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Canberra Times article by Ross Peake, May 2013 on a report on the potential impact of public sector cuts which can create waste rather than savings

In ‘False Economies – Doing Less with Less’ a report published by the Centre for Policy Development, author Christopher Stone argues that shifting responsibility to the private sector is not necessarily a cost-effective strategy when the public sector is better placed to provide essential services.  ”Cuts to the public sector can end up costing far more than they save, and leaving some jobs to the private sector will result in them being done badly or not at all,” he says in ”While some politicians talk about doing ‘more with less’ this can in reality mean doing less with less.”  The report is published by the Centre for Policy Development, to build on its report from earlier in 2013 which warned about further cuts to the public service in the federal budget:  ‘A blind faith in the market can result in decisions to withdraw government from the jobs it should be doing.  This can be through selling government assets, outsourcing services previously provided by the public sector, or simply withdrawing government from the area in the expectation that the private sector will fill the gap.  Privatisations, government outsourcing, or simple cuts, are pursued on the mistaken assumption that the private sector is always more efficient than the public sector, and therefore the costs to government, or the economy as a whole, will be lower.  ”This can be a false economy, with the private sector doing so much less in critical areas, that any potential savings are overwhelmed by the costs of doing too little.”  The report gives case studies to argue the value provided by public services is greater than their costs.

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