Overview

There are rumours that Government is set to withdraw the so called ‘Two Tier Code’ in public sector outsourcing contracts, a move which would represent a significant policy change, albeit not an unexpected one.

Abandoning the Code would be likely to lead to a material simplification and cost reduction for private sector firms and so called "third sector" service providers who bid to provide public sector services.

Such a step would also seem to be in keeping with Government thinking: externalising public sector services appearing to be a key aspect of the austerity drive. As reported by the Guardian on 17 July 2010, for instance, billions of pounds worth of additional public sector services are expected to be let over the next year or so. This accords with
a shift in the role of a public sector - from provider of services to a commissioner of services.

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