Friday, July 30, 2010
Contract Out Services?
Rep John Dougall out of Highland has called for UTA to look into contracting out services in order to save money. I am not sure what Dougall's motives are, as I am cynical about most politicians and their true motives, but lets take a look at the pros and cons of contracting out services.
First of all, cost usually go down when you contract out services. Most contract operations do not use union labor (I will do my union rant some other time), so they pay less than union wages. In addition the operations usually cut down on overhead over the bureaucratic transit agency.
However, the cons currently out weigh the positives.
First of all, while I believe in private enterprise and especially small business, there is little change a small operator the Resorts (owner of Lewis Brothers) or a company like LeBus would end up operating the service.
Instead one of the "big" operators such as Stagecoach that are not only non local companies, but are not even US based. There for the profits and the benefits of the outsourcing not only leave the immediate area, they do even benefit our country. Since employement will stay the same but wages go down there is no benefit to the community.
In addition the quality of service can be questionable at best. Because these operators do not truly care about the local community they do not care about the quality of service provided to the customer. While some union drivers don't care about the quality of service they provide because they know it is so hard to fire them, the outsourced drivers have very few oportunities for advancement and there is little oversight, often the drivers can have questionable attitudes.
A few years ago I was in Denver for a meeting. At the time Denver's bus service was outsourced to three different providers. I actually had a wonderful experience with a bus driver so I decided to let RTD in Denver know. Usually companies only hear negative so I go out of way to let them know when I have good service. I called RTD and the operator was in shock they were getting a compliment.
He said it was the first time he had ever gotten a postive comment about a contratracted service. Whether that is a sign that people don't have the class to compliment the drivers when they do right or the drivers are that bad in general, you will have to decide for yourself.
Other downside of contracting out service is maintence. Often the companies will scimp on taking care of things to make more money. Once again because the companies are not local they do not have any reason to ensure that the equimpment is properly maintianed to help the community.
In Los Angeles and other cities that have contracted out service there has been bad experiences with air conditioners, wheelchair lifts, and other equipment malfunctions. In addition there has been multiple horror stories about last runs of the day missing due to malfunction equipment so thus people being stranded. In addition I have seen photos of buses being held together with duct tape in order to keep major items such as the A/C cover from falling off.
The only solution is to have oversight and conditions in the contract if they things happen or maintence is not up to standards, the contracter can be fined.
Am I saying that all contractors are bad? Of course not, like anything there is good and bad. However, anytime you contract to a company that has no financial interest in the local community, you send the money out of town with no benefits to the community.
While I have no idea what Dougall's true motives are, you need to look at the unitended consequences of any action taken and make sure that the local community benefits from the decisions made.