Public Enterprises

These are set up by the government (State or Federal) not to make a profit, but to provide essential services that are required by the citizens. They are also known as public corporations. They are established by law to provide services like electricity, communication, transportation, water, hospitals, schools, etc.

They are controlled by a Board of Directors elected by the government.

Whenever profits are made, they are paid into the treasury of the government.

Examples of Public Enterprises:

• Power Holding Company of Nigeria (PHCN)
• Water Board Company (WBC)
• Nigeria Railway Cooperation (NRC)
• Nigeria Airport Authority (NAA)
• Nigeria Postal Services (NIPOST)
• Nigeria Port Authority (NPA)
• Lagos State Waste Management Authority (LAWMA)
• Nigerian National Petroleum Corporation (NNPC)

Advantages of Public Enterprises:

• The government provides the capital.

• Products and services are usually subsidized by the government, for example, electricity, water, etc.

• They enjoy a monopoly.

• It ensures continuity.

• They provide employment opportunities.

• The standard of living of people is raised.

Disadvantages of Public Enterprises:

• Most Public Enterprises are inefficient and corrupt.

• The company’s resources could be poorly managed.

• It is very legalistic or formalistic.

• It encourages wastefulness in materials and human resources.

• Lack of commitment by the employees.

• It is deprived of privacy.

• Recruitment of staff is not based on merit, but on a quota system and nepotism.

• Unnecessary government interference.