The impact of contracting out on employment relations in public services

Submitted by carolyn on Sun, 01/01/2006 - 21:42
_by Sanjiv Sachdev_ As part of the New Labour agenda for renewing better funded public services, there has been a sharp increase in the role of the private sector in public services delivery. Areas of the public realm once almost exclusively undertaken by the public sector – such as defence and criminal justice - have seen the private sector play an increasingly prominent role. Indeed, according to this report 93% of workplaces are outsourcing four or more services previously done by their own employees. So what are the implications for workers? Despite the large numbers of employees affected, the employment relations implications of contracting out have been seriously neglected. This report aims to set that right and the conclusions are worrying. Based on the minimal evidence that does exist – notably in the prison service – the results are greater income inequality, deterioration in terms and conditions of employment and greater pension poverty due to the poor pension provision of many private providers of public services. Given that the prison service has been promoted as a model for the health and education sectors, the concerns raised in this timely report, make essential reading for all those defending public services provision.

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