Competition from Private Sector could save over £20bn

  • Business leaders have called on councils to open up public services - including social housing and school catering - to competition from the private sector.

    According to a report by CBI, opening up more services to competition could save the public sector a total of £22.6bn.

    The organisation said 73% of school catering is still handled by the public sector, along with 98% of social housing management.

    It added opening up the social housing management market could save £675m and a further £190m could be saved in improving waste management.

    The chair of the CBI Public Services Board and chief executive of local government contractor Interserve, Adrian Ringrose, said:

          "Providers from all sectors need to understand the Government's vision for public service markets, so that they can invest in new delivery models, technology innovations and supply chains, which will deliver the savings and transform and transform the way the public access key services.

          Ensuring providers from the public, private and voluntary sectors can compete on a level playing field, and their performance is judged on equal terms, means in the end the best provider will provide."

    But the chairman of the Local Government Association's improvement and innovation board, Cllr Peter Fleming, said some of the estimated savings are ‘pie in the sky':

          "The CBI calculation assumes that cost is the only criteria councils have to consider, and rickety methodology means fresh savings are being claimed for services which have already been outsourced.

          Local authorities routinely look at how services can be delivered better and more cheaply. In some cases the private option is the best and in others councils find better value, a superior service and more control over standards by keeping them in house."

    Source: Local Gov





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