Friday, November 21, 2008

IT outsourcing

Georgia is planning on outsourcing its IT operations to private firms with Gov. Sonny Perdue estimating that such a move will save taxpayers $180 million or more over their lifetimes (which, in all honesty, is actually a relatively insignificant amount of savings when stretched out over 40-plus years and compared to the size of existing state budgets). Not that I'm not all for encouraging efficiency in government and finding ways to get more bang for our buck, but I do think this is an odd move.

For starters, the savings is miniscule, but there's also a cost to recognized.

Buried at the bottom of the story is the observation that 92 state employees will be laid off and the remaining jobs transferred to the private firms. These reductions are where most of the savings will be realized, and that's something not to be so easily glossed over. Because, in addition to these layoffs, presumably those transferred employees will personally see higher costs of health care coverage and no longer will have access to the fiscally secure state-managed retirement plans.

Again, those are arguably areas of financial savings for the state, but added burden for those workers.


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