Following the Labour victory at the 1997 General Election which ended 18 years of Conservative political domination of the UK, the precise future of the competitive contracting state is uncertain.' The question of how public services should be provided specifically, whether the role of the state should be that of direct provider, purchaser, or market regulator remains pressing in respect of a wide range of health care, ancillary, social and community services.2 Against this background, the present paper considers the usefulness of the concepts of responsive and reflexive law and governance in the evaluation of contractual as distinct from bureaucratic arrangements for service delivery. Particular reference will be made to local public services such as social housing management, refuse collection, and building and street cleaning. The focus on local authority services is timely. Councils will soon be freed from the legal requirement to engage in competitive tendering as a prerequisite to providing services by their own employees.4 Without compulsory competitive tendering (CCT), there will be no need for 'contractual' relationships between local authority clients and internal provider units. Many commentators believe that the removal of compulsion will result in a return to bureaucratic organisation. This paper suggests, on the contrary, that the positive aspects of the recent experience of internal contracting (notwithstanding the damaging effects of compulsion), and the