Making a success of government outsourcing

The UAE has announced plans to outsource government services, but such agreements need careful management

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Making a success of government outsourcing (ITP Images)
By  Mark Sutton Published  March 7, 2016

The announcement by the UAE last month that the government intends to outsource many of its services puts into focus one of the most pressing issues for the public sector in the region, the question of finance. Low oil prices have undoubtedly put pressure on government spending in a way that the economies of the GCC have not experienced before, and while the leading countries have already taken steps to diversify their economic base, there is still a need to look at how government services can be provided in the most economical manner, while maintaining a balance with quality of service.

E-government has already been a major driver in making provision of government service more efficient. In many different areas, the days of having to visit numerous government departments, to complete multiple forms and file endless paperwork have been replaced with online services. The more advanced e-services have combined the functions of multiple organisations, in some cases making transactions completely virtual.

The digitalisation of such services has obviously saved the users time and effort, but it has also allowed public sector organisations to reposition their resources, allocating staff to more important duties than just manning counters and allowing some physical locations to be closed or repurposed. Even the elimination of physical handling of documents has saved in areas such as storage and transportation.

The drive for more efficiency in government in the region is now going beyond just digitisation of services to save money, and indeed, new methods of funding and ways of operating are now being considered by government leaders and IT decision makers in the region.

There are definitely models of operating that can benefit the GCC. More use of open source, sharing of IP and greater collaboration among government entities are all topics that .GOV has touched on before. There is a lot of potential for Public/Private Partnerships, and alternate means of finance that such arrangements can offer, and again, some government organisations are already looking at how the PPP model can be applied to IT projects and platforms.

Outsourcing has been successful for some governments in some fields in other parts of the world, and while outsourcing can sometimes be seen as a trend that swings in and out of favour - sometimes seen as essential, sometimes as undesirable - there could be benefits to be gained for the GCC too.

There must be adequate checks and balances on these sorts of agreements, of course. The drivers behind private and public sector activities are fundamentally different, profit versus public good, but they need not be in opposition or mutually exclusive. However, there may be some areas where it is culturally inappropriate to outsource services, and there are even economic ideologies to consider - anyone with experience of the efficiency and cost of using the private rail network in the UK versus publically-owned (and far superior services) in other countries in mainland Europe will understand that the private sector doesn't always do things better than the public sector, and if happiness is the final goal, then private may not always be the best route. Sensitive areas such as law enforcement or social services may be preferred to be left to the control of the state rather than treated as a profit centre.

If outsourcing is the chosen route, as with private sector outsourcing agreements, detailed, well-defined, service level agreements are a must, coupled with meaningful incentives or penalties to ensure that both parties stick to the spirit and the letter of SLAs. Governments need to be able to walk away from a service provider if the relationship is not working - outsourcing should not leave a government so tied to one provider, or so lacking in its own capabilities, that they cannot easily break a contract that is not working.

As data becomes more and more valuable thanks to analytics, rights and ownership to data is becoming more of an issue, and with any data generated through public services, such as health information, the sensitivity of the data must be accounted for as well.

There are numerous other factors that must be considered to make outsourcing a success - some can be learned from the private sector, other lessons can be learned from public agencies that have already been successful with outsourcing, and other ways of working will have to be worked out afresh.

With careful planning and a spirit of co-operation, the governments in the GCC, can, and indeed should, look to new ways of working with the private sector to ensure that the growth and prosperity they have enjoyed can be maintained, and that the ambitions to lead the world in good government can continue with the same momentum that has been experienced so far, even if some of the burden shifts to the private sector.

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