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| davrosG5 wrote: There might be hefty break clauses in the contracts but don't forget that a government can legislate. They'd have to be careful how they did it of course but what they need to do is create conditions where it's better for the private companies to surrender the contracts. It could be done with a windfall type tax (or even the threat of a windfall tax - hand back the contracts or we'll make them cost you more than it does the state) or they could freeze out the ability of the suppliers to raise prices so it becomes less economically attractive to hold the contract over time. The nuclear option is just to put in some sort of state by-back legislation heavily weighted in favour of the state - surrender the contract or we'll by it off you for £1. That would however create problems in the future if the state ever wanted to use any form of private investment again but it's a possibility and one that would certainly appeal to the really hard left. | |
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Those tactics have been used in Russia, Venezuela and Argentina. But those aren't the greatest rule of law states. In Britain all of the tactics you describe would be challenged in the courts and struck down given that they are nakedly predatory renegotiations in bad faith. In order to make any of them work at all, the first step would therefore have to be a major rewriting of UK contract law, granting powers to renegotiate in such a way to the state on some sort of strategic basis, or under some other doctrine of unusual force outside of emergency.
Unfortunately, given that similar contracts are used to raise all the sovereign borrowings that make our government work day to day, the instant effect of even presenting such a bill to the House would be to bring the UK's sovereign credit rating down to the sort of status enjoyed by countries who break contracts and expropriate assets outside of emergencies. Which would be ironic, because then we get an actual emergency.