ABSTRACT
This chapter looks at some of the pressures in positive economics for a shift towards indirect provision in the social services. It is concerned with actual performance rather than with ideal types. The chapter describes the some main reasons for change in detail and then examines which of them are particularly important for particular types of service. The argument about public sector service has raged mainly at the level of general economic and political principle. Motives ranged from the desire to encourage voluntary effort to the wish to provide more choice in housing. Employees in new enterprises, whether these are private or semi-public, are less intensely concerned with getting their pay and conditions exactly into line with those in the core public sector. The housing association movement has shown remarkable growth under successive governments since 1970. Local and central government have pension schemes and other fringe benefits that add one-third or more to the hourly wage cost.
