Co-operation Win-Win for Unions, Taxpayers: Service delivery innovation should be applauded

Commentary, Municipal Government, Joseph Quesnel

Hopefully, by the mind this column has reached readers, Winnipeg’s alternative service delivery committee would have wisely given due attention and support for proposed changes to its service delivery system.

Winnipeg appears to be ready to break the mold of stagnant municipal public policy by embracing what is called modified managed competition.

Under this system, the city management co-operates with unions to find cost efficiencies that are the same or better than estimates submitted by the private sector. 

The advantage is both management and unions work together to come up with creative solutions. If no in-house savings can be found then the service is contracted out through competitive bidding. 

Winnipeg City Council should be commended for considering this innovative, non-confrontational approach, as an alternative to business as usual.

Canadian cities are not known for having innovative policies.  Traditionally, they have chosen to raise taxes to pay for their expensive old style service delivery models.

Winnipeg, which has frozen its property taxes for over a decade, seems to have avoided this trap somewhat, it there is always good reason to keep costs down.

The approach is positive because it does not assume whether the private or the public sector performs a service better in a more cost effective way. This country’s policy discourse is divided where those on the left envision something approaching a firewall between public services and the private sector. Sometimes the rhetoric on the right almost pre-supposes that the public sector cannot be productive or cost-effective.

To a certain extent, this model under consideration cuts through the divisive rhetoric and focuses on results and value for money first.

It allows the city to determine whether it can perform it cheaper in-house first and also respects union rights by working within the current collective agreement. But it doesn’t end with just finding the cheapest bid. In the report to the alternative service delivery committee it is clearly stated that if modified managed competition is pursued, then that particular service would have performance measures imposed, such as outcomes and continuing cost-effectiveness) which are collected annually and reviewed every three years.

To a certain degree, Canadian labour relations are not used to this kind of labour-management co-operation. Our adversarial system almost promotes polarization of positions and interests. Thus, it is a breath of fresh air to see some form of collaboration at the municipal level. The chief strength of this modified approach is unions participate in the process before a formal competitive bid for contracting out the service occurs.

Winnipeg evaluated this before. In 1998, it considered the “Indianapolis model” of managed competition. Facing large-scale privatization, Indianapolis city workers re-designed the unionized workplace to increase productivity. Services improved. Costs fell. Union members achieved the highest pay increases among US cities due to gain sharing bonuses.

So, unionized workers actually gained from this proposal. It made them better workers and did not diminish their rights.

If Winnipeg City Council eventually adopts these changes – and the right system is put in place – then this really is a win win for everybody.