UE Local 170 members are mobilizing against efforts by the state to privatize information technology (IT) jobs. On July 14, nearly 100 state Office of Technology employees showed up for a union press conference outside their workplace in the Capitol Complex – turning it into a rally against outsourcing. UE members say that state’s plans would not only wipe out jobs, but would endanger the privacy of West Virginia residents.
“Do you want your tax data, your driver’s license information, your health information being made available to people in other states, or possibly overseas?” asked Carolyn Saul, a systems programmer with 25 years service in state government. She described in detail how privatization of state IT operations has proven to be a costly blunder in Virginia, Texas, and Indiana. For example when Indiana privatized IT for its welfare system, the “error rate on welfare claims went from 4 percent before outsourcing to 18 percent afterwards.” IBM and Indiana are now suing each other over the terms of their $1.3 billion contract.
Pam Schwarz, Local 170 president, told the crowd that privatization in other states “has not been a panacea, but rather a way to plunder public wealth.” Privatization of IT would “affect the lives of hundreds of highly-skilled state employees, many of whom have 10 to 20 years of experience... At a time when the state has experienced the loss of thousands of good-paying jobs, why would it be looking to outsource hundreds of highly-skilled jobs?”The state’s plan would outsource not only the Office of Technology, but IT work within other departments including the tax department, division of highways, motor vehicles, workforce, environmental protection, health and human resources, and insurance commission. IT privatization, Schwarz pointed out, “will have state agencies competing for limited customer service time from a private for-profit contractor” that also has other clients.
COSTLY RUSH TO OUTSOURCE
Carolyn Saul noted that, in addition to outsourcing jobs, Kyle Schafer, the current state chief technology officer, “is proposing to outsource the state’s mainframe computer and servers” and idea whose foolishness seems to be obvious even to others in the administration. “Schafer’s managers have repeatedly told him that we could consolidate many of the servers in-house to save money,” Saul continued, “but Schafer has refused to listen to their suggestions. IBM told Schafer that it would cost more for them to run the State’s data centers than what the state is currently spending now. It seems strange to me that instead of saving money, Schafer proposes to increase spending by turning our computers over to IBM.”
Even federal officials have cautioned West Virginia against outsourcing. A letter last November from U.S. Undersecretary of Agriculture Kevin Concannan to West Virginia DHHR Secretary Patsy Hardy warned: “We believe that the outsourcing of key application processing duties to for-profit organizations is an unwise use of state and federal resources that undermines program accountability.”The union says that Schafer has yet to identify what the cost of providing this service is compared to what purchasing these services from the private sector will cost and that even IBM in its “secret” efficiency study, said that it cannot provide IT services at less cost than the state can provide these services for in house.
Local 170 planned to follow up the rally with face-to-face meetings to lobby legislators against state efforts to outsource IT operations. An op-ed piece by Carolyn Saul elaborating the union's position was published in the August 2 edition of the Charleston Gazette. An August 9 news report in the Gazette indicated that, since the union's protest, legislators have become more skeptical of the outsourcing plan.
“Once the privatization of IT services takes place it will be impossible reverse,” warned Local President Schwarz. “The loss of the state’s data center and hundreds of highly-skilled IT employees will mean the citizens of West Virginia will be at the mercy of a private for-profit contractor, whose main concern will be maximizing its profits for its shareholders.”