A affordablehousingaction.org, we’ve already expended a certain amount of ink on the notion that the “private sector does it better,” a favourite theme of neoliberal politics which has had a strong influence on decision making. A recent investigation of the emergency shelter system in New York City calls attention to the things that can go wrong when services are contracted to the private sector.
The New York Post has zeroed in on one organization, which operates several emergency shelters for people who experience homelessness. The investigation led to a series of private companies and payments that have nothing to do with providing services to people who have lost their housing. Read more in the New York Post: Troubled NYC Shelter Operators Have Scored $4 Billion In City Contracts, Records Show
How does the Post’s investigation affect: the clients who use the services, all shelter service providers, as well as the government staff who administer the contracts?
- Clients may lose confidence in the people who are supposed to be helping them. This is an unnecessary distraction for people who are already in a crisis.
- Service providers may be putting every cent they receive into assisting their clients, but they are likely to find themselves subject to additional public and funder scrutiny. This inevitably necessitates more time spent in reporting and responding to media inquires, and less time assisting clients to cope with living in a shelter, finding housing and/or moving on.
- Government staff can also anticipate questions and further work at best. Allegations of mismanagement and staff dismissals in such circumstances would not be unusual. Altogether, not a very positive environment for administering funding to help people in a crisis.
The Post’s article documents that City staff were already investigating where the shelter funding was going. On its own, the staff investigation could have led to consequences (which, according to the Post, seem to be in process) or could have been covered up.
The external media investigation by the Post certainly makes a coverup more difficult. It also raises doubts about staff competence, especially when the adage that “the private sector can do it better” is accepted without question. When it is not accepted as gospel and misgivings are investigated, the costs fall on the shoulders of the city and, in this case, the people who are staying at emergency shelters.
Another Country… Another Emergency
A recent article in the Guardian argues that “the private sector can do it better” thinking is making a mess of helping people who are in crisis. In this case the subject of investigation is the COVID response in Britain. The authors, Rosie Collington and Mariana Mazzucato, point out that as part of our collective reliance on the private sector, a lot of public funding is being tipped into the pockets of a few individuals.
They also remind us that the public sector has been innovative and effective in the past. And they are brazen enough to suggest that the public sector can and should be given the chance to deliver services directly again. You can see more of their thinking in the Guardian: Britain’s public sector is paying the price for the government’s consultancy habit
Finishing Up At Back At Emergency Shelters…
Although it is not a widespread practice, there are local governments that operate emergency shelter services themselves. In the “small government” mindset, service reviews almost inevitably recommend that these services should be contracted out. The above articles demonstrate that such recommendations are far from risk free.
