ISSUE FRAMING AND SECTOR CHARACTER AS CRITICAL PARAMETERS FOR GOVERNMENT CONTRACTING‐OUT IN THE UK

This article shows that variations in how two UK governments justified contracting‐out (issue framing), combined with shifting sector‐derived incentives for union activism (sector character), can help explain the extent of contracting‐out. Janitorial service, an activity of the UK government that should have been ‘low hanging fruit' for its prolific reformers, proved difficult to contract‐out for Thatcher's New Right Conservatives, but easier to contract‐out for Blair's New Labour. The New Right government framed contracting‐out narrowly, as merely an improvement in operational efficiency, and its reform faced unions that stood to lose a great deal from movement of janitorial jobs to private firms. In contrast, the New Labour government framed contracting‐out broadly, as a means to efficient social justice, and faced unions with low stakes in government janitors. As a consequence, UK government units could expect lower benefit and higher cost from contracting‐out janitors under Thatcher than they would under Blair.     

Contracting Out Local Government Services to Private Agents: An Analysis of Contract Design and Service Delivery Performance in Ghana

Contracting out is generally justified on the principle that as governments contract out part of their responsibilities in service provision to private agents, they harness the power of market competition which leads to efficiency in service provision. In working with private contractors, local governments (LGs) face problems related to agent opportunism, while agents also face risks such as dereliction of payment responsibility by LGs for services delivered. The literature shows that these problems are addressed through a web of contractual arrangements. Using agency theory, this study investigates the relationship between contract design and quality of services delivery in three Ghanaian cities (Accra, Kumasi and Tema). The study found a surprising negative correlation between contract document and agents' performance. The paper concludes that effectiveness of contracting out documents depends on contract management capacity of government administrators. In its absence, LGs that contract out are exposed to risks. The paper uses the findings to reflect on the inherent deficiencies in agency theory and Africanist literature on patronage.     

Breaking up a partnership to build a competitive market in Denmark’s ambulance service: how can studies of contract reversals learn from the sociology of markets?

ABSTRACT

paper analyses a case of contract reversal in the market for ambulance services. The paper suggests that the sociology of markets-literature provides insights into market institutions of importance to relations between government and contractors that will benefit contracting out theory. Building on document analysis and interviews with 19 key stakeholders, it is demonstrated how a regional government in Denmark tried to wrestle the service provision from a long-time private provider and create a competitive market, only to discover that the implementation of the new contract was beset by obstacles largely stemming from informal norms in the market and attempts of the existing provider to hamper market entry for challenger firms. The result was a contract reversal: from private provision to government-provided service delivery. The paper contributes to the contracting out literature by providing a more elaborate understanding of the institutional conditions under which contract reversals can take place.     

From-Long Term To Short-Term Contracting

One can look at the arrival of New Public Management and the extensive public sector reforms inspired by this theory from many angles. Here we examine the shift from long-term contracting, typical of bureaucracy and traditional enterprises, to short-term contracting, borrowed from private sector governance methods. Short-term contracting has three principal uses in the governance of the public sector: (a) contracting with service providers after a tendering/bidding process; (b) contracting with the CEOs of the incorporated public enterprises; and (c) contracting with executive agencies about what they should deliver. Theoretical analysis, supported by substantial empirical evidence, suggests that short-term contracting eliminates the extensive post-contractual opportunism connected with long-term contracting, but is vulnerable to precontractual opportunism. Short-term contracting is not just another public sector reform fad, but constitutes a new tool for government which increases efficiency when handled with prudence.     

Can Vendors Buy Influence? The Relationship Between Campaign Contributions and Government Contracts

Over the past 30 years, research on government contracting has identified three major influences that help explain variation in contracting decisions—managerial, organizational, and political. This study looks to advance the political influence literature by introducing a factor that has received limited attention—vendor influence. This study specifically focuses on contract transactions at the U.S. federal government to determine if vendors influence the contract award. Traditionally, political influence is studied at the macro or meso levels. This study shifts the unit of analysis to the micro level which requires a change in measurement of political influence. The study uses vendor campaign contributions to capture political influence on this new level of focus.     

Lessons Learned from Public and Private Contract Managers for Effective Local Government Contracting Out: The Case of New Jersey

To date, very few studies have explored practical strategies for exercising effective financial management of local government contracts through two main stakeholders’ perspectives of the contracting system at the same time. Employing a series of semi-structured interviews with public officials and private contractors in New Jersey, this study attempts to fill this gap in the scholarship. The finding of this study suggests that government agencies should pay greater attention to competitive bids without favoritism, contract specificity, a statewide performance database, sufficient staffing with well-trained personnel, strong leadership, team-based structures, two-way communication, and evaluation based on both qualitative and quantitative values.     

DESIGNING CONTRACTS FOR COMPLEX SERVICES

In this article, we employ transaction cost economics and the contingency stream of organization theory to answer two related questions. First, when contracting for complex services, do governments design contracts for flexibility? Second, is the contingency perspective relevant to understanding contract design? Examining 130 professional service contracts awarded by state government agencies in the USA, we find that task complexity and task unpredictability, two dimensions of task uncertainty, increase the probability of flexible governance. This research highlights for managers the important fact that the potential for opportunism and task complexity are different sources of uncertainty that pose different challenges and call for different governance solutions. The study enriches our understanding of transaction costs by probing the conditions under which task uncertainty matters most (and least), and further shows the utility of integrating transaction cost economics with contingency theory to better understand contract governance.     

California local government contracting after proposition 13

Recent fiscal constraints have forced many local governmental jurisdictions to search for alternative service delivery approaches. One approach frequently discussed is contracting out services to the private sector. While local governments in the state of California have been involved in such contracting for many years, the fiscal pressures which brought abut the passage of Proposition 13 have refocused increased attention to activities in this area. This article focuses on local government activities with the private sector, the reasons for deciding to provide services through the contract method, assesses probable outcomes to contracting out, and develops three future scenarios on the issue.     

A replication of “Contracting out: For What? With Whom?”

In the 1980s, governments around the world adopted New Public Management ideas about inserting competition into government as a way to improve the performance of public organizations. In many nations, contracting out was one method of making governments more businesslike. Yet, there have been few studies of how government contracting behaviors have changed since the early 1980s. We replicate Ferris and Graddy's classic 1986 study of local government production and sector choice to assess how public procurement has changed over the past 35 years. Our findings show that today, contracting out is more commonly used across 25 local government service areas. In contrast to the original study, much of the growth has been in government-to-government contracts. For profit firms are also winning more contracts for high transaction cost work, while nonprofits are receiving fewer government contracts in nearly every service area. Our analysis suggests that contracting out remains of the highest importance in 21st-century governance and that additional research is needed on how to manage contracts to achieve the best value.     

Towards Strong Local Governance: Current Reform Scenario in Fiji

This article examines how the historical context of poor central-local relations and inefficient service delivery structure is used by the current military-led government in Fiji as a ploy for its local government reform agenda. Based on an analysis of secondary information on local government structure and a review of the reforms undertaken by the Review/Reform Committee, this article identifies the concentration of economic and political power at the central level as one of the major obstacles towards empowering local governance in Fiji. The article emphasizes the need for effective institutional reforms to devolve governance and resources from the centre to the grassroots.     

Contracting Out Parks and Recreation Services: Correcting for Selection Bias Using a Heckman Selection Model

Despite the growing scholarly attention on the efficiency rationale of contracting out, the empirical evidence to support claims that contracting out service delivery reduces service costs has not been forthcoming. Using transaction cost theories, this research explores park and recreation service provision costs across contractor sectors, controlling for the choice to contract out a service or not. The two-stage Heckman model indicates the importance of competitive markets and economies of scale in reducing transaction cost risk which local governments must face. This research also addresses how state and local institutional settings define the context in which policy decisions are made and implemented.     

The capacity building programme for english local government: Evaluating mechanisms for delivering improvement support to local authorities

The Capacity Building Programme for local government in England has employed a variety of different mechanisms to support local authority improvement. Like other central government initiatives to improve local government performance, the CBP has been the subject of evaluation of its progress. This article draws on the findings from the evaluation, to compare Direct Support and a series of National Programmes. It concludes by suggesting that the CBP's most recent changes herald an exciting new era for the CBP in which it might better develop the capacity of the ‘whole system’ of local governance and public service delivery to meet locally determined objectives.     

The Effect of Formal and Informal Contracting Mechanisms on Implementation Performance in the U.S. Federalist System

The relationship between contract management capacity and implementation success in local government contracting is well established. However, less is known about how specific contract mechanisms are linked to this success. This study uses implementation of the Energy Efficiency and Conservation Block Grant Program to examine the use of formal and informal contract management techniques in the implementation of energy projects. The use of formal contract mechanisms, such as full and open competitive bidding, contact rescission and outcome-based performance measures, exhibits a statistically significant effect on implementation performance. The findings advance contracting theory and have practical implications for local government contracting and implementation success in fiscal federalism.     

Faith-based initiatives and the challenges of governance

The task of this paper is to offer an analysis of the Faith-Based and Community Initiative (FBCI) established by George W. Bush and continued under the Obama administration based on a critical and decentred approach to governance (networks). The paper starts out by placing FBCI in the context of the welfare reform of 1996 arguing that both share certain basic assumptions, for example, regarding the nature of poverty, and that FBCI can be interpreted as a response to the relative failure of some aspects of the reform of 1996. In what follows, FBCI is analysed as a typical case of (welfare) state restructuring from government to governance. Emphasis is given to the way discourses and traditions such as communitarianism and public choice have shaped the formation of this new governance arrangement in the field of social service delivery in order to strive for a ‘decentring’ of FBCI by drawing attention to actors' beliefs and worldviews. Finally, I argue that it is not least because of a divergence of such views between policy-makers and faith-based organizations that the effect of FBCI remains for the time being limited.     

Contract Management from the Perspectives of Bureaucrats and Contractors: A Case Study of Hong Kong

New Public Management (NPM) encourages private sector participation in the provision and delivery of public services through outsourcing. Bureaucrats and contractors assess the values, processes, and outcomes of contract management differently. This study adopts transaction cost economics (TCE), the resource-based view (RBV), and the principal–agent theory to analyze Hong Kong bureaucrats’ and contractors’ views on contract management. It finds that both groups are critical of the existing contract management system in Hong Kong. The study shows that the government’s neglect of the risks is causing transaction costs because it lacks a proper monitoring mechanism, two-way communication channels, and appropriate training, and because of contract complications and issues of accountability. There is insufficient proof to assert that the government purposefully conceals these risks, but they are not properly addressed.     

RESTRUCTURING GOVERNMENT NEW ZEALAND STYLE

The fourth Labour government (1984–90) has carried out a radical restructuring of executive government comparable to corresonding reforms in Britain. The changes described have been carried out in government Bepartments, state-owned enterprises, the civil service, minister/civil servant relationships, regional and local overnment, and in the organization of the health and education services. The reforms folfow a consistent blueprint based on ideas of economists andublic choice theorists, especially those relating to agency theory and transaction costs. The themes of the New Zealand blueprint are 'decoupling' policy from service delivery, a PrinapaVagent model of managerial decentralization, new financial accounting systems, contracting for service provision and monitoring managerial performance. In implementation, where there are elected authorities but government is the main funding agent, there is uncertainty about the degree of discretion and appropriate accountabilities. Implementation has also illustrated the problems of defining desired outputs and outcomes and in malung them useable by professional workers and elected representatives.     

PUBLIC ADMINISTRATION REFORM IN SRI LANKA

In 1996, the government of Sri Lanka enlisted the help of international consultants to address significant weaknesses in the countr's public administration. Their study focused on reorganization of public administration structures, rationalization of public sector cadres and introduction of results-based management systems and procedures. The analysis focused on five main topics: consolidation of core strategic functions in the President's office; improvement of the policy coordination process at cabinet and ministerial levels; separation of policy-making, service delivery and regulatory functions of public administration; enhancing the effectiveness of line ministries through realigning tasks; and introduction of a results-based management system that links resource inputs with well-defined outputs of departments and offices. The urgency of public service reform has been an issue on the national agenda for some time. Until the institutional capacity and effectiveness of the public administration system is upgraded, the credibility of government efforts to bring about a more liberal and competitive market environment will be seriously in doubt. The recommendations in this article can be extended beyond Sri Lanka, serving as a general model of civil service reform for other South Asian nations.     

Mutual dependence or state dominance? Large private suppliers and the British state 2010–15

As public outsourcing has grown, the need to understand government's relations with supply side actors has become more important for public administration scholars. The article analyses the role of a small group of large contractors in the British outsourcing system during Britain's Coalition government. These ‘public service conglomerates’ have thus far received little attention in the public administration literature. The article compares two approaches for understanding the role of these corporations and analyses why the corporations faced sometimes severe disruption during the Coalition period in the form of multiple contract problems, conflict with ministers and financial problems. Over the period, the corporations became the objects of policy debate, and what had appeared to be a stable set of arrangements started to fracture. The case shows the value of analysing the political and organizational foundations of contracting arrangements.