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University of Guelph
Political Science
POLS 2250
Tim Mau

POLS 2250 – Public Admin & Government 3/23/2013 8:44:00 PM Crown Corporations February 11, 2013  Also known as „public enterprise‟ or „state enterprise‟  Formal definitions o Legal entity with corporate form o Canada Business Corporations Act (Ontario Business Corporations Act) or special act of parliament/legislature o Dimension of ownership  Wholly owned (parent corporation – agency or proprietary corporations)  Subsidiaries or sub-subsidiaries  Definitional ambiguity o Government appointment of the board of directors  Functional Definitions 1 o Corporations that provide goods or services to the public on a commercial or quasi-commercial basis o Some provide expert advice – Standards Council of Canada o Perform regulatory functions – Atomic Energy of Canada LTD. o Stabilize commodity prices – Canadian Diary Commission o Lambert Commission (1979) – 6 elements  Constituent Act/ Letters of Incorporation  Tasks Akin to private sector entrepreneurial ventures  Wholly owned  Board of Directors  Separate employer  Minister my give direction Forms of Public Enterprise  Mixed enterprise o Shares are partly owned by government through minister o Remaining shares owned by private sector entity(ies) o Benefit – access to private capital and skills o Concern – accountability  ie: Petro Canada prior to privatization in 2004  Joint Enterprise o Shares partly owned by government through minister o Remaining shares owned by another level of government  ie: Lower Churchill Development Corp; Northern Portage Development Corp. Forms of Public Enterprise  Shared governance corporations o No share capital for government o But government, directly or through crown corp, has the right to appoint or nominate one or more members to governing board  ie: Agricultural Adaptation Council; Canada Games Council; Canadian Sports Centre  International Organizations o Corporate entities created pursuant to international agreements o Can either appoint board members or own shares  ie: IMF, World Bank, World Anti-Doping Agency; North American Commission for Environment Cooperation 2 Crown Corporations – Rationale  1. Nation Building  2. Economic Protection  3. Principle of Public Ownership – Natural Monopolies  4. Nationalist Argument  5. Political Ideologies  6. Develop relations with private sector  7. Advantages over departments  8. Federal-Provincial relations Accountability Issues February 13, 2013  Designed to be autonomous, arms-length  Weakened ministerial responsibility  Policy direction – power to use directives  Appointment/removal of directors  Funding issues  Scrutiny of corporate plans and annual reports o Statement of how the corporation actually did perform over the past 12 months o Met its objectives for the year – various quantitative statistics through these reports Arguments for Privatization  Financial reasons o Deficit/debt reduction o Less efficient o Unfair competition o Prevents other policy initiatives  Ideological preferences – neo-liberalism  Crown corporations often represent failing industries  Conflicting goals – profit or public purpose? New Public Management  New? – originated as a produce of the neo-conservative agenda of Margaret Thatcher in the UK (1979)  Global reform movement – Scandinavian countries, New Zealand, Australia, Canada, US – even Mongolia  4 key factors driving NPM o Economic crisis and need to reduce government spending 3 o Lack of confidence in politicians and public demand for better and more cost-effective service delivery o Globalization o Political/Ideological  Managerialism – focus on „bottom lin
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