The outsourcing of public services is set to grow by at least £20bn by 2020, according to new analysis by OC&C Strategy Consultants.
The research found that departmental spending on outsourced services has increased from 22% to 28% over the course of this Parliament.
The consultancy firm also said the findings reflect the diverse nature of public service contracts, with the top 15 suppliers accounting for just 10% of local authority spending on third parties.
Vivek Madan, partner at OC&C Strategy Consultants, said: ‘Controversial cases of public sector outsourcing risk overshadowing the overwhelming number of examples where outsourcing is working well. With innovation in technology and a new wave of research into areas like criminology, there is more opportunity than ever to reduce costs and increase the quality of public services.
‘Outsourcing neither fundamentally guarantees nor fundamentally prevents the delivery of world-leading public services. What we’ve seen all too often is successive governments and organisations committing one of the three deadly sins of outsourcing – focussing on inputs rather than outcomes, devolving too much or too little control to the contractor, or letting politics rather than reason drive decision-making.’
