Privatizing Public Services
Safety
Net for Sale: The Dangers of Privatizing Social Services
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AFSCME and its members embrace the goal of providing
cost-effective, high-quality public services. When public
sector managers and their employees work together toward
this goal, service recipients, workers and taxpayers
benefit, as numerous models of public sector innovation
indicate. Public employers should treat workers as assets to
develop, not costs to cut.
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Social Workers Raise Privatization Concerns About Governor's Mental Health Initiative (4/2007): Maureen Glover of AFSCME Local 34 told legislators that “You will shortchange my clients if you exchange our well-integrated case management services for expanded HMO benefits that clients can’t access.”
She offered this real world example of how the managed care system would break down. “My clients suffer from panic disorders, major depression, social anxiety and paranoia. Who will support my clients so they can get to their medical and psychiatric appointments? It’s not a matter of having an HMO case manager simply give them a phone number for transportation. It’s a matter of spending time with clients in their environment, skillfully helping them manage their illness, and collaborating with their doctors and family.”
“I help some of our most vulnerable citizens,” explained Glover. “I know they need an intensive level of support to get the mental health care they need. Care management from HMOs is no substitute for what I do.”
SHOW YOUR SUPPORT FOR THE WORK THAT WE DO! (4/2007) If you would like to indicate your support for "county-based case management / social services" you can contact the following MINNESOTA HOUSE Health Care and Human Services Finance Division members, especially if you live in their district by Clicking Here.
If you would like to indicate your support for "county-based case management / social services" you can contact the following MINNESOTA SENATE Health and Human Services Budget Division members especially if you live in their district by Clicking Here.
WE NEED YOUR SUPPORT TO MAKE THIS HAPPEN! When you contact any of the legislators, please remember to do so on your own time and on your own personal phone and / or computer!
Click Here to read additional testimony.
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WHEREAS:
Public workers continue to be the backbone of federal,
state, county, and municipal governments, providing
essential services needed by citizens in good times and bad;
and
WHEREAS:
The public has a right to expect honest, efficient public
service workers, who are responsive to citizens’ needs,
provide services fairly, and provide services without regard
to profits, political goals, or personal gain; and
WHEREAS:
Right-wing politicians continue to use privatization to
circumvent civil service systems, due process protections,
sunshine laws, and other crucial safeguards which ensure
honest and open government; these same unscrupulous
politicians continue to use privatization to reward their
corporate friends with contracts, while trying to take away
public workers’ jobs, rights, union contracts, and
political power; and
WHEREAS:
Privatization often replaces family-sustaining jobs with
jobs of lower pay and diminished benefits, without
improvement in the quality of services; and
WHEREAS:
Privatization supporters are intellectually dishonest in
their predictions of cost savings, which do not stand up to
scrutiny, and frequently turn out to be based more on
ideology and wishful thinking than on fact. Privatization
often means major cost overruns and quality problems; and
WHEREAS:
Privatization problems are not confined to specific sectors
or states, but occur across the country, in the provision of
information technology, social services, corrections,
schools, general government, water and wastewater,
transportation, health care, mental health, federal
government services, and others; and
WHEREAS:
Estimates in such sources as Governing Magazine put the
total volume of privatization at “between 15 and 20
percent of all state spending,” and indicate that it “adds
up to a total that may be in excess of $200 billion” per
year, but the same sources indicate that there is a chronic
lack of oversight for privatized services. A
contractor’s association claims local governments spend
about $300 billion a year on privatized services.
THEREFORE
BE IT RESOLVED:
That AFSCME continue to aggressively oppose privatization
and outsourcing by exposing contractors and by educating the
membership, elected officials and the general public about
the problems related to privatization, and by working in
coalitions with other concerned groups; and
BE IT
FURTHER RESOLVED:
That, where appropriate, AFSCME participate in joint
labor-management quality initiatives or other similar
partnership efforts to improve the quality and cost
effectiveness of public services by developing and utilizing
the expertise of public workers and by eliminating costly
and outdated management barriers; and
BE IT
FURTHER RESOLVED:
That AFSCME continue to develop an aggressive communication
strategy that underscores the value of public service and
exposes the practices of private contractors; and
BE IT
FURTHER RESOLVED:
That AFSCME continue to advocate for strong laws and
regulations that shine the light on privatization, that
require ample and adequate oversight of privatized services,
and that require state and local government to disclose and
track privatization spending and projects in detail; and
BE IT
FURTHER RESOLVED:
That AFSCME continue to lobby for the highest standards of
cost-effectiveness, quality, openness, and honesty in public
services, and hold private vendors to similar high
standards; and
BE IT
FINALLY RESOLVED:
That AFSCME continue to point out cases where private
contractors fail to meet high standards, and to insist that
in those cases, the contractors are held fully accountable
for their shortcomings.
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PRIVATIZATION
OF SOCIAL SERVICES - THE FORCES DRIVING SOCIAL SERVICE
PRIVATIZATION
Private
Vendors Seeking New Markets: Before welfare reform in
1996, federal law limited private agencies’ roles in
providing services. Now, states and counties may
contract out their entire cash assistance programs. This
federal policy change has opened up an annual market of
$30 billion.
Pro-Privatization
Ideology: In an era heralding government downsizing and
private sector ingenuity, too many state legislatures
and public social services agencies view privatization
as a worthy end in itself. Instead, decision-makers
should rigorously assess what system reforms are needed
and give specific, quantifiable reasons why a private
agency would be a better, more cost-effective, provider
of services.
Inadequate
Social Services Funding: Even in flush economic times
like these, programs for poor and other vulnerable
populations are under-funded at the federal, state and
local levels. Not surprisingly, service provision often
falls short of expectations. Instead of granting
additional resources to public agencies so they can do
their jobs well, state legislatures and local
governments are increasingly tying budget increases to
extensive privatization.
The
Seven Common Myths of Social Services Privatization
1.
Myth: Privatization improves quality of services and ensures
equal treatment.
Reality:
Quality is uneven at best, with many private companies
limiting services to clients to protect their profit
margins. This can lead to unequal treatment among recipients
of services.
2.
Myth: Privatization saves money.
Reality:
The added layers of bureaucracy necessary to set up
competitive bidding and monitor contracts is expensive, and
cost overruns by successful bidders are common. Where money
is saved, it is often due to contractors paying their
employees low wages and benefits, or cutting corners on
services. In child welfare, for example, cost savings can
result in bigger costs (both financial and societal) when
children who do not receive adequate services end up in
juvenile or adult detention.
3.
Myth: Privatization enhances flexibility.
Reality:
Once a public agency divests itself of the employees,
expertise and other capacities to deliver services, it
becomes vulnerable and beholden to whichever private
contractor is delivering services.
4.
Myth: Privatization reduces bureaucracy.
Reality:
Privatization necessitates new, costly bureaucratic
structures including writing and evaluating Requests for
Proposals (RFPs) and monitoring contractors’ performance.
5.
Myth: Contracting is objective and fair.
Reality:
Political connections and nepotism continue to distort the
contracting process, giving companies multimillion dollar
contracts that are not merit based.
6.
Myth: Privatization prevents waste and abuse.
Reality:
Contrary to popular belief, the private sector is more awash
in waste and abuse than are public agencies, at least in
part because the profit motive often distorts
decision-making.
7.
Myth: Privatization contributes to the greater good.
Reality:
Privatization reduces public accountability and can result
in contracts that cost more and deliver less than originally
promised.
Public
Administration of Social Services Provides:
Greater
accountability to the public
Fair
and equal treatment of often vulnerable social service
recipients
Direct
control over quality of services
Merit
based civil service hiring which prohibits nepotism,
political connections and favoritism unrelated to job
qualifications
Key
Public Sector Roles in Social Services Include:
Gatekeepers
to services
Case
management
Ensuring
due process for clients
Oversight, measuring performance and evaluation
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