The State should opt out of education, health and water supply, IBEC's competition consultant claimed yesterday.
Mr Myles O'Reilly also said the State should cease to own all its commercial companies. He claimed that the primary barrier to competition in the Republic's economy was the State.
At a conference in Dublin, Mr O'Reilly said it was "extraordinary" that the State was owner of the major companies in sectors it regulated. Only by transferring such companies from State ownership could that anomaly be solved. Mr O'Reilly said he spoke in a personal capacity - IBEC policy was different.
His paper said: "Assuming that one believes in the benefits of competition, it is arguable that there is a need to firstly change the ownership of all State commercial companies. Similarly, the provision of services directly by the State needs to be questioned." He added: "The State should opt out of supporting public services of essential services and utilities such as water supply, public libraries, education and health."
Other options included taking such services out of the State sector or opening them up to competitive tender. But absence of a policy commitment to do that meant the only possibility was to use European competition law to prompt change, he said.
"As we have seen in the sectors such as telecommunications, electricity and transport, it is necessary to introduce regulations to liberalise the market. The first requirement in some sectors to bring about competition is, therefore, to introduce regulation even though regulation in itself can inhibit competition. Regulation can be good if it encourages competition, or bad if it inhibits competition at the expense of consumers."
