Thanks. I actually do support government helping refugees (although I don't see reason why not do it directly), but my point was that I am pretty skeptical about the "This way the reputation of a certain firm will rapidly hit rock bottom as word about bad service gets out. This will keep pressure high to provide good service." claim. The traffickers actually operate under the condition that you claimed as sufficient for this to happen, i.e. "open the market for more private providers and let the refugees pick and pay for their service".

So unless there is some additional framework that lets people evaluate the results, and takes care of fraudulent offers, I don't think empirical experience shows that the condition suffices.

Here in Czech Republic there is a cottage industry of providing lodging to poor people and immigrants (from government support), and it's not very pretty - expensive with poor quality.