All Commentary
Friday, February 1, 1991

The Growth of Privatized Policing

Nicholas Elliott is a financial journalist in London, and an associate scholar of the Adam Smith Institute.

Privatized police! The suggestion is usually met with disbelief, even by free-marketeers who would like most other government services shifted into the private sector. But there are good arguments to justify privatization of at least some policing functions, and few are probably aware of the spread of privatized policing that has been taking place both in the United States and in Britain.

Many object to private sector involvement in policing and criminal justice bemuse they say that it is the state’s responsibility to maintain law and order. This view fails to take into account the origins of rights. In liberal democracies, rights are considered to reside originally with individuals. The responsibility of law enforcement is only ceded to the state so that rights may be protected more effectively. The state does not own the right to enforce the law, it administers this right on behalf of the people. Therefore, there is no reason in principle why private individuals should not have law enforcement duties delegated to them, as long as they are responsible to the same system of law under which the state operates. This point has been argued by James Stewart, Director of the U.S. National Institute of Justice: “Although law enforcement is rooted in constitutional principles, the responsibility of government to ensure security need not necessarily mean that government must provide all the protective services itself.”

Those who argue against private policing often assume that it is only the police who ensure that laws are observed at all, that there is a sharp demarcation between the policeman and the citizen. This disregards the role that individuals have always played in keeping order just by going about their daily business. As urban analyst Jane Jacobs writes: “The first thing to understand is that the public peace—the sidewalk and street peace—of cities is not kept primarily by the police, necessary as police are. It is kept primarily by an intricate, almost unconscious, network of voluntary controls and standards among the people themselves, and enforced by the people themselves.”

A Growing Industry

Private sector police are nothing new. Until the middle of the 19th century most of Britain’s policing was provided by groups known as “Associations for the Prosecution of Felons.” These groups provided law enforcement, crime prevention, and insurance services to their members.

More recently, there has been a steady growth in the private security industries of Britain, the United States, and Canada. In each of these countries there are now more private security guards than official policemen.

More policing services are being contracted out to the private sector by the official police forces and by local government; and as private individuals become more affluent, they are showing more willingness to buy additional security from the private sector. There is evidence that private firms can often do the same job more efficiently and more cheaply.

All over the United States, different types of police service are being performed on contract by private firms. In Amarillo, Texas, local police have authorized a private security company to respond to alarm calls. Nearly three-quarters of American cities have contracted out the removal of illegally parked cars. A 1986 survey by Hallcrest Inc. found that 44 percent of U.S. law enforcement officials contract out the patrolling of public property.

In Fresno, California, 21 private security firms provide security at shopping centers, in apartment complexes, at concerts and sporting events, and at the city convention center and zoo. The firms provide their services to the city for $10 per hour, compared to the cost of $59 per hour if the police were to do the job.

Los Angeles County awarded 36 contracts for guard services between 1980 and 1984 and “county data show that the cost was 34 percent greater when the work was performed by county personnel.”

Policing functions frequently contracted out in the United States include prisoner custody, communications system maintenance, police training, laboratory services, radio dispatching, and traffic and parking control.

Other examples come from Europe. Private security firms in Bavaria are used to patrol the Olympic Park grounds, university sports arenas, a mental hospital in the suburbs of Munich, and the Munich subway. In Switzerland the private company Securitas employs 1,700 guards throughout the country to provide police backup services. Securitas has contracts with the police and with municipalities for such services as visiting restaurants and bars to ensure compliance with licensing laws, and patrolling parking lots and railway property. In the United Kingdom, a survey by Police Review found over 1,000 private security patrols in operation, including 239 patrols operated by private firms on behalf of local authorities.

Bromley Council in London was the first to use a private firm to patrol housing estates. The council hired Sentinel Security to provide patrols in crime-ridden areas.

Some local authorities also take on their own non-police security guards. At Livingston in Scotland, 42 council guards equipped with radios patrol housing and shopping precincts. The patrol is run by a former police sergeant who reports that “residents say they feel safer going out at night because of our patrols.”

A Further Stage

In a few instances, the whole policing of an area has been contracted out to a private firm. The first city to try this was Kalamazoo, Michigan. A private firm was given responsibility for street patrols and for the apprehension of traffic offenders for three and a half years in the 1950s.

One of the most successful examples is the small town of Reminderville in northern Ohio. Faced with having to pay $180,000 a year for continued county policing, residents decided in 1981 to hire Corporate Security Inc. for $90,000 per year. The firm also increased the number of patrol cars in the area, and improved the emergency response time from the previous 45 minutes to six minutes.

The private company was motivated to keep costs down because they were paid a flat yearly fee, and because they wanted to retain the contract. Adverse publicity for this radical experiment disturbed local officials who then set up their own town police department at higher cost in 1983.

Another example of fully contracted out police services is from Oro Valley, Arizona. There, fire-fighting, police services, alarm response, and paramedic operations were provided to 1,200 residents by the company Rural/Metro, The contract was agreed in 1975, with a flat yearly fee of $35,000 to be paid to Rural/Metro, a saving over what the same state services would have cost. Overall control of policing was retained by the town authorities.

During their time in securing Oro Valley, the company employed some innovative operating methods. They patrolled in four-wheel drive vehicles on difficult roads. They initiated a “dark house” scheme whereby residents who planned to be away could leave their addresses with the company, and their property would then be checked twice every 24 hours. Burglary rates in the area fell from 14 a month to an average of 0.7 a month.

However, the Rural/Metro contract encountered opposition from the Arizona Law Enforcement Officers Association Council, who refused access to training programs and refused to grant accreditation. When a state attorney questioned the legality of the arrangement, Rural/Metro decided to pull out.

Notably, when the town authorities took over full provision again in 1977, many costs increased. One change was to replace the civilian employees of Rural/Metro with uniformed officers on higher salaries. By 1982 the police budget in Oro Valley was $241,000 when Rural/Metro had done the job for $35,000.

Neighborhood Initiatives

In Britain and the United States, there has been a proliferation of neighborhood patrols, where residents take the initiative in patrolling their own locality.

On the Brunton Park and Melton Park estates in Gosforth, Newcastle, U.K., residents started their own patrol to deter thieves. Pairs of residents patrol the area in cars between 11 P.M. and dawn, reporting anything suspicious to the police. In three months of patrols only three break-ins occurred, compared to a previous annual average of 130. As a result, these residents have had their home-contents insurance reduced by 35 percent.

One growing form of private initiative in the U.S. is that undertaken by homeowners associations. There are estimated to be over 90,000 of these associations in the United States. According to the Community Associations Institute, 25 percent of them provide manned security for their members, and 15 percent provide electronic surveillance.

In other instances, neighbors get together to hire security for themselves. Residents of a street at Blackfell in Tyne and Wear, U.K., hired a private security firm to cut break-ins and car thefts. One resident explained that “The police would come round after a crime was reported but usually could do little more than take the details from the injured party and offer sympathy.”

Residents of East Graceland in Chicago hired a private security firm to drive out gang warfarefrom their neighborhood, They took on Security Enforcement Services for two months in 1989 for a charge of $8,000. Rather than strong-arm tactics, the company used intelligence to rid the area of crime. They became familiar with the known trouble spots and offenders, as well as with residents. They videotaped illegal activities such as vandalism and drug dealing, and then handed the tapes over to the official police.

The most unusual example of private initiative comes from San Francisco. The city is divided into 80 “beats,” which are sold by the Police Commission to Patrol Specials deputized with peace officer powers (one step down from police officers). Beat-owners then seek business among the companies and neighborhoods in the beat area. The Patrol Specials must pass a rigorous selection procedure, before being sent on an arrest and firearms course at the police academy, and must answer to the Police Commission. The Specials cost nothing to San Francisco taxpayers, and they have endured since the 1800s.

The private sector in law enforcement will continue to grow, and more individuals, neighborhoods, and local authorities will take the step of organizing their own local policing or hiring private security. The choice is either to encourage this as a supplement to official law enforcement, or to demand a rigid distinction between police and people. The experience of privatized policing demonstrates that the idea is not so unimaginably radical as might be supposed.

1.   James K. Stewart, “Public Safety and Private Police,” Public Administration Review, November 1986, p. 764.

2.   Jane Jacobs, The Death and Life of the Great American Cities (New York: Vintage Books, 1961), pp. 31-32.

3.   E. S. Savas, Privatization: The Key to Better Government (Chatham, N.J.: Chatham House, 1987), p. 183.

4.   Police Review, January 13,1989, p. 65.

5.   Oscar Newman, Community of Interest (New York: Anchor Press/Doubleday, 1981).

6.   Police Review, October 21, 1988, p. 3.

7.   Christine Dorffi, “San Francisco’s Hired Guns,” Reason, August 1979; Randall Fitzgerald, When Government Goes Private: Successful Alternatives to Public Services (New York: Universe Books, 1988), p. 73.