I think the (broken) idea is,
In House services costs get bloated with tea breaks, career progression training, workers' Xmas party, pension schemes, sick pay, health & safety, etc. that these execs do not care about.
Also 'Accounts' have to deal with many suppliers of things use by the In House staff. All those extra account staff to check your 20p expenses claim was filled in correctly...
Also the (broken) idea of with no competition there is no drive to efficiency - sending things 1st class instead of second or in A4 envelopes - keeping useless staff because it is more expensive to fire them.
I worked for a global co. we had locally source cleaners who were happy and caring. Then HQ makes a deal with a Crapita type which costs the same locally, but may be cheaper in central London. We get the same actual people doing the cleaning, but now they are miserable and uncaring because their (hours and hence) pay has been cut.