Privatizing Transport Industries: The British Experience.

If any one policy has characterised the Conservative government in Britain since 1979 it is privatization. Although the policy was first canvassed in the United States, by the early 1990s Britain had become the world leader and privatization the country's most visible export (1). Moreover, transport industries were very much at the forefront of the Thatcher revolution in industrial ownership and organisation. This paper firstly defines what is meant by privatization. Secondly, it assesses the economic reasons for privatization. Thirdly, it outlines the main privatizations that have occurred in the British transport market and assesses their impact. Fourthly, the applicability of the British experiment to other countries, particularly in the developing world, is considered. It is concluded that a necessary pre-requisite to privatization is commercialisation and as a result emphasis in many developing countries will be on reforming public enterprise rather than on out and out privatization.