Grandstand. The issue of public services is often taken upside down in political debates. Indeed, it is approached exclusively as a cost that should be reduced by committing to a spending freeze or a reduction in staff. But consistent management and rigorous economic reasoning cannot do without a precise assessment of economic and social needs.
Broadly speaking, most of the activity of the public services concerns two sectors, health and education. However, as the recent work of France Strategy on “sustainability” points out, the French economy of 2030 will experience an increase in public spending needs, for reasons that are both demographic because of an aging age pyramid, but also to meet new training needs, in the context of an environmental transition that calls for new skills.
The political question is therefore whether we will meet these needs by strengthening and improving the quality of public services, or whether we consider letting the market meet these growing needs.
A process of privatization “from above”. When the needs are dynamic and the means do not follow, we are mechanically witnessing a privatization “from above”: the private sector develops because it is left to respond alone to some of the new needs, the most profitable . At the same time, the public sector, saturated, must face the most difficult missions.
This process is already at work in the hospital sector: from 2002 to 2019, the share of hospital beds provided by the public fell from 66% to 60%, while the private for-profit fell from 20% to 25%, the private non-profit sector remaining stable at 15%. The same dynamic can be observed in the nursing home sector, where the share of beds provided by the for-profit private sector is currently 22% and could reach 36% in 2030 without political intervention. In higher education, from 1999 to 2020, the number of students increased by 600,000, but 60% of this increase was supported by the private sector.
We could be satisfied with that: after all, public or private, the important thing is that the services are provided to the population. But the issues of efficiency and equality plead for a reinforcement of the public rather than for the scenario of privatization from above.
The public service does not cost households more. Take the example of health. With very different tax and benefit systems, OECD countries face similar health needs. It is thus possible to compare current health expenditure per inhabitant. However, it is clear that a lower share of public health expenditure is not a guarantee of cheaper or even better quality health. In this regard, the case of the United States is caricatural: Americans spend an average of 22 euros per day on their health, the French 11 euros. In the French context, the control of health expenditure implies much more a regulation of the tariffs practiced than the reduction of the means allocated to public services: each time a public health establishment opens in town, without exceeding fees, the price overall health decreases.
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