Privatization: An International Review of Performance

Privatization: An International Review of Performance

Privatization: An International Review of Performance

Privatization: An International Review of Performance


Graeme A. Hodge is director (research) at the International Centre for Management in Government, Monash Mt. Eliza Business School, Monash University, Australia.


The 1990s are a significant time of change for governments throughout the world. One major economic and social issue in many countries is that of reforming organizations across the public sector. These reforms have been driven by several considerations. Citizens are certainly looking to get more for less from government as a whole. There is increasing pressure from all fronts for reduced funding. Simultaneously, there are also significant community expectations for marked improvements in government practices in terms of economic efficiency and service delivery. Many improvements expected of the public sector are modeled on those of the private sector. For example, a greater customer focus is expected across government. Old methods and procedures are being increasingly challenged, and service delivery practices and standards are being subjected to review.

These drivers of reform are leading to a renewed questioning of not only the practices of government but its structures, processes, and service delivery mechanisms. The very roles and responsibilities of government are being opened up. In providing services, there is now a requirement to benchmark and to openly demonstrate competition and efficiency.

This review follows these pressures for change and the imperatives that are inherent within them. This book aims not to provide a fashionable statement of current trends in service provision, but a careful and measured review of empirical findings in contracting out and the sale of government enterprises. Such a considered review is in keeping with the simultaneous requirements of the public sector both to review service delivery improvement options, and to be held accountable to the public in adopting those changes that clearly do lead to enhanced performance.

Government uses a significant proportion of the resources of a nation. For example, projected government outlays as a proportion of the U.S. gross domestic product (GDP) were around 33.1 percent in 1998, and for Organisation for Economic Cooperation and Development (OECD) countries around 39.2 percent on average. Of this, a significant part is related to the provision and production of goods and services.

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