"If you see a plan that says what they will do differently and how that will cost less, it might be OK." I totally agree with your sentiment but if they put that in the plan, then the council could just do it themselves couldn't they? Why would they need the outsourcing "partner"?
I always see outsourcing as an admission by management that they don't actually know what they are managing and have to get someone else to do their job for them. The only valid reason for outsourcing in my view is economy of scale. But even with that, multiple councils could get together and still do an effective job without outsourcing. It just takes good management. But it's easier to outsource and let someone else deal with the horrible 'doing stuff'.