ZIMSEC O Level Business Studies Notes: Features of Public Corporations/ Parastatals
- These are entities found in the public sector
- They are owned by the local and national government and
- They exist primarily to provide an essential public service such as Refuse collection, fuel, education or street lighting.
- There is usually no profit motive although some corporations are commercialized.
- They are usually formed by an ACT of parliament for example the University of Zimbabwe Act and the Grain Marketing Board Act.
- Examples of public corporations include GMB, University of Zimbabwe, National Railways of Zimbabwe and ZESA holdings.
- Public corporations fall under the control of a ministry and its minister.
- Public corporations are separate legal entities.
- The capital is provided by the government.
- They enjoy powers set out in the legislature.
- Provide essential services to the public which would otherwise be impossible or unprofitable to be provided privately.
- Products are sold at cost or nominal prices that are affordable to the public.
- Shares are sometimes sold publicly to everyone on the stock exchange enabling people to participate.
- Continues to exist even if the government changes.
- The lack of profit motive usually means that the businesses are inefficient and poorly run.
- Often suffer from political interference and corruption
- Are often under-funded.
To access more topics go to the O Level Business Notes page.