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Contracting for public servicess

Contracting for public servicess. Competition and partnerships. Government by Contract. Three functions: Policy function Buyer function Contractor function Also contracts between policy and provider functions and service users. Key Questions.

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Contracting for public servicess

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  1. Contracting for public servicess Competition and partnerships MN4235/MN5035 University of St Andrews

  2. Government by Contract Three functions: • Policy function • Buyer function • Contractor function Also contracts between policy and provider functions and service users MN4235/MN5035 University of St Andrews

  3. Key Questions • Should there be competition between contractors to provide services? • Should these contractors be in the private, public or voluntary sectors? • Is the appropriate role for public sector organisations that of the enabling organisation? MN4235/MN5035 University of St Andrews

  4. Ways of introducing the discipline of the market place • Internal markets • (Compulsory) competitive tendering • Privatisation MN4235/MN5035 University of St Andrews

  5. Public sector markets Designed by administrative rules: • Supplier power • Buyer power • Access to markets • Market growth potential • Nature of contracts MN4235/MN5035 University of St Andrews

  6. Executive agencies (Flynn) • Monopoly supplier • Monopsony buyer • Transactions infrequent • Buyer a lot of knowledge about sellers and operation and costs • Block contracts MN4235/MN5035 University of St Andrews

  7. Former NHS internal market example GP budget holders District purchasing agents Private patients Demand for hospital services Supply of hospital services Directly managed hospitals Self-governing hospitals Private hospitals MN4235/MN5035 University of St Andrews

  8. Competitive Tendering - Market testing Long history of contracting in public sector: • Building works • ‘Housekeeping’ services - catering, cleaning • Larger services - eg refuse collection • Core services - finance, personnel, etc MN4235/MN5035 University of St Andrews

  9. The enabling organisation Advantages and disadvantages of contracting out? MN4235/MN5035 University of St Andrews

  10. Privatisation • Done little to enhance competition (Cullis and Jones) • Policy popular due to subsidised shares and tax reductions • Transfer to private monopolies due to successful industry lobbying • Subsequent need for regulation MN4235/MN5035 University of St Andrews

  11. Other ways of involving the private sector • As contractors • As funders (PFI) • As partners (PPP) MN4235/MN5035 University of St Andrews

  12. Are partnerships the future? Competition Hierarchies Networks/ partnerships MN4235/MN5035 University of St Andrews

  13. Contrived randomness Oversight/ Review Mutuality Competition Shift from NW/SE to NE/SW to NE/SE Four basic ways of controlling public management (Hood) MN4235/MN5035 University of St Andrews

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