Local and national public sectors

The public sector continued to be dominated in terms of scale of operations by local government down to 1939. Local authorities extended their provision of water, sewage disposal, gas, electricity and trams and buses. A considerable range of minor miscellaneous services was added. Some were prohibited: the municipalities were denied the right to enter banking, though Birmingham had gained such powers in 1916. The most important extension of local authority functions came after 1919 in housing, and in educational provision. But there was no longer the dream among socialists that the nation could be carried to socialism through a multiplicity of local socialisms.

The scale of public ownership at the national level did not greatly increase. The Forestry Commission was set up in 1919. The Post Office, telegraphs and the Pacific Cable were in the public sector before 1914. The telephone system was taken over. The government continued to own the Anglo-Persian Oil Company, involving itself deeply in the politics of Iran and the Middle East.

The state became active in four new fields. In 1926 the Central Electricity Board and the British Broadcasting Corporation were formed. In 1929 government merged four rival companies and its own Pacific Cable into the privately owned Cable and Wireless Limited. In 1939 British Overseas Airways was brought into being, a governmental merger of private companies, supported by subsidy. Each of these organisations was unique in the challenge it posed to the state.