Financial Aspects of Britain's National Coal Board

Abstract

Both in Britain and America financial success, in terms of commercial standards, has been the yardstick commonly employed in evaluations of the public corporation. Private enterprisers have always insisted that self-support is the only valid criterion, while the nationalizers themselves have often agreed. Certainly this was true of successive Conservative Governments which created the first British corporations in the period between the two great wars. In the view of contemporary Socialist philosophy, however, the traditional criterion has lost is pre-eminence, becoming secondary if not irrelevant. Today the public corporation per se tends to be viewed as nothing more than a convenient means of achieving most effectively the proper end of public enterprise a wider and cheaper distribution of goods and services than was possible under the British system of private ownership. Indeed, Socialists add, there may exist a fundamental disparity between the end of 'public and that of financial self-sufficiency. The danger of a rigid application of the financial criterion is most clearly illustrated by those British public corporations which have operated under a heavy indebtedness, incurred by excessive compensation payments. To meet oppressive financial obligations, they have sometimes been forced to compromise their proper role. In the London Passenger Transport Board particularly, the objective of public service was subordinated to the fetish of financial success.' As a result, the public received an unfortunate impression of Socialism in action, while disenchanted employees were obliged to strike in order to obtain justifiable wage increases. Finally, it is maintained, the criterion of financial self-sufficiency overlooks the existence of subsidy programs in the field of private enterprise; or if recognized, the practice is often summarily dismissed as a deviation from the norm.2 However, it would be