Rewiring the State: The Privatization of Information Technology in the Ontario Public Service (1972-2003) A Dissertation Submitted to the Committee on Graduate Studies In Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy in the Faculty of Arts and Science TRENT UNIVERSITY Peterborough, Ontario, Canada © Copyright by David Rapaport 2014 Canadian Studies PhD Graduate Program January 2015 ABSTRACT Rewiring the State: The Privatization of Information Technology in the Ontario Public Service (1972-2003) David Rapaport Senior managers in the Ontario Public Service (OPS) and neo-liberal public policy advocates rationalize the privatization of Information Technology (IT) as an organizational quest for new efficiencies, specifically efficiencies imported from market economies. The findings of the research for this study indicate that IT privatization frequently results in inefficiencies, dependencies and a loss of core skills. The explanation for widespread IT privatization must be sought elsewhere. This study researches and depicts two related IT developments. The first development is the evolution of IT privatization from the earlier practice of body-shopping, i.e. the hiring on contract of IT consultants to the more complex public private partnership. This evolution is a reflection of the maturation of privatization. Body-shopping informs the alienation of IT skills from the public sector, the shaping of a labour hierarchy based on skills distribution, and the foundation for the public-private partnership. The second development, the evolution of OPS management attitudes towards IT privatization, is a reflection of growing neo-liberal hegemony. Archival research indicates middle management disdain towards excessive IT privatization in the early 1980’s; particularly its high costs, loss of skills and growing dependency on external private sources. By the ii late 1990’s, parliamentary committee transcripts indicate IT management acceptance of more excessive IT privatization. As neo-liberal practice became more accepted and as governments and central ministries pressured line ministries through budgetary and organizational controls, IT managers accepted their new roles as authors of RFP’s and tenders of public sector work. The IT service providing industry gladly bid on contracts and acquired the new skills required for future IT projects, exacerbating the provision/dependency cycle. Furthermore, the new technologies provided an ideological smokescreen of technological necessity to conceal the market forces that promoted and benefitted from IT privatization. “Why do managers in the Ontario Public Service privatize the production of Information Technology systems?” The dissertation has two tasks when answering this central question. First, it must refute the efficiency arguments. Second, it must formulate an answer within the context of neo-liberal state transformation, new investment strategies of IT service providing corporations and a restructured IT labour hierarchy. Keywords: Privatization, Information Technology, Ontario, New Public Management, capital accumulation, neo-liberalism, state apparatus, government, public sector, public private partnership, P3. iii Preface This study on IT privatization represents the third dimension in my complex relationship with Information Technology. I retired from the Ontario Government after twenty five years as a programmer/systems analyst for two Ministries as well as a union activist who opposed all forms of privatization, including IT privatization. I unconventionally began graduate studies after retirement. This study is a late-life project to theoretically understand the ideological and organizational logic of IT privatization. The research and the writing of the dissertation provide me with the opportunity to understand and analyze the field and the technology where I worked for over thirty years and its privatization that I challenged politically for twenty years. My intellectual curiosity was certainly stimulated by those decades of political opposition to IT privatization. A suspicion of bias would be understandable. As a member of the executive board of the Ontario Public Service Employees Union (OPSEU), I actively opposed the practice of contracting-out of Information Technology and, indeed, the privatization of any public sector activity. As a leader in the union’s opposition to the privatization of Information Technology, I regularly challenged IT management and senior IT executives of the Ontario Government. I appeared often at the Grievance Settlement Board (GSB)1 for the mediation and arbitration of disputes involving the use of IT contract staff by the Ontario Government. In addition to my leadership role in the union, I worked as an IT professional for two ministries in the Ontario Public Service (OPS); the Ministry of Transportation and Communication from 1984 to 1985 and the Ministry of Education from 1985 until my retirement in 2009. In many of my assignments at both Ministries, I iv worked alongside IT contractors and employees from IT consulting houses. Contract staff directed me in some of my work assignments. In other work assignments I directed contract staff.2 I had and continue to have relationships with some of the people interviewed for this dissertation. Many were contacts in one or both of those capacities, either as an IT professional or as a union activist, admittedly an odd combination of life journeys. The intersection of my technical career path and my union activism provided an unusual lens into the professional/worker dichotomy of IT workers; one that was exacerbated by employer induced workplace pressures. Software products, such as code generators and application-development tools as well as the rise and development of the IT contractor elite created a less secure work environment for in-house state-sector IT workers.3 That work experience was also a focus of my union activism. My professional and oppositional backgrounds provide me with an atypical insight into the Information Technologies, their organizational dynamics as well as the implications of IT privatization. A knowledge of the skills and the technologies results in a critical and informed analysis, providing me with the capacity to assess the claims of IT contractors and IT executives. My technical background includes the testing and use of application developmental tools, hierarchal and relational databases, data access languages, second, third and fourth generation application packages and programming languages, systems development methodologies, operating systems, and telecommunications products and protocols. I worked on large mainframe applications in v distributed data processing environments as well as personal computers using the MS- DOS and Windows operating systems. The main purpose of this preface is to provide full disclosure. It is certainly not meant to be material for an employment resume. In fact, my skills are no longer in high demand. They are the skills of a past generation of data processing and Information Technology systems professionals. While some large organizations such as banks, insurance companies and government ministries maintain many of their main-frame platforms and large databases, most IT applications development projects in the past two decades are on object oriented platforms. My status as an IT professional is compromised by technological change in software development platforms. I am effectively deskilled by the technological developments and innovations of the past two decades. The restructuring of the IT labour market in this recent period is largely a result of changes in application development software.4 The restructuring of the IT labour market in the OPS is also informed by the uneven distribution of skills and the rise and persistence of a stratum of independent IT professionals and IT software service corporations. They had and continue to have the capacity to reap and assimilate IT skills as well as the opportunities to market those skills that make them seemingly indispensable to any organization that requires IT systems. The Ontario Public Service is an obvious target for their skills as well as their marketing initiatives. When I joined the OPS in 1984 as a computer programmer/analyst at the Ministry of Transportation and Communications, I immediately noticed that IT contractors occupied vi the more creative and prestigious positions in the development of the distributed data processing systems for vehicle registration and driver licensing. My first work assignment was training for programming the Mohawk Data Science (MDS) computer, the end user platform and technology for the Vehicle Registration System (VRS). The consultant who developed the MDS programs and the interface with the IBM mainframe application and the IBM Information Management System (IMS) database at the Downsview OPS data centre in Toronto directed my training. Consultants designed, programmed and implemented the VRS application. By 1984, the system was in full production mode and the consultants who designed and implemented the application trained in-house civil servants, including me, for future maintenance and enhancement assignments. When I moved to the Ministry of Education in 1985, I encountered the same labour hierarchy; high priced consultants occupying lead positions in the development of mainframe Decision Support systems, ORACLE and VAX based distributed IT systems for school boards and MS-DOS based systems for the colleges in