Public Sector is
that part of the economy concerned with the transactions of the government.
Public
Corporations
Public
Corporation is a separate legal form of organization in the Public Sector set
up by an Act of Parliament to run the whole or most of an industry.
The main aim of
public corporations is to provide efficient public services at a reasonable
price. They do not aim to maximize profit.
There are two
main forms of Public Corporations.
v Those who provide a product to the public and
charge for it directly.
v Those who provide a product to the public and do
not charge for it directly.
Features
v It is set up by an Act of Parliament
v It is run by a board appointed by a government
minister
v The general policy is laid down by the government
v The day-to-day management is left to the board
v The government sets financial targets for the
Public Corporation in the parliament
v It is a corporate body with a separate legal
existence
Difference between
Public Corporations and Limited Companies
Municipal Enterprises
Public
Corporations
|
Limited
Companies
|
v It is owned by the government
v It is financed by the government
v It is aimed at providing public efficient
services
v It is regulated by an Act of Parliament
v It is run by a board appointed by a government
minister
|
v It is owned by shareholders
v It is financed by issuing shares and debentures
v It is aimed at maximizing profits
v It is regulated by the Companies Act
v It is run by a board elected by shareholders
|
Municipal Enterprises
Some local
authorities involve in running trading enterprises. They provide services such
as local bus service. They are often subsidized from rates.
