Accountability and Transparency
• Lack of public information and open records
• Lack of public input on decisions affecting the public interest
• Loss of recourse if the public is harmed
Democratically elected governments are accountable to voters and their processes are open to public scrutiny. Privatization shuts the public out of decision-making that deeply affects the public interest.
Terms of privatization contracts often are decided behind closed doors, without any public input. In some cases, the public is unaware of the possibility of a privatization deal until the contract is almost finalized. A prime example is the privatization of Chicago’s parking meters, which was planned and negotiated without public knowledge, and left the public extremely unhappy with the outcomes.
Transparency also refers to the public’s ability to obtain information regarding government contracts. While government documents generally are available through open records requests, private companies can shield information from public view by claiming it has a proprietary status.
Another important aspect of accountability and transparency relates to the government’s ability to properly manage contracts. Contracts and governmental policy must contain adequate mechanisms for monitoring and oversight to ensure contract compliance and hold contractors accountable for contractual abuses and the failure to deliver on promised deliverables.
In many large complicated contracts, it is difficult to hold companies accountable partly because no one can anticipate all possible contingencies and set consequences, and partly because companies may be able to shield important information from the government. Furthermore, governments that have sunk a lot of time and money into a contractual relationship may choose not to hold the contractor accountable for fear of losing that initial investment or the transaction costs associated with contract cancellation.
As the Blackwater Nisoor Square case shows, it can be difficult for the government to hold a private company accountable for even the most heinous actions. A New York Times editorial titled "Privatized War and Its Price" (January 2010) noted that in dismissing charges against Blackwater agents for killing civilians in Iraq, a federal judge "highlighted the government’s inability to hold mercenaries accountable for crimes they commit."
No state has fully emulated the federal concept of a single searchable grant and contract database, but government leaders are gradually picking up on the need for more public transparency when it comes to tracking -- and evaluating -- the spending of taxpayer dollars.
This Issue Brief provides a state-by-state overview of some of the existing Internet databases for grants, contracts, bond allocations, and regular budget appropriations.Read more »
All around the country, companies are running schools, hospitals and prisons – duties that were once the exclusive responsibility of government. But public records laws and open meetings laws in most places have yet to catch up with this trend of contracting out. Many, including the federal Freedom of Information Act, say that only an entity that qualifies as an “agency” under the law is subject to the public records law. That may include all kinds of quasi-governmental entities (more on that later) but excludes many government contractors, even those that have significant responsibilities or receive large amounts of public money.Read more »