Ministerial Control of the British Nationalized Industries

Abstract

In Britain the public corporation has for some time been almost universally regarded as the appropriate form of organization for publicly-owned commercial undertakings, but the only common article of faith underlying this agreement is the negative proposition that such undertakings cannot be run efficiently by organizations on the lines of government departments, staffed by civil servants. Beyond that there is nothing approaching unanimity, either between or within the political parties. And now that the nationalization programme of the Labour party is substantially completed (and, with the important exceptions of road transport and steel, substantially accepted by the Opposition) attention centres increasingly on those questions which remain in dispute.Foremost among these is the question of public control: how much control? and by whom? The scheme adopted by the Labour Government rests on two premises: first, that by eliminating the motive of maximizing profits, nationalization eliminates much of the need for external controls, since the industries may now be expected to devote themselves wholeheartedly to public service; and, second, that the equity interest which passes from the shareholders to the general public can only be exercised by a minister of the Crown, answerable for his actions to the public's representatives in Parliament. Thus, while the various nationalized industries differ from each other in a number of respects, all may be classified together under the general description: “public corporations, strong minister type.”