Public enterprise is a type of business in which the government owns or controls the majority of the shares. The purpose of public enterprise is to provide a public service that is better than what could be provided by the private sector.
There are many different types of public enterprise, such as state-owned enterprises, state-controlled enterprises, public limited companies, transportation, healthcare, and education. The purpose of public enterprise is to serve the public interest.
Type of Public Enterprises
When it comes to business, obviously the ultimate goal of any business is to be successful. That of course, depends on a lot of things, but the main things to gauge when it comes to success is revenue and growth.
When looking at public enterprises, there are two different types.
State and Government owned enterprises
These are some of the largest companies in the world. They are owned and operated by a state and government. They are often multimillion dollar companies and tend to dominate a specific industry within the country. Examples of state owned enterprises include Gazprom in Russia, PetroChina in China and Saudi Aramco in Saudi Arabia.
Public Private Partnerships
A public-private partnership (PPP) is a method of financing a project, especially for a public infrastructure, through a structure in which a private company owns a part of the project and works in partnership with the government.
Advantages of Public Enterprises
- Public enterprises tend to have better brands. In most cases, the company is owned by a state or a country. This means that it is much easier to create a brand which is unique to the company. This also makes it easier to stand out from the competition.
- Public enterprises tend to be many companies under one roof. This means that the public enterprises tend to have a larger network. This means that it is a lot easier to find partners and suppliers.
- When it comes to taxation, public enterprises tend to pay a lower tax rate.
Public Enterprises come in all shapes and sizes. We know them better by the names they are known by, such as British Rail or NHS. However, there is a certain stigma surrounding Public Enterprises. Many people see them as an outdated institution and one that is held back by outdated technology.
Public Enterprises simply mean that a Business is run for the benefit of all the people instead of shareholders.
For example, British Rail is a business run for the benefit of all the British people. All the profits generated are reinvested back into the company in order to provide the best services possible.
Furthermore, British Rail does not charge any fares for passengers. This means that if you can afford to travel on rail you will, without a doubt, be able to travel.
Why is this relevant?
Public Enterprises offer something which many private businesses cannot offer. They offer a service that is inclusive to everyone. They do not charge passengers and they do not charge premium prices. Generally speaking, costs are kept to a minimum.
Furthermore, they offer a service that is needed in our society. Public Enterprises often provide services which are not offered by private businesses. For example, British Rail runs Ireland’s rail network. Private businesses do not run train routes.
Do Public Enterprises offer value?
Yes. Of course they do.
This value comes in a few different ways. Firstly, they provide a service which private businesses cannot provide. For example, British Rail provides rail travel in Ireland. Private businesses do not run train routes in Ireland.
Secondly, they provide a service that is inclusive to everyone. For example, British Rail does not charge passengers for the use of trains.
Thirdly, They provide a service that is needed in our society. Although many people may choose not to travel on public transport, many people do still need to travel to certain areas. Public Enterprises often provide services that private businesses do not. For example, British Rail runs Ireland’s rail network. Private businesses do not run train routes in Ireland.
Finally, Public Enterprises offer value for money. Private businesses generally charge higher prices for their services. In some cases these higher prices are justified because of the quality of the service. However, in many cases the prices are simply excessive.
Is Public Enterprise Necessary?
No. It is not.
However, it is not the role of Government to provide everything for everyone. It is the responsibility of individuals to choose where they want to go. If an individual wants to travel on public transport, then it is up to them to pay for the service.
However, if a person wants to travel on a private rail service, then it is their choice.
Is Public Enterprise outdated?
No. It is very much not.
It is true that some Public Enterprises have outdated technology. However, this is not necessarily the case. In many cases, the technology used is simply outdated. For example, British Rail’s heritage railway service is called the Queen’s Railway. The trains that the service uses were decommissioned a long time ago. However, British Rail is using them as part of the Queen’s Railway heritage experience.
In most cases, the outdated technology is merely part of the experience.
Public Enterprises offer something which private businesses cannot. They are not run by shareholders and do not charge customers. If an individual wants to travel on public transport, then it is up to them to pay for the service. However, if a person wants to travel on a private rail service, then it is their choice.
The stigma surrounding Public Enterprises is outdated. It is no longer necessary. However, Public Enterprises do bring something to the table that private businesses cannot.