Privatisation Competition And Regulation In The U.K.

The UK experience of Privatisation has, in many ways, been unique not only in its scope and extent but also for the various modalities of privatisation tried out with various degrees of success. But above all, the UK experience is unparalleled because it is the only country to have adopted a conscious policy of spreading the benefits of privatisation among the public at large and enforced competition and regulation in a pre-determined way, so that benefits were maximised. The privatisation process was usually preceded by restructuring the public enterprise aimed at covering it into one which would invite investment-this included splitting up the enterprises functionally to avoid privatisation of public monopolistic organisations and creation of competition, so that the enterprises could achieve desired economic efficiency and benefit the consumers. However, where enterprises were privatised in their entirety, regulation served as surrogate competition to achieve the same objective. The UK experiment has proved that these methodologies have succeeded in benefiting the Government, the consumers and the companies privatised. Government benefited from constraints on public sector borrowings on the one hand and earned substantial revenue from sale of its shares in public sector enterprises; consumers benefited from lower prices and better services and companies benefited from lower costs, more efficient means of production and meaningful autonomy to conduct their affairs. This is the reason why the UK experience serves as a model for countries wishing to privatise their public sector undertakings not only for the benefits of their Government but for their citizens.