Privatization of Welfare Services: A Review of the Literature. The Current State of Social Service Privatization


State and local governments have turned to private providers for a wide range of services, from routine matters such as road maintenance and garbage removal to sensitive undertakings such as fire protection and the operation of corrections facilities (Sclar 2000). A 1997 survey by the Council on State Governments documents the use of privatization by state agencies of at least 15 different types, as varied as environmental protection, education, and the treasury (Chi and Jasper 1998).

This diversity of privatization experience applies within the sphere of welfare and related services as well. Under contract with public agencies, private organizations and corporations supply job training and placement, child support enforcement, child care and child protection, the administration of cash assistance programs, and other services.

This chapter describes the current state of social service privatization. It first reviews data from surveys on state and local contracting. It then highlights the types of social services privatized and, finally, describes the types of nongovernmental organizations that provide these services.

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