Competitive Tension: The Value of contestable public services in a post-pandemic world

In collaboration with the Australian think tank the Menzies Research Centre, the Serco Institute has developed a new insightful report Competitive Tension: The Value of contestable public services in a post-pandemic world. The research finds that by introducing a ‘competitive edge’ to many areas of the public sector, services from public transport to healthcare can be markedly improved, productivity increased, and employment opportunities expanded.

The report finds that a focus on the principles of contestability and user-satisfaction can deliver public services that are 20-25% more efficient.  It also includes case studies of contestable service delivery in Australia and around the world which show that when governments set quality and efficiency standards, contestability can frequently improve performance and service delivery. 

Included in the report’s 12 recommendations are calls for:

  • Contestable processes to be the default strategy for public service delivery
  • Giving employees a voice in contestable processes
  • Empowering citizens to make their own choices on both which services they want, and which providers they choose to use
  • Commissioning public services based on outcomes and objectives

The report’s chief authors are former New South Wales legislator Dr Peta Seaton AM, public policy expert and former Policy Director for three NSW Premiers Matt Crocker, and prominent economist Henry Ergas AO, who previously worked at the OECD and Australian Competition & Consumer Commission.

The reports chief authors are former New South Wales legislator Dr Peta Seaton AM, public policy expert and former Policy Director for three NSW Premiers Matt Crocker, and prominent economist Henery Ergas AO, who previously worked at the OECD and Australian Competition & Consumer Commission.

The Covid pandemic has demonstrated how important a contestable and diverse marketplace is to community and economic wellbeing: The resilience rather than reliance it can create; the spirit of innovation rather than stagnation it inspires; the flexibility rather than rigidity it encourages.

This report hopes that contestability as ‘the default setting for all public service provision’ will prove to be one of the positive lasting legacies of the pandemic.

Read the full report here

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