Thimphu Thromde is dabbling in privatisation of waste collection, which is drawing mixed public reactions. The municipality says privatisation is better and more efficient, but attempts to privatise public services have proved unsuccessful globally.
The justification for privatisation Thimphu Thromde gives is that private companies do better and more ‘efficiently’ than government, which will lead to cutting costs. What they fail to understand, though, is that a public service and business are inherently different. Private companies don’t do things unless there is profit. When the government does something, the bottom line is not profit.
Essentials like food, water, energy, access to health services, housing, sanitation and sewage, and social care are too important to expose to the volatilities of the free market. Public services are funded by public money, paid to public workers, managed by public representatives working together to deliver social utility – every Ngultrum put in recycles within the public economy.
Economists and academics, who study outsourcing, are divided on their view on whether it usually saves public money. Recent data from a state in the USA show that privately operated prisons often cost more to operate than state-run facilities. Similarly, privatisation of railway in the UK failed to raise sufficient ticket revenues to make profit that the operator had to raise the ticket fee above the rate of inflation. In a town in Tennessee, the USA, a privatised fire department allowed a family’s home to burn down because the family hadn’t paid the fire department. They didn’t act until the fire threatened the house next door. Privatisation of electricity supply in Australia, housing in Europe, immigration services to private security agency in the UK, private healthcare system in the US and the UK have all not fared well.
Privatising garbage collection is business and business means profit. Businesses are not created to deliver a public service and a public service is not intended to be a business. They are different.
It’s safe to say that there will be many residents who will be unwilling or unable to pay for waste disposal. This has numerous implications. To avoid paying, residents might dispose of waste into the rivers, streams, bushes, and street corners. And the private company undertaking waste collection will neglect households that don’t pay or fail to pay the collection fee. Where would their garbage go?
Thimphu residents are already paying for several services. The idea of paying for basic public services has mostly been imported wholesale from other countries where socio-economic systems are totally different. Let’s stop mindless aping.