UK government offers guidance on port privatisation

The UK government yesterday set out the factors it would take into consideration when deciding whether to privatise a trust port.

In a written ministerial statement, the parliament under-secretary of state for transport, Paul Clark, said the factors it would consider were: whether the port would continue to supply high-quality service; the affect on competition; whether it would improve the chance of investment and the current market appetite for a sale and the value for money likely to be achieved.

Other factors that would be considered were: giving prospective purchasers a fair and equitable opportunity to make an offer; encouraging disposal of equity to managers and employees of the port; and whether it would help to deliver reliable and efficient transport network.

Trust ports are expected to make bids to be privatised any day now.

Of the ports that are considering making a bid, Europe’s busiest ferry port Dover’s plans are the most advanced. The others are Tyne, Harwich Haven, Milford Haven, Poole and Shoreham.

It is understood one of the main reasons Dover is considering privatisation is to help secure funding to develop its £420m (US$678m) Terminal Two project.

Currently trust ports can struggle to find funds for expansion because they are classified as public corporations.

By privatising they would be able to fund expansion as any other company would.

The full guidance issued by the government can be found at the address below:

http://www.dft.gov.uk/pgr/shippingports/ports/trust/guidancenote/pdf/guidance.pdf