cover image: Contestability

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Contestability

3 Feb 2005

Contestability refers to the introduction of competition into a government monopoly, irrespective of whether the competition comes from the public or the private sector. [...] Unlike contracting out, a PPP involves the pooling of the financial resources of both the public and the private sector (Hrab 2004, 5). [...] According to Ruth Richardson, New Zealand’s Minister of Finance from 1990 to 1993, the Public Finance Act established a true government balance sheet (Richardson 2004, 2), and all three pieces of legislation helped lay the groundwork for the Fiscal Responsibility Act of 1994 and the creation of high-performance government in New Zealand. [...] These legislative changes, together with other reforms, have led to the establishment of high-per- formance government in New Zealand, which now boasts one of the lowest inflation rates and one of the highest growth rates of the member countries of the Organisation for Economic Co-operation and Development, and its once-high unemployment rate is also falling (Richardson 2004 2). [...] The survey also found that the change was responsible for both improved performance and cost savings of up to 60 percent, although most estimates of the impact of contestability suggest savings of 10 to 40 percent.
government education politics public finance economy school privatization municipal government public expenditure business competition economic policy employment government policy municipal services outsourcing contracting out ppps government budget ppp public–private partnership seader

Authors

Mrozek, Andrea

Pages
29
Published in
Canada

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