I think this is a case of the usual issues of in-sourcing vs outsourcing. I know a large insurance company that flip-flops on their decisions every 3-5 years. When in-sourced, staff are "lazy, cost too much, can't be fired due to HR rules, etc, etc" so they outsource, at which point the outsourcer becomes "they are not responsive, too hard to work with, every little items needs to be tallied against the contract, every little change requires too much time and requirements specification, etc, etc" so they turn around and in-source again, to begin the cycle over again.
In theory, in-sourced allows for better flexibility on what work is being performed (you are already paying the dollars for hours, so you can allocate as you desire) but you may lack expertise, less flexibility to expand then reduce/contract the workforce (which is especially true with governments and their unions), too hard to get rid of people if they do not grow skills and adapt as the organization changes, etc. Outsourcing works well when there are well defined boundaries, and requirements to expand/contract the workforce (within reasonable limits, the problem here is that the Olympics are too big for an outsourcer to deal with because there are not enough staff in reserve).
None-outsourced government IT projects aren't any better.
We decide to install system X so we need to hire some experts in system X. But system X experts are expensive and if we hire them as staff they are paid according to fixed internal pay scales - or there is a hiring freeze - or we have to hire 'internal candidates" from other government branches first.
So we hire consultants. These are a lot more expensive. Then part way through the project there is an investigation into how much "external consultants' are costing. So there is a ban on external consultants which the government shows has saved us $$$ million.
The result of course is that we have a half-implemented system X that costs us $$$$million and doesn't work.
Comments
I think this is a case of the usual issues of in-sourcing vs outsourcing. I know a large insurance company that flip-flops on their decisions every 3-5 years. When in-sourced, staff are "lazy, cost too much, can't be fired due to HR rules, etc, etc" so they outsource, at which point the outsourcer becomes "they are not responsive, too hard to work with, every little items needs to be tallied against the contract, every little change requires too much time and requirements specification, etc, etc" so they turn around and in-source again, to begin the cycle over again.
In theory, in-sourced allows for better flexibility on what work is being performed (you are already paying the dollars for hours, so you can allocate as you desire) but you may lack expertise, less flexibility to expand then reduce/contract the workforce (which is especially true with governments and their unions), too hard to get rid of people if they do not grow skills and adapt as the organization changes, etc. Outsourcing works well when there are well defined boundaries, and requirements to expand/contract the workforce (within reasonable limits, the problem here is that the Olympics are too big for an outsourcer to deal with because there are not enough staff in reserve).
None-outsourced government IT projects aren't any better.
We decide to install system X so we need to hire some experts in system X. But system X experts are expensive and if we hire them as staff they are paid according to fixed internal pay scales - or there is a hiring freeze - or we have to hire 'internal candidates" from other government branches first.
So we hire consultants. These are a lot more expensive. Then part way through the project there is an investigation into how much "external consultants' are costing. So there is a ban on external consultants which the government shows has saved us $$$ million.
The result of course is that we have a half-implemented system X that costs us $$$$million and doesn't work.