Obligations II : Contract Law

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Term Paper Title	Obligations II : Contract Law
# of Words	2855
# of Pages (250 words per page double spaced)	11.42

Obligations II : Contract Law

Using Examples (eg education, health, etc), critically analyse the

role of contract principles in the provision of public sector

services.

Traditionally, there has been a distinction, in essence if not in entirety, between

public sector bodies on one hand, and private firms on the other.Public service areas,

for example schools, hospitals, and the utilities, were under the control of public

bodies such as local government, and stayed at a distance from the sphere of free

markets and the world of contract law. However, since the reforms of the nineteen-

eighties and nineties, such divisions have become far more blurred.

The Conservative governments of Margaret Thatcher, and later John Major, made

radical changes and applied contract principles to the ownership, culture and control

of many of the services that were previously in the public sector. The motivation for

these changes was mainly ideological. The government, influenced by ideas being

introduced by an ideological counterpart government in the United States, believed

that, in crude terms, the market was best. Many nationalised industries, such as

British Telecom and British Airways, who were seen as inefficient, providing poor

quality services or products, that the taxpayer paid for . Such industries were

privatised and exposed to the pressures and opportunities of the free market.

Later on from this, in the late 1980's, the government sought to improve public

services including health, education and the prison service, using similar free-market

ideas and principles. The reasoning was that applying the rigours of market forces

into these areas would improve their cost-effectiveness, the levels of service and so

on. Part of this philosophy, was that of the empowerment of users of these services

(the patients, parents and pupils, etc) by turning them into "consumers" of a product,

contracting with a "supplier" (the hospital, school, etc). This is related to the liberal,

and in particular free market liberal, idea that individuals are their own best judge

about what is best for them. Much of these ideas were developed by free-market think

tanks such as the Adam Smith institute, who believed welfare economics theories

could be applied in the public sector.

For reasons of practicality and public opinion, these services were not privatised, but

had only market ideas incorpora...

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