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Privatization, Share Ownership and Voting

Published online by Cambridge University Press:  27 January 2009

Extract

Popular support for the British government's privatization programme has never exceeded 40 per cent of the electorate, and by the end of the 1980s, huge public flotations of industries like water and the electricity suppliers and generators were taking place in the teeth of widespread popular opposition. The evidence on voting behaviour suggests, however, that it was the Labour party rather than the Conservatives which lost electoral support as a result of the privatization programme. This Research Note offers an explanation for this apparent paradox.

Type
Notes and Comments
Copyright
Copyright © Cambridge University Press 1995

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References

1 In 1979, almost four out of ten electors supported some measure of privatization while fewer than one in six wanted more nationalization (McAllister, I. and Studiar, D., ‘Popular Versus Elite Views of Privatization: The Case of Britain’, Journal of Public Policy, 9 (1989), 157–78CrossRefGoogle Scholar), and privatization remained popular with around 40 per cent of electors so long as the government did not actually sell anything of any consequence (see Edgell, S. and Duke, V., A Measure of Thatcherism (London: Harper Collins, 1991Google Scholar) for a review of the evidence). However, during the government's second term, when it sold BT and British Gas, the pattern began to change, and by the 1987 election, support for further privatization was down to 30 per cent (Jowell, R., Witherspoon, S. and Brook, L., British Social Attitudes: The Fifth Report (Aldershot, Hants.: Gower, 1988).Google Scholar Ever since then, the government has lacked any marked popular support for its programme, and by the end of the decade, the numbers favouring further privatization were overtaken by those favouring more nationalization (MORI, personal communication). This lack of public support is reflected in the results of the survey of 828 members of the public reported in this research note. In 1989, less than a quarter of respondents supported government privatization policies while 57 per cent opposed them. While fewer than one in twenty people strongly supported the principle of privatization, more than one in three strongly opposed it. Eighteen months later, opposition was still marked with 52 per cent of people still against privatization and just 30 per cent in favour.

2 The study was supported by the Economic and Social Research Council and was designed to trace the impact of water privatization on customers, employees and share buyers as well as on voters. The full results of the study are to be published in Saunders, P. and Harris, C., Privatization and Popular Capitalism (Milton Keynes, Bucks: Open University Press, 1994).Google Scholar

3 MORI, ‘1988: Prospects for the New Year’, British Public Opinion, 10 (1988, 0102), 45.Google Scholar

4 Sunday Times, 4 12 1988.Google Scholar

5 Marsh, D., ‘Privatisation in Britain: An Idea in Search of a Policy’, Essex Papers in Politics and Government, No. 72 (Colchester: University of Essex, Department of Government, 1990).Google Scholar

6 McAllister, and Studiar, , ‘Popular Versus Elite Views of Privatization’.Google Scholar

7 See the 1988 General Household Survey (London: HMSO, 1989).Google Scholar

8 McAllister, and Studiar, , ‘Popular Versus Elite Views of Privatization’.Google Scholar See also Studiar, D., McAllister, I. and Ascui, A., ‘Privatization and the British Electorate: Microeconomic Policies, Macroeconomic Evaluations, and Party Support’, American Journal of Political Science, 34 (1990), 1077–101.CrossRefGoogle Scholar

9 Heath, A. and McMahon, D., ‘Privatization and the British Electorate: A Comment’, Joint Unit for the Study of Social Trends Working Paper, No. 8 (Oxford: SCPR and Nuffield College, 1991).Google Scholar

10 The overall rate of desertion was much higher than that among Labour supporters. This partly reflects the dramatic decline in support for the Greens between 1989 and 1991, and is partly a reflection of the relative weakness of loyalty among supporters of centre parties.