PHS policies - Implementation and monitoring guide

Supply side obstacles


In addition to the above demand-side obstacles, there are also obstacles on the supply side that imply that a private market without supporting policies would lead to non-optimal provision of services. In particular, we can list the following failures that would arise without supporting policies:

  • Unfair competition from undeclared labour would lead to less profitability for the private sector and underinvestment by the private sector (with less innovation, for instance, as a result);
  • Possible labour shortages with regard to required skills. Specifically, some services within PHS (such as care) require specific skills. Given the growing demand for those services, possible labour shortages may arise;
  • Lack of quality guarantee schemes (it must be noted, however, that the private market can propose a guarantee of that type, if it is in its interest, without implementing supporting policies).