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Private Finance Initiative

Private Finance Initiative

The Private Finance Initiative specifies a method, developed initially by the United Kingdom government, to provide financial support for "Public-Private Partnerships" (PPPs) between the public and private sectors. This has now been adopted by parts of Canada, France, the Netherlands, Portugal, Ireland, Norway, Finland, Australia, Japan and Singapore (amongst others) as part of a wider reform program for the delivery of public services. These projects aim to deliver all kinds of works for the public sector, together with the provision of associated operational services. In return, the private sector receives payment, linked to its performance in meeting agreed standards of provision.

Overview

PFI is used in central and local government. In the case of projects procured by local government authorities, the capital element of the funding enabling the local authority to pay the private sector for these projects is given by central government in the form of what are known as PFI "credits". PFI is basically just a different way of borrowing money as the loans are paid back over the period of the PFI scheme. The local authority then procures a partner to carry out the scheme and transfers detailed control, and in theory the risk, in the project to the partner. The cost of this borrowing as a result is higher than normal government borrowing but does not appear as borrowing in public accounts. Each PFI project is different depending on local circumstances. However there are some common threads that run through all projects. The public sector authority signs a contract with a private sector "Operator". During the period of the contract the Operator will provide certain services, which are currently provided by the local authority. The Operator is paid for the work over the course of the contract and on a "no service no fee" performance basis. The authority will design an "output specification" which is a document setting out what the Operator is expected to achieve. If the Operator fails to meet any of the agreed standards it should lose an element of its payment until standards improve. If standards do not improve after an agreed period, the public sector authority is entitled to terminate the contract. PFI is therefore dependent on both the standard of contracts used and the determination of the parties to enforce them. The National Audit Office scrutinises public spending on behalf of Parliament and is independent of Government. It provides review reports on the value for money of many PFI transactions and makes recommendations. The Public Accounts Committee and Audit Commission also provide reports on these issues. A notable example of PFI, and the only UK mission so far funded under the scheme, is the British Embassy in Berlin.

Controversy

The Private Finance Initiative was begun under the Conservative government of John Major in 1992. It immediately proved controversial, as it was perceived by critics as a back-door form of privatisation. Nonetheless, the Treasury found the scheme advantageous and pushed Labour to adopt it after the 1997 general election. PFI has continued and, indeed, expanded under Labour. This has been strongly criticised by many trade unions and elements of "Old Labour". The 2002 Labour Party Conference passed a vote against PFI, though this did not change the government's policy. According to Treasury and NAO reports that PFI deals are very much more likely to be delivered on time and on budget - a study by the Treasury in July 2003 [http://www.hm-treasury.gov.uk/documents/enterprise_and_productivity/PFI.cfm] showed that the only deals in its sample which were over budget were those where the public sector changed their minds after deciding what they wanted and from whom they wanted to buy it. It is claimed there is a far greater visibility of long-term consequences of decisions made by politicians and civil servants through PFI deals than conventionally where most of the long-term consequences and obligations of decisions are obscured from public scrutiny. This is not agreed with by those who believe that the details of these deals are wilfully complex and buried in confidential documents and footnotes. As against that, however, there have been a number of high-profile PFI failures, many of which have been exposed by Private Eye, a British satirical magazine. For example, a June 17 2005 leaked government report said that a new privately financed hospital in Leeds had "breached every section of the fire safety code".[http://politics.guardian.co.uk/publicservices/story/0,11032,1508413,00.html]. The PFI Skye Bridge infamously cost the public £93m (and required the closure of the existing ferry to prevent competition), although it should have cost only £15m to build.

See also


- London Underground's PPP

References


- George Monbiot, 2000. Captive State: the corporate takeover of Britain. Macmillan, London.
- Chris Lonsdale, [http://www.blackwell-synergy.com/doi/pdf/10.1111/j.0033-3298.2005.00438.x "Risk Transfer, the UK's Private Finance Initiative and Asymmetric Post-Contractual Lock-in: The Cases of National Savings and Investments and the Lord Chancellor's Department"], Public Administration, 2005.

External links

Websites


- HM Treasury's PFI home page [http://www.hm-treasury.gov.uk/hmt/documents/public_private_partnerships/ppp_index.cfm?ptr=29]
- UK National Audit Office review reports of individual PFI projects [http://www.nao.org.uk/recommendation/reportList.asp]
- UNISON PFI Research and Campaign [http://www.unison.org.uk/pfi/index.asp]
- thePFI.net online resource for PFI and PPP news [http://www.thepfi.net]
- PFIJobs.com online recruitment portal for the PFI industry [http://www.pfijobs.com]

Reports


- UK Parliament research paper on PFI (2001) [http://www.parliament.uk/commons/lib/research/rp2001/rp01-117.pdf]
- PricewaterhouseCoopers (2001), "PPPs - A Clearer View" [http://www.pwc.com/Extweb/service.nsf/docid/953520E1B107D60B85256BDD00329852]
- Institute of Public Policy Research paper: "Building Better Partnerships - Commission on Public Private Partnerships" (June 2001) [http://www.ippr.org.uk/publications/index.php?current=22&book=257]
- 2004 [http://www.bbc.co.uk/radio4/news/fileon4/index_20040706_pfishareholdings.shtml Report on PFI] by BBC Radio 4's File on four ([http://www.bbc.co.uk/radio4/news/fileon4/transcripts/20040706_pfi.pdf full transcript] - PDF format).
- Northern Ireland Audit Office report (2004) into PFI in the health sector [http://www.niauditoffice.gov.uk/pubs/onereport.asp?arc=False&id=144&dm=0&dy=0].

Comment


- George Monbiot, The Guardian, June 28, 2005, [http://www.guardian.co.uk/comment/story/0,3604,1516031,00.html "Our very own Enron: All it has delivered is one financial scandal after another - but the government remains wedded to PFI"]
- Mark Johnson, Global Finance Magazine, January 2005, [http://globalf.vwh.net/content/?article_id=329]
- George Monbiot, The Guardian, 28 December 2004, [http://www.monbiot.com/archives/2004/12/29/a-scandal-of-secrecy-and-collusion/ A Scandal of Secrecy and Collusion]
- George Monbiot, The Guardian, 30 November 2004, [http://www.monbiot.com/archives/2004/11/30/road-hogs/ "Road Hogs"]
- Paul Maltby, PFI Journal, 30 April 2003, [http://www.ippr.org.uk/articles/index.asp?id=340 Comparing cost]
- George Monbiot, The Guardian, 10 March 2002, [http://www.monbiot.com/archives/2002/03/10/private-affluence-public-rip-off/ "Private Affluence, Public Rip-Off"]
- George Monbiot, The Guardian, 22 January 2002, [http://www.monbiot.com/archives/2002/01/22/very-british-corruption/ "Very British Corruption"] Category:Economy of the United Kingdom Category:Government of the United Kingdom

United Kingdom

:For other meanings of the terms "United Kingdom" and "UK" , see United Kingdom (disambiguation) and UK (disambiguation). :For an explanation of terms like England, (Great) Britain and United Kingdom see British Isles (terminology). The United Kingdom of Great Britain and Northern Ireland (usually shortened to the United Kingdom or the UK) is a country located off the north-western coast of continental Europe, surrounded by the North Sea, the English Channel, the Celtic Sea, the Irish Sea, and the Atlantic Ocean. It is composed of four constituent parts: three constituent countries—England, Scotland, and Wales—on the island of Great Britain, and the province of Northern Ireland on the island of Ireland. The border between Northern Ireland and the Republic of Ireland forms the United Kingdom's principal international land border, although there is a nominal frontier with France in the middle of the Channel Tunnel. The UK has several overseas territories and the Crown dependencies of the Isle of Man and the Channel Islands come under the UK's sovereignty. The UK also has close relationships with the fifteen other Commonwealth Realms, as they all share the same head of state. The UK is also one of the largest member states of the European Union and a founding partner of both the UN and NATO.

Terminology


- United Kingdom of Great Britain and Northern Ireland: The official name for the sovereign state
- United Kingdom: an abbreviation of United Kingdom of Great Britain and Northern Ireland
- Britain: an informal term that sometimes means United Kingdom of Great Britain and Northern Ireland and sometimes means Great Britain
- British: an informal term that sometimes means from the United Kingdom of Great Britain and Northern Ireland and sometimes means from Great Britain
- Great Britain (as a geographical term): the largest island of the British Isles
- Great Britain (as a political term): England + Wales + Scotland
- British Isles (as a geographical term): Great Britain + Ireland + many smaller surrounding islands. This term is disputed, please see below.
- Ireland (as a geographical term): the second largest island of the British Isles
- Ireland (as a political term): an abbreviation of the Republic of Ireland, a sovereign state on the island of Ireland
- Northern Ireland: a political region of the United Kingdom of Great Britain and Northern Ireland
- Ulster (as a geographical term): Often used to refer to Northern Ireland. It is derived from the Irish Language term 'Ulad.' It was one of the ancient Irish provinces (the others were Connaught, Leinster and Munster.). Although it is normally used to refer to Northern Ireland, Ulster also (traditionally) includes Counties Cavan, Monaghan and Donegal, which lie in the Republic of Ireland. The term Ulster is often favoured by the Protestant community.

History

Protestant Today's state is the latest of several unions formed over the last 1000 years. Scotland and England have existed as separate unified entities since the 10th century. Wales, under English control since the Statute of Rhuddlan in 1284, became part of the Kingdom of England by the Laws in Wales Act 1535. With the Act of Union 1707, the separate kingdoms of England and Scotland, having shared the same monarch since 1603, agreed to a permanent union as the Kingdom of Great Britain. The Act of Union 1800 united the Kingdom of Great Britain with the Kingdom of Ireland, which had been gradually brought under English control between 1169 and 1691, to form the United Kingdom of Great Britain and Ireland. The United Kingdom of Great Britain and Northern Ireland was formed in 1922, after bitter fighting which echoes down to the current political strife, the Anglo-Irish Treaty partitioned Ireland into the Irish Free State and Northern Ireland, with the latter remaining part of the United Kingdom. As provided for in the treaty, Northern Ireland, which consists of six of the nine counties of the Irish province of Ulster, immediately opted out of the Free State and to remain in the UK. The nomenclature of the UK was changed in 1927 to recognise the departure of most of Ireland, with the current name being adopted. 1927 The United Kingdom, the dominant industrial and maritime power of the 19th century, played a leading role in developing Western world ideas of property, liberty, capitalism and parliamentary democracy - to say nothing of its part in advancing world literature and science. At its zenith, the British Empire stretched over one quarter of the Earth's surface and encompassed a third of its population. The first half of the 20th century saw the UK's strength seriously depleted from the effects of World War I and World War II. The second half witnessed the dismantling of the Empire and the UK rebuilding itself into a modern and prosperous nation. The UK has been a member of the European Union since 1973. Its attitude towards further integration is conservative, and there is significant Euroscepticism in UK politics. It has not chosen to adopt the Euro, owing to internal political considerations and the government's judgement of the prevailing economic conditions.

Government and politics

The United Kingdom is a constitutional monarchy, with executive power exercised on behalf of the Queen by the Prime Minister and other cabinet ministers who head departments. The cabinet, including the Prime Minister, and other ministers collectively make up Her Majesty's Government. These ministers are drawn from and are responsible to Parliament, the legislative body, which is traditionally considered to be "supreme" (that is, able to legislate on any matter and not bound by decisions of its predecessors). The UK is one of the few countries in the world today that does not have a codified constitution, relying instead on customs and separate pieces of constitutional law. While the monarch is Head of State and holds all executive power, it is the Prime Minister who is the head of government. The government is answerable chiefly to the House of Commons and the Prime Minister is drawn from this chamber of Parliament by constitutional convention. The majority of cabinet members will be from the House of Commons, the rest from the House of Lords. Ministers do not, however, legally have to come from Parliament, though that is the modern day custom. The British system of government has been emulated around the world - a legacy of the United Kingdom's colonial past - most notably in the other Commonwealth Realms. The Prime Minister is chosen as the MP who can command a majority in the House of Commons - usually the leader of the largest party or, if there is no majority party, the largest coalition. The current Prime Minister is Tony Blair of the Labour Party, who has been in office since 1997. In the United Kingdom the monarch has extensive theoretical powers, but his or her role is mainly, though not exclusively, ceremonial. The monarch is an integral part of Parliament (as the "Crown-in-Parliament") and theoretically gives Parliament the power to meet and create legislation. An Act of Parliament does not become law until it has been signed by the Queen (being given Royal Assent), although no monarch has refused to assent to a bill that has been approved by Parliament since Queen Anne in 1708. Although the abolition of the monarchy has been suggested several times, the popularity of the monarchy remains strong in spite of recent controversies. Support for a British republic usually fluctuates between 15% and 25% of the population, with roughly 10% undecided or indifferent [http://www.mori.com/mrr/2000/c000616.shtml]. The current monarch is Queen Elizabeth II who acceded to the throne in 1952 and was crowned in 1953. Parliament is the national legislature of the United Kingdom. It is the ultimate legislative authority in the United Kingdom, according to the doctrine of parliamentary sovereignty. It is bicameral, composed of the elected House of Commons and the unelected House of Lords, whose members are mostly appointed. The House of Commons is the more powerful of the two houses. The House of Commons has 646 members who are directly elected from single-member constituencies based on population. The House of Lords has 724 members (though this number is not fixed): hereditary peers, life peers, and bishops of the Church of England. The Church of England is the established church of the state in England. established church]] The two largest political parties are the Labour Party and Conservative Party. The UK has long had a two-party system, but in the last 20 years the Liberal Democrats have re-emerged as a large third party. The electoral system used for general elections is first-past-the-post. The constitution of the United Kingdom is un-codified and partially unwritten, which means that no single document regulates how the government works, and unwritten constitutional conventions are used extensively. The constitution is based on the principle that Parliament is the ultimate sovereign body in the country. There has long been a widespread sense of national identity in the Celtic nations. Throughout the late 19th century the UK debated giving Ireland home rule. The Scottish National Party was founded in 1934, and Plaid Cymru (Party of Wales) in 1925. Referenda for devolution succeeded in 1997 for Scotland and Wales and in 1998 for Northern Ireland. In 1999, the Scottish Parliament and the National Assembly for Wales were established, the former having primary legislative power. Proportional representation is used for the elections, which has resulted in a Labour-Liberal Democrat coalition government in Scotland. Due to internal disagreements, the Northern Ireland Assembly has been suspended since 2002.

Subdivisions

The United Kingdom is a country that is divided into four constituent parts:
- England
- Scotland
- Northern Ireland
- Wales The constituent parts of the United Kingdom have administrative subdivisions as follows:
- The regions and administrative counties of England
- The council areas of Scotland
- The counties and county boroughs of Wales
- The districts of Northern Ireland The Laws in Wales Act 1535 incorporated Wales and England into England and Wales for legal purposes. Although all four have historically been divided into counties, England's population is an order of magnitude larger than the others so in recent years it has for some purposes been divided into nine intermediate-level Government Office Regions. Each region is made up of counties and unitary authorities, apart from London, which consists of London boroughs. Although at one point it was intended that each or some of these regions would be given its own regional assembly, the plan's future is uncertain, as of 2004, after the North East region rejected its proposed assembly in a referendum. Scotland consists of 32 Council Areas. Wales consists of 22 Unitary Authorities, styled as 10 County Boroughs, 9 Counties, and 3 Cities. Northern Ireland is divided into 26 Districts. Also sometimes associated with the United Kingdom, though not constitutionally part of the United Kingdom itself, are the Crown dependencies (the Bailiwicks of Jersey and Guernsey, and the Isle of Man) as self-governing possessions of the Crown, and a number of overseas territories under the sovereignty of the United Kingdom.

Military

The armed forces of the United Kingdom are known as the British Armed Forces or Her Majesty's Armed Forces, officially the Armed Forces of the Crown. Their Commander-in-Chief is the Queen and they are managed by the Ministry of Defence. Ministry of Defence The British Armed Forces are charged with protecting the United Kingdom and its overseas territories, promoting the United Kingdom's wider security interests, and supporting international peacekeeping efforts. They are active and regular participants in NATO and other coalition operations. The United Kingdom fields one of the most powerful and comprehensive military forces in the World. Its global power projection capabilities are second only to those of the United States Armed Forces. The British Army had a reported strength of 112,700 in 2004, including 7,600 women, and the Royal Air Force a strength of 53,400. The 40,900-member Royal Navy is in charge of the United Kingdom's independent strategic nuclear arm, which consists of four Trident Ballistic Missile Submarines, while the Royal Marines provide infantry units for amphibious assault and for specialist reinforcement forces in and beyond the NATO area. This puts total active duty military troops in the 210,000 range, currently deployed in over 80 countries. The UK's special forces, principally the SAS, provides elite commandos trained for quick, mobile, military responses; often where secrecy or covert operations are required. The Royal Navy is the second largest navy in the World in terms of gross tonnage. Despite the United Kingdom's wide ranging capabilities, recent pragmatic defence policy has a stated assumption that any large operation would be undertaken as part of a coalition. Bosnia, Kosovo, Afghanistan, Iraq (Granby, No-Fly-Zones, Desert Fox and Telic) may all be taken as precedent - indeed the last true war in which the British military fought alone was the Falklands War of 1982, in which military action was initiated by Argentina and the UK was fighting a defensive, rather than offensive, campaign. The British army has been actively involved in the Troubles in Northern Ireland. However, a programme of demilitarisation is being gradually implemented.

Geography

Troubles World Factbook Map of the United Kingdom]] Most of England consists of rolling lowland terrain, divided east from west by more mountainous terrain in the Northwest (Cumbrian Mountains of the Lake District) and north (the upland moors of the Pennines) and limestone hills of the Peak District by the Tees-Exe line. The lower limestone hills of the Isle of Purbeck, Cotswolds, Lincolnshire and chalk downs of the Southern England Chalk Formation. The main rivers and estuaries are the Thames, Severn and the Humber Estuary. The largest urban area is Greater London. Near Dover, the Channel Tunnel links the United Kingdom with France. There is no peak in England that is 1000 metres (3,300 ft) or greater. Wales is mostly mountainous, the highest peak being Snowdon at 1085 metres (3,560 ft) above sea level. North of the mainland is the island of Anglesey. The largest and capital city is Cardiff, located in South Wales. Scotland's geography is varied, with lowlands in the south and east and highlands in the north and west, including Ben Nevis, the UK's highest mountain at 1343 metres (4,406 ft). There are many long and deep-sea arms, firths, and lochs. A multitude of islands west and north of Scotland are also included, notably the Hebrides, Orkney Islands and Shetland Islands. The largest city is Glasgow. Northern Ireland, making up the north-eastern part of Ireland, is mostly hilly. The main cities are Belfast ('Beal Feirste' in Irish) and Londonderry / Derry ('Doire' in Irish). The province is home to one of the UK’s World Heritage Sites, the Giant's Causeway, which consists of more than 40,000 six-sided basalt columns up to 40 feett (12 m) high. In total it is estimated that the UK includes around 1098 small islands, some being natural and some being crannogs, a type of artificial island which was built in past times using stone and wood, gradually enlarged by natural waste building up over time.

Economy

artificial island The United Kingdom, a leading trading power and financial centre, has an essentially capitalist economy, the fourth largest in the world in terms of market exchange rates and the sixth largest by purchasing power parity (PPP) exchange rates. Over the past three decades, the government has greatly reduced public ownership by means of privatisation programmes, and has contained the growth of the Welfare State. Agriculture is intensive, highly mechanised, and efficient by European standards, producing about 60% of food needs with only 1% of the labour force. The UK has large coal, natural gas, and oil reserves; primary energy production accounts for 10% of GDP, one of the highest shares of any industrial state. Services, particularly banking, insurance and business services, account for by far the largest proportion of GDP. Industry continues to decline in importance, although the UK is still Europe's largest manufacturer of armaments, petroleum products, personal computers, televisions, and mobile telephones. Tourism is also important: with over 24 million tourists a year, between China (33) and Austria (19.1), the United Kingdom is ranked as the sixth major tourist destination in the world. The Blair government has put off the question of participation in the Euro system, citing five economic tests that would need to be met before they recommend that the UK adopts the Euro, and hold a referendum.

Society

Demographics

At the April 2001 census, the United Kingdom's population was 58,789,194, the third-largest in the European Union (behind Germany and metropolitan France) and the twenty-first largest in the world. Its overall population density is one of the highest in the world. Almost one-third of the population lives in England's prosperous south-east and is predominantly urban and suburban--with about 7.2 million in the capital of London. The United Kingdom's high literacy rate (99%) is attributable to universal public education introduced for the primary level in 1870 and secondary level in 1900 (except in Scotland where it was introduced in 1696). Education is mandatory from ages five through sixteen. referendum The Church of England and the Church of Scotland function as the official national religions in their respective countries, but most religions found in the world are represented in the United Kingdom. Anglicanism is the state religion that has been established in England since 1534 during the reign of King Henry VIII. During his reign, England broke ties with the Roman Catholic church and established the Church of England as the offical religion of England. Reforms to the nature of the church's relationship to the state have been ongoing, especially concerning the nature of the House of Lords and the appointment of a fixed amount of the lordships going to Lords Temporal, bishops of the Church of England. A group of islands close to continental Europe, the British Isles have been subject to many invasions and migrations, especially from Scandinavia and the continent, including Roman occupation for several centuries. Contemporary Britons are descended mainly from the varied ethnic stocks that settled there before the eleventh century. The pre-Celtic, Celtic, Roman, Anglo-Saxon, and Norse influences were blended on Great Britain under the Normans, Scandinavian Vikings who had lived in Northern France. Although Celtic languages persist in Wales, Scotland, and Northern Ireland, the predominant language is English, which is a West Germanic language descended from Old English, featuring a large amount of borrowings from Norman French.The other indigenous languages include the Celtic languages; Welsh, the closely related Irish and Scots Gaelic, and the Cornish language; as well as Lowland Scots, which is closely related to English; Romany; and British Sign Language (Northern Ireland Sign Language is also used in Northern Ireland). Celtic dialectal influences from Cumbric persisted in Northern England for many centuries, most famously in a unique set of numbers used for counting sheep. Recent immigrants, especially from the Commonwealth, speak many other languages, including Bengali, Cantonese, Hindi, Punjabi and Urdu. The United Kingdom has the largest number of Hindi speaking peoples outside of the Indian sub continent.

Culture

Urdu The United Kingdom contains many of the world's leading universities, including the University of Cambridge, the University of Oxford and the University of London (which incorporates, amongst others, Imperial College and University College London), and has produced many great scientists and engineers including Sir Isaac Newton, Charles Darwin and Isambard Kingdom Brunel; the nation is credited with many inventions including the locomotive, vaccination, television, vacuum, and both the internal combustion and the jet engine. The English language has spread to all corners of the world (primarily because of the country’s empire) and is referred to as a ‘global language’. It is now taught as a second language more than any other around the world. Over the next few decades, it is estimated that approximately half the world’s population will be proficient in the language. Playwright William Shakespeare is arguably the most famous writer in the history of the English language; other well-known writers from the United Kingdom include the Brontë sisters (Charlotte, Emily, and Anne), Jane Austen, William Thackeray, J. R. R. Tolkien, John Milton, H. G. Wells and Charles Dickens. Important poets include Lord Byron, Robert Burns, Lord Tennyson and William Blake. Notable composers from the United Kingdom have included William Byrd, John Taverner, William Lawes, John Dowland, Thomas Tallis, and Henry Purcell from the 16th and early 17th centuries, and, more recently, Sir Edward Elgar, Sir Arthur Sullivan (most famous for working with librettist Sir W. S. Gilbert), Ralph Vaughan Williams and Benjamin Britten in the 19th and 20th. George Frideric Handel spent most of his composing life in England. The BBC is the oldest and perhaps the most respected broadcasting network on the globe, with the BBC World Service radio channel and its news output held in particularly high regard. The other main television networks are ITV, Channel 4, five (TV) and Sky Television. Popular programmes in the UK include the three soaps Eastenders, Coronation Street and Emmerdale, as well as the comedy news quiz Have I Got News For You and Reality TV shows Big Brother and The X Factor. Various British TV formats have been exported to other nations, notably Who Wants To Be A Millionaire?, The Weakest Link and The Office. The UK was, with the US, one of the two main contributors in the development of rock and roll, and the UK has provided some of the most famous rock stars, including the Beatles, Queen, Led Zeppelin, Pink Floyd, the Rolling Stones, The Who and many others. The UK was at the forefront of punk rock music in the 1970s with bands such as the Sex Pistols and The Clash, and the subsequent rebirth of heavy metal with bands such as Motörhead and Iron Maiden. In mid to late '90s, the Britpop phenomenon has seen bands such as Oasis, Blur, Radiohead and Coldplay gain international fame. The UK is also at the forefront of electronica, with British artists such as Aphex Twin, Talvin Singh, Nitin Sawhney and Lamb at the cutting edge. The United Kingdom was also associated with music from the Caribbean, with a large number of Jamaicans and other Caribbean nationals being present in the UK.

Sport

A great number of major sports originated in the United Kingdom, including football, golf, cricket, rugby, tennis and boxing. The national sport of the UK is association football, but the UK does not compete as a nation in any major football tournament. Instead, the home nations compete individually as England, Wales, Scotland and Northern Ireland. It is because of this unique four-team arrangement that the UK currently does not compete in football events at the Olympic Games. However, a united team will probably take part in the 2012 Summer Olympic Games, as these are hosted in London. The English and Northern Irish football associations have confirmed participation in this team while the Scottish FA and the Welsh FA have declined to participate. The UK also hosts many world-renowned football clubs, such as Manchester United, Liverpool, Chelsea and Arsenal in England and Rangers and Celtic in Scotland. Clubs compete in national leagues and competitions and some go on to compete in European competitions. Both forms of rugby are national sports. Rugby League originates from and is generally played in the North of England, whilst Rugby Union is played all over Britain. In Rugby League the UK plays as one nation - Great Britain - whilst in union it is represented by the four nations. England are the current holders of the Rugby Union World Cup. Every four years the British and Irish Lions (comprising the best players from England, Scotland, Wales and Ireland) tour other countries. Cricket is also played in the UK, although it is focussed in England. The Wimbledon Championships are an international tennis event held in Wimbledon in south London every summer and are seen as the most prestigious of the tennis calendar. Golf is one of the most popular participation sports played in the UK and St Andrews in Scotland is the sport's home course.

Miscellaneous topics

External links


- [http://www.bbc.co.uk/history/state/nations/ BBC Nations] History of the nations within the UK.
- [http://www.bbc.co.uk British Broadcasting Corporation (BBC)]
- [http://www.cia.gov/cia/publications/factbook/geos/uk.html CIA World Factbook: UK.]
- [http://www.direct.gov.uk Gateway to UK governmental services and websites.]
- [http://www.number-10.gov.uk Number 10 Downing Street]
- [http://www.statistics.gov.uk Office of National Statistics]
- [http://www.opsi.gov.uk Office of Public Sector Information] Source for all UK legislation 1987-present (successor to Her Majesty's Stationery Office).
- [http://www.macs.hw.ac.uk/britishisles/ The British Isles] Independent view of the UK.
- [http://www.royal.gov.uk The British Monarchy]
- [http://www.parliament.uk/ The United Kingdom Parliament]
- [http://www.statistics.gov.uk/StatBase/Product.asp?vlnk=5703&Pos=&ColRank=1&Rank=272 Official Yearbook of the UK] factbook produced by the Office for National Statistics (years 2000 to 2005 available online).
- [http://www.ukcities.co.uk UK Cities] lists a variety of useful resources for every city in the UK.
- [http://www.justuk.org UK travel guide] United Kingdom for travellers.
- [http://www.world66.com/europe/unitedkingdom World66 Guide to United Kingdom] A travel guide written by its users.
- [http://www.multimap.co.uk www.multimap.co.uk] provides online maps and aerial photographs of the UK.
- [http://www.streetmap.co.uk www.streetmap.co.uk] an alternative to multimap.
- [http://www.freeworldmaps.net/europe/united-kingdom/map.html Physical map of United Kingdom.]
- [http://www.upmystreet.com www.upmystreet.com] detailed localised information about places in the United Kingdom.
- [http://www.parks.it/world/UK/Eindex.html UK Parks] National parks, Areas of Outstanding Natural Beauty and other protected areas. ----
Category:British Isles Category:European countries Category:European Union member states Category:Members of the Commonwealth of Nations Category:Monarchies A als:Grossbritannien und Nordirland zh-min-nan:Liân-ha̍p Ông-kok ko:영국 ms:United Kingdom ja:イギリス simple:United Kingdom th:สหราชอาณาจักร

Government

A government is the body that has the power to make and enforce laws within an organization or group. In its broadest sense, "to govern" means to administer or supervise, whether over an area of land, a set group of people, or a collection of assets. The word government is derived the Greek Κυβερνήτης (kubernites), which means "steersman", "governor", "pilot" or "rudder".

Definitions

One approach is to define government as the decision-making arm of the state, and define the latter on the basis of the control it has over violence and the use of force within its territory. Specifically, the state (and by extension the government) has been considered by some to be the entity that holds a monopoly on the legitimate use of force within a territory. This view has been taken by the political economist Max Weber and subsequent political philosophers. The exact meaning of it depends on what is understood by “legitimate”. If we use the term in an ethical sense, then this definition would suggest that an organisation might be considered a state by its supporters but not by its detractors. An alternative definition is to take "legitimate" violence to be simply that which has active or tacit acceptance by the vast majority of the population. In this view, the presence of insurrection or civil war against an entity would jeopardise its claim to be a state, provided the insurrection enjoyed significant popular support. Similarly, an entity that shared military or police power with independent militias and bandits could be considered to have a monopoly on “legitimate” violence but to be failing to enforce it, reducing its claim to statehood. In practice, such situations are often described as "failed states". Government can also be defined as the political means of creating and enforcing laws; typically via a bureaucratic hierarchy. Under this definition, a purely despotic organization which controls a territory without defining laws would not be considered a government. Another alternative is to define a government as an organisation that attempts to maintain control of a territory, where "control" involves activities such as collecting taxes, controlling entry and exit to the state, preventing encroachment of territory by neighbouring states and preventing the establishment of alternative governments within the country. In Commonwealth English, the word "Government" can also be used to refer only to the executive branch, in this context being a synonym for the word "administration" in American English (e.g. the Blair Government, the Bush Administration). In countries using the Westminster system, the Government (or party in Government) will also usually control the legislature. The French use of the word gouvernement covers both meanings, whereas Canadian French generally uses it to mean the executive branch. The German word Regierung refers only to government as the executive branch; the wider meaning of the word, government as a system, can be translated as Staatsgewalt.

Forms of government

Various forms of government have been implemented. A government in a developed state is likely to have various sub-organisations known as offices, departments, or agencies, which are headed by politically appointed officials, often called ministers or secretaries. Ministers may in theory act as advisors to the head of state, but in practice have a certain amount of direct power in specific areas. In most modern democracies, the elected legislative assembly has the power to dismiss the government, but in those states that have a separate head of government and head of state, the head of state generally has great latitude in appointing a new one.

Theories

There are a wide range of theories about the reasons for establishing governments. The four major ones are briefly described below. Note that they do not always fully oppose each other - it is possible for a person to subscribe to a combination of ideas from two or more of these theories.

Greed and oppression

Many political philosophies that are opposed to the existence of a government (such as Anarchism, and to a lesser extent Marxism), as well as others, emphasize the historical roots of governments - the fact that governments, along with private property, originated from the authority of warlords and petty despots who took, by force, certain patches of land as their own (and began exercising authority over the people living on that land). Thus, it is argued that governments exist to enforce the will of the strong and oppress the weak.

Order and tradition

The various forms of conservatism, by contrast, generally see the government as a positive force that brings order out of chaos, establishes laws to end the "war of all against all", encourages moral virtue while punishing vice, and respects tradition. Sometimes, in this view, the government is seen as something ordained by a higher power, as in the divine right of kings, which human beings have a duty to obey.

Natural rights

Natural rights are the basis for the theory of government shared by most branches of liberalism (including libertarianism). In this view, human beings are born with certain natural rights, and governments are established strictly for the purpose of protecting those rights. What the natural rights actually are is a matter of dispute among liberals; indeed, each branch of liberalism has its own set of rights that it considers to be natural, and these rights are sometimes mutually exclusive with the rights supported by other liberals.

Social contract

One of the most influential theories of government in the past two hundred years has been the social contract, on which modern democracy and most forms of socialism are founded. The social contract theory holds that governments are created by the people in order to provide for collective needs (such as safety from crime) that cannot be properly satisfied using purely individual means. Governments thus exist for the purpose of serving the needs and wishes of the people, and their relationship with the people is clearly stipulated in a "social contract" (a constitution and a set of laws) which both the government and the people must abide by. If a majority is unhappy, it may change the social contract. If a minority is unhappy, it may persuade the majority to change the contract, or it may opt out of it by emigration or secession.

Operations

Governments concern themselves with regulating and administering many areas of human activity, such as trade, education, medicine, entertainment, and war.

Enforcement of power

Governments use a variety of methods to maintain the established order, such as police and military forces, (particularly under despotism, see also police state), making agreements with other states, and maintaining support within the state. Typical methods of maintaining support and legitimacy include providing the infrastructure for administration, justice, transport, communication, social welfare etc., claiming support from deities, providing benefits to elites, holding elections for important posts within the state, limiting the power of the state through laws and constitutions (see also Bill of Rights) and appealing to nationalism. Different political ideologies hold different ideas on what the government should or should not do.

Territory

The modern standard unit of territory is a country. In addition to the meaning used above, the word state can refer either to a government or to its territory. Within a territory, subnational entities may have local governments which do not have the full power of a national government (for example, they will generally lack the authority to declare war or carry out diplomatic negotiations).

Scale of government

Main articles: government ownership, government spending The scale to which government should exist and operate in the world is a matter of debate. Government spending in developed countries varies considerably but generally makes up between about 30% and 70% of their GDP.

See also


- Conspiracy theories
- Government ownership
- Government simulation
- Minority government
- Political corruption
- Premier
- Statesman

Relevant lists


- List of democracy and elections-related topics
- List of fictional governments Category:Society ko:정부 ms:Kerajaan ja:政府 simple:Government th:รัฐบาล

Public-private partnership

Public-private partnership (PPP) is a variation of privatization in which elements of a service previously run solely by the public sector are provided through a partnership between the government and one or more private sector companies. Unlike a full privatization scheme, in which the new venture is expected to function like any other private business, the government continues to participate in some way. These schemes are sometimes referred to as PPP or P3. Typically, a private sector consortium forms a special company called a "special purpose vehicle" (SPV) to build and maintain the asset. The consortium is usually made up of a building contractor, a maintenance company and a bank lender. It is the SPV that signs the contract with the government and with subcontractors to build the facility and then maintain it. A typical PPP example would be a hospital building financed and constructed by a private developer and then leased to the hospital authority. The private developer then acts as landlord, providing housekeeping and other non medical services while the hospital itself provides medical services.

Some examples

International

Some international health care programs may be considered public-private partnerships:
- The Global Alliance for Vaccines and Immunization is financed per 75% (750 Mio.US$) by the Bill and Melinda Gates Foundation, which has a permanent seat in the supervisory board of GAVI.
- As a UN agency, the WHO is financed through the UN system by contributions from member states. In recent years, the WHO's work has involved more collaboration with NGOs and the pharmaceutical industry, as well as with foundations such as the Bill and Melinda Gates Foundation and the Rockefeller Foundation. Some of these collaborations may be considered global public-private partnerships (GPPPs); half the WHO budget is financed by private foundations.

Britain


- The London Underground (since 2003)
- Some National Health hospitals
- Private Finance Initiative

Canada


- The 407 ETR toll road in Toronto, Ontario
- The Royal Ottawa Hospital in Ottawa, Ontario
- The William Osler Hospital in Brampton, Ontario

United States


- Central Park, New York City
- The redevelopment of downtown Chattanooga, Tennessee.
- California Fuel Cell Partnership (CaFCP)

Netherlands


- NFX: Netherlands Financial Sector Development Exchange. A platform of ING, Rabobank, ABN AMRO, Fortis, Triodos Bank, FMO (Dutch development bank) and the Dutch Ministries of Foreign Affairs, Economic Affairs and Finance to stimulate financial sector development in developing countries and emerging markets.

External links


- BBC News article http://news.bbc.co.uk/1/hi/uk/1518523.stm
- Industry Canada Website http://strategis.ic.gc.ca/epic/internet/inpupr-bdpr.nsf/vwGeneratedInterE/Home
- thePFI.net http://www.thepfi.net
- Medicines and vaccines for the world's poorest: Is there any prospect for public-private cooperation? http://www.globalizationandhealth.com/home/
- NFX - Netherlands Financial Sector Development Exchange http://www.nfx.nl Category:Economics

Public sector

The public sector is that part of economic and administrative life that deals with the delivery of goods and services by and for the government, whether national, regional or local/municipal. Examples of public sector activity range from delivering social security, administering urban planning and organising national defences. The organisation of the public sector (public ownership) can take several forms, including:
- Direct administration funded through taxation; the delivering organisation generally has no specific requirement to meet commercial success criteria, and production decisions are determined by government.
- Publicly-owned corporations (in some contexts, especially manufacturing, "State-owned enterprises"); which differ from direct administration in that they have greater commercial freedoms and are expected to operate according to commercial criteria, and production decisions are not generally taken by government (although goals may be set for them by government).
- Partial outsourcing (of the scale many businesses do, e.g. for IT services), is considered a public sector model. A borderline form is
- Complete outsourcing or contracting out, with a privately owned corporation delivering the entire service on behalf of government. This may be considered a mixture of private sector operations with public ownership of assets, although in some forms the private sector's control and/or risk is so great that the service may no longer be considered part of the public sector. (See Britain's Private Finance Initiative.) The decision about what are proper matters for the public sector as opposed to the private sector is probably the single most important dividing line among socialist, liberal, conservative, and libertarian political philosophy, with (broadly) socialists preferring greater state involvement, libertarians favoring minimal state involvement, and conservatives and liberals favoring state state involvement in some aspects of the society but not others.

See also


- Public services Category:Politics Category:Economics

Works

Works can mean several things, including:
- drug paraphanelia
- albums called Works.
- a collection of an artist's creations.
- public works
- Microsoft Works, a collection of office programs by Microsoft.
- In motorsports, cars sponsored and tuned by automobile manufacturers (i.e. World Rally Championship, D1 or Formula D drifting, racing).
- Engineering structures such as earthworks, waterworks.
- In theology, works are good deeds, human actions; commonly used in reference to the doctrine of salvation through works. See discussion at Divine Grace.
- a request for all the toppings and condiments available("I'll have the works on that burger") See also: work

Service

:This article is about a term used in economics. For other uses, see service (disambiguation). In economics and marketing, a service is the non-material equivalent of a good. Service provision has been defined as an economic activity that does not result in ownership, and this is what differentiates it from providing physical goods. It is claimed to be a process that creates benefits by facilitating either a change in customers, a change in their physical possessions, or a change in their intangible assets. By supplying some level of skill, ingenuity, and experience, providers of a service participate in an economy without the restrictions of carrying stock (inventory) or the need to concern themselves with bulky raw materials. On the other hand, their investment in expertise does require marketing and upgrading in the face of competition which has equally few physical restrictions. Providers of services make up the Tertiary sector of industry.

Key attributes

Services can be described in terms of their main attributes.
- Intangibility - They cannot be seen, handled, smelled, etc. There is no need for storage. Because services are difficult to conceptualize, marketing them requires creative visualization to effectively evoke a concrete image in the customer's mind. From the customer's point of view, this attribute makes it difficult to evaluate or compare services prior to experiencing the service.
- Perishability - Unsold service time is "lost", that is, it cannot be regained. It is a lost economic opportunity. For example a doctor that is booked for only two hours a day cannot later work those hours— she has lost her economic opportunity. Other service examples are airplane seats (once the plane departs, those empty seats cannot be sold), and theatre seats (sales end at a certain point).
- Lack of transportability - Services must be consumed at the point of "production".
- Lack of homogeneity - Services are typically modified for each client or each new situation (customised). Mass production of services is very difficult. This can be seen as a problem of inconsistent quality. Both inputs and outputs to the processes involved providing services are highly variable, as are the relationships between these processes, making it difficult to maintain consistent quality.
- Labour intensity - Services usually involve considerable human activity, rather than precisely determined process. Human resource management is important. The human factor is often the key success factor in service industries. It is difficult to achieve economies of scale or gain dominant market share.
- Demand fluctuations - It is very difficult to estimate demand. Demand can vary by season, time of day, business cycle, etc.
- Buyer involvement - Most service provision requires a high degree of interaction between client and service provider.

Service delivery

The delivery of a service typically involves five factors:
- The service providers (e.g. the people)
- Equipment used to provide the service (e.g. vehicles, cash registers)
- The physical facilities (e.g. buildings, parking, waiting rooms)
- The client
- Other customers at the service delivery location The service encounter is defined as all activities involved in the service delivery process. Some service managers use the term "moment of truth" to indicate that defining point in a specific service encounter where interactions are most intense. Many business theorists view service provision as a performance or act (sometimes humorously referred to as dramalurgy, perhaps in reference to dramaturgy). The location of the service delivery is referred to as the stage and the objects that facilitate the service process are called props. A script is a sequence of behaviours followed by all those involved, including the client(s). Some service dramas are tightly scripted, others are more ad lib. Role congruence occurs when each actor follows a script that harmonizes with the roles played by the other actors. In some service industries, especially health care, dispute resolution, and social services, a popular concept is the idea of the caseload, which refers to the total number of patients, clients, litigants, or claimants that a given employee is presently responsible for. On a daily basis, in all those fields, employees must balance the needs of any individual case against the needs of all other current cases as well as their own personal needs.
alt text
Service-Goods continuum

The service-goods continuum

The dichotomy between physical goods and intangible services should not be given too much credence. These are not discrete categories. Most business theorists see a continuum with pure service on one terminal point and pure commodity good on the other terminal point. Most products fall between these two extremes. For example, a restaurant provides a physical good (the food), but also provides services in the form of ambience, the setting and clearing of the table, etc. And although some utilities actually deliver physical goods — like water utilities which actually deliver water — utilities are usually treated as services. In a narrower sense, service refers to quality of customer service: the measured appropriateness of assistance and support provided to a customer. This particular usage occurs frequently in retailing.

List of economic services

The following is an incomplete list of service industries, grouped into rough sectors. Parenthetical notations indicate how specific occupations and organizations can be regarded as service industries to the extent they provide an intangible service, as opposed to a tangible good.
- business functions (that apply to all organizations in general)
  - consulting
  - customer service
  - human resources administrators (providing services like ensuring that employees are paid accurately)
- child care
- cleaning, repair and maintenance services
  - janitors (who provide cleaning services)
  - gardeners
  - mechanics
- construction
  - carpentry
  - electricians (offering the service of making wiring work properly)
  - plumbing
- death care
  - coroners (who provide the service of identifying corpses and determining time and cause of death)
  - funeral homes (who prepare corpses for public display, cremation or burial)
- dispute resolution and prevention services
  - arbitration
  - courts of law (who perform the service of dispute resolution backed by the power of the state)
  - diplomacy
  - incarceration (provides the service of keeping criminals out of society)
  - law enforcement (provides the service of identifying and apprehending criminals)
  - lawyers (who perform the services of advocacy and decisionmaking in many dispute resolution and prevention processes)
  - mediation
  - military (performs the service of protecting states in disputes with other states)
  - negotiation (not really a service unless someone is negotiating on behalf of another)
- education (institutions offering the services of teaching and access to information)
  - library
  - museum
  - school
- entertainment (when provided live or within a highly specialized facility)
  - gambling
  - movie theatres (providing the service of showing a movie on a big screen)
  - performing arts productions
  - sexual services (where legal)
  - sports
  - television
- fabric care
  - dry cleaning
  - laundromat (offering the service of automated fabric cleaning)
- financial services
  - accounting
  - banks and building societies (offering lending services and safekeeping of money and valuables)
  - real estate
  - stock brokerages
  - tax return preparation
- foodservice industry
- hairdressing
- health care (all health care professions provide services)
- information services
  - data processing
  - database services
  - language interpretation
  - language translation
- risk management
  - insurance
  - security
- social services
  - social work
- transport
- utilities
  - electric power
  - natural gas
  - telecommunications
  - waste management
  - water industry

See also


- marketing
- product
- tertiary sector of industry
- services marketing
- experience economy
- customer service
- ecosystem services
- Vendor-independent solutions provider
- Software_as_a_Service
- Application service provider
- On-demand

Finding related topics


- list of marketing topics
- list of management topics
- list of economics topics
- list of finance topics
- list of human resource management topics
- list of accounting topics
- list of information technology management topics
- list of business law topics
- list of production topics
- list of business ethics, political economy, and philosophy of business topics
- list of business theorists
- list of economists
- list of corporate leaders
- list of companies Category:Economics Category:Services management and marketing Category:Marketing ja:サービス

Contract

A contract is any legally-enforceable promise or set of promises made between parties. In the civil law, contracts are considered to be part of the general law of obligations. This article describes the law relating to contracts in common law jurisdictions.

Comparison of contract and tort law

The law of obligations has traditionally been divided into contractual obligations, which are voluntarily undertaken and owed to a specific person or persons, and obligations in tort which are based on the wrongful infliction of harm to certain protected interests, primarily imposed by the law, and typically owed to a wider class of persons. Recently it has been accepted that there is a third category, restitutionary obligations, based on the unjust enrichment of the defendant at the plaintiff’s expense. Contractual liability, reflecting the constitutive function of contract, is generally for failing to make things better (by not rendering the expected performance), liability in tort is generally for action (as opposed to omission) making things worse, and liability in restitution is for unjustly taking or retaining the benefit of the plaintiff’s money or work [Beatson (1998) Anson’s Law of Contract, 27th ed. (Oxford: OUP), pg. 21].

Scope of common law contract law

Basic common law contract law addresses four sets of issues: #When and how is a contract formed? #When may a party escape obligations of a contract (such as a contract formed under duress or because of a misrepresentation)? #What is the meaning and effect to be given to the terms of a contract? #What is the remedy to be given for breach of a contract? Contract formation: There must be an agreement which consists of an offer and acceptance, consideration (see also consideration under English law) and contractual intention for a simple contract to exist: i.e. it is not a deed - otherwise no consideration is needed. Subject to the sine qua non of Contract Formation, other ingredients that make up a contract include: :
- Form - In some cases, certain formalities (that is, writing) must be observed. :
- Capacity - The parties must be legally capable of entering into a contract. :
- Consent - The agreement must have been entered into freely. Consent may be vitiated by duress or undue influence. :
- Legality - The purpose of the agreement must not be illegal or contrary to public policy. A contract which possesses all of the above ingredients is said to be valid. The absence of an essential element will render the contract either void, voidable or unenforceable In some situations, a collateral contract may exist. Meaning and effect of contract terms: Many contract disputes involve a disagreement between the parties about what terms in the contract require each party to do or refrain from doing. Hence, many rules of contract law pertain to interpretation of terms of a contract that are vague or ambiguous. The parol evidence rule limits what things can be taken into account when trying to interpret a contract. Privity: In general, only parties to a contract may sue for the breach of a contract.

Validity of contracts

For a contract to be valid, it must meet the following criteria:
- Mutual agreement - (see main article offer and acceptance): There must be an express or implied agreement. The essential requirement is that there be evidence that the parties had each from an objective perspective engaged in conduct manifesting their assent, and a contract will be formed when the parties have met such a requirement. (Notice that the objective mainifestation requirement means that one need not actually have assented so long as a reasonable person would believe that assent had been granted.) For a contract based on offer and acceptance to be enforced, the terms must be capable of determination in a way that it is clear that the parties assent was given to the same terms. The terms, like the manifestation of assent itself, are determined objectively.
- Consideration: There must be consideration (see also consideration under English law) given by all the parties, meaning that every party is conferring a benefit on the other party or himself sustaining a recognizable detriment, such as a reduction of the party's alternative courses of action where the party would otherwise be free to act with respect to the subject matter without any limitation.
- Competent, Adult (Sui Juris) Parties: Both parties must have the capacity to understand the terms of the contract they are entering into, and the consequences of the promises they make. For example, animals, minor children, and mentally disabled individuals do not have the capacity to form a contract, and any contracts with them will be considered void or voidable. Although corporations are technically legal fictions, they are considered persons under the law, and thus fit to engage in contracts. :For adults, most jurisdictions have statutes declaring that the capacity of parties to a contract is presumed, so that one resisting enforcement of a contract on grounds that a party lacked the capacity to be bound bears the burden of persuasion on the issue of capacity.
- Proper Subject Matter: The contract must have a lawful purpose. A contract to commit murder in exchange for money will not be enforced by the courts. It is void ab initio, meaning "from the beginning."
- Mutual Right to Remedy: Both parties must have an equal right to remedy upon breach of the terms by the other party
- Mutual Obligation to Perform: Both Parties must have some obligation to fulfill to the other. This can be distinct from consideration, which may be an initial inducement into the contract.

Written contracts

Contrary to common wisdom, an informal exchange of promises can still be binding and legally as valid as a written contract. A spoken contract is often called an "oral contract", not a "verbal contract." Any contract that uses words, spoken or written, is a verbal contract. Thus, all oral contracts and written contracts are verbal contracts. This is in contrast to a "non-verbal, non-oral contract," also known as "a contract implied by the acts of the parties." Courts in the United States have generally ruled that if the parties have a meeting of the minds (i.e., the same intent), consideration is paid or given by the parties, and they act as though there was a formal, written and signed contract, then a contract exists. However, most jurisdictions require a signed writing for certain kinds of contracts (like real estate transactions). In the United States, a law setting out such requirements is typically called the Statute of Frauds; the name originates from an English statute that was for "the prevention of frauds." The point of the Statute of Frauds is to prevent false allegations of the existence of contracts that were never made, by requiring formal (i.e. written) evidence of the contract. Contracts that do not meet the requirements of Statute of Frauds legislation are unenforceable, but not void. However, a party unjustly enriched by an unenforceable contract may be subject to restitution for unjust enrichment. Statutes of Frauds are typically codified in state statutes covering specific types of contracts, such as contracts for the sale of real estate. In Australia, for contracts subject to legislation equivalent to the Statute of Frauds, there is no requirement for the entire contract to be in writing, although there must be a note or memorandum evidencing the contract, which may come into existence after the contract has been formed. The note or memorandum must be signed in some way, and a series of documents may be used in place of a single note or memorandum. It must contain all material terms of the contract, the subject matter and the parties to the contract. In England and Wales, the Statute of Frauds is still in force, but only for guarantees, which must be evidenced in writing, although the agreement may be made orally. Certain other kinds of contract (such as for the sale of land) must be in writing or they are void. Furthermore, the existence of a written contract does not necessarily ensure its enforceability or validity. A contract can be deemed unenforceable if it requires a party to undertake an illegal act, if it was signed under duress or while intoxicated, if the disparity in knowledge between the parties is extreme and the weaker party was given onerous terms, etc. For example, in Massachusetts a contract is not enforceable if it is executed on a Sunday. If the terms of a contract subject to Statute of Frauds legislation are to be varied, the variations must be noted in writing as well. However, the contract may be discharged orally. If a contract is in a written form, then generally, you are bound by its terms regardless of whether you have read it or not (L'Estrange v. F Graucob Ltd [1934] 2 KB 394). However, this is tempered by the exception that if the terms of the contract are misrepresented, then the plaintiff is unable to rely on the terms of the contract; in addition, the document must be contractual in nature (Curtis v. Chemical Cleaning and Dyeing Co [1951] 1 KB 805). Furthermore, if a party wishes to use a document as the basis of a contract, reasonable notice of its terms must be given to the other party prior to their entry into the contract (see Balmain New Ferry Company Ltd v. Robertson (1906) 4 CLR 379). This includes such things as tickets issued at parking stations.

Void, voidable and unenforceable contracts

In general, there are three classifications of contracts that are not binding:
- Void: If a contract is held to be void, the contract has never come into existence. For example, a contract is void if it is based on an illegal purpose or contrary to public policy; the classic example is a contract with a hit man. Such a contract will not be recognized by a court, and cannot be enforced by either party.
- Voidable: A contract is voidable if one of the parties has the option to terminate the contract. Contracts with minor are examples of voidable contracts.
- Unenforceable: If a contract is unenforceable, neither party may enforce the other's obligations. For example, in the United States, a contract is unenforceable if it violates the Statute of frauds. An example of the above is an oral contract for the sale of a motorcycle for US$5,000 (because in the USA any contract for the sale of goods over US$500 must be in writing to be enforceable).

Uncertainty and incompleteness

If the terms of the contract are uncertain or incomplete, the parties cannot have reached an agreement in the eyes of the law. An agreement to agree does not constitute a contract, and an inability to agree on key issues, which may include such things as price, may cause the entire contract to fail. However, a court will attempt to give effect to commercial contracts where possible, by construing a reasonable construction of the contract (see Hillas v. Arcos Ltd (1932) 147 LT 503). Courts may also look to external standards, which are either mentioned explicitly in the contract (Whitlock v. Brew (1968) 118 CLR 445) or implied by common practice in a certain field (Three Rivers Trading Co., Ltd. v. Gwinear & District Farmers, Ltd. (1967), 111 Sol. J. 831). In addition, the court may also imply a term; if price is excluded, the court may imply a reasonable price, with the exception of land, and second-hand goods, which are unique.

Severence of unenforceable clauses

If there are uncertain or incomplete clauses in the contract, and all options in resolving its true meaning have failed, it may be possible to sever and void just those affected clauses. The test of whether a clause is severable is an objective test - whether a reasonable person would see the contract standing even without the clauses.

Spy contracts

In the U.S., one unusual type of unenforceable contract is a personal employment contract to work as a spy or secret agent. This is because the very secrecy of the contract is a condition of the contract (in order to maintain plausible deniability). If the spy subsequently sues the government on the contract over issues like salary or benefits, then the spy has breached the contract by revealing its existence. It is thus unenforceable on that ground, as well as the public policy of maintaining national security (since a disgruntled agent might try to reveal all the government's secrets during his lawsuit).

Bilateral v. unilateral contracts

Contracts may be bilateral or unilateral. The more common of the two, a bilateral contract, is an agreement in which each of the parties to the contract makes a promise or promises to the other party. For example, in a contract for the sale of a home, the buyer promises to pay the seller $200,000 in exchange for the seller's promise to deliver title to the property. In a unilateral contract, only one party to the contract makes a promise. A typical example is the reward contract: A promises to pay a reward to B if B finds A's dog. B is not obliged to find A's dog, but A is obliged to pay the reward to B if B finds the dog. In this example, the finding of the dog is a condition precedent to A's obligation to pay. An offer of a unilateral contract may often be made to many people (or 'to the world') by means of an advertisement. In that situation, acceptance will only occur on satisfaction of the condition (such as the finding of the offeror's dog). If the condition is something that only one party can perform, both the offeror and offeree are protected — the offeror is protected because he will only ever be contractually obliged to one of the many offerees; and the offeree is protected, because if she does perform the condition, the offeror will be contractually obliged to pay her. In unilateral contracts, the requirement that acceptance be communicated to the offeror is waived. The offeree accepts by performing the condition, and the offeree's performance is also treated as the price, or consideration, for the offeror's promise. The most common type of unilateral contract is the insurance contract. The insurance company promises to pay the insured a stated amount of money on the happening of an event if the insured pays premiums; note that the insured does not make any promise to pay the premiums. Courts generally favor bilateral contracts. The general rule in the United States is: "In case of doubt, an offer is interpreted as inviting the offeree to accept either by promising to perform what the offer requests or by rendering the performance, as the offeree chooses." Restatement (Second) of Contracts § 32 (1981) (emphasis added). Here the law attempts to provide some protection from the risk of revocation in a unilateral contract to the offeree. Note that if the offer specifically requests performance rather than a promise, a unilateral contract will exist. See option contracts for more information on protection given to the offeree in a unilateral contract.

Express and implied contracts

A contract can be either an express contract or an implied contract. An express contract is one in which the terms are expressed verbally, either orally or in writing. An implied contract is one in which some of the terms are not expressed in words.

Implied in fact or implied in law

An implied contract can either be implied in fact or implied in law. A contract which is implied in fact is one in which the circumstances imply that parties have reached an agreement even though they have not done so expressly. For example, by going to a doctor for a physical, a patient agrees that he will pay a fair price for the service. If he refuses to pay after being examined, he has breached a contract implied in fact.

Quasi-contract

A contract which is implied in law is also called a quasi-contract, because it is not in fact a contract; rather, it is a means for the courts to remedy situations in which one party would be unjustly enriched were he or she not required to compensate the other. For example, an unconscious patient treated by a doctor at the scene of an accident has not agreed (either expressly or by implication) to pay the doctor for emergency services, but the patient would be unjustly enriched by the doctor's services were the patient not required to compensate the doctor.

Incorporation of terms

Course of dealing

If two parties have regularly conducted business on certain terms, it may be reasonable to presume that in future dealings where there is no contract, the parties wish to incorporate the terms of the previous contracts. However, if a party wishes to incorporate terms by course of dealing, the original document must have been contractual in nature, and delivery receipts may not fit this description. In Australia, there is a further requirement that the document was procured after formation.

Express and implied terms

Different types of statements

Whether a statement is a term of a contract is important because only if a promise is a term of the contract can a party sue for the breach of the contract. Statements can be split into the following types:
- Puff (sales talk): If no reasonable person hearing this statement would take it seriously, it is a puff, and no action in contract is available if the statement proves to be wrong.
- Representation: A representation is a statement of fact made to induce another person to enter into a contract and which does induce them to enter into a contract, but it is one that the maker of the statement does not guarantee its truth. If the statement proves to be incorrect, it cannot be enforced, as it is not a term of the contract, but it may prove to be a misrepresentation, whereupon other remedies are available.
- Term: A term is similar to a representation, but the truth of the statement is guaranteed by the person who made the statement. The test is an objective test. Factors that a court may take into account in determining the nature of a statement include:
- Timing: If the contract was concluded soon after the statement was made, this is a strong indication that the statement induced the person to enter into the contract.
- Content of statement: It is necessary to consider what was said in the given context, which has nothing to do with the importance of a statement.
- Knowledge and expertise: In Oscar Chess Ltd v. Williams [1957] 1 WLR 370, a person selling a car to a second-hand car dealer stated that it was a 1948 Morris, when in fact it was a 1939 model car. It was held that the statement did not become a term because a reasonable person in the position of the car dealer would not have thought that an inexperienced person would have guaranteed the truth of the statement.

Terms implied in fact

The Privy Council proposed a five stage test in BP Refinery Western Port v. Shire of Hastings: # Reasonableness and equitableness: The implied term must be reasonable and equitable. # Business efficacy: The implied term must be necessary for the business efficacy of the contract. For instance, if the term simply causes the contract to operate better, that does not fit this criterion. # Obviousness: The term is so obvious that it goes without saying. Furthermore, there must be one and only one thing that would be implied by the parties. For example, in Codelfa Construction Pty Ltd v. State Rail Authority of New South Wales (1982) 149 CLR 337, a term regarding the inability of construction company to work three shifts a day could not be implied because it was unclear what form it would have taken. # Clear expression: The term must be capable of clear expression. No specific technical knowledge should be required. # Consistency: The implied term may not contradict an express term. In Australia, the High Court has ruled that the test in BP Refinery applies only to formal contracts, while the test in Byrne and Frew v. Australian Airlines Ltd (1995) 185 CLR 410 shall apply to informal contracts:
- Necessity: The term must be necessary to ensure reasonable or effective operation of a contract of the nature before the court.
- Consistency: The implied term may not contr