Introduction
Public enterprises are businesses owned and operated by the government. These organisations aim to serve the public interest and contribute to economic development. In India and many other countries, public enterprises play a key role in sectors like energy, transport, finance, and communication. There are different forms of organisation for public enterprises, each with its own structure, rules, and management style. In this answer, we will explain the main forms of organisation in public enterprises.
1. Departmental Organisation
In this form, the public enterprise is directly managed by a government department. It is under the control of a government ministry and is considered part of the government itself.
Examples:
- Indian Railways
- Post and Telegraph Department
Features:
- Fully owned and controlled by the government
- Employees are government servants
- Funded through the government budget
Advantages:
- Complete government control ensures public interest
- Useful in providing essential services
- Profits go directly to the government
Disadvantages:
- Slow decision-making due to red tape
- Lack of flexibility
- Low motivation and efficiency
2. Public Corporation (Statutory Corporation)
This type of public enterprise is set up by a special act of parliament or state legislature. It is a legal entity with its own powers and responsibilities.
Examples:
- LIC (Life Insurance Corporation of India)
- Airports Authority of India
Features:
- Has its own legal status
- Works independently of government departments
- Can make quick decisions
Advantages:
- More flexibility in operations
- Professional management
- Less political interference
Disadvantages:
- Sometimes lacks proper control
- Can become inefficient if not monitored well
3. Government Company
A government company is a company in which at least 51% of the share capital is owned by the government. It is registered under the Companies Act, just like private companies.
Examples:
- Steel Authority of India Ltd. (SAIL)
- Oil and Natural Gas Corporation (ONGC)
Features:
- Formed under the Companies Act
- Government holds majority ownership
- Run like a private business
Advantages:
- Freedom in day-to-day operations
- Professional approach
- Can raise funds from the market
Disadvantages:
- Government may still interfere in key decisions
- Sometimes profit motive may override public interest
Conclusion
To summarise, the main forms of organisation in public enterprises are departmental organisation, statutory corporations, and government companies. Each has its own structure, advantages, and limitations. The choice of form depends on the nature of service, need for control, and operational flexibility. Public enterprises play a vital role in nation-building, and their structure should ensure both efficiency and public welfare.