2131312- Privatization of government services

There has been a growing trend towards the privatization of governmental services in the world today. Privatization of government services refers to the handing over of public functions to companies that are privately owned. This paper will examine some of the benefits and detriments of privatization. I will give my position on the topic and give reasons why I take this position.

Benefits of privatization

The privatization of government services is beneficial in various ways. The government is not capable of providing all services to all its citizens. This is because the government might lack some expertise that is necessary to perform different functions. Most of the private companies have all the relevant expertise required to effectively provide various services to the public. This means privatization of government services will provide an opportunity to private companies to use their resources and tools in order to effectively provide services to the public. These are particularly services that the government can not provide due to the required expertise (Nichols, 2010).

Private companies are also quite productive hence reducing the costs incurred by the government. Through privatization, the government makes savings on the services they could be offering to the public but are now offered by private companies. Private companies have a profit incentive and hence they work towards cutting costs and becoming more efficient. The main interest of private companies is profit generation. Therefore they strive hard to cut down their costs as much as possible. Due to privatization, many companies such as British Airways have been able to improve on their efficiency and increased their profitability. Privatization will lead to a reduction of the size of the government. This is because the government would no longer require many people to work for them since they have privatized the services they were offering. The government does not have resources in place to deal with the emerging and changing needs. The private sector on the other hand is up to date hen it comes to technology required to satisfy the changing and emerging needs. With privatization, the private companies are able to cope with these changes in the needs of the public. Privatization also mans that there will not be nay political interference when it comes to service delivery. The privatization of monopolies that were previously controlled by the government allows more firms to venture into the industry. This increases competition and leads to efficiency when it comes to service delivery (Nichols, 2010).

Detriments of privatization

There are also various disadvantages of the privatization of government services. With privatization, the public good is normally threatened since the government loses its control. This means that the private companies will have the freedom to do anything they want since the government is no longer providing the services. This leads to the development of monopolies within the private sector which are quite difficult for the government to control. Privatization also leads to corruption and unscrupulous behaviors from greedy businessmen who are out there to benefit themselves without considering the interest of the public. There are some industries that perform important public services such as education and healthcare. Within such industries the driving force should not be profit but due to the greed by private companies, they end up concentrating on profits and at the end of the day compromise on service delivery. This means that the quality of services declines with privatization since the private companies only aim to make maximum profits (Nichols, 2010).

Personal position

I am against the privatization of government services since the standards of services that are offered by the private companies are not the same as those ones that are regulated by the government. The private companies’ main focus is how they can use minimum costs and realize maximum profits. They aim at saving money and are least bothered on delivering quality services to the public. Delivering quality services to the public is not as easy as private companies think. In many occasions, private companies have failed and it has forced government workers to come in and clear their mess.

References

Nichols, R. (2010). The pros and Cons of privatizing Government Functions. Retrieved September, 25 2014 from http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&uact=8&ved=0CDsQFjAD&url=http%3A%2F%2Flocalgovinstitute.org%2Fsites%2Fdefault%2Ffiles%2FThe%2520Pros%2520and%2520Cons%2520of%2520Privatizing%2520Government%2520Functions.pdf&ei=7OIjVJumLKmaygPu3IHADA&usg=AFQjCNEBDTshrG_MEXhjuSCHLiiwi1Oc8A&sig2=hjHGdDUwune24w4QEeRuYg