contracted

Grants and Sub-Grants to Non-Profits

Investment or Production

Privatized

Public Private Partnerships

Service Delivery Systems and Categories of Service Delivery

Private Provision

Use of conventional Markets

Contracts with public agencies

Monopoly Franchises

Management Contracts

Vouchers

Consumer Cooperatives

Monopoly Franchises

Alternative Service Delivery Systems: Decentralization

Confederation- Lower level Units Dominate: European Union and other regional associations

Federal Relationship

Some power lies with National Unit

Some power lies with lower units

Alternative Service Delivery SystemsFederal Relationship

Key distinction:

Lower units cannot break away from National Unit

National Units cannot take power away from lower units

Under Federalism: One can transfer additional authority back to sub-units but not take power from federated governments

Alternative Service Delivery SystemsFederal Relationships

ExamplesUSACanadaGermany NigeriaIndiaRussian FederationAustriaSwitzerlandMalaysia

Alternative Service Delivery SystemsUnitary Systems and Sub-regional units

All power ultimately lies at national level

Local level power is given by national level

Power that national unit has given to local level can also be taken from it

Unitary Systems

Alternative Service Delivery SystemsUnitary Systems and Sub-regional units

Examples

United Kingdom

France

Kenya

Ivory Coast

South Africa?

Japan

Forms of Decentralized Service Delivery in Unitary Systems

Concept:

Transfer of authority to a lower level of government

Primary Unit of Government:

Lowest level that carries a bureaucracy with it

Forms of Decentralized Service Delivery in Unitary Systems

“Devolution”: Transfer to non-Federal political body

Budget and personal authority to district and town councils

Key--power lies with lower level politicians

Future Devolution?

Forms of Decentralized Service Delivery in Unitary Systems

De-concentration: Transfer to non-Federal political bodyTransfer of authority to administrators at lower

level within the administrative system

DelegationPublic Corporations or parastatals

Privatization- Ideological Debates

Forms of Decentralized Service Delivery in Unitary Systems

Program and Project Decentralization:

Sectoral - By regular line or agency within aMinistry

e.g. Focused activity - seed production (Green Revolution)

agricultural experiments and extension

Forms of Decentralized Service Delivery in Unitary SystemsProgram and Project Decentralization:

Deconcentration or Devolution of authority to central level special unit

e.g. Water, health, emergency or education activities or projects to subordinate administrative or council structures

Port authorities

Forms of Decentralized Service Delivery in Unitary Systems

Program and Project Decentralization:

Inter-Ministerial Committees or Units

Planning supervision

Overlapping memberships, e.g. Land Use Planning

Forms of Decentralized Service Delivery in Unitary Systems

Program and Project Decentralization:

Creation of field level Special Project Units with semi-autonomous status

Range Management project

Integrated Rural Development

Integrated Rural Development- IRD

Most well-known type of special project:

Special designated geographical areas

Multitude of project activity in different sectors that may overlap or compliment

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