United Kingdom: An Experiment in Picking Winners—the Industrial Reorganisation Corporation

Abstract

The Industrial Reorganisation Corporation (IRC), which was in operation between 1966 and 1971, was a public corporation whose major task was to promote changes in the structure and management of industry in the United Kingdom. It was set up by a government whose expressed view was that much of British industry was unduly and inefficiently fragmented and that greater concentration or ‘rationalisation’ was needed. In the words of the first IRC Annual Report, the role of the corporation was ‘to seek out those sectors of industry where structural change should be happening but is not’.¹ Mr Michael Stewart, the minister responsible for the passage of the enabling legislation through Parliament, expressed things more soberly when he said that the job of the IRC was to help secure ‘the optimum size of firm — the firm which is neither unwieldy nor menaces the consumer though the danger of monopoly but which is able to obtain all the advantages of scale which modern conditions of industry make possible’.²