Coalition plans to open up public service markets to a wider variety of providers have failed to consider the ‘transaction costs' involved – leaving the public exposed to greater risk of service failures and oligopolies, experts have warned.

While reaction to the publication this week of the Cabinet Office's delayed Open public services White Paper has been mixed – critics accused the Government of lacking fresh ideas, while supporters backed a document merging diverse service proposals into a single strategy – a consensus seems to be emerging around a perceived failure to reflect the true cost of creating new markets.