Contracting Out Public Services To The Private Sector
HC 777, Forty-seventh Report of Session 2013-14 - Report, Together with Formal Minutes, Oral and Written Evidence
- House of Commons - Committee of Public Accounts
- TSO (The Stationery Office)
The Government spends £187 billion on goods and services from third parties each year, around half of which is estimated to be on contracting out services. Recent scandals illustrate the failure of some contractors to live up to expected standards. 'Contracting Out Public Services To The Private Sector (HC 777)' examines weaknesses in the Government's ability to negotiate and manage contracts with private companies.
The Committee calls for three basic transparency measures:
the extension of Freedom of Information to public contracts with private providers;
access rights for the National Audit Office; and
a requirement for contractors to open their books up to scrutiny by officials.
The four private contractors who met with the Committee - G4S, Atos, Serco and Capita - all said they were prepared to accept these measures.
An absence of real competition has led to the evolution of privately owned public monopolies which have become too big to fail. Small and Medium Enterprises (SMEs) have been crowded out by the complexity of the contracting process, excessive bureaucracy and high bidding costs.
The report concludes that the Government should require higher ethical standards of private providers than have sometimes been displayed in the past, for example, Departments should ensure their contractors have proper whistleblowing processes in place.
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