Jim Power: We shouldn't sell off our state assets to vulture capitalists interested only in extracting short-term profit.
Published 22/02/2012 | 15:30
THE sale of state assets, in other words privatisation, is an emotive subject that elicits strong ideological views. The left believes that the state does a better job delivering goods and services than the private sector, while the right believes that the state should have minimal control over state assets and that the private sector can deliver goods and services more efficiently and effectively than the public sector.
As in most matters of an economic nature, neither perspective is correct. We have numerous examples of state failure in delivering goods and services, of which FAS springs to mind as just one example. On the other hand, there are also numerous examples of the private sector failing to deliver in an efficient and effective manner. The banking fiasco readily springs to mind in this regard. It doesn’t really matter who owns the assets, if they are used and managed incorrectly, market failure will inevitably follow.
What we got today was government action based on two reports. Firstly, the IMF/EU Memorandum of Understanding states that ‘the Government will undertake an independent assessment of the electricity and gas sectors with a view to enhancing their efficiency. State authorities will consult with the Commission Services on the results of this assessment with a view to setting appropriate targets for the possible privatisation of state-owned assets’.