Contracting out at Local Government Level in Slovakia and the Czech Republic

„To make or buy“ is a question faced by public organizations when considering how public ser-vices should be delivered to their citizens. Public organizations must decide whether to produce goods and services internally or to acquire them from external sources, to use some of alternative service delivery arrangements. At the local level, the most prevalent way of acquiring goods and services externally is to contract with for-profit and non-profit firms and the use of contracting ap-pears to be on the rise.The goal of our paper is to present a set of analytical data connected with local public services and their delivering by private sector. Brief theoretical part of this paper highlights general theory and CEE specifics in public service provision, and analytical part provides selected data on the use of contracting-out in Slovakia and the Czech Republic, including trends, main problems of contracting out processes and outcomes. This study uses a quantitative approach to investigate the research question. The study analyze the original collected survey data from own research and the data gathered by the research pro-jects focused on the research question. A survey was conducted for each of selected local public service to collect data on the frequency of use of contracting-out, the way/system of deciding for contracting-out and selecting the supplier, the efficiency and quality impacts of contracting service.The external delivery of local public services is very frequent solution in Slovakia and also in the Czech Republic. However, the situation in selecting an appropriate procurement method is bad - in most cases municipalities do not respect public procurement law. Contracting out public services is apparently more cost-intensive than internal delivery of public services, because of inaccuracy in calculating of the real cost of service, insufficient supply of public services produced by private sector, higher quality standard of contracted services, non-systematic decision-making process in service delivery arrangement selection. Solutions for this situation might be increased transparency, implementation of regular testing of all existing arrangements of public service delivery; implementation of accrual accounting in the public sector.