The government is keen on nationalisation, pressing ahead with completing rail and regulating private utilities to get similar effects. Lifetime study of UK nationalised concerns has taught me that they are bad for employees, for customers and taxpayers. They invest badly, fail to innovate and fall behind in productivity.
Employees of nationalised concerns are more likely to go on strike. Sickness and absence rates are often high, signs of an unhappy workforce. There is more likely to be a work to rule or I know my rights Union mentality than a We are here for the customers approach. There is insufficient flexibility over pay, so there can be staff shortages where pay is below market rates alongside Ā above market pay for others who have benefitted from comparability awards. Management often Ā fails to work with employees to get a better answer for them and the customers.
Customers usually face a rules based system, not a problem solving one. Its a world of do not reply to email addresses, complex on line forms and customer inconvenience.
I recently tried Ā to buy stamps in a Post Office. There were huge queues for the 3 staffed positions. I queued in a shorter queue for a machine to serve me. When it did so it then took several minutes to print out one at a time a different proof of post paid to a normal stamp, Why? No wonder there were long queues.
Potential passengers for HS2 are subject to years of delays and cancellation of substantial parts of the Ā planned new all nationalised railway .
Taxpayers get the worst deal. Every loss and every pound of investment is Ā a charge on government revenues. Over the years accumulated losses have been enormous. Many investment programmes have been disastrous. Horizon and the delayed Ā HS2 are just the latest examples .
January 6, 2025
We are all too aware of what you say. I visited four post offices seeking a DVLA form advertised as being available at all but in fact not. Why is the form not online.
We have discussed this ad nauseum, UK nationalisation does not work. Nor does monopolistic privatisation, who all hide behind do not reply to this email systems. The UK public are treated worse than a herd of cows. It will form an increasing part of this governments implosion.j
January 6, 2025
Realistically cows are treated wonderfully, in the UK. They produce the product if looked after, well fed, and ensured they are happy.
January 6, 2025
They are also executed at the end of their usefullness.7
January 6, 2025
After quite a few years of having young, producing milk and goodbye said when they find life a struggle – they get old too you know. Most farmers are upset when their old favourites need to go. Rather cynical of you I may say.
If you had directed your criticism to the production of lambs for the table, way too young, I might have agreed.
January 6, 2025
contact.dvla.gov.uk āDownload and order DVLA formsā
January 6, 2025
Reply to Hefner.
If you are changing an EU licence to a UK licence you need form D1. This form has a facility for attaching the requisite photo to it in a very precise window. This cannot be sent on the internet. Post Offices supposedly stocking these forms can be found on the site I am well aware of. However in my part of the UK only the town centre PO stocks D1. I merely pointed out that lesser POs ,listed as stocking it do not.
I would add that the DVLA gave a better than expected free service, returning my new UK licence in days. Three cheers for them.
Aside, when I applied for an EU licence while resident in Spain it took 9 months wheras my pilots licence took 14 days. On remarking on this strange discrepancy to my Spanish lawyer, he explained that perceptions were different in Spain. Drivers were very passe wheras pilots were gods. Very good I thought, but never fly with that sense of deity.
January 6, 2025
10 Year Gilts hit 4.64% this morning, although they’ve eased off a smidge since. That’s higher than Liz Truss managed when she “wrecked the economy” according to the popular narrative. I think Ms Reeves has a very real problem with debt interest and the markets are already scenting blood. Further tax increases are already looking baked in I’m afraid.
January 6, 2025
Good morning.
Before we debate whether or not a service should be Nationalised or not we need to ask if this service a monopoly ? If it is, can it be broken up into competing parts ?
Only competition brings in fresh ideas, better service and lower costs. Changing a monopoly from one type to another does not address the underling problem(s). It just satisfies ideological dogma !
For those industries that cannot be broken up we need new thinking and better means of making them work. I have suggested a few and others, both for and against, have kindly commentedIs it not time for some fresh ideas?
reply Competition is the best idea and most of the nationalised monopolies are capable of being open to competition.
January 6, 2025
Regulators are frequently monopolies and as bad as the bozos they are supposed to regulate.
Consumers on social media are probably better.
January 6, 2025
The question is are all the sub-post offices profitable.
If they are one then has to look at the nationalised infrastructure and costs at the Post Office.
January 6, 2025
Yes competition is the best path, but in some areas administratively difficult. Water minus a national grid for instance. Most water companies are mostly private while at the same time mostly monopolistic.
The NHS can be privatised in almost every detail, large parts of it already are, pharmaceuticals and GPs for instance. Parts of it, purchasing for instance, is in need of professionalism. The more private the more professional the service will become. That needs to be the business driver. For the patient it needs to be accessable irrespective of their financial status. Whether this is via insurance or taxation is a political decision. I favour the former because it adds a sense of involvement from the patient, but it needs to be thought out and applied free of UK insurance’s cherry picking cop out clauses.
January 6, 2025
Off topic, I have just sent this letter to our local newspaper, the Maidenhead Advertiser:
“The Independent newspaper has just run a full front page spread covered with “The damning statistics that reveal the true cost of Brexit, five years on”.
However there is one crucial statistic they have not included, and that is Ā£2535 billion, the total value of UK output, Gross Domestic Product, in 2023.
Set in that context their central “damning statistic”, Ā£27 billion, a recent estimate of the reduction in our goods export to the EU, does not seem so bad.
And here I will refer back to a letter which the previous editor was kind enough to print just before the EU referendum, that started with these words:
“According to the European Commission, the EU Single Market has added about two per cent to the collective GDP of the EU member states.
However, that is the average gain across the EU, and it appears from a German study that the UK is one of the countries which has gained least, only about one per cent.”
(Viewpoint, June 2 2016, “Loss to families much smaller than predicted”.)
I do not claim to have any expertise in economics, nor any uncanny skill in prognostication, but I can, and indeed like to, perform simple arithmetic.
And it is good enough to mentally divide 27 by 2535 and get an answer of about one per cent, which I would describe as a “marginal” loss of GDP.
Where I did go wrong was in arguing that this loss would be corrected by just a few months natural growth at the trend rate of 2.5 per cent a year.
I failed to recognise then what has since become very clear, that our economy has never fully recovered from the 2008 global financial crisis.
(Viewpoint, June 26 2024, “Driving with handbrake on for past 16 years”.)
That should be the top priority for this Labour government, repairing the truly disastrous damage inflicted under the last Labour government.”
January 6, 2025
May I gently point out that whilst a drop in exports of Ā£27 billion is a blow to our Balance of Payments, this figure doesn’t take into account the EU imported materials that go into those lost sales, and, as an occasional exporter myself, the actual loss is the derived profit, after transport, bank insurance costs and TAX have been levied – perhaps a couple of billion, or so ?
Reply PS Exports to EU are up on 2016, not down!
January 6, 2025
Exports of goods to the EU make up about 7% of GDP. So while the 13% drop in those exports supposedly found in the LSE study is large in those terms it is diluted down to a loss in the region of 1% of GDP, as predicted in 2016 before the EU referendum. On the other hand if we had properly recovered from the global financial crisis per capita GDP could now be about 30% higher than it is, and that is much more important for the government to tackle than the small erosion of GDP caused by the EU putting up largely unnecessary barriers to our goods.
January 6, 2025
dream on, they probably don’t know that but would love it when told.
January 6, 2025
The system has not -and could not- recover from the 2008 crisis;nor will it with the emergence of a competing framework from Russia/China/BRICS.
January 6, 2025
Off topic but reports are emerging that Russian forces have taken Shevchenko in the Donbass-and the largest lithium mine in Ukraine.
Eurasia Daily,4/1/25:”One of the largest lithium deposits in Europe,Rozhin,has come under Russian Control.”
This deposit stretches from the Donbass,along the River Dnepr all the way to the Belarus border.
January 6, 2025
“Customers usually face a rules based system, not a problem solving one. Its a world of do not reply to email addresses, complex on line forms and customer inconvenience” … writes someone who’s obviously never tried to complain to Amazon, DPD, British Airways, etc etc
January 6, 2025
You can choose not to buy from Amazon, use DPD, or British Airways …. because they’re not monopolies and there are alternatives. The same applies to the entire private sector; there is law against private sector monopolies so that customers can’t be exploited by a single provider.
Nationalised industries are monopolies and they behave as monopolies always do – they exploit the service user.
January 6, 2025
Amazon is not a good example there. The others I’ll agree with you but Amazon is very customer orientated.
January 6, 2025
Lemming
You can easily choose another company to deliver your parcels or purchase goods on line or book a flight.
You have a huge choice of alternative businesses.
If you are dissatisfied with the ones you listed, you can take your custom elsewhere.
Unlike a nationalised monopoly run by the State.
January 6, 2025
āDo not replyā messages are suited to people being occasionally absent.
In some consumer services they are a sign of low accountability for poor performance, and fear of complaint about their own failure. They can signal utter contempt unless an easy method of reach is available.
January 6, 2025
āQui veut noyer son chien lāaccuse de la rageā (āwhen you wants to hang your dog you give it a bad name firstā)
Moliere, Les Femmes Savantes, 1672
January 6, 2025
Nobody in Britain WANTS to hang their dog.
January 6, 2025
hefner was bring sarcastic as usual Lynn.
January 6, 2025
Amazon has a great complaints system, they get back to you straight away?
The others I’ve not tried to complaint to.
People who e-mail you, including the Conservative Party, shouldn’t have a no-reply function. If they want to solicit my support, don’t stop me from responding.
January 6, 2025
By definition, a nationalised industry has no competition so there is no need to improve the service or innovate.
The money rolls in regardless of the quality of service provided, as is so well and regularly demonstrated by “our wonderful NHS” and the cowardly politicians who keep shovelling more and more money into the bottomless pit and requiring nothing by way of improvement in delivery in return.
There are, instead, clear disincentives for improving a nationalised industry, since it would be likely to lead to a reduction in the number of employees at both the delivery and “management” levels.
The heavily unionised public / nationalised sector use their monopoly provision to prevent innovation; to protect their, and their colleagues, jobs rather than to improve the service and to (effectively) blackmail the Government into accepting a poor service and to pay more for it ….. as we have recently seen with the above inflation pay award handed out to the already well paid train drivers, for nothing in return.
Nationalised industries are basically state-funded monopolies. There is legislation against Monopolies in the private sector, so why not the public sector?
January 6, 2025
Wes’ latest duff idea is to stop follow-up appointments after operations; at least these failures will just die.
All these 14 years of Tory failure, for goodness sake, do they think we are thick? We had to re-elect the Tories because Blair and Brown busted the Country following America’s mortgage-cheap for all including those without good credit and holding down interest for nearly 14 years, selling off our gold reserve cheap and leaving the Tories with a crisis the likes not seen for years. Then we had the Con/Dems for five years. Suppose the establishment hadn’t been so quick to get rid of Boris. In that case, I truly believe they’d have been re-elected or the losses not as severe, the infighting and positioning of LibDems hiding out in the Tories (just look at Soubry now and Grieve) exposed the party to the wilderness.
January 6, 2025
excellent post.
January 6, 2025
Good Morning,
Nationalisation based on political theory is of course a very bad idea.
But what of the failed, or failing, ‘privatised’ businesses? Are these not as much or more drain on the public purse?
Reply Not so. Nationalised costs more with annual subsidies and write offs.
January 6, 2025
As in nature, there is no ‘steady state’ of subsidy to partly privatised businesses. You can keep a party privatised activity going so long as the public keep paying ever larger subsidies, and such contributions are in part paid to shareholders and management as bonuses for a job poorly done.
January 6, 2025
Oh yes, private companies are so much better as seen every day by Thames Water (and other water providers).
January 6, 2025
If you live in the area where Thames Water provide water and sewerage what alternative companies are there to choose?
Do you really consider them anything less than a monopoly provider hefner?
January 6, 2025
So sorry, I should have added /sarc for those a bit slow on the uptake ā¦
January 6, 2025
Most of your posts on here are sarcastic hefner.
So you are flattering yourself to think your tone wasn’t realised.
But well done for avoiding answering the question I posed
January 6, 2025
šš¤£ Hefner you did say āThames water and other water companiesā – Martin was quite right to ask what other water companies.
You are the slow witted one š¤in this as in many many other cases.
January 6, 2025
I’m not sure that nationalisation is always bad for employees, if working conditions there are akin to the public sector.
I’ve had many stressful, unhappy non-managerial jobs in the private sector, being pushed about with no job security and constant hassle from supervisors and managers who were desperate to drive staff harder or reorganise, in their attempt to prove their own worth and climb the greasy pole. They were not enjoyable workplaces. Staff turnover was high. Almost every private sector job I’ve done (as an employee) got worse over time and I moved on.
I also worked in the public sector, though that was 35 years ago. As an employee then you were under a lot less pressure as the managers didn’t have to prove anything… promotion was largely determined by length of service and relations with the department head. It was boring but calm. Lazy or diligent, it didn’t matter. Staff turnover was extraordinarily low. On balance a far better experience as a low level employee than in the private sector, though times may have changed.
In the end I’ve been most happy when self-employed, despite there being no sick pay, paid holidays, pension entitlement etc. There’s more flexibility, and you can pick who you work for/with.
Reply Job losses have been huge in big nationalised industries including rail, steel, coal. The Post Office has behaved far worse than private employers in sending loyal staff to prison.
January 6, 2025
True but government is also appalling at regulation. The regulators usually get captured by the regulated industries. Appalling examples are the Covid Vaccines which did vast harm regulated by organisation largely funded by big Pharma, the Water companies, the banks and financial services, the dire āindependentā Bank of England, the FCA, building regulatorsā¦
January 6, 2025
London is still the world’s slowest city ā highlights from the latest TomTom Traffic Index it seems.
This is clearly due to a policy of road blocking, anti-car traffic lights, empty bus and bike lanes. This is road blocking as a deliberate policy. Thankyou Sir Sadiq but this was also a Boris policy from the uni-party. What does “sitting on the fence” net zero fan Kemi think on this topic?
Blocking the roads increase fuel use and pollution and kills the economy too.
January 6, 2025
So slowest city traffic, very high taxes, very poor public service, energy prices almost the highest in the world, crime rates dire… what a well run country we have from the UNI-Party ever since John Major took us in to the ERM in 1990. Major, Blair, Brown, Cameron, May, Boris, Sunak, Starmer… all absolutely appalling. How can we escape other than to leave. I left the UK (London) in 2008.
January 6, 2025
Sir John I wonder if your life long study of Nationalised industries shows any change in performance over time?
That is have they always been as bad as you indicate they are now?
All Utilities started operation as individual private undertakings serving a local community only. So why is this still not the case? Likewise over time there has been a pendulum swing between Nationalisation and Privatisation of utilities based on Political thinking. Is there some alternative way of operating the country’s strategic assets? A middle ground ?
Can it be shown that we are paying less, for example our electricity, than we paid under Nationalisation ?
The cost being what is shown on the bill plus any hidden tax going to support the utility.
A change over the years has been to reduce skilled staff and increase “management” staff. This is a big factor in both private and public sector. Too many chiefs and not enough Indians makes the Indians unhappy.
If you introduce artificial competition into something which is naturally one Network it does not perform very well. Some basic network management theory
Reply When electricity was privatised in the first decade it increased productivity by 103% and cut prices by more than a fifth. This century government and Regulators have taken over and created greater costs and different priorities. My Third Way, Which Way book looks at a range of hybrids between full privatised competitive businesses and nationalisation.
January 6, 2025
Third Way – mutualisation, where the customer owns the service industry.
Your book appears to be out of print. Is it just available 2nd hand?
Yes. I am not trying to sell more copies. I have a few spares for those with a serious interest in the topic.
January 6, 2025
you can find second hand copies at varying prices from various sites – I’ve just ordered one.
January 6, 2025
Sir John,
My question was the cost of electricity today compared with a Nationalised Electricity Industry before privatisation.
The initial savings in cost were due to early retirement of senior and experienced staff on very generous terms. They went off to find employment elsewhere. This meant less experienced staff had to take on the duties without a pay increase. A 25% saving on the Electricity Bill but what about the cost to the tax payer in selling the Industry off at a low price to attract private investment ?
You can say the first decade. But do you mean the first few years or the years at the end of the decade. You are talking about 1980/90 it is now 2025.
Reply The study of prices and productivity was for the 1990 s , the first decade after sale. there was no cost the taxpayer from sale. There was a big receipt.
January 6, 2025
The capital value of the plant purchased by investors was below true value. That is the issue. Not that the tax payer had to pay for the seller off. The same thing was done for Telecoms.
Reply, No, it was sold at market value. Rates of return on much nationalised industry investment was low so of course they went to a discount to book cost.
January 6, 2025
Reply to Reply
We are having this discussion, again, because neither nationalisation nor privatisation of natural monopolies work.
In the absence of a copy of Third Way (can we buy a digital copy?) –
Instead offer a positive rate of interest, say 2% above inflation as a start, then ask monoploy users (water, trains, electricity &ct.) to invest/buy shares in a co-operative to run the industy on a commercial basis. Make the interest tax free.
January 6, 2025
Sickness and WFH for employees is because they have guaranteed jobs
Generally they have no face to face contact with the people who pay their wages so feel no responsibility to do a good job.
This government is determined to create a socialist state taking complete control of our lives.
Yesterday I was reading about the latest mandate on aviation fuel, not content with making holidays more expensive by increasing APD we’re now going to be priced out of the market because of expensive fuel. We really are heading for the great reset and 15 minute cities, project 30 is well on track.
January 6, 2025
Yes, nationalisation fails, inherently fails as owners cannot make a profit from it by managing it competitively and well, so the taxpayer usually makes a huge loss for a poorly run activity out of it. So not only should there be no more nationalisations but everything that can reasonably be privatised should be privatised – even if in some cases such as in education and health it may be publicly funded, it should be privately operated. The politically fashionable ‘mixed economy’ is a mistake that should be replaced by a ‘privately operated’ economy.
January 6, 2025
We should go further and make all public services contributory. Having to generate income focusing minds on service and efficiencies.
Being given grants does not.
However monopoly providers will always abuse their position so an element of competition needs to be built in.
January 6, 2025
Perhaps we should have a 10p income tax and 5p national insurance on every Ā£1 everyone earns, no freebies for people who can afford to do just a couple of days per week up to the NMW of Ā£23,810 this year (for a 37.5 full time week). Then the next tax bands.
If everyone contributes, they might start taking more interest. One of the biggest complainers I ever met was a part-time female worker who didn’t pay any national insurance; she only had to work a couple of days per week for interest as her husband had a high income.
January 6, 2025
@Geoffrey Berg +1 agreed.
Health and Education in particular offer readily available alternatives – therefore competition. leading to the best of the best in the supply chain. If one fails – so what! there is something to take its place. When Government fails we all suffer.
January 6, 2025
“I recently tried to buy stamps in a Post Office” – you found a Post Office? Lucky you! Our local post office – five minutes walk – closed some years ago due to the sale of that much loved and used convenient store to a supermarket – CoOp. The central one – a walk and bus ride and walk away – was a big and well used place. It was in a central, new shopping arcade. Gone. Closed. The one left is a good 45 minute’s walk away, on a good day.
Actual, real community infrastructures to which a post office, a bank, a pharmacy and a GP surgery belongs, have been successively and slyly dismantled over the last 10 years. But that’s another story.
January 6, 2025
postoffice.co.uk āStampsā sells stamps of all kinds. They are delivered to your door usually within 48 hours.
January 6, 2025
Gosh that must be profitable!
January 6, 2025
As part of the post(wo)manās round, I donāt think that the cost of delivery is adding so much to the profit/deficit of Royal Mail.
And if that saves me a few car miles why should I not order stamps from that site?
January 6, 2025
I feel Nationalised industries could learn from the private sector. Regarding the workforce specifically, the management should work with government to shore up Union indoctrination but they also need to raise standards across the workforce so that everyone is productive, dressed smartly and everything is clean. It should be demonstrated to staff where current productivity levels are below their predecessors and that they need to at least return to par again. If the management can’t do this then its time for new management.
January 6, 2025
The problem with nationalised industries and their growing inefficiency is, there’s no effective feedback mechanism to correct the growing inefficiency.
In the Private sector if a business does not provide service at a price people are willing to pay, the business goes bust. Consequently, most Private business owners realise the public feedback they receive is important and respond to. They use it to make their business more successful.
In the Public sector great effort is made to avoid any public feedback. In fact the opportunity to even speak to any real person in a managerial role in the Public Sector is now all but gone.
The effect off this lack of listening to the ‘customers’ is a closed culture that sees itself as above the people it is in place to serve.
Until the Public sector are put into a position where failure to supply service the public need and are willing to pay for, is punished by losing their jobs and all privileges, the Public Sector will continue to provide an ever more expensive and ever more remote poor/failing service.
January 6, 2025
Nationalising of industries in this country has never been about making the service cost effective or even being more productive.
Due to the way it gets implemented and run a kind of lethargy enters into the minds of everyone involved in running that service. They don’t have to try very hard and in any case they expect to have a job for life. The few that try to innovate are left frustrated and worn down by the lack of perceptive management, the excessive layers of management and so many rules.
Those in favour of nationalisation assume wrongly that they can make profits at least on a par with the private sector, but they always fail in that regard. Those seemingly large profits dissipate faster than the effectiveness of the service.
While socialism pays lip service to productivity and cost effectiveness of nationalised services, the real aim of such regimes is to have control of ever more things that make the country tick. It doesn’t matter how ineffective these industries are, just as long as they can be used to keep on increasing taxation, while reducing the power of the middle classes. Total control of everything and everyone is the ultimate aim.
January 6, 2025
The railway. Train drivers got their unconditional pay rise which now means that there is no incentive to work Sundays and we end up with a de facto strike every sunday and no services. The drivers have calculated that they are better off working a weekday rest day @ Ā£500 minimum per shift (even for six hours) and having their non-obligatory Sunday off.
So how did that improve things, Ms Haigh ?
January 6, 2025
The train drivers have 3 ‘rest days’ per week. Now with a handsome pay increase they may decide to take the generous ‘rest’ off, after all sitting in the cab for perhaps an hour, up to three must be really tough.
Otherwise expect wonderful pay rate for working a fifth day.
January 6, 2025
Sir John
The BIG one, you could even suggest the Elephant in the room that shows the Socialist concept both Labour/Now Conservatives (the Uniparty) havenāt a clue about business, the running of a business is the NHS. It is an illustration of the lack of managerial ability we have in Parliament and their wonderful business acumen skills. All that was ever needed was a compulsory national insurance that everyone contributed too, private, public or State that was then able, as insurance policies do, pay out should the need arise with a claim.
How many structures of State interference are there in the delivery of our health care? The country has even moved away from management by clinicians, to management by friends of friends with Woke and IDE, even ESG doctrine being applied before health.
January 6, 2025
Nationalisation is very often bad.
However, private profit-making businesses are not always good just because theyāre competitive, self-financing or their profits are highest.
Postal services, such as parcel deliveries may be competitive and profitable, but those alone do not ensure the service is efficient, good value for money or reliable.
Many parcels are delivered dirty and left outside in rain or insecure places, left at wrong addresses & much else.
An efficient, good value, high quality reliable service would be welcome whether it is private or nationalised.
January 6, 2025
I can’t think of a way that the railways could be made more efficient, either by the fragmented privatisation/state ownership we have seen for a couple of decades, or by full state ownership which I recall as being dire. Surely they need to be run as a cohesive whole with simpler fare structures and flexibility of manpower. The short sighted destruction of so much infrastructure of sixty(!) years ago has left a transport legacy of overcrowded roads, while the farce of HS2 indicates that “prestige projects” are of more interest to politicians than more useful but mundane developments.
January 6, 2025
Unfortunately, the public sector is hamstrung by politicians. Take for example the Ā£10 Christmas bonus which hasnāt increased since it was introduced in 1972. The process to pay it out costs far more than the total value of the payment. No sane private company would continue this benefit and would long since have rolled it up into the individual payments yet the Government wants the kudos of appearing kind at Christmas. Iām not sure why when the public considers them mean-spirited for removing the much more generous Winter Fuel Allowance. It should have been scrapped at the same time along with the Cold Weather Payments and rolled into the monthly payments.
Then we have the ludicrous situation of the public sector having to provide free interpreters for foreigners using their services. Why? Other countries donāt offer this. In Spain I have to pay for my own. With the now excellent AI facilities on mobile phone this whole service can be scrapped but has anyone even thought to do this? I doubt it because staff get no thanks for innovative ideas. In fact itās the opposite.
Small and agile is the way to go. Iāve worked for both the public sector and big corporates and there is little difference between them.
January 6, 2025
No difference? Really? Big Corporates, especially US owned ones fire staff quite unreasonably on any quarterly downturn in results, when did Public sector do the same?
January 6, 2025
Sir Johnb
I wouldnāt suggest that the UKās version of privatization should be a beacon as to a way forward.
Organizationās that have been able to get to the front of the line with glorious political style promises have in the main failed constructs, their premise and promise have had failure writ large all over them. Governments, politicians, the BLOB as they demonstrate daily do not understand Price vs Cost. Any enterprise/business without competition is doomed to fail.
The mode used for taking over State operations is massive promises without an actual plan or their own money to back the commitments made. The main ones that come to mind are the Water Companies, money for the purchase, and money to run the Company wasnāt to come from customer service, it was to come from selling off the companiesā assets and then taking on massive borrowing to rent or lease them back, paying massive volumes or interest and high dividends. All in the knowledge that it would be the Taxpayer (some try to call it Government when the reality it is taxpayer) that comes to the rescue when things go wrong.
The main takeaway is that there has been no improvement in delivery, the taxpayer and users that had already paid for the infrastructure is forced to pay for it all over again. There was no due diligence taken by the State/Government. There is no competition to keep rogue management in check. Utter political failure leading to a lack of understanding in how to run anything.
Governments should not run things that actually require a delivery. In the absence of competition either the āuserā or the āstateā should retain ownership of the infrastructures involved, with the day-to-day running being carried out by responsible organization on fixed period or rolling contracts. Shareholder that are not invested as āusersā are unable to apply the same style of required pressure of holding the board to account that is required and happens in the real world.
None of this helps pricing but it does secure the facilities needed should the delivery company fail.
Reply Water needed competition to work better. The privatised industry is dirty like the nationalised industry before it. The capital to try to remedy broken and inadequate pipes is no longer a charge on taxpayers.
January 6, 2025
Nationalisation will bring all utilities on a par with the performance of the NHS
January 6, 2025
a race to the bottom?
January 6, 2025
Geoffrey Berg is correct. The way forward for increasing prosperity is to privatise everything that can reasonably be privatised. The trick is to find ways to provide the necessary competition or it will not work. Creeping nationalisation and increasing state employment leads inevitably to Communist stagnation and then decline where the government pretends to pay you and you pretend to work. Even the existing Communist systems rely upon the capitalist West for all their innovation and progress, generally acquired by stealing their Intellectual Property.
January 6, 2025
Not so.Washington-based Information Technology & Innovation Foundation,16/9/24:”China is rapidly becoming a leading innovator in advanced industries according to new report.”
If you google ‘China’ and ‘innovation’ a whole host of similar well researched reports from reputable western organizations comes up.You underestimate China at your peril.
January 6, 2025
Mitchel nobody wants to live in China. China is like a computer. It can keep flogging on indefinitely, it can copy – thatās it – no brilliance, no innovation. Itās ācatching upā with US chips, has the blueprint. Itās producing EVās when we all – apart from Mr Cold, understand that they are a dud. Huge roads, driven through mountains – going nowhere with no traffic on them. Mind numbing stupidity – the sort of thing we have come to expect from the British political class. Much money will be lost by the bureaucracy which governs Communist China. The peasants will always be poor because they have to pay.
Every capitalist starts everything by recognising a need. Then developing a financially viable satisfaction for said need or walking away! Every Corporatist/communist starts with āwhat can we doā – they have to use what we produce = BIG LOSSES.
My Russian friends are complaining like mad at the quality of Chinese imports.
January 6, 2025
Mitchel :
Why do you think there are 150,000 Chinese “students” in our universities?
January 6, 2025
Would steel making be economically viable in this country without the lunatic carbon taxes in place?
January 6, 2025
With pumped British energy and without quotas – always was!
January 6, 2025
The national electricity and gas grids were constructed with public funds and would not have existed if left to private industry. The water industry in our area is owned by foreigners whose costs are far higher than when our water was supplied by local government and charged to the rates. The major saving in the electricity generating workforce was as a result of the discovery of North Sea gas which made gas the cheapest fuel in this country for power generation; coal generation is labour intensive.
Reply Of course free enterprise would have built the energy grids if they had been allowed to. they are building the very expensive broadband network.
January 6, 2025
Since we have no productivity from public service people according to figures I would agree that nationalisation will make the problem worse. However, I don’t think the private running of companies has been much better, eg water companies. How to deal with a problem which has not been dealt with for decades by politicians of all colours is the question. Any ideas besides going private? I think we need some new thought on this. Perhaps Trump will show us how to do it.
January 6, 2025
Private enterprise is trying to compete with the State for manpower. We pay for the manpower anyway, but they sop it up in unproductive activity.
As much as we need our own money available for capital investment etc. we also need manpower.
January 6, 2025
Because Nationalised services face no competition, the government allows them to operate at a far lower standard of service that a good private sector company would not find acceptable.
The perfect example is Amazon Customer Service. Before Christmas, I ordered a replacement batery for a Samsung tablet. It arrived promptly but when I fitted it, there was obviously another fault with the tablet so I bought a new tablet, also from Amazon. I then wanted to return the new battery, which had cost Ā£20.00
The no-quibble return label that Amazon provided was corrupted and the Post Office could not accept it. I therefore went to Amazon customer service Live Chat and was told that, because of the trouble that I had with posting, they would process the refund and I would not have to return the item !
The NHS and every other branch of the government could learn a lot from Amazon Customer Services which I have always found exemplary.
Mind you, there are many companies operating in the UK that also provide truly indifferent customer service.
We have all come across businesses which make it all but impossible to contact them. There are no phone numbers on their website, or email address, just an enquiry form which often is not replied too.
January 6, 2025
“Nationalisation is bad” sure. But the real power of the free market economy versus command and control economies is the cumulative power of lots of individual end consumers being able to take their business elsewhere without any hassle instantly. The thing that keeps supermarkets efficient is customers being able to swap supplier easily, frequently, hassle free. It forces innovation, efficiency, customer friendly approaches, and so on, from the suppliers. If gives power to the consumers, and the local managers who can attract the most customers, and it takes away power from the central powers that think they know best, and the lazy inefficient managers.
January 6, 2025
“Many investment programmes have been disastrous”
But it’s Labour’s way of saying they know “how to run a business”.
It gives them short term publicity for “seen to be doing something”.
They can give their friends lucrative jobs and guaranteed employment to unions.
It gives alternative political parties real money pit disadvantages trying to fix it with legacies of mega contingent liabilities bailed out by the taxpayers.
Above all they are not ever held responsible under British law for the trail of disaster.
Criminal indeed, cynical and devious in the extreme.
yet today Starmer declared the NHS will not be a money pit!
January 6, 2025
Still dont know why we cannot buy postage stamps in any news agents of place that sells birthday cards?
January 6, 2025
(sarc) You haven’t cottoned on to how challenging it is having to provide a service to customers, they are a nuisance after all. When the business only has to answer to itself, things become so much easier to run, and the govt will always bail out.
January 6, 2025
HS2 should never have been started at the costs quoted, and which often appear to be open-ended and go up. The costs such as they are, are two to three times what a similar railway would cost in France or Germany. Why have no questions been raised about this – and surely one could ask the companies quoting for work, why their prices are so high – on what is the money going.
Is there any need for the trains to go so fast – as cost of construction goes up with speed, and the cost of maintenance goes up as the square of speed.
On the figures we see in the press – I can’t see HS2 paying off its costs with fares at affordable prices that will attract sufficient passengers.
The bigger the project the less effectively money is spent – this must have a drastic impact on a multitude of smaller more cost-effective projects that won’t happen as a result.
January 6, 2025
Let’s not pretend that private business treats its customers with respect. On the contrary we are treated with utter contempt. The banks are a good example.
Then there are all the companies where the only way to resolve issues is to contact the Indian call centre. Need I say more ?
January 7, 2025
The Banks formed a cartel – thatās how they activated the De-Banking scam.
So many scams, so must to be put right, but rejoice – Trudeau has gone – another globalist bites the dust.
January 7, 2025
but the banks are not allowed to fail when the customers take their business elsewhere, that is the problem. bank management teams should be jobless when they fail, sure bail the customer balances out, not the crap management teams.
January 6, 2025
There is no point in the state saying, give us your money and we’ll do it ….and then letting us down!
The NHS has been a “problem” for as long as it has existed. It has never delivered.
Basic duties such as mending roads or collecting taxes etc are a disaster.
And when the public say “we paid and you did not deliver, we want our money back”, where is the money? “Sorry, we spent it” is the sorry reply. “On what!!??”
It’s a con. If they canpt do the job – and clearly they cannot – give us the choice of keeping our own money and buying our own services,
January 7, 2025
Yes – we need opt-outs from everything provided by the state! With commensurate tax breaks.