Insourcing: Reclaiming Public Control

Governments across the country are turning to reverse privatization, or “insourcing”, to bring contracted functions back in-house.  

Despite promised cost savings and better services, cities and states are finding that reasserting public control over public services is saving taxpayer dollars, improving the quality of our services and creating community-supporting middle class jobs.

In the Public Interest has collected some of the many insourcing cases in a backgrounder brief that highlights the experience of our states, cities, and federal government in cutting costs and increasing quality through insourcing across a wide array of sectors.

Jails. By bringing prison medical services in-house three years ago, Ohio has greatly increased the quality of services for inmates, allowing for public physicians to provide continuity of care to patients, and has achieved significant cost savings, including $7.2 million in prison prescriptions alone.

IT Systems. In 2011, New York City took advantage of its public expertise by insourcing much of its technology work, saving New Yorkers $100 million by consolidating server rooms and an additional $25 million by employing talented city staff.

Water. Evansville, Indiana ended its long-term water and sewer privatization contract with American Water in 2010, shortly after the private company underwent a lawsuit from the Environmental Protection Agency involving untreated sewage leaked into a nearby river. The city estimated that ending the privatization will save the city $14 million over a 5-year period and foresaw increased autonomy of the public to invest in the quality of the water system while preventing steep rate increases. 

You can read about more cases in the full insourcing backgrounder brief.

ITPI will continue to track insourcing trends, so send us any cases and examples you may have.