The benefits of increased investment and efficiency in public infrastructure and utilities

A guest post by Paul Hunt

The case for a pro-cyclical fiscal contraction accompanied by a significant “internal devaluation” has been convincingly demonstrated by many commentators and, in particular, on this site by Philip Lane (most recently here).

But Philip has been equally strong on the requirement to tackle rent capture and inefficiencies that increase costs and prices and, to some extent, justify calls for the retention of current nominal pay levels, as in:

As a complement to pay reductions, it is also vital to more vigorously tackle monopoly power in many sectors of the economy, since a reduction in markups and monopoly rents (often shared between owners, managers and workers in these firms) is an important source of real depreciation and improved competitiveness.” (Irish Economy Note9, p3)

However, apart from a recognition of the importance of this task, it appears that little attention is being paid to what could be done in the short to medium term. There can be no doubt that the bubble economy facilitated increased rent capture and inefficiencies in the sheltered sectors of the economy, but quantifying the scale and extent – not to mind devising effective remedies – is a daunting task. And the political and economic power of the beneficiaries is not insignificant. So it is, perhaps, not surprising that there is little evidence of these problems being tackled effectively.

But a start must be made somewhere and the focus here is on public infrastructure and utilities such as transport, energy, communications, and water and waste water that are, to varying extents, owned, directed, overseen and regulated by Government departments or associated statutory regulatory bodies. There are three reasons for this focus. First, the inefficiencies are significant, are relatively easily quantified (compared to other sheltered sectors) and have economy-damaging impacts. Secondly, since there is significant state direction, it is possible to devise and implement effective remedies quite rapidly. And finally, comparisons with other developed economies (and Ireland’s major trading partners) highlight serious deficiencies in these areas that need to be addressed. The nature of the economic crisis and the fiscal situation prevent the Government from pursuing textbook Keynesian interventions, but that should encourage an even greater focus on enhancing the infrastructure and utilities “platform” to improve the competitiveness of the tradable sectors and to attract new investment.

And to clarify the potential in this area the focus is narrowed to look at the regulated energy businesses. This narrowing of focus reflects personal knowledge and experience, but does not prevent the identification of factors and remedies that have a broader relevance.

The high levels of electricity and gas prices in Ireland (particularly, when compared using Eurostat data with those in other EU member-states) frequently attract attention. Specific features of the individual national markets may go some way to explain the differentials, but, unfortunately, much public attention is focused on the perceived high levels of staff pay in the ESB and Bord Gáis where even significant reductions would have a negligible impact on final prices. (The public perception of the ESB or Bord Gáis has not been helped by the legal requirement to award pay increases under the social partnership agreement or the ability of both (and other semi-states) to avoid the pension levy imposed on public sector workers – even though, by any criteria, Bord Gáis is extremely efficient in operational terms and the ESB has a well-deserved international reputation in the management and operation of electricity systems.)

The resulting public indignation diverts attention from serious specific failings in investment decisions and the financing of investment and more general failings in energy policy and regulation that cost consumers dearly. The public impression is that, since these businesses are in majority state ownership, the state contributes to the financing of investment. The reality is that, apart from some limited forgoing of dividend payments, there has been zero direct exchequer financing of investment by these semi-states within living memory. In the case of the ESB, the significant increase in network investment since the early 2000s has been financed 75% by consumers with much of this being provided up-front in the form of customer capital contributions and via excessively high revenues awarded by the energy regulator. It would be difficult to devise a more inefficient and, for consumers, more costly approach to investment financing. Bord Gáis network investment financing is similarly inefficient.

The unwillingness of successive governments to contribute to the financing of electricity interconnection with Britain (as well as, perhaps, a desire to shield the sector from inefficiency-highlighting competition) has delayed construction. (it is now going ahead with EU co-funding and an EIB loan.) A second gas interconnector, IC2, to Scotland was constructed when LNG importation and, possibly, some reinforcement of the existing Scotland to Northern Ireland interconnector would have made much more sense. IC2 has seen little use and, when Corrib gas and the new LNG importation facility come on stream, it and, most likely, some of the capacity on the first interconnector will be redundant – yet Bord Gáis will recover the full sunk costs of these dubious investments leading to prices being higher than they should be.

Energy regulation has been subverted to facilitate these inefficiencies and to award excessively high revenues that subsidise expansion by the ESB and Bord Gáis into other areas both in Ireland and abroad. The reductio ad absurdum was probably reached with the foray by Bord Gáis into the electricity market: all gas consumers are being penalised to subsidise supply to the much smaller number that switch to Bord Gáis. But, of course, this was greeted as evidence that competition is taking hold in the market.

This naïve belief in “competition” as a panacea for all ills would be touching and charming if it were not so costly for households and businesses. And this naïve belief, unfortunately, is shared by the European Commission and there appears to be a limited appreciation of the genuinely competitive market structures and arrangements that are required to secure investment in specific, long-life assets and to generate benefits, ultimately, for consumers. In Ireland’s case it has led to a policy-decision to reduce the ESB’s share of the generation market on the island to no more than 40%, irrespective of the costs that will be incurred or the fact that this will limit the ESB’s ability to compete in the increasingly integrated regional markets within the EU.

It is possible to estimate the cumulative effect of these failings as comprising €300 – 400 million of the total of the annual bills for electricity and gas. The challenge is to strip out as much of these additional and unjustified costs as possible.

The simplest and most effective approach is to fully separate the network and supply businesses, possibly merge the ESB and Bord Gáis generation and supply businesses and sell the resulting 3 (or 4) businesses via trade sales. It should be possible to generate in excess of €6 billion. The contested market values of the networks are likely to be higher than the current book values, but below the artificially inflated regulatory values which will lead to lower network revenues and lower final prices.

There is a strong case for pursuing a similar approach, though with a different mix of competition in and for the market and an innovative approach to the requirement for subsidy, in the transport sector. The existing water and waste water activities of the local authority providers could be extracted, merged into a number of regional businesses, sold off and made subject to regulation. Conversely, state investment may be required in Eircom (in collaboration with the new ownership structure) to leverage an accelerated development of its network and activities.

And regulation of these sectors should be combined in a single, suitably empowered, regulatory body.

It is probably futile to attempt to demolish the usual arguments about the importance of public ownership of “strategic assets”, the need to preserve and fatten-up “national champions” (such as the ESB), the losses that would be incurred in a “fire-sale” of national assts, the anti-privatisation “lessons” of the Eircom debacle and the malign impact of carpet-bagging, asset-stripping private equity ghouls, but these arguments should be seen for what they are: spurious, self-serving and woolly. When one surveys the costly, inefficient mess that state ownership and direction has created it is difficult to believe that private sector investment and participation, subject to effective policy and regulatory control, would be worse.

14 replies on “The benefits of increased investment and efficiency in public infrastructure and utilities”


Very interesting article indeed. If Ireland is to become competitive then we require to have a low cost base for citizens and business. This will help reduce cost of living, wage inflation and improve our exports etc etc.

However I feel your article does not fully investigate how we have transformed from having one of the cheapest electricity prices in Europe to one of the most expensive.

Prior to the arrival of foreign power producers electricity in this country was provided by the ESB. The ESB is a semi state company and as such it was tasked with providing a service to the citizens of this country. Profits made could be reinvested in the physical infrastructure. Hence if the citizens of Ireland overpaid in year one for electricity then they might pay less in year two, or the profits could be reinvested in the infrastructure hence keeping overall costs down. We were shareholers so there was a dividend to the people. Unfortunately there were some inefficiencies. I personally knew a electrician who joined the ESB in the 1980’s. Despite the fact that he could carry out 4 domestic installations a day as a private contractor, when he became a ESB employee he was limited to 2 installations per day. Union rules dictated the pace of work in those days. There was a cost to this inefficiency but it was not a major concern.

In addition there was another cost, power station efficiency. As the state had built power stations they tended to run these power stations for longer. Even though more modern technology was available to run a power station more efficiently it would still require significant capital investment. But again this does not always work out cheaper in the long run. Boiler technology is old technology, basically you are looking at around 36% thermal efficiency for a sub critical boiler. Super critical boilers can achieve around 42% thermal efficiency. This is a big difference when burning 10,000 tons of coal per day. However this is not the full picture, as supercritical boilers are much more expensive and can be more troublesome to operate reliably. You don’t get something for nothing with technology.

Ireland is a small nation, and the ESB monopoly ran quiet well, we had reliable supply of electricity at low prices. The situation changed drastically with the introduction of competition.

Foreign power companies could not compete with the ESB on cost grounds. As the ESB stations were older a lot of the capital borrowed to build the station was already paid off, hence it was just fuel, maintenance and labour costs to be paid. So prices could be lower. A foreign IPP (Independant Power Provider) would have to borrow capital at commercial rates to build the power station (typically 350 to 400m which would have a typical payback time of around 15 years). It would have to pay for fuel, maintance, labour costs and return a dividend to shareholders who would be outside the country. The plus side would be a more modern efficient power station, thermal efficiency in the region of 55%. But the important point being any profits after tax were taken out of the country and were not distributed to the citizens of the state.

As the ESB was forbiden from building new power stations as it had to reduce its market share a problem arose. The economy was growing annually every year from the mid 1990’s to 2007. Houses had more electrical devices than ever before, hence electrical demand increased. But the ESB was not allowed to build any more power stations. In this scenario something had to give. Portable generators were installed a various points on the grid to provide extra power. Unfortunately these are costly to run as they had to be rented, fueled and maintained. In addition agreements were reached with large industrial users of electricity, providing them with sweet deals of cheap electricity if they agreed to install their own generating sets. This would allow a large user to disconnect from the grid at peak times. When the peak had passed the industrial user could reconnect to the grid. The stick for the user was capital expenditure in a generator, but very cheap electricity from the ESB off peak times (carrot). But again this all had a cost and it was paid for by the taxpayer and small business.

We now have a situation which is more complex than before. The user has to pay for the Network, the IPP, external shareholders, expensive boosting peak plants, and sweet deals with large industrial users. It’s a real dog’s dinner now.

While Ireland has benefitted from higher standards imposed on us from Europe, the one size fits all strategy does not always work. Ireland is a small country, with half the population of Paris. We require to make things simple, less complex, more efficient and cut out expensive middle men. In this regard I feel very betrayed by our politicans who should have known what they were doing when dealing with directives from Europe.

Unfortunatley due to a serious lack of professional investigative journalism the public still believes we have high electricity prices because we have to pay large salaries to ESB workers.

The public have not only been fooled, but we have been robbed.

I just scanned your article and I would agree with much of what you say about our high electricity prices.
The ESB was for many years seen as a perhaps the most successful semi-state. Perhaps this was due to the considerable German influence in setting it up -a lesson for our own time?
The botched attempt to encourage competition has resulted to date in higher electricity prices and encouraged inefficiency and excessive wages within the ESB. The simplest thing to do is to allow the ESB to cut its prices to match. We are in an emergency and what we need immediately is lower costs. If we can find a better way of organising things even in the medium term so be it. But for now prices must drop.

I, perhaps, need to confirm Richard’s post. He is responsible only for kindly providing me with the opportunity to sound off; I am solely responsible for the content.


Many thanks for your expansive and detailed response. I agree that there are many examples of inefficiencies that could be highlighted. However, while these should not be ignored, they frequently amount to millions and perhaps 10s of million of Euros; I’m more concerned with stripping out the efficiencies that amount to 100s of millions of Euros. In addition, I think an excessive focus on electricity (which I know I may have encouraged) might not be sufficiently fruitful and I would welcome comments and responses from those who have knowledge and experience of the other infrastructure and utility sectors. My objectives are increased efficiency, lower costs and better service in the infrastructure and utility sectors accompanied by a significant de-leveraging of the state’s balance sheet.


I agree that prices must drop, but there is a Catch 22 which prevents an immediate achievement of your desire. The energy regulator, alone, has the power to set prices and tariffs. When the Taoiseach directed Minister Ryan in February to secure a reduction in electricty prices, the CER brought forward to May the price reduction it envisaged authorising for October. It achieved this by borrowing from network revenues in this year (from 1 October). This is now being paid back so that there was only a negligible reduction in electricity prices in October. The regulator believes it can’t deviate from its price decisions or its credibility would be blown. Only a sale of the networks which would reveal contested market values would allow the regulator to revise its price determinations downwards. And this would require a change so that the regulator sets maximum prices rather than “the prices”.

However, much could be achieved rapidly if there were the politcial will.

@Paul Hunt
I think the psychological impact of a fall in energy prices would perhaps be as beneficial to struggling businesses as the impact of the actual fall.
Surely Eamonn Ryan is not precluded from indicating that he would like to see ESB prices fall to match the others. This is a crisis.

Fortunately for the vested interests, the government does not care for anything but lip service to efficiency. Nama will maintain fee income and land values. The ESB is quite safe!

There will be a democratic paradigm change only when law and order is threatened. That will take a few years more.

Interesting times …..

Interesting post and the comments provide much food for thought. One issue I’d like a bit of clarity on though is your claim that since the early 2000s network investment has been financed 75% by consumers with much of this being provided up-front in the form of customer capital contributions.

Of course ultimately customers will pay for all energy assets, but I don’t understand your point, what is it you are getting at here?


I am not an energy economist but I share the concerns about the impact of high energy costs on our competitiveness, and I would like to know some solutions. However, I found your post left many unanswered questions.

Your post begins by asserting that “by any criteria, Bord Gáis is extremely efficient in operational terms and the ESB has a well-deserved international reputation in the management and operation of electricity systems.” Yet by the end of the post this had morphed into an attack on the “costly, inefficient mess that state ownership and direction has created [and] it is difficult to believe that private sector investment and participation, subject to effective policy and regulatory control, would be worse.” The path from premise to conclusion was, to say the least, pretty unclear to me.

Your conclusion seems to favour three or four privately owned utility firms arising from the sale of ESB and Bord Gais assets, subject to public regulation. But in the course of your argument, you describe the belief that competition can be a panacea for all ills as “naive”, and your description of our present experience with regulation hardly bodes well when you argue that “Energy regulation has been subverted to facilitate these inefficiencies and to award excessively high revenues”. If you argue that regulatory practices would be different in the future, why not implement these changes now?

You envisage the Irish market supporting three or four privately-owned power generating companies, but you bemoan the fact that the limitation of the ESB to 40% of the Irish market “will limit the ESB’s ability to compete in the increasingly integrated regional markets within the EU”. Would three or four privately owned companies be better placed to compete in these future integrated regional markets, and why?

You are critical of the fact that the “significant increase in network investment since the early 2000s “has been financed 75% by consumers with much of this being provided up-front in the form of customer capital contributions and via excessively high revenues awarded by the energy regulator”. However, elsewhere in the post you say that
the ESB is not allowed to build new plant, so it seems unlikely that the ESB required capital contributions. And indeed you do say that the investment has been made in the network, not in generation. My undestanding is that the network is now controlled by Eirgrid and is separate from the ESB. Now you did not argue that the transmission network should be privatised, so it is not clear to me, given the unwillingness or incapacity of the government to finance investment or, presumably, to permit raising finance through issuing bonds, where else the funding would come from except from cash flow.

Finally, you describe the Eircom privatisation as a debacle but dismiss that it has any relevance to a discussion of the possible privatisation of the ESB or An Bord Gais. I guess to the many thousands of households without access to a decent broadbank connection, that might seem as a pretty cavalier approach.

There are a lot of dots here which just don’t join up….

Regarding the regionalisation and selling off water and wastewater activities and regulating them. This requires of course full cost recovery through water charges. Regionalisation makes a lot of sense particularly in the larger urban areas. Full cost recovery through charges brings transparency on the true cost of providing the service and economic regulation may work. Does it require privatisation to get the necessary gains for the consumer? has privatisation of water companies worked satisfactorily in the UK. ?

Competition in water supply or sewage isn’t really an option, there is no national grid

@David Kerins,

You have highlighted an important factor which is the principal contributor to excessively high electricity and gas prices. It has also been raised by Alan Matthews – of which more below. This table (apologies for its presentation) shows the financing of ESB network (both transmission and distribution) investment in excess of €4 billion for the period 2001 to 2007 incl. (as per the ESB Summary Regulatory Accounts):

Source € million %Share
Funds generated from operations 2,579.1 62.0%
Customer capital contributions 614.8 14.8%
Transfer from ESB central treasury 965.9 23.2%
Total 4,159.8

The transfer from central treasury is likely to come from corporate borrowings, but could also include some cash generated from other activities. If the network business had been operated as a stand-alone regulated business (and financially ring-fenced) similar to those in other jurisdictions, it could have borrowed up to, say, 60% of this investment financing. (A statutory limit on the ESB’s borrowings was increased by emergency legislation in Sep. 2004.) In addition, a rational shareholder confronting investment of this scale and with a regulatory assurance of full investment recovery would have injected some equity. Therefore, it is possible to estimate that, in these seven years in addition to providing the revenue to ensure full investment recovery on an on-going basis – which is entirely appropriate, consumers contributed over €2 billion up-front that should have come from increased borrowings and equity. The situation is similar for the Bord Gais networks.

The energy regulator was compelled to value the network assets in a manner that would generate the additional revenues to compensate for this gloriously inefficient financing of investment. This is the outcome of the policy of three successive governments not to provide any direct exchequer financing of network investment and to maintain, as far as possible, the vertical integration of the ESB and Bord Gais in financial terms. Another aspect of this policy is the requirement to compensate the ESB for its loss of generation market share in pursuit of the holy grail of “competition” and this is reflected in the conservation of its borrowing potential to finance other activities both in Ireland and overseas rather than applying it to the financing of the huge network investment in Ireland.

@Alan Matthews,

Many thanks for attempting to disentangle my frequently cryptic argumentation. We have seen the increasing complexity of the NAMA beast in the space of 6 month; this situation, like Tposy, has growed over 12 years.

I am keen to avoid consideration of operational efficiencies , work practices or pay levels in the ESB or Bord Gais. The ptoential effciency gains in these areas are likely to be hard-won and are small in relation to the other efficiency gains that may be achieved. My principal targets are the inefficient financing of network investment (including the full recovery of dubious investments by Bord Gais) as outlined above and the ill thought through promotion of “competition” in a market whose scale, by international standards, is unlikely to create the conditions that will generate benefits for consumers – and may increase costs.

The immediate and pressing requirement is to reduce final electricity and gas prices. The first step is to fully separate (and financially ring-fence) the network bsuinesses. (Eirgrid does not own the electricity transmission assets – it is the operator – though the apparent policy intention is to transfer ownership to Eirgrid. This, not surprisingly, is being resisted by the ESB.)

To progress matters the Government could direct the stand-alone network businesses to increase their borrowings and this would finance a state equity buyback. A simple one line bill amending the powers of the energy regulator to set maximum prices and tariffs – rather than setting actual prices and tariffs – would allow the Government to direct the ESB and Bord Gais to set lower network tariffs and, thereby, reduce final prices. Subsequent privatisation of the networks would provide contested market values of the assets, get the energy regulator off its inflated asset valuation hook and generate proceeds for the Government.

Given the existence of the Single Electricity Market and the steps being taken to establish something similar for gas, resolving competition issues is less easy. However, given the extent of interconnection, steps could be taken quite quickly to more fully integrate the gas markets on the islands of Ireland and Britain. Integration of the electricity markets is unlikely to progress until the East-West interconnector is commissioned, but preparatory steps could be taken. I passing I envisage a single merged electricity generation and dual-fuel supply business being extracted from the ESB and Bord Gais. This should be well capable of competing in the larger integrated market.

With regard to Eircom, I am simply pointing out that this bodged privatisation should not be used as an argument against the privatisation other semi-states. And I accept that state equity may be required to facilitate expansion of its activities. It should make sense to use some of the proceeds from the sale of old assets – the electricity and gas networks – to finance investment in new assets.

@J Daly,

Privatisation is being advanced primarily because of the constraints on the Government’s ability to finance infrastructure investment and of the need to de-leverage the state’s balance sheet. Contrary to what some might think, I do not have an ideological stance. Recycling privatisation proceeds might be a start, but metering and user charges would be required and, in that context, there is no reason why private sector provision subject to regulation, would not work. In addition, a number of regional water companies would permit some yardsticj regulation.

J Daly asks if privatisation of the water industry worked in the UK. I will quote David Parker, the UK’s authority on privatisation who is currently working on the second volume of “The Official History of Privatisation in the UK”. In a recent interview Parker was asked to identify privatisations that failed. Not surprisingly he identified the railways and the water industries. Why the water industry? Because in that particular industry “there is no competition: there wasn’t when it was state owned, effectively there isn’t now in almost all areas of water and sewerage”. As a consequence the reduced prices evident in electricity, gas and telecommunications didn’t materialise in the water industry. J Daly is correct in asserting that competition makes no sense in water supply given its natural monopoly characteristics.

On a related point it should be noted that privatisation is happening in the water services industry. Public Private Partnerships (Design, Build, Operate Model) are being used to construct and operate water and wastewater plants around the country (over 100 plants at various stages of the appraisal/tendering and operating stages. It is interesting that while the Department of Finance requires that value for money of PPPs must be demonstrated before PPP is adopted, the Department of the Environment expliciltly states that PPP is the preferred option. Local authorities are fully aware that PPP is the only game in town. If they conduct VFM reports that indicate traditoinal procurement is cheaper the Department sends them back to the drawing board. As a consequence much needed water and wastewater treatment plants are not going to tender. This has happened in a number of local authorities and is a perfect example of bad practice under PPP.

Paul Hunt makes the point that Eircom should not be held up as a case that precludes privatisation. The problem with that line of thinking is that it assumes our policy makers, regulators etc learn from their mistakes. I’m not so sure.

@Eoin Reeves

To some extent I share your doubt about the ability of “our policy makers, regulators etc” to learn from their mistakes. The first thing, of course, is that they admit their mistakes; and that never seems to happen.

The bottom line is that households and businesses, or indeed the economy, can no longer afford to subsidise the non-core empire-building ambitions of the ESB and Bord Gais either in Ireland or elsewhere. (It may be the case, of course, that Irish consumers are happy to be, in effect, taxed by the energy regulator to finance this heroism up front – there is a deep and widespread residual affection for the ESB – but it would be good manners to inform them of this implicit taxation and to give them an opportunity to express their consent.) And citizens and the economy require high quality communications and broadband services and high quality and effcient water and waste water services.

The almost reflexible aversion to any form of privatisation – fuelled to a considerable extent by the Eircom debacle – does not sustain scrutiny. Private sector participation and increased competition and choice are two dimensions in the provision of efficient and high quality services. Yes, of course, there are areas where head-to-head rivalrous competition does not make sense and yes, again, the private sector will seek to extract returns greater than those allowed by a regulator (by using, for example, asset-sweating, financial engineering, information assymetries to hood-wink regulators, skimping on maintenance and service quality, imposing additional costs on consumers, etc), but a huge body of both theory and practice has been developed internationally to devise and apply the controls and incentives to minimise these detrimental effects.

Where the private sector is both willing and able to provide capital and expertise it should be facilitated.

@Paul Hunt

You state “Where the private sector is both willing and able to provide capital and expertise it should be facilitated”.

By facilitated , do you mean that the private participtation option should be explored or utilised? Just because the private sector is willing to build and operate roads, schools and water treatment plants etc certainly does not justify decisions to let this happen. Private sector particiaption through PPP has a chequered (and thats being kind) record worldwide. The Irish experience to date has been disappointing with slow delivery of projects, witdrawal of the private sector at enomous social cost (e.g. social housing), and absolutely no evidence of value for money.

You persist in arguing that Eircom should not be held up as case to deter decision makers from privatising. The reason the Eircom privatisation was botched was not just because ordinary citizens lost a a fortune (not a trivial point – and an example of where economic decisions have serious social impacts). Neither was it because a strategic national asset was shamelessly expoited for huge profits by Tony O’Reilly and his cronies. Eircom was privatised as a near monopoly and did exactly what monopolies do. THey exploited their ownership of the network to prevent compeition at the expense of the consumer and wider society. This was facilitated by a regulatory framework that was ill-equipped to do what regulators are supposed to do. We have no reason to trust our policy makers to get it right in the context of privatising our other vital networks. The argument that there is now huge international experience with regulating former state owned monopolies doesn’t give grounds for faith that we will get it right in this country.

If the goal is reduce consumer costs the suggestion made by Donal Palcic on previous posts makes eminent sense. He argued for a state-owned networks company that co-ordinates investment (telecoms, electricity, gas etc) and exploits economies arising from co-ordination that translates into lower prices.

@Eoin Reeves,

In the thread to which you refer Donal Palcic and I debated these issues to the point of agreeing to disagree. There seems to be little point in pursuing this debate when there appears to be a refusal to acknowledge the evidence of the ineffcient and, to consumers, extremely costly outcome of majority state ownership and direction of the network businesses.

I think the most I can do is to encourage some reflection on the disjunction between your doubt that Ireland would be able to develop and apply appropriate regulatory arrangements for networks in private sector ownership and your support for Donal’s advocacy of state-owned networks company. Effective regulation isn’t easy to develop and apply, but all of the international experience I’ve accumulated suggests it is much easier – and generates more efficient outcomes – than complete state ownership, direction and control.

Comments are closed.