Public Corporations

Public corporations are businesses that are owned by the government, which provide finance and determines policy. They are run, however, by independent boards (although members of these may be appointed by the government).

Corporations arise where an industry has been nationalised- that is, taken from private ownership into the public sector- while others will nver have been in the private sector, having been established and funded by the government from the start (set up with a charter).

While, at one time, most of the steel, water, gas and telecommunications), the trend towards the end of the twentieth century was to return these to the private sector through the process of privatisation.

In some cases, it is difficult to make economic charges for services. E.g. street lighting benefits everyone within a particular area, but it is not possible to charge each individual for his or her use of the service. The service is therefore provided by local authorities and paid for through council tax.

Other local authority services include libaries, parks, gardens, museums and some control over school (although budgets are now being more and more given to individual schools rather than to the local authority).

Public goods are those for which it would not be possible to make an economic charge, such as street lighting and roads, merit goods are those wich government feels that they ought to provide for social reasons, otherwise people will not make enough use of them. These include education and the health service.