IMPACT OF PRIVATIZATION POLICY ON THE PERFORMANCE OF PUBLIC SECTOR ORGANIZATION IN NIGERIA. A CASE STUDY OF NEPA

Abstract

This study was on impact of privatization policy on the performance of public sector organization in Nigeria. Three objectives were raised which included: To ascertain whether Privatization of public enterprises has encouraged price increase of goods and services, to ascertain whether Privatization of public enterprises has created more job opportunities to the citizens in Nigeria and to ascertain whether Privatization of public enterprises has encouraged price increase of goods and services. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from NEPA portharcourt. Hypothesis was tested using Chi-Square statistical tool (SPSS).

Chapter one

Introduction

1.1Background of the study

Public enterprises were established to enhance Nigeria’s socio-economic development, especially, after independence in 1960. The major concern, in this regard, had been to accelerate development and economic selfreliance through “economic nationalism” (Odeh, 2011). A public enterprise has been defined as one that has a corporate identity, whose capital is wholly or substantially provided by a central or local government authority. The enterprise is accountable to the central or local government, which acts as trustee for the community. The enterprise will be engaged in the production and marketing of goods and services and designed to add wealth to the community (Powell, 1987). Put differently, public enterprises are rationally organized activities by the government (Central, State or Local) aimed at producing services and commodities to its citizenry. From the foregoing, we can deduce that public enterprises are owned and run by the government and geared towards the production of either consumer or producer goods or services. In this regard, institutions and organizations are set up by the government to produce and market goods and services to the generality of the people. Government fully owns, finances, manages and controls these institutions.

While presenting a paper on commercialization and privatization of public enterprises with particular reference to the communication sector, Ayodele (2004) explained that Nigeria relied heavily upon public enterprises up to the mid-1980s for the development, management and allocation of utilities and social services. He affirmed that they were seen as major instruments, not only for the mobilization and allocation of public investments, employment generation and income redistribution, but also for determining government finances and the acceleration of overall economic development.

Obadan (2000), Obadan and Ayodele (1998) as cited by Adeyemo and Salami (2008) explained public enterprises as organizations whose primary functions are the production and sale of goods and/or services and in which government or other government controlled agencies have no ownership stake that is sufficient to ensure their control over the enterprises regardless of how actively that control is exercised. In his own explanation of public enterprises, Omokhodion (2013) saw them as organizations set up and wholly owned by government or ones in which government has majority shareholding.

Free enterprise characterized the classical economic era and the era of empires when kingdoms and empires were concerned mainly about securing their empires and kingdoms. They virtually left the production of goods and services in the hands of the private sector. They only provided proper economic, legal and institutional frameworks to enable the private sector operate more efficiently in the interest of the kingdom or the empire (Kuye, 1990). The great economic depression of the late 1920s and the early 1930s brought about the collapse of the private sector enterprises. Based on this the researcher wants to investigate the impact of privatization policy on the performance of public sector organization in Nigeria. using NEPA as a case study

Statement of the problem

The privatization policy was intended to improved electricity generation and handle effective service delivery through sector friendly prices. However all that was expected has not been fully utilize. Instead privatization led to the mass retrenchment of staff, increased tariff and the control of company by few elite. Consequently it has led to the lost of billions of naira due to corruption in the sector. The problem confronting the research is to the appraise the impact of privatization policy on the performance of public sector organization in Nigeria

Objective of the study

The objectives of the study are;

1. To ascertain whether Privatization of public enterprises has encouraged price increase of goods and services
2. To ascertain whether Privatization of public enterprises has created more job opportunities to the citizens in Nigeria.
3. To ascertain whether Privatization of public enterprises has encouraged price increase of goods and services

Research hypotheses

The following research hypotheses were formulated;

H1: Privatization of public enterprises has not encouraged price increase of goods and services

H2: Privatization of public enterprises has not encouraged price increase of goods and services

Significance of the study

It will assist the government on the implementation of the on-going privatization exercise and improve on the existing policy.  It will help to provide a clear assessment on some of the privatized enterprises.  It will provide an avenue for the people to decide on whether to support the privatization programme or to kick against it and equally assist students as a reference material in their libraries and for future research work.

Scope and limitation of the study

The scope of the study covers impact of privatization policy on the performance of public sector organization in Nigeria

Financial constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint: The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

 1.8  Definition of Terms

Privatization: Privatization can mean several different things, most commonly referring to moving something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when a heavily regulated private company or industry becomes less regulated

Public sector: The public sector is a part of the economy that comprises all organizations that are owned and operated by the government. This includes everything from schools and hospitals to roads and bridges. The main purpose of the public sector is to provide services that are considered essential for the well-being of society

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