A state-owned enterprise ( SOE ) is a business entity created or owned by a national or local government, either through an executive order or legislation. SOEs aim to generate profit for the government, prevent private sector monopolies, provide goods at lower prices, implement government policies, or serve remote areas where private businesses are scarce. The government typically holds full or majority ownership and oversees operations. SOEs have a distinct legal structure, with financial and developmental goals, like making services more accessible while earning profit (such as a state railway). They can be considered as government-affiliated entities designed to meet commercial and state capitalist objectives.
32-748: The Forensic Science Service ( FSS ) was a government-owned company in the United Kingdom which provided forensic science services to the police forces and government agencies of England and Wales , as well as other countries. The UK Government announced the closure of the FSS in December 2010, citing monthly losses of up to £2m as justification. The House of Commons Science and Technology Committee - Seventh Report ( FSS ) took evidence between 23 March 2011 and 27 April 2011 Science and Technology Committee . The FSS finally closed on 31 March 2012. The FSS archives –
64-633: A DNA profile. The FSS's innovative and highly sensitive DNA profiling technique called LCN ( low copy number ) was used in convicting Antoni Imiela (the M25 rapist) and Ronald Castree (for the murder of Lesley Molseed in 1975), but was questioned during the 2007 trial of a suspect in the Omagh bombing . However, a review by the CPS found that "the CPS has not seen anything to suggest that any current problems exist with LCN. Accordingly we conclude that LCN DNA analysis provided by
96-531: A Forensic Laboratory it had research facilities where the Lion intoximeter was pioneered later leading to the pioneering use of the hand held breath alcohol roadside tester and the DNA national database was first worked on and initially tested on all staff and police forces to ensure its reliability. The organisation later pioneered the use of large scale DNA profiling for forensic identification and crime detection when it moved
128-565: A collection of case files and retained casework samples such as microscope slides, fibre samples and DNA samples – has been retained to allow review of old cases. Forensic work is now contracted out to the private sector or carried out in-house. Originally the Aldermaston laboratory was known as the Central Research and Support Establishment and was part of the Home Office. As well as having
160-661: A public objective. For that reason, SOEs primarily operate in the domain of infrastructure (e.g., railway companies), strategic goods and services (e.g., postal services, arms manufacturing and procurement), natural resources and energy (e.g., nuclear facilities, alternative energy delivery), politically sensitive business, broadcasting, banking, demerit goods (e.g., alcoholic beverages ), and merit goods (healthcare). SOEs can also help foster industries that are "considered economically desirable and that would otherwise not be developed through private investments". When nascent or 'infant' industries have difficulty getting investments from
192-489: A regular enterprise, state-owned enterprises are typically expected to be less efficient due to political interference, but unlike profit-driven enterprises they are more likely to focus on government objectives. In Eastern Europe and Western Europe , there was a massive nationalization throughout the 20th century, especially after World War II . In the Eastern Bloc , countries adopted very similar policies and models to
224-456: A sustainable business". On 14 December 2010 HM Government announced that the service was to be closed by March 2012, with as much of its operations as possible being transferred or sold. This prompted criticism, both from international forensic scientists as well as victim campaigners, for the potential damage the cuts would do to the UK criminal justice system. The FSS had several facilities throughout
256-562: Is a viable argument for SOEs is debated. SOEs are also frequently employed in areas where the government wants to levy user fees , but finds it politically difficult to introduce new taxation. Next, SOEs can be used to improve efficiency of public service delivery or as a step towards (partial) privatization or hybridization. SOEs can also be a means to alleviate fiscal stress, as SOEs may not count towards states' budgets. Compared to government bureaucracy, state owned enterprises might be beneficial because they reduce politicians' influence over
288-753: Is approximately 70% of total employment. State-owned enterprises are thus a major factor behind Belarus's high employment rate and a source of stable employment. In most OPEC countries, the governments own the oil companies operating on their soil. A notable example is the Saudi Arabian national oil company , Saudi Aramco , which the Saudi government bought in 1988, changing its name from Arabian American Oil Company to Saudi Arabian Oil Company. The Saudi government also owns and operates Saudi Arabian Airlines , and owns 70% of SABIC as well as many other companies. China's state-owned enterprises are owned and managed by
320-542: Is debatable what the term "state" implies (e.g., it is unclear whether municipally owned corporations and enterprises held by regional public bodies are considered state-owned). Next, it is contestable under what circumstances a SOE qualifies as "owned" by a state (SOEs can be fully owned or partially owned; it is difficult to determine categorically what level of state ownership would qualify an entity to be considered as state-owned since governments can also own regular stock , without implying any special interference). Finally,
352-602: Is highlighted in the predominant local terminology, with SOEs in Canada referred to as a " Crown corporation ", and in New Zealand as a " Crown entity ". The term " government-linked company " (GLC) is sometimes used, for example in Malaysia , to refer to private or public (listed on a stock exchange) corporate entities in which the government acquires a stake using a holding company . The two main definitions of GLCs are dependent on
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#1732858171874384-621: The A452 , near to where it crosses the M42 . The Police in England and Wales spend £170 million on forensic science. It had seven main laboratories across England and Wales: Before HM Government wind-up led by minister James Brokenshire , the FSS was the market leader in the supply of forensic science services to police forces in England and Wales, as well as being a source of training, consultancy and scientific support. The FSS originally set up and maintained
416-474: The Claremont serial killings . In later years the FSS drew on internal expertise and key international experts to become a pioneer in forensic software and technology, notably DNA interpretation, databasing, and electronic forensics. Government-owned company The terminology around the term state-owned enterprise is murky. All three words in the term are challenged and subject to interpretation. First, it
448-703: The State-owned Asset Supervision and Administration Commission (SASAC) . China's state-owned enterprises generally own and operate public services, resource extraction or defense. As of 2017 , China has more SOEs than any other country, and the most SOEs among large national companies. China's SOEs perform functions such as: contributing to central and local governments revenues through dividends and taxes, supporting urban employment, keeping key input prices low, channeling capital towards targeted industries and technologies, supporting sub-national redistribution to poorer interior and western provinces, and aiding
480-736: The UK National DNA Database , but it is now run by the National Policing Improvement Agency (NPIA). The FSS suffered damage to its reputation following the failure to recover blood stains from a shoe in the murder of Damilola Taylor . Further damage occurred when the FSS failed to use the most up-to-date techniques for extracting DNA samples in cases between 2000 and 2005. This led the Association of Chief Police Officers (ACPO) to advise all police forces in England and Wales to review cases where samples had failed to give
512-538: The FSS should remain available as potentially admissible evidence". In addition, other Police Forces around the world are reviewing cases where LCN DNA profiling resulted in the successful prosecution of suspects. Included in this are several high-profile international cases including the murder of Swedish Foreign Minister Anna Lindh by Mijailo Mijailovic and in Australia, the murder of a backpacker Peter Falconio by Bradley John Murdoch and trial of Bradley Robert Edwards for
544-833: The Minister of Finance II, the Minister in the Prime Minister's Department in charge of the Economic Planning Unit, the Chief Secretary to the Government, Secretary General of Treasury and the heads of each of the GLICs (the Employees Provident Fund, Khazanah Nasional Berhad , Lembaga Tabung Angkatan Tentera (the armed forces pension fund), Lembaga Tabung Haji and Permodalan Nasional Berhad . Khazanah Nasional Berhad provided
576-1003: The USSR. Governments in Western Europe, both left and right of centre, saw state intervention as necessary to rebuild economies shattered by war. Government control over natural monopolies like industry was the norm. Typical sectors included telephones , electric power , fossil fuels , iron ore , railways , airlines , media , postal services , banks , and water . Many large industrial corporations were also nationalized or created as government corporations, including, among many others: British Steel Corporation , Equinor , and Águas de Portugal . A state-run enterprise may operate differently from an ordinary limited liability corporation. For example, in Finland, state-run enterprises ( liikelaitos ) are governed by separate laws. Even though responsible for their own finances, they cannot be declared bankrupt ;
608-609: The country, and provided scene-of-crime and forensic investigation services to police forces in England and Wales, as well as to the Crown Prosecution Service , HM Revenue and Customs , HM Coroners' Service , Ministry of Defence Police , British Transport Police and worldwide forensic services. When an executive agency, its two main headquarters were at 109 Lambeth Road (A3202), London and at Priory House on Gooch Street North in Birmingham. Its headquarters were close to
640-453: The facilities to Birmingham. This later enabled the launch of the world's first DNA database on 10 April 1995. The organisation became an executive agency of the Home Office on 1 April 1991, shortly after deciding to close its Aldermaston Laboratory. It became a trading fund on 1 April 1999. In December 2005, it changed its status from an executive agency to a government-owned company. It
672-500: The form of Public Sector Undertakings (PSUs). The Malaysian government launched a GLC Transformation Programme for its linked companies and linked investment companies ("GLICs") on 29 July 2005, aiming over a ten-year period to transform these businesses "into high-performing entities". The Putrajaya Committee on GLC High Performance ("PCG"), which oversaw this programme, was chaired by the Prime Minister , and membership included
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#1732858171874704-412: The leading application of the incomplete contract theory to the issue of state-owned enterprises. These authors compare a situation in which the government is in control of a firm to a situation in which a private manager is in control. The manager can invest to come up with cost-reducing and quality-enhancing innovations. The government and the manager bargain over the implementation of the innovations. If
736-592: The negotiations fail, the owner can decide about the implementation. It turns out that when cost-reducing innovations do not harm quality significantly, then private firms are to be preferred. Yet, when cost-reductions may strongly reduce quality, state-owned enterprises are superior. Hoppe and Schmitz (2010) have extended this theory in order to allow for a richer set of governance structures, including different forms of public-private partnerships . SOEs are common with natural monopolies , because they allow capturing economies of scale while they can simultaneously achieve
768-399: The private sector (perhaps because the good that is being produced requires very risky investments, when patenting is difficult, or when spillover effects exist), the government can help these industries get on the market with positive economic effects. However, the government cannot necessarily predict which industries would qualify as such 'infant industries', and so the extent to which this
800-428: The proportion of the corporate entity a government owns. One definition purports that a company is classified as a GLC if a government owns an effective controlling interest (more than 50%), while the second definition suggests that any corporate entity that has a government as a shareholder is a GLC. The act of turning a part of government bureaucracy into a SOE is called corporatization . In economic theory ,
832-451: The question of whether a firm should be owned by the state or by the private sector is studied in the theory of incomplete contracts developed by Oliver Hart and his co-authors. In a world in which complete contracts were feasible, ownership would not matter because the same incentive structure that prevails under one ownership structure could be replicated under the other ownership structure. Hart, Shleifer, and Vishny (1997) have developed
864-508: The secretariat to the PCG and managed the implementation of the programme, which was completed in 2015. As of 2024, Philippines Amusement and Gaming Corporation (PAGCOR) is the most profitable state-owned enterprise in the Philippines. It is the third largest contributor to government revenues, following taxes and customs. Damilola Taylor Too Many Requests If you report this error to
896-469: The service. Conversely, they might be detrimental because they reduce oversight and increase transaction costs (such as monitoring costs, i.e., it is more difficult and costly to govern and regulate an autonomous SOE than it is the public bureaucracy). Evidence suggests that existing SOEs are typically more efficient than government bureaucracy, but that this benefit diminishes as services get more technical and have less overt public objectives. Compared to
928-465: The state answers for the liabilities. Stocks of the corporation are not sold and loans have to be government-approved, as they are government liabilities. State-owned enterprises are a major component of the economy of Belarus . The Belarusian state-owned economy includes enterprises that are fully state-owned, as well as others which are joint-stock companies with partial ownership by the state. Employment in state-owned or state-controlled enterprises
960-493: The state's response to natural disasters, financial crises and social instability. China's SOEs are at the forefront of global seaport-building, and most new ports constructed by them are done within the auspices of the Belt and Road Initiative . As of at least 2024, an Ethiopian SOE is Africa's largest and most profitable airline, as well as Ethiopia's largest earner of foreign exchange. In India , government enterprises exist in
992-657: The term "enterprise" is challenged, as it implies statutes in private law which may not always be present, and so the term "corporations" is frequently used instead. Thus, SOEs are known under many other terms: state-owned company, state-owned entity, state enterprise, publicly owned corporation, government business enterprise, government-owned company, government controlled company, government controlled enterprise, government-owned corporation, government-sponsored enterprise , commercial government agency, state-privatised industry public sector undertaking, or parastatal, among others. In some Commonwealth realms , ownership by The Crown
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1024-612: Was the Home Office's only government-owned company, although shareholder responsibilities were delegated to the Shareholder Executive . Increasing use of competitive tendering by police forces for forensic services resulted in the loss of market share. Earlier in 2009, the government injected £50 million into the business. On 22 October 2009, the FSS confirmed plans to close a further three regional labs in Chepstow , Chorley and Priory House, Birmingham , "to ensure provision of
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