Outsourcing in the public refuse collection sector: exploiting old certainties or exploring new possibilities?

An outsourcing process in a medium-size city, by Norwegian standards, provided the background for our study. In 1996, the city council decided to contract out the refuse collection in half of its total area (the western part of the city), and to let the public refuse collection enterprise continue to collect in the other half of the area. The public enterprise also participated in the competitive tender, without success, however. The bid submitted by the public refuse collection enterprise was used as the basis for a benchmarking process performed by the chief administrative officer of the city in May 1999. The process resulted in the requirement that the public enterprise downsize its number of refuse collectors by 27 per cent. The city thus acquired a more cost-effective refuse collection system both in the western part, now run by a private company, and in the rest of the city, where the collection remained the responsibility of the public enterprise, in its newly pared-down and reorganized version. Detectable changes in the refuse collectors' health status in the three-year period immediately following the outsourcing constitute our main focus in this study. We found that the downsizing and reorganization of the public enterprise had a negative impact on the refuse collectors' health status. One year after the downsizing, six of the 27 refuse collectors remaining in the public enterprise had been diagnosed with heart problems or musculoskeletal pains that were sufficiently serious to form the basis of their individual approaches to secure a disability pension, which all six were in the process of acquiring. The registered sick leave among the refuse collectors showed a dramatic increase during the same period. We found clear indications that the refuse collectors remaining in the employment of the public enterprise had no alternatives in the labour market. Although not the focus of this study, we found that the totality of costs and benefits, not only for the enterprise in question, but also for local and national authorities, needs to be considered in any realistic assessment of the impact of public sector outsourcing of activities.