While the alleged ability of private finance to deliver "additional" resources was, as shown above, the central motive behind PPP's expansion during devolution, the rationale was broadened under direct rule. Working Together had signalled this change in emphasis, stressing the ability of PPP providers to introduce "reform and change management" in the public sector so as to develop "new working practices or less bureaucratic procedures" (p. 3). Combined with the "strong preference" for private finance, this set the stage for the major expansion of PPP outlined in Section 1 of this report.
The importance of this new rationale grew during the period of direct rule, and mirrored reforms in England where the private sector was encouraged to play a larger role in the public services delivery. However, this agenda had a distinct role in NI where PPP was regarded as playing a role in a wider attempt to "rebalance" the NI economy in favour of the private sector. Direct rule ministers argued that the NI public sector was too large; that the level of a public expenditure per head was higher than the UK as a whole and that it needed to be reduced; and that efforts had to be made to stimulate the private sector, including through the use of tax-funded services (Hain 2006).
The Review of Private Services in NI (NIERC and Regional Forecasts 2004), commissioned by the Northern Ireland Office, suggested that the "Direct Rule Administration promote privatisation of appropriate organisations still in the public sector" (p.9). Privatisation should include "whole organisations" but also "individual government activities could be hived off to the private sector to a greater extent than at present" (p.115). In response to this, the NIO said it would "look at areas where public/private partnerships in capital projects can help lever in private finance to Government projects" and "continue to explore how the private sector can be most effectively engaged" (p.6).
Similarly, the Economic Vision for NI (DETI 2005) said the government would deliver "a reformed public sector which is in better proportion to the size of the private sector" and "exploit greater partnership between the public and private sectors for the delivery of services and facilities" (p.9). This stood in contrast with the stated preference of the Committee of Finance and Personnel's for retaining services within the public sector; and the statements of devolved ministers that PPPs were about increasing public investment, and were not intended to result in any privatisation.