9 - Public law and privatisation

Summary

Introduction

Most political scientists agree on some core functions for government: for example, to ensure that citizens enjoy a reasonable level of security, both in terms of maintaining order domestically and protecting the state from external attack. But beyond this core, there is little agreement about what else the state should do. In the United Kingdom, the role of the state has varied over time. In the 1950s, there was considerable expansion as many industries were nationalised and the welfare state was created. The government's proper role was thought to include the running of key parts of the economy, and the provision of health and social care to citizens. In the 1980s, the state began to shrink again, with the ‘privatisation’ of significant parts of the public sector, such as manufacturing industry and the utilities. And, where functions remained within the public sector, like social care or rubbish collection, the government encouraged much greater use of private firms to provide the services on a day-to-day basis. On this view, the government's task was to supervise private providers, rather than to provide the services itself.

In simple terms, the transfer of a previously public activity to the private sector involves a retreat of public law. Since public law regulates public sector activities, its intervention in what is now a private activity is not required. However, matters are not so simple in the majority of ‘privatisation’ cases, since the government often retains some control over the activity, either through regulation or through its ongoing role as the purchaser of a service under a contract. Public law remains potentially applicable to these situations.

The discussion will proceed in five parts. First, we will define the concept of ‘privatisation’ more precisely. Second, we will examine the relationship between the subject-matter of this chapter and broader debates about the public/private divide. In the third section, we will turn to the role of public law in regulating the process of privatising or contracting out a public service. Fourth, we will examine the role of public law in regulating public services once they have been privatised or contracted out. And fifth, we will consider the implications of privatisation and contracting out for the role of government and for democracy more generally.