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Nationalised Industries in Britain and France

Published online by Cambridge University Press:  02 September 2013

William A. Robson
William A. Robson
Affiliation:
London School of Economics and Political Science
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Extract

The trend towards public ownership or control of certain basic industries and services, particularly those relating to fuel, power, transport and banking, is a secular movement of world-wide dimensions. Traces of it can be found, in greater or less degree, in almost every country which is economically developed, and in many backward ones as well.

The political scientist who studies this subject in his own country is almost certain to feel strongly tempted to consider developments elsewhere. There is a deep fascination in comparing and contrasting the manner in which this great movement manifests itself in different countries. The pattern of development will inevitably be influenced by history, and by variations in the political, economic, legal, psychological and sociological characteristics of the several nations. These divergences, however, serve to heighten the interest by enabling us to distinguish the fundamental elements of general significance from the incidental aspects of local significance due to national idiosyncrasies.

Type
Research Article
Information
American Political Science Review , Volume 44 , Issue 2 , June 1950 , pp. 299 - 322
Copyright
Copyright © American Political Science Association 1950

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References

1 For an account of these and other early developments see Ventenat, Marcel, L'Expérience des Nationalisations (Paris, 1947)Google Scholar, Ch. 4.

2 “Les Nationalisations en France et en Grande-Bretagne,” La Documentation Française, August 27, 1948, Notes Documentaires et Études, No. 983, p. 15 Google Scholar.

3 “La Reconstruction de la S.N.C.F. et Ses Perspectives d'Avenir,” La Documentation Française, April 28, 1948. Notes Documentaires et Études, No. 890, p. 10 Google Scholar.

4 Auby, Jean-Marie, “La Nationalisation du Gaz et de l'Électricité” in de la Morandière, L. Julliot and Byé, Maurice (eds.), Les Nationalisations en France (Paris, 1948), pp. 111–112 Google Scholar.

5 The headquarters organisation was known as La Direction de l'Éleotricité de l'État. Below it were nine provincial organs, each directed by an engineer-in-chief of the Pont et Chaussées, and a control service over the distribution of electricity in each département. “Les Nationalisations en France et en Grande-Bretagne,” op. cit., p. 12.

6 Ventenat, op. cit., pp. 82–96.

7 Gordon, Lincoln, “The Port of London Authority” in Robson, W. A. (ed.), Public Enterprise (London, 1937), pp. 14–57 Google Scholar. See also Gordon, Lincoln, The Public Corporation in Great Britain (London, 1938), pp. 18–83 Google Scholar; Robson, W. A., The Government and Misgovernment of London (2d ed., London, 1948), pp. 131–139 Google Scholar.

8 See G. Haldane, “The Central Electricity Board and Other Electricity Authorities” in Public Enterprise, op. cit.

9 See Robson, W. A., Justice and Administrative Law (2d ed., London, 1947)Google Scholar, Ch. 3, for an account.

10 Chester, D. N., Public Control of Road Passenger Transport (Manchester, 1936)Google Scholar, passim.

11 Report of the Royal Commission on the Private Manufacture of and Trading in Arms, Cmd. 5292/1936.

12 The heavy subsidies paid to the sugar industry for many years was one of the principal reasons which led the Labour Party to include nationalisation of that industry in its programme for the recent General Election.

13 “Nationalisation in France,” The World Today, Vol. 2, p. 365 (August, 1946)Google Scholar.

14 Law of April 8, 1946.

15 Law of December 2, 1945, as amended by the law of May 17, 1946.

16 Deposit banks are those which accept deposits for not more than two years or with-drawable on demand. They may not hold more than ten per cent of the capital of any enterprise except banks, finance houses, or mortgage companies necessary to their operation. Business banks are those whose principal activity is to acquire stock and participate in the management of firms. They can invest their own funds or deposits made with them for not less than two years. Long term and medium credit banks are those whose main business is to open credits for not less than two years. They may not accept deposits for shorter periods without authorisation.

17 “Nationalisation of Banks and Industries in France,” International Labour Review, Vol. 54, pp. 206–207 (Sept.-Oct., 1946)Google Scholar.

18 Law of April 25, 1946.

19 “A central fund will be responsible for reinsurance operations; this is, as the finance Committee stated ( Journal officiel, 18 May, 1946, p. 45 Google ScholarPubMed) one of the corner stones of the scheme. First of all, the Reinsurance Fund is a supervisory and statistical body; its situation reports will reproduce, on a reduced scale, the operations being conducted at a given moment, by insurance establishments in France as a whole. The Fund also has commercial functions: it will insure French insuring agencies, specially encourage types of insurance operations which are in the social and economic interest of the country, and promote the covering of certain special risks. The Fund will be administered by a board similar to those of the nationalised undertakings, and a Director-General.” “Nationalisation of Banks and Industries in France,” op. cit., p. 210.

20 Decree of June 26, 1945. Pinkney, David H., “Nationalization of Key Industries and Credit in France after the Liberation,” Political Science Quarterly, Vol. 62, p. 374 (Sept., 1947)CrossRefGoogle Scholar.

21 Law of June 16, 1948. See “Le Statut d'Air France,” La Documentation Française, July 17, 1948 Google Scholar. Notes Documentaires et Études, No. 954.

22 Ibid., Article 4.

23 Decree of May 29, 1945.

24 Ventenat, op. cit., pp. 195–202. The name of the company was changed on August 28, 1945 to Société Nationale d'Étude et de la Construction de Moteurs d'Aviation.

25 For a list of the branches and subsidiaries of this vast undertaking, see Wilmet, Bernard and Faber, Maurice, “De la Société Anonyme à la Régie Nationale des Usines Renault,” Économie et Humanisme, No. 33, p. 496 (Sept.-Oct., 1947)Google Scholar.

26 Law of May 11, 1945.

27 The French Ministry of Finance has published a complete list of the public corporations and the mixed economic enterprises; see “Liste des Établissements Public à Caractère Industriel et Commercial et des Sociétés d'Économie Mixte” in Inventaire de la Situation Financière de la France. Ventenat, op. cit., Annexe II.

28 The need to nationalise the great deposit banks in France was justified by M. Pleven as Minister of Finance on the ground that only by so doing could the Government secure acceptance of its monetary and credit policies by the leading banks. He contrasted this with the situation in England where, he said, one word uttered by the Governor of the Bank of England was sufficient to obtain compliance by the joint stock banks. Einaudi, M., “Nationalization in France and Italy,” Social Research, Vol. 15, pp. 22–43 (March, 1948)Google Scholar.

29 Bank of England Act, 1946, s. 4 (3).

30 The original proposal was to nationalise the industrial assurance companies. Owing to opposition by the Consumers' Cooperative movement, which is heavily involved in this business, the proposal was changed to mutualisation—that is, ownership of the under-taking by the policy holders.

31 Report of the Technical Advisory Committee, Cmd. 6610/1944.

32 “Les Nationalisations en France et en Grande-Bretagne,” op. cit. p. 9.

33 But the matter is under active discussion and several proposals have been put forward.

34 For a discussion of the motives for the nationalisation of the Renault concern, see Wilmet and Faber, loc. cit.

35 “Les Nationalisations en France et en Grande-Bretagne,” op. cit. pp. 9–10.

36 For details of the Board's organisation see the Annual Report, 1948, of the National Coal Board, Ch. 10. Chester, D. N., “The Organisation of the Nationalised Industries,” Political Quarterly, Vol. 21, p. 122 (April, 1950)CrossRefGoogle Scholar.

37 Law of April 8, 1946; Electricity Act, 1947; Gas Act, 1948.

38 In regard to electricity supply in France, the authority of the central organ appears to be preponderant. It is true that it has exclusive competence only in the sphere of transmission of energy; this attribution is quite natural when one recalls that hydro-electric production must be greatly developed. This factor will contribute to accentuate the separation of production regions (the mountainous zones) from the regions of high consumption. Moreover, the production curve varies each year in each region according to the climate and hydrographical conditions. For all these reasons the problems of transmission, interconnection and distribution present themselves forcibly in France at the national level. Production is in the hands of the secteurs du service national, the precise degree of whose autonomy the law does not define. As regards production, the law envisages six regional services, public autonomous undertakings, but they will be, in fact, strictly sub-ordinated to the national service. In effect, apart from the right of general control that the national service exercises on all the decentralised organs, it will nominate the Governing Board of each regional distribution undertaking. If its competence is limited by the requirement that it must designate representatives of the consumers and of the employees, the national service nevertheless has the right of four representatives on each Governing Board and the Director of each distribution undertaking must be approved by it. In short, the national service exerts over the distributive services the ordinary powers of a Minister over the other public enterprises. “Les Nationalisations en France et en Grande-Bretagne,” op. cit., p. 13.

39 Ventenat, op. cit., p. 175; Auby, “La Nationalisation du Gaz et de l'Électricité,” op. cit.

40 “Nationalisation of Banks and Industries in France,” op. cit., p. 211.

41 “La Fonctionnement Financier de l'Électricité de France,” La Documentation Française, March 11, 1948. Notes Documentaires et Études, No. 848, p. 4 Google Scholar.

42 Gas Act, 1948. s. 5 (4); Electricity Act, 1947, s. 3.

43 One must avoid the term “Board of Directors,” because in France a Directeur is an executive officer. The French term is Conseil d'administration. For a full discussion of the English principles and practice, see Robson, W. A., “The Governing Board of the Public Corporation,” Political Quarterly, Vol. 21, p. 135 (April, 1950)CrossRefGoogle Scholar.

44 Bank of England Act, 1946, s. 2.

45 Civil Aviation Act, 1946, s. 1 (2).

46 Transport Act, 1947, s. 1 (2).

47 Overseas Resources Development Act, 1948, s. 2 (1).

48 Cotton (Centralised Buying) Act, 1947, s. 5.

49 Bank of England Act, 1946, Second Schedule.

50 “Le Tripartisme et l'Administration des Entreprises Nationalisées” in Économie Contemporaine. Centre de Recherches et de Documentation Economiques, April, 1948.

51 Law of April 8, 1946, Article 20. The members are appointed by decree made on the recommendation of the Minister of Industrial Production.

52 Wilmet and Faber, loc. cit.

53 Article 21.

54 Decree of January 16, 1947.

55 E. g., Law of April 8, 1946, Article 20.

56 “Lea Nationalisations en France et en Grande-Bretagne,” op. cit.

57 Wilmet and Faber, loc. cit.

58 See Robson, “The Governing Board of the Public Corporation,” op. cit.

59 “Le Tripartisme et l'Administration des Enterprises Nationalisées,” op. cit.

60 Ibid.

61 Ibid.

62 Civil Aviation Act, 1946, s. 4.

63 See Coal Industry Nationalisation Act, 1946, s. 3; Cotton (Centralised Buying) Act, 1947; Transport Act, 1947, s. 4; Electricity Act, 1947, s. 5; Overseas Resources Development Act, 1948, s. 9; Gas Act, 1948, s. 7.

64 Civil Aviation Act, 1946, s. 12; Transport Act, 1947, s. 4 (4) and (5).

65 Gas Act, 1946, s. 42; Coal Industry Nationalisation Act, 1946, ss. 26 and 27.

66 Electricity Act, 1947, s. 42; Transport Act, 1947, s. 90. The Treasury must guarantee stock issued to compensate the former owners of the nationalised industries.

67 Gas Act, 1948, s. 41 (1); Electricity Act, 1947, s. 36.

68 “Les Nationalisations en France et en Grande-Bretagne,” op. cit., p. 19.

69 Decree dated January 16, 1947 (published in the Journal officiel of the following day), Article 10.

70 Ventenat, op. cit., pp. 131–132.

71 “Le Fonctionnement Financier de l‘Éleotricité de France,” op. cit., p. 7.

72 Decree of January 16, 1945, Article 7.

73 Coal Industry Nationalisation Act, 1946, s. 31 (1); Overseas Resources Development Act, 1947, s. 16 (1); Transport Act, 1947, s. 94 (1); Gas Act, 1948, s. 50.

74 Civil Aviation Act, 1946, s. 21 (1).

75 Coal Industry Nationalisation Act, 1946, a. 54; Civil Aviation Act, 1946, s. 22 (1); New Towns Act, 1946, s. 13 (6); Electricity Act, 1947, s. 8; Cotton (Centralised Buying) Act, 1947, s. 8.

76 Law of April 8, 1946, Article 28.

77 Einaudi, op. cit., p. 22.

78 “Nationalisation in France,” The World Today, op. cit.

79 Law of January 6, 1948, Articles 66–60.

80 “Commission de vérification des comptes des éstablissements publics de l'État de caractère industriel et commercial, des entreprises nationalisées et des sociétées mixtes à participation majoritaire de l'État.”

81 Maurice Byé, “Le Conflit des Tendances dans l'Organisation du Secteur Public” in La Morandière and Byé, op. cit., p. 55.

82 Public Enterprise, op. cit., pp. 379–380.