... future lead to productivity improvements in state firms the government becomes better off when the productivity improves not when(or if ) the firm is sold Many privatised firms now face intense competition often from abroad. However , natural monopolies have aquired a new framework of regulation. This has favoured price capping, administered by independent regularity agencies (quangoes) and subject to periodic review Increasingly, the UK has been driven to regulate not merely conduct but structure. This presupposes that some parts of a natural monopoly can be hived off and become suitable for competition. In practice, this has usually been down stream activities in a vertically related industry ie union of firms at different production stages in the same industry Recent privatisations include 1British Rail (now taken back into public ownership as a not for profit organisation) 2 British Air Ways 3 Air Traffic Control 4 British Steel 5 British Gas 6 British Telecom 7 The Water Companies 8 And ...

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