Especially with the rhetoric today about creeping fascism, we should recognize that all authorities have the potential to become corrupt and oppressive. We should ensure proper checks against that and consider the potential consequences before implementing centralized services. Efficiency and cost effectiveness should not be the only consideration.
For instance, you might think that there are no potential downsides to a centralized welfare system. However what happens if those benefits are provided only to people of specific ideologies or races? What if it becomes contingent on giving up your biometric data or subject to drug testing as we have already seen in many areas of the US? Maybe we should consider the potential consequences of centralizing essential support structures and social safety nets.