Operating a statutory body in a commercial environment
A Port of London Authority case study

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Page 1: Introduction

Port Of London Authority 4 Image 1Government plays an important role in the lives of individuals and business organisations. There are many reasons why governments intervene in markets. For example, during the Second World War, many industries were taken over by the Government to co-ordinate production to meet the war effort.

One organisation set up to provide key benefits not just to the people of London but also to the country as a whole was the Port of London Authority (PLA). It was created by an Act of Parliament in 1908 to take responsibility for 'administering, protecting and preserving' the docks and wharves along the Thames. At that time, the situation was chaotic with many operations going out of business and serious problems of delay and theft.

Public ownership and privatisation

An industry or organisation owned by the Government is referred to as a public corporation or a nationalised industry. In 1979, Margaret Thatcher’s Conservative Government came into power. One of the key policies of this Government was privatisation. This is the process of returning the corporation or industry to private ownership and to the discipline of market forces. The PLA is neither owned by the Government nor is it privatised. It is a hybrid, known as a public trust.

The PLA's last remaining dock, the Port of Tilbury, was privatised in the 1990s. Previously the PLA had run the Port of Tilbury and employed more than 10,000 people. Now the Port of Tilbury is a private company and the PLA is no longer responsible for running its facilities.

The role of the PLA has changed radically in the past twenty years, from being a port operator as well as conservator and regulator before privatisation, to now being solely a navigation and harbour service. It is also responsible for marketing the port and the River Thames world-wide as a place for business, pleasure and recreation.

Port of London Authority | Operating a statutory body in a commercial environment