The Impact Of Public Enterprises On Socio-Economic Development

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The Impact Of Public Enterprises On Socio-Economic Development


Abstract


This research study is designed to contain the contributions and role of public enterprises on socio-economic development of Kaduna State. The main purpose of this research is to determine the role of public enterprises in the growth and success of the socio-economic development. In Kaduna State in particular, the great desire to industrialise arises partly because of the relative backwardness of the state, which depends for over 90% of her revenue from the federal government. Realizing how vulnerable the state is, as a result of dwindling revenue from the federation account accasioned by the 1980s world glut the economic recession that followed and the poor financial management of available resources, the leadership set out to reverse this trend. Realising the relationship between the establishment of manufacturing industries within the state and economic growth and development of the state, the government thus made the establishment of small and medium scale industries one of its cardinal objectives. To achieve this lofty objective, the Kaduna Investment and Pro-perties Limited and Kaduna Transport Corporation were established to serve as catalysts in this policy of the development process of the state. The evaluation was done by the establishment of three hypotheses set out to measure such variables as employment opportunities, development of infrastructure, rate of revenue generation and investments. The study is based on a field research carried out in the state capital: Kaduna metropolitan. Qustionaires and personal observation constituted the primary sources of primary data collection, official publications by the management, gazette, information brochure etc, constituted the sources for secondary data. Tables and percentages were used for data presentation and analysis. During the course of this work, it was discovered that the two companies selected as samples relied heavily on the State Government for the their investment capital and exhibit different characteristics in their mode of operations, control and services. We have recommended to the Government to grand autonomy to these companies to enable them function professionally, monitor the activities to ensure accountability check recklessness etc. Finally, further research is recommended to further expand the findings where necessary.


Chapter Five


Summary, Conclusion and Recommendations

Summary

This study was an evaluation of the contributions of public enterprises to socioeconomic development of Kaduna State. In the first chapter, we examined the importance of public enterprises in developing nations and the role which they are expected to play in economic development. The significance of the study was said to study selected enterprises using a sample survey for Kaduna State.

The literature reviewed, dealt on the contributions of public enterprises to economic development in developing countries with special reference to Nigeria.

To provide a framework for this study, we adopted Suchman’s criteria for evaluative research.

Two public enterprises were evaluated with respect to their contribution to socioeconomic development of Kaduna State. In the course of doing that the organisation and management of Kaduna Investment and Properties Limited and Kaduna Transport Corporation were examined. It provided a historical background of the evolution of the two enterprises, its objectives and organisation structure. The nature of their operations and activities were also discussed.

The data collected in the course of this study were analysed. Data were collected from primary and secondary sources and presented in tabular form and analysed. Using simple averages and percentages.


Conclusion:

Having tested the three hypothesis, proposed in Chapter One of this study, the major findings are hereby summarised below

The first hypothesis tested showed that TRIP and TSTC were able to generate revenue in the years under study. This has enhanced their investment capacity. Their ability to generate revenue for investment made them financially less dependent on government thereby reducing the burden on government’s limited funds.

The second hypothesis was related to the contributions of TRIP and TSTC in reducing unemployment. The data at our disposal showed TRIP and TSTC have provided employment to many Kadunans thereby reducing unemployment.

The third hypothesis was tested, and showed that TRIP enjoyed high degree of control while TSTC did not. This level of autonomy enjoyed by TRIP was found to have enhanced efficiency in TRIP’s efforts to achieving set objective.

From the findings of hypothesis 3 therefore, we concluded that TRIP and TSTC have substantially contributed to economic development in the years under study.


Recommendations:

Having analysed the three hypotheses, and findings on the two sample enterprises, we recommend thus:-
Kaduna Investment and Properties Limited and Kaduna Transport Corporation as shown by the first hypothesis have continued to registered substantial profits which has helped in augmenting the state government with essential fiscal receipts to back up its socio-economic development programmes. This investment however, on a closer look reveals it to be lower in scope and quantum than is expected to cope with huge development task being faced by the state in this era of revenue deterioration accruing to the state government from the federation accounts. It is in view of this that we recommend that the state should channel more capital to both TRIP and TSTC so as to enhance their investments opportunities in the area of property development, expansion of polythene factory in Kaduna and Kaduna Oil Mills Baissa in addition to its portfolios holding in other companies and to open more routes and acquire buses to augment the ones on ground.

  1. During the course of this studies quiet a number of respondents said they did not feel the impact of the two companies as sample survey. Some even said they hardly hear of their existence. It is in view of this that we recommend that both TRIP and TSTC should endeavour to advertise their services for adequate coverage.
  2. Another recommendation which we wish to proffer to the government for adoption which will ensure spectacular growth of the economy for the two organisations is to expand on the present fleets of TSTC for adequate coverage and to open more routes to all other state’s of the federation. TRIP should make investment opportunity known to all and sundry and at the same time make interesting members of the public to acquire shares in its company.
  3. Another recommendation is that government should completely remove its hands from the direct control exercised on TSTC to allow it function professionally well, and to give more investment autonomy to TRIP.
  4. Another recommendation is that government should closely monitor the activities of TSTC to ensure accountability and to check recklessness of officers and drivers to drive home more revenue.

During the course of this research, a problem that came to light was the issue of delays in response to memo by government and ministries, inadequate data/information on various investible projects regarding the two enterprises. We strongly recommend that government should remove all the stringent
bureaucratic bottle necks so as to allow these institutions function well.

Finally, further research into similar or follow-up studies are recommended so as to correct or contribute further in the development of these sectors and to compare the findings of this study and those of later studies.


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Frequently Asked Questions


What is the economic impact of public-private partnerships?

The Bottom Line It’s impossible to evaluate the complete impact of public-private partnerships (PPPs) on overall economic growth. It is likely that a private-public partnership increases net investment in a specific industry and leads to greater project growth in a specific sector.

What is the role of public sector in economic diversification?

The public sector, for its part, provides incentives for the private sector to deliver projects on time and within budget. In addition, creating economic diversification makes the country more competitive in facilitating its infrastructure base and boosting associated construction, equipment, support services, and other businesses.

What can the private sector do to improve public services?

Private-sector technology and innovation, for example, can help provide better public services through improved operational efficiency. The public sector, for its part, provides incentives for the private sector to deliver projects on time and within budget.

What is the difference between public-private partnership and socialism?

Public-private partnerships involve collaboration between a government agency and a private-sector company. Socialism is an economic and political system based on public or collective ownership of the means of production, which emphasizes equality rather than achievement.

Do public-private partnerships (PPP) promote economic growth?

It’s impossible to evaluate the complete impact of public-private partnerships (PPP) on overall economic growth. It is likely that a private-public partnership increases net investment in a specific industry and leads to greater project growth in a specific sector.

What are the benefits of private sector partnerships with the government?

Partnerships between private companies and the government provide advantages to both parties. Private-sector technology and innovation, for example, can help provide better public services through improved operational efficiency.

What are public-private partnerships in infrastructure?

Public-private partnerships are typically found in transport infrastructure such as highways, airports, railroads, bridges, and tunnels.

What are the risks of a public-private partnership?

Economists note that these partnerships work well when private sector technology and innovation combine with public sector incentives to complete work on time and within budget. However, risks for private enterprise include cost overruns, technical defects, and an inability to meet quality standards. What Is a Public-Private Partnership?

What is the role of public sector in economic development?

Thus, in order to provide the necessary support to the development strategy of the country, the public sector offers the necessary minimum push for bringing the economy to a path of self sustained growth.

What is economic diversification and why is it important?

Economic diversification is a key element of economic development in which a country moves to a more diverse pro- duction and trade structure. A lack of economic diversification is often associated with increased vulnerability to external

What is the role of private sector in India’s economy?

India, being a mixed economy, has assigned a great importance on the private sector of the country for attaining rapid economic development. The Government has fixed a specific role to the private sector in the field of industries, trade and services sector.

What is the role of SMEs in diversification?

SMEs are the cornerstone of diversification efforts, as their growth creates real economic value and jobs. These policy actions have been supplemented by free trade zones and special economic zones that operate to various degrees outside the regulatory distortions of the private sector.

How can the private sector improve public sector infrastructure performance?

They could purchase infrastructure facilities from the government and operate them more efficiently subject to general business laws (privatisation). They could develop technological innovations that the public sector could implement to improve current infrastructure performance.

How can the government improve public services?

Historically, governments have tried to improve public services through structural reform; routine process improvements; outsourcing and the creation of public service markets; and technology-enabled change.

How can we improve public service efficiency through outsourcing?

Successive governments have tried to improve public service efficiency through outsourcing. Private and voluntary sector organisations now deliver around £90bn of public services annually. Outsourcing can work well for transactional services like waste collection.

What is the role of the private sector in public health?

The private sector has enabled better health for communities and individuals. It provides services ranging from hospitals, clinics and laboratories to drugs, vaccines and diagnostics to ancillary services like ambulances and insurance. 

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