The Challenge of Public–Private Partnerships

The Challenge of Public–Private Partnerships

Learning from International Experience

Edited by Graeme A. Hodge and Carsten Greve

The aim of the book is to investigate how PPP reforms function in comparison to the more traditional methods of providing public sector services and infrastructure and who typically experiences the successes and failures of these reforms.

Chapter 8: United States: human services

Lawrence L. Martin

Subjects: economics and finance, public sector economics, politics and public policy, public policy

Extract

Lawrence L. Martin INTRODUCTION In the United States (USA), most human services are provided by the 50 states. The US federal government provides substantial funding, frequently with matching or cost sharing requirements, but actual service delivery is generally delegated to the states. The states have three major options in terms of how human services are delivered: (1) direct state provision, (2) subvention to county governments,1 or (3) private sector delivery. In the United States, the term ‘private sector’ includes both non-governmental organizations (NGOs) as well as for-profit business firms (Martin, 2000; 1999a). The involvement of the private sector in the delivery of human services has a long history in the USA. For reasons perhaps unique to the USA, this relationship has primarily involved the use of contracting. This chapter argues that over the last 25 years two major models (the market model and the partnership model) have competed for dominance in human service contracting. In recent years, however, a new ‘tool’ of human service contracting (performance-based contracting) has appeared on the scene. While it is too early to say with confidence, PBC may be the mechanism that will lead to more public–private partnerships in human service contracting (Martin, 2005, 2004b, 2002; Thomson, 2002). THE MARKET MODEL AND PARTNERSHIP MODEL OF HUMAN SERVICE CONTRACTING Human services contracting in the USA has been influenced by two competing paradigms, the market model and the partnership model (Kettner and Martin, 1998, 1987, 1986). In the market model, the role of...

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