You see two important knock-on effects as a result of CSOs not being available.
The first is the obvious one, which you've heard a lot about today. People who would otherwise properly serve their sentence in the community and rehabilitate are forced into the jail system. I don't think there's any real debate that they are not going to rehabilitate there to the extent that they would in the community.
You also see the opposite end of the spectrum. Individuals are getting suspended sentences instead of the more harsh version of a sentence in the form of a conditional sentence because the parties that are litigating and the judges who hear the cases realize it would be completely unjust to send the person to jail. They are left with only one other alternative, which is simple probation. Rather than unjustly sending the person to jail, they give them something less than a conditional sentence and probation. That doesn't do anything for the administration of justice either.
When we take away the discretion of this elegant middle option, we're really forcing people to go to one end of the spectrum or the other and avoiding the obvious answer, which lies in the middle and is often the conditional sentence.