Contracting out in NZ: evolutionary or revolutionary? Lessons from the UK experience.

Despite the worldwide trend to Facilities Management Contracting and the documented improvements in organisational efficiency, the NZ health sector has yet to grasp the benefits of awarding a single contract to manage a comprehensive range of services. This appears contradictory for an industry which has considerable assets tied up in supporting its core business and is under huge pressure to reduce costs and improve service. NZ is therefore faced with two options: an "evolutionary" route which could take us over a decade to achieve the same benefits as they are currently enjoying in the UK NHS, or "revolutionary" route, taking a quantum leap forward, both in the way contracts are specified and the way services are structured and managed. In this article Sarah Meads, General Manager of Serco Health Services, takes a look at how New Zealand health providers could learn from the NHS experience of contracting out since the introduction of Compulsory Competitive Tendering in 1983. Serco Health Services is the division of Serco Group NZ Limited responsible for assisting healthcare providers to review and manage a wide range of non-core support services. It shares resource and expertise with similar divisions working with the NHS and health-care organisations in Hong Kong.