Cambridge Journal of Economics 1992,16,385-404 E m p l o y m e i n i t regiuiIlattaoiDi^ s t a t e asud tBae ©<s©ini©innil<s pefffomnsimee of Peter Turnbull and Syd Weston* 1. Introduction During the 1980s the economic watchwords of successive Thatcher Government's were deregulation and privatisation. The former involved, inter alia, the abandonment of con- trols over prices, incomes and capital movements, a biennial programme of trade union reform, and attempts to 'individualise' the labour market. The latter, simply put, involved the return of state-owned industries to private ownership and management. Thus, deregulation and privatisation represent an attempt to 'roll back the frontiers of the state', reflecting an ardent belief in the superiority of the market over state intervention and regulation. This belief, firmly rooted in neoclassical economic theory, extols the virtues of competition and assumes that the performance of nationalised industries is inferior to that of the private sector (on average) and that relative performance is superior in the presence of competition between private and public sectors (Fine, 1990, p. 130). But the abandonment of any co-ordinating role by the state in the economy and a further withdrawal from any coherent industrial planning can only serve to consolidate the weak- ness of the British economy (Fine and O'Donnell, 1985, p. 165). This can be clearly demonstrated in the case of Britain's port transport industry, the latest sector to be subject to deregulation (1989) and wholesale privatisation (1991). Britain's ports have always occupied an uneasy position between the private and public sectors. A number of ports were nationalised by the post-war Labour Government in 1947, not as part of any specific or coherent industrial strategy but merely because they were owned by the major railway companies. As a result, the British Transport Commission, which was the only authority responsible for more than one port, controlled only 25% of all UK traffic. The Government's main concern at that time was to resolve the labour relation problems generated by casual employment, but these problems could not be separated from the question of port ownership and operation. It very quickly became apparent that 'some measure of national planning is essential if resources are to be used to the best advantage, and if results are to be achieved within a reasonable time' (Rochdale Committee, 1962, para. 8). But the Labour Government of the 1960s failed to develop a national transport plan or even to create a National Ports Authority as recommended by the Rochdale Committee. Again, port reform simply concentrated on the question of Manuscript received 14 October 1991;finalversion received 27 March 1992. •University of Wales College of Cardiff. The financial support of the Economic & Social Research Council is gratefully acknowledged. 0309-166X/92/040385 + 20 $08.00/0 © 1992 Academic Press Limited Downloaded from https://academic.oup.com/cje/article/16/4/385/1735122 by guest on 07 April 2021