AN ASSESSMENT OF THE MANAGEMENT PERFORMANCE OF THE PUBLIC ENTERPRISES

Abstract

This study was on an assessment of management performance of the public enterprises. Three objectives were raised which included:  To ascertain the management performance of public enterprises in Nigeria, to determine the evaluation of public enterprises in Nigeria and to determine the challenges facing public enterprises in Nigeria. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from NITEL in Lagos. Hypothesis was tested using Chi-Square statistical tool (SPSS).

Chapter one

Introduction

1.1Background of the study

Nigeria’s Public Enterprises are generally corporate entities other than ministerial departments; they derive their existence from special statutory instruments and engage in business type of activities to provide goods and services for the cultural, social and economic upliftment of the citizen. These include corporation, authorities, boards, companies and enterprises so owned and operated (Jerome, 1999). The contemporary globalization, liberalization, marketization and structural transformations of national economies have contributed to the expansion of the private sector, on the one hand, and downsizing of the public sector including dismantling or divestment of public enterprises, on the other, earmarking two main objectives – giving more space to the private sector to function as the main engine of growth and at the same time, by downsizing and divesting inefficient public enterprises, save costs and generate more revenue, which are the cardinal arguments of privatization and commercialization. Nevertheless, the divestments and dismantling of Public Enterprises, have continued to play significant roles in many countries, both developed as well as developing especially in the Sub-Sahara Africa, the principal suppliers of social services, some relevant to the attainment of the Millennium Development Goals (MDGs), especially in the areas of employment generation due to the slow growth of the private sector, the main sources of employment in many countries such as Nigeria (Abubakar, 2011).

        These developments have necessitated painstaking and meticulous review of the role of the Public Enterprises in socio-economic development of countries. Several scholars (Abubakar, 2011; Nwoye, 2011) have argued that the current debate on Public Enterprises is no longer whether Public Enterprises have a role to play in national development, but on what that role should be and how it should be played, as it became crucial that new Public Enterprises must perform efficiently and effectively and where appropriate, under market conditions to excel. The reform agenda of Public Enterprises include, inter alia, the issues of management, structures, performance monitoring and feedback arrangements including exploring options of private/public partnerships etc, encapsulated in privatization. Since the 1930s and particularly after World War II, numerous State Owned Enterprises (Public Enterprises), were created in both developed and developing countries to address market deficits & capital shortfalls, promote economic development, reduce mass unemployment and/or ensure national control over the overall direction of the economy. By providing capital and technology to strategic areas where the private sector either shy away from or lacked the capacity to invest (such as heavy industries, infrastructure etc), most governments resorted to Public Enterprises to increase capital formation, produce essential goods at lower costs, create employment and generally contribute to the economic development of the country. This trend continued till the early eighties (Adesanmi, 2011). However, increased corruption, management inefficiencies, overstaffing (without due regard to their economic viability, many government treated Public Enterprises as easy conduits for job creation and a convenient vehicle for patronage distribution), inflation and rising current account deficits of the 1980s, exposed serious government failures and the limits of Public Enterprises as major players in economic development. In addition to management deficits, many Public Enterprises also suffered from technological shortcomings. Imported through either foreign aid or soft loans from abroad, many of the Public Enterprises were either equipped with low or second grade machineries contributing to low capital/output ratio, or were established without due regard to their economic and financial sustainability. (Okoli, 2004) As a result of these failures, large-scale privatization of Public Enterprises were undertaken in the 1980s and 1990s, with the vital support (if not inducement) of multilateral financial institutions as the possible way out of the shambles. The collapse of the Soviet Union also removed ideological and political barriers that hindered capitalist/market-oriented reforms, triggering a movement towards marketization and privatization. Howbeit, the main thrust of this paper is to determine how this public enterprises failures have come to be in Africa in general and Nigeria in particular

Available evidence shows that the performance of the public service in virtually all tiers of government in Nigeria has remained very dismal, hence the present state of underdevelopment (Abubakar, 2011). The dismal performance of parastatals and agencies of government, like the former National Electric Power Authority (NEPA) and the Nigerian Telecommunication (NITEL) is very obvious in this regard (Adewale, 2011). And even the current Power Holding Company of Nigeria that were privatized recently. Nigerians are demanding more and better services and their demands are not being met, by all indications on the basis of the score cards of the civil service and other parastatals. In effect, this has slowed the process of socio-economic and political development of Nigeria as pipe borne water is no longer seen anywhere except for boreholes, usually owned by individuals. Public schools are no longer attractive to attend as their activities are considered moribund; government owned transportation lines have winded up while those of the private individuals flourish and the same goes to public health centres especially in the rural areas

Statement of the problem

The non performance of the Public Enterprises in Nigeria has prompted services of discussions and policy recommendations on how best to move them out of their present quagmire. Privatization and commercialization of Public Enterprises is a vital tool for the upliftment of a country’s political economy, more especially the developing countries like Nigeria. Regrettably, the problems facing this privatization and commercialization program of Public Enterprises are too numerous to mention: corruption, lack of transparency, inconsistency and incredibility to mention just a few. However, it is based on these problems that the basis of propositions for the effective performance of Public Enterprises in Nigeria is being hindered. In trying to look towards a positive state, it becomes imperative to analyze the performance of Public Enterprises in Nigeria

Objective of the study

The objectives of the study are;

1. To ascertain the management performance of public enterprises in Nigeria
2. To determine the evaluation of public enterprises in Nigeria
3. To determine the challenges facing public enterprises in Nigeria

Research Hypotheses

The following research hypotheses are formulated;

H0: there is no management performance of public enterprises in Nigeria

H1: there is management performance of public enterprises in Nigeria

H0: there are no challenges facing public enterprises in Nigeria

H2: there are challenges facing public enterprises in Nigeria

Significance of the study

The study will be very significant to students and the policy makers in Nigeria. the study will give a clear insight on the assessment of the management performance of the public enterprises. The study will serve as a reference to other researcher that will embark on the related topic

Scope and limitation of the study

The scope of the study covers an assessment of the management performance of the public enterprises. The study will be limited to NITEL

Limitations/constraints are inevitable in carrying out a research work of this nature. However, in the course of this research, the following constraints were encountered thus:

1. Non-availability of enough resources (finance): A work of this nature is very tasking financially, money had to be spent at various stages of the research such resources which may aid proper carrying out of the study were not adequately available.

Time factor: The time used in carrying out the research work is relatively not enough to bring the best information out of it. However, I hope that the little that is contained in this study will go a long way in solving many greater problems.

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