However, it is doubtful if a tendency to incentivise contraction of service inputs in a system of resource scarcity will ensure high quality and responsiveness.
Because of the lack of other industries, state governments became dependent on the national government for funds, contributing heavily to the contraction of social services in recent years.
But the outlook was soon reversed and an unexpected contraction of the services sector in December, the first time in two years, again raised fears that the country might not be able to stave off another recession.
The chronic underfunding of primary care, the neglect of community services, the in-year cuts to public health funding which went almost unnoticed, and the rapid contraction of adult care services are all overshadowed by hospital debts, missed A&E wait targets and now seven-day working.
For-profits reduced operating expenses more aggressively than not-for-profits but faced even larger reductions in revenues, suggesting a fairly major contraction in the intensity of services provided.
However, the proportional increase of the agricultural contribution to the GDP after 1990 is the result of contraction of the industrial and service sectors.
Meanwhile the ONS based its 0.6% estimate of services growth on a 0.1% contraction on the month in the sector in June (latest prevailing figures were for May).
While the extent of such problems will depend upon the structures and processes that the provider or fund-holder has in place with respect to clinical governance, purchasing, and industrial relations; resource release may be more achievable when resources are redeployed in quite a direct manner from areas of service contraction to areas of service expansion.
Recall, however, direct redeployment of released resources might be difficult to achieve when areas of service contraction demand a different level, mix and quality of inputs than do areas of service expansion.
"Economic contraction in the third quarter was attributable to the continuous decline in exports of services, of which exports of gaming services decreased by 37.4% year-on-year and exports of other tourism services dropped by 15.3%," it added.
