New Public Contracting

This book charts the significant increase in Britain over the last 25 years in the deployment of contract as a regulatory mechanism across a broad spectrum of social relationships. Since Labour came to power in 1997, the trend has accelerated, the use of contract spreading beyond the sphere of economics into public administration and social policy. The 'new public contracting' is the term given to this distinctive mode of governance, characterized by the delegation of contractual powers and responsibilities to public agencies in regulatory frameworks preserving central government controls and powers of intervention. In many cases, the contracts are not legally enforceable, their power as regulatory instruments deriving from the hierarchical authority relations in which they are embedded. Examples of the new public contracting include the regulation of relationships between government departments through Public Service Agreements and Framework Documents; the regulation of relationships between individual citizens and the state through Youth Offender Contracts, Parenting Contracts, and Jobseekers Agreements; the funding of public infrastructure projects through Public Private Partnerships; and the restructuring of key public service sectors such as health, social care and education through contracts in competitive quasi-markets, reflecting the Government's privatization agenda. The book critically analyzes and evaluates such contractual arrangements with reference to theories of relational contract and responsive regulation. It argues that while in business and other private relations contract routinely enables the parties to regulate and adjust their on-going relationships to mutual benefit, this is often not the case in the new public contracting. In many instances, crucial elements of trust, voluntariness, and reciprocity are shown to be lacking. This and other weaknesses in regulatory design are likely to impede the attainment of the Government's policy objectives. The book demonstrates the problems of ineffectiveness and lack of legitimacy generally associated with this mode of regulation, and specifies institutional and other conditions that need to be satisfied for the more responsive governance of these public service functions.