New Jersey Governor Releases Privatization Report

Most interesting is the report’s call for a centralized entity whose sole purpose is to promote competitive efficiency within state government.
by | July 22, 2010 AT 9:00 AM

The New Jersey Privatization Task Force has delivered its final report to Gov. Chris Christie -- and he's excited about what he's reading, calling it a path to a more efficient, cost-effective government. The report highlights more than $200 million in potential cost savings.

"In March, I asked the Privatization Task Force to develop a strategy that would reduce the size, scope and cost of state government," said Christie. "What they have provided is a path for change that will benefit New Jersey's taxpayers..."

The report recommended privatizing services in a wide variety of areas from highway maintenance to prison food services, from toll collection to vehicle inspection. It includes a brief overview of recent privatization efforts in New Jersey and other states. "There have been -- and continue to be -- numerous successful privatization successes in New Jersey," notes the report.

Senior leaders of the state Legislature criticized the report. "Certainly state government needs to operate in a more cost-effective way, but our history with privatization is dotted with instances where we've had to go back and spend more just to clean up mistakes," New Jersey Senate President Stephen Sweeney told the Newark Star-Ledger. "We cannot rush into privatizing just for privatization's sake." Historically, public employee unions have been ardent opponents of privatization.

Most interesting is the report's call for a centralized entity whose sole purpose is to promote competitive efficiency within New Jersey's state government:

States that have had the most success in privatization created a permanent, centralized entity to manage both privatization and related policies aimed at increasing government efficiency. Such an entity can constantly evaluate agency performance, and implement and oversee privatization initiatives in a consistent way across state government. New Jersey would be well served by an entity whose mission is to seek government efficiency and create competition for service delivery. It should assist government agencies in developing a “business case,” for any proposed privatization...

According to the Task Force report, successful privatization requires appropriate management structures and suitable policies to ensure best practices are followed. Time will tell how many of the report's recommendations Christie will be willing and able to follow through on.