Why not privatization?

The idea of privatizing utilities and infrastructure gained traction starting in the 1970s and peaked in 1992 in Canada and 1997 in the US.

Since that peak, the distribution of public and private employment in the service-producing sector has held constant at a distribution of 29% and 71%, respectively. This indicates that governments are content with the services being provided in-house.

Also, the failures of these privatization efforts cast doubt on the practice as a whole. Here in Calgary, the Calgary Parking Authority (CPA) that had previously contracted out about half of their enforcement services brought those positions in-house. The reasoning was to “improve customer service to Calgarians,” indicating that the service quality of CPA had deteriorated under privatization.

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Insourcing CPA operations has also delivered a noticeable impact on the department's annual expenses. The department's 2015–2018 budget plan, submitted prior to insourcing, projected 2018 expenditures of $64.5 million. In their 2018 adjustment report, the department lowered expenditures to $58.9 million.

Privatization in waste collection

More contemporary research has reinforced growing consensus around the world, that pubic delivery of solid waste collection is optimal. Most recently, in 2016, the Columbia Institute presented 15 Canadian case studies of insourcing in their report "Back in House: Why Local Governments Are Bringing Services Home."

Four cases dealt explicitly with solid waste collection, and one case study was from Calgary. These case studies affirm that insourcing of municipal services is the right choice from both cost and quality perspectives.

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For complete findings and breakdown of the full opportunity costs of privatizing waste and recycling services, read our full report on the subject.

And if you'd like an objective take on privatization, this piece from the Harvard Business Review is one of the best.