Toll road bankruptcy shows failure in outsourcing public services Corporations and government agencies seeking to outsource public sector work nearly always make the same argument: the move will save taxpayers money. Experience shows that is rarely the case. This is partly because despite whatever claims a corporation makes about doing government work, corporations are based on profit. They have to make money somewhere, and eventually their profit comes from your pocket. A good example of this sort of failure is the Indiana Toll Road. In 2006, Spain’s Cintra and Australia’s Macquarie Group Ltd. leased a 157-mile toll highway in Indiana from the state for a 75-year agreement for $3.8 billion. By September 2014, the operators were filing for bankruptcy, buried under $6 billion in debt and looking to sell the rights to operate the road. It is a scenario many CSEA members are familiar with: everyone seems to know how to do our jobs better than we can, until they try and fail, and no one listens to public employees until it is too late. We have seen this attitude from some in the private sector taking over nursing homes, the outsourcing of patient care for the developmentally disabled, and in municipal services such as water treatment. By principle, there are many government services that should be delivered by public employees and the government responsible for providing the services. A perfect example is privately operated prisons. Laws are written and passed by our elected representatives, enforced by publicly employed police, and justice delivered by our courts, which represent a critical part of our government’s foundation. To turn someone convicted of a crime over to a private prison operator is to shirk the responsibility of a democracy and its rules. Philosophical arguments aside, a larger problem occurs when public entities outsource public resources, such as roads, and then discover the private operator is cutting corners, such as not filling potholes, because the operator is losing money, and the public is left to shoulder the burden of unsafe roads and poor delivery of services. February 2015 The Work Force 5
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