Tuesday, May 1, 2012

Paper: Outsourcing and Accreditation of Public Service - Providing Efficiency and Accountability


Claudio Travaglini (University of Bologna - Department of Management)  has a new article on SSRN entitled Towards a New Model of Control in Outsourcing and Accreditation of Public Service - Providing Efficiency and Accountability.  This is an important component of privatization, and this paper makes a nice contribution to the literature on this subject.  Here is the abstract:
Public accreditation certification of private institutions and differentiation of institutional forms of public bodies providing public services determines a convergence between public and private nonprofit providing of social, educational and health services in Italy. A new paradigm and the need for new tools of governance and regulation.  In Italy system of public welfare and provision of social, health and educational services has developed in the past fundamental as an expression of the central and local government, regulated, financed and managed by the public administration.  On the other side private, religious, nonprofit institutions providing same services that were not included in public system had maintained a wide autonomy in organizing services, but suffering for the absence of a strong financial support.  In recent years, we can see a gradual process of contracting out before, and then public-private partnership, and now of general accreditation and public financing of private institutions providing public services.  On the other side and in the same period the increasing strategic and financial autonomy of public institutions and their search of financial resources are leading public administrations to a different frame of reference and to the adoption to private (profit and nonprofit) models in managing public services by public bodies.  
So private bodies (profit entities, cooperatives and nonprofit) reduce their differentiation and autonomy to conform to accreditation organizational standards defined by public authorities to gain full public financing and to cover their costs with public tariffs under the 'accreditation' framework regulation.  By contrast, in the meanwhile, public bodies, in search of new opportunities and new funding, tend to adopt private law models (before as public private partnership or for profit company and now as nonprofit public benefit organization) to adopt models more efficient. So public and private bodies provide same services, to same people, with same public money, with very different governance and accountability regulations. This path suggest us to affirm a new concept of 'public service' objective and not subjective, and to identify unified forms of regulation and transparency for it. In particular to public services managed by private operators with public funding should be requested more transparency and a mandatory formalized social control, while to the public bodies should be requested a greater responsibility and economic competitiveness with private entities that have the same standard of service. Only in this way the accreditation could be a fruitful revolution in competition in providing public service.


Dru Stevenson


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