Justice: Private Sector

Lord Wallace of Saltaire Excerpts

Tuesday 18th June 2019 Lords Chamber

Asked by

[Lord Wallace of Saltaire]

To ask Her Majesty’s Government what plans they have to review the principles of government outsourcing to the private sector, particularly in regard to justice matters.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, the Ministry of Justice has supported the Cabinet Office-led review into outsourcing. In February 2019, the Government published three new documents: guidance on financial distress, a revised supplier code of conduct and The Outsourcing Playbook. The playbook applies to all outsourcing decisions, but with a focus on complex outsourcing.

[Lord Wallace of Saltaire (LD)]

I am sure the Minister will agree that the underlying drive for privatisation of public services was public choice economics, which said that the concept of public interest and public service was not a strong motivating factor and that the profit motive was the only one. Behavioural economics has now accepted that there are other psychological motivations, including, in the words of economists themselves, “inequity aversion”, “fairness” and even “altruism”. Therefore, is it not correct that, in dealing with probation or rehabilitation in prisons—two obvious areas where outsourcing has got into trouble—factors other than the profit motive need to be given a great deal more importance, and that this undermines some of the principles of outsourcing?

[Lord Keen of Elie]

The noble Lord makes a perfectly valid point. The Government are extending the requirement of the social value Act in central government to ensure that all major procurements explicitly evaluate social value, where appropriate.