Future

Some have suggested that the Crown company framework was established as a ‘halfway house’ to privatisation and is not a valid structure for companies that the Crown does not intend to sell.

• However, the Crown company framework primarily involves the use of internationally proven and orthodox objectives, governance structures and accountability regimes for the conduct of trading activities. It is primarily focussed on objectives of value generation and performance enhancement.
• It does not follow that the purpose of corporatising an asset is to sell it.
• Some organisations are so important to the national economy that they will never be sold. Another way to capture the gains from corporatisation is to retain ownership and capture these gains through increases in value and the stream of dividends paid over the medium to long term.

Although the performance of Crown companies has varied due to factors such as market conditions, on the whole they have performed well and have certainly performed far better than their predecessor organisations.

This framework works well because of the disciplines and clarity of objectives that it brings to the management of trading activities and is not dependent on the possibility of privatisation to bring results.

Since 1999, the Government has had a policy of ‘no asset sales’. Under this policy, major asset divestments are still permissible where there are compelling commercial or legal reasons for doing so, but the Crown has no programme of selling down its overall portfolio of commercial investments.