DU SOL BA 3rd Year Administration and Public Policy Notes Chapter 2 Public Administration and Private Administration
Bring out the difference between Public and Private Administration.
What are the points of similarities and differences between Publie and Private Administration.
The term Public Adhiinirtation appeals to suggest that there must be ‘Non-PubHc- or ‘Private” administration also. Some thinkers believe that all admimstration is one and there is no difference between Public or Private Administration Urwick, Mary Parkor Follet and Henri Fayol are of this view. They belong to a school of thought which tried to find basic principles of administration which were equally applicable to Public and Private Administration. For example, Layndal Urwick stated, “It is difficult to contemplate seriously a bio-chemistry of bankers, a physiology of professors, or a phycho-pathology or politicians. The attempt to subdivided the study of management of administration in accordance’ with the purpose or particular forms of undertaking seems to many authorities…..eaualy misdirected”
Similarly, Henri Fayol stated, “The meaning which I have given to the word administration and which has generally been adopted broadens considerably the field or administrative science. It embraces not only the public service bat enterprises of every size and description of every form and every parpose. All undertaking require planning organisation, command, coordination and control and in order to function’ properly, all must observe the same general principle. We are no longer confronted with several administrative sciences, but with one which can be applied equally to the Public and to Private affairs.”
Similarities Between Public And Private Administration :
(a) The Public and Private Administration show a number of similarities in practice. We usually say fld all those activities which are performed by the governmental agencies, or public’ agencies from part of Public Administration while those performed by the private agencies art; called % private administration. There are, however, many activities which are preformed both by private and public agencies. For example, business activities were mainly performed by private organizations.. But, the government has taken upon itself many economic and business activities w ch hitherto were the preserves of Private Administration.
This has given rise to a new form or organisation, namely, a public corporation which is very much different from the usual departmental form of organisation prevalent in the government. This form of organisation has become necessary to provide the Public Administration sufficient flexibility necessary for running business enterprises. In developing countries like India the public sector has. come to occupy a very important position in the economic organisation of the country. The role of public corporations has, therefore, gone up tremendously giving rise to the phenomenon of adopting the business practices of private organisations in the government
(b) Moreover, there are many skills, techniques and procedures which are common to both Public Administration. For example, accounting, statistics, office management, office procedures, purchases, disposals and stocking and many other activities are common to both Public and Private Administration. In a number of countries several institutions have come up which attempt to train administrators from Public and Private Administration together. For example, Administration Staff College of U. K. and Hyderabad Staff College of India have been established to bring about harmony and coordination between Public and Private Administration. Obviously this is due to the realisation of the feet that there is a lot in common between the Public and Private Administration and both can benefii from each other’s experience.
(c) In many countries there has also- been a cross movement of functionaries between Public and Private Administration. For example, in Japan a large number of public servants taken up employment in private industry after seeking premature retirement. Similarly, there is a great deal of exchange of personal between public and private sector in United States of America. Even in India recruitment to public services has been made on an ad hoc basis from open market This has been done twice since dependence in addition to regular recruitment A large number of personal a these special recruitments have been contributed by the private sector.
This would not have been possible if the public sector and die private ector did not have anything in common. There appears to be a lot of force in the contention of scholars like Urwick and Fayol that both Public and Private Administration have common techniques. Having said that, it must be admitted that there are some significant difference between the Public and Private Administration and they cannot be overlooked in any objective study of administration.
Differences Between Public And Private Administration :
The general impression appears to be that differ in the following three important aspects :
- Public Administration is bureaucratic, while Private Administration is business-like.
- Public Administration is politicals whereas Private Administration
- Public Administration is characterized by red-tape from which private administration is comparatively free.
Although these distinctions are not fully home out by facts, the popular image of Public Administration continues to be that characterised fey these observations.
Sir Josia Stamp pointed out four major points of difference between Public and Private Administration. We would briefly .discuss them below :
(a) The Principle of Uniformity. One of the most significant characteristics of Public Administration is that it is subject to the principle of uniformity. It requires that administrative acts and decisions must be consistent, i.e., in conformity with the rules and precedents. These rules and precedents must be applied uniformly to ail tire citizens and classes of citizens. If any discrimination Is shown without a reasonable cause, it may give rise to a lot of criticism and discontent among the people. The Private Administration on the other fend is not bound by any such rules of uniformity. In fact, a great deal erf preferential treatment is shown to certain clients in almost every business activity. This, kind of favoured treatment is not viewed unfavourably and is taken as a normal business practice.
(b) External Financial Control In Public Administration the executive 1 does not control finance. The expenditure from public funds can only be incurred when authorised by Lejpslature. Even after authorisation, tire expenditure is subject to a great deal of control by Legislature through its . agencies of audit etc. Such complete divorce of finance and administration does not exist in private administration. The beard of management which controls the business operations of tire private undertakings, also control ’ financial management
(c) Public Accountability. Public Administration Is obviously subject to public accountability. This is very much more so in ease of parliamentary democracy like India. Every action of s minister or a public servant is so subject to close scrutiny by the representatives of the .people sitting in Parliament Even for trivial matters, a Minister can be called upon to reply a question in Parliament Any departure from the accepted norms of behaviour or practice can cause a lot of embarrassment to the Government.
On account of this accountability the public servants have to be very guarded and circumspect in all their actions. They have to keep records of actions die Government. On the other hand, Private Administration is generally not so accountable to the people or their representatives. The private managers are free to take whatever action they deem fit in the interests of the organisation in which they are serving.
(d) Profit Motive. The private administration is largely governed by a profit motive. This principle is not applicable to Public Administration. It does not mean that the Government should necessarily indulge in extravagant or wasteful expenditure. However, it does mean that a Public Administrator cannon be guided solely by consideration of profit or economy in expenditure.
He has to make sure that his actions are justified by die results in terms of public welfare. For example, when it centres to controlling a law and order situation, a District Magistrate or a Police Commissioner cannot think in terms of saving money on the movement of troops to die place of disorder. On the other hand, the private administrator is mostly governed by the profit motive.
The sole criterion for decision in a private organisation is the answer to the question ‘will it pay’. Sometime die Private Organisations adopt even questionable means to maximise their profits. Even the honest Private Administrators cannot be expected to indulge in activities which do not bring profit to the organisation.
Apart from the above mentioned basic difference pointed out by Josia Stamp, there are a number of other significant differences between Public and Private Administration. We would discuss here some of the important ones.
(e) Political Direction. One of the most important distinctions between the Public and Private Administration is that Public Administration is subject to political direction while Private Administration is not, expect in times of emergencies. The latter has its own objective mainly governed by the profit motive as mentioned above. The Public Administration on the other hand has to carry on the policy laid down by the political executive. He has no option to change the policy and has to implement it. Since, the job of the Public Administration is to execute public policy, it cannot be divorced from political direction.
(f) Nature of Functions. The Nature of Functions on Public Administration is much more comprehensive tha® that of the Private Administration. It deals with various needs of the people. For example, it is connected with the maintenance of law and order, provision of transport In a welfare state the scope of activities of Public Administration is still larger- and, covers the various aspects of human life. It has to undertake a number of economic and business activities in the fields where private sector does not come in.
It has to provide infrastructure to meet the needs of development. Besides Public Administration has to own several monopolies like railways, post and telegraphs etc. to provide necessary service to the people. In a socialist state, the Public Administration covers t the entire gamut of activities from maintenance of public order and defence of the country to the running of retail shops for maintaining supplies. No private organisation can boast of such a wide range of activities. Most of ” the private organisations are concerned with one or two activities which they can run on profit.
(g) Efficiency. As already mentioned, according to popular imagination, private administration functions more efficiency than Public Administration.
It is believed that the efficiency of the private sector is on account of the profit motive and also on account of the tear or removal from service on the part of the employes. The hire and fire system of private management ensures that the employees are kept in better discipline due to the fear of losing their jobs. On the other hand the private management can also reward good work more quickly and more adequately. This carrot and is tick approach is said to ensure efficiency in Private Administration. None of those tools is available to the Public Administration, The jobs are secure and the remuneration is determined more or less by seniority according to fixed rules. There is neither fear or punishment nor the incentive of any reward. Consequently, the Publifc Administrators have little motivation to work efficiency.
(h) Binding of Laws. Public Administration functions within the frame -work of the law of the land. No administrator can afford to take any action which is not sanctioned by the law. It is not only their moral duty to obey the law, but, they are subject to judicial and legislative review for the actions taken by them. Any illegal action by a public servant can be questioned in the Legislative by raising a Parliament question or a longer discussion. The citizens can also challenge the actions of the public servants in the courts of law who have the authority to declare then actin ultra-vires. This does not mean that the Private Administration is not bound by the laws of the land. The private., enterprise – has also to work’.within the framework of laws. Company Law, Partnership law, Taxation Laws, etc
They also invite severe penalties if they break the law.-by any of chei; actions. However, it may be realised that their actions are not so much circumscribed by law as those of a public servant .
(i) Code of Ethics. The code of ethics for Public and Private Administration are different. For example, Public Administration cannot advertise its services in the way in which business can advertise its product. Government propaganda is looked upon with suspicion and hostility by the public. Whatever public relations work the Public Administrator performs has to be very’ discreet. Moreover, a Public Administrator has to act and also appear to act according to the laws, rules and regulations as well as norms of propriety.
There appears to be no such compulsion of the part of Private Administrators to be inhibited by the need to appear impartial and discreet.
(j) Urgency. The activities of Public ’Administration very often have a sense of urgency which is not the half-mark of Private Administration. For example, the maintenance of law and order, provision of medical and health services, maintenance of infra-structure facilities like electricity, railways, transport net-work, etc. cannot be neglected for any length of time. If the railways, posts and telegraphs etc. are not functioning even for a day, there is likely to be a hue and cry in the public. The managers of private organisation can decide their own pace of activity depending upon their own convenience. As already mentioned, they would be mainly guided by the profit motive. If it is profitable for them to postpone the production of a commodity, nothing prevents them from doing so even if the continuance of its production is in the Interest of the people in general.
(k) Consciousness’ of’PubUc. Service. Many services provided by the Public Administration are characterised ’by the consciousness of service to the community. A number of decisions in the provision of these services are guided by the same. consciousness.- For .example, transport services in the cities are often subsidised fry the Government to make these services available to the poor people No private organisation can afford to do the same. Similarly, electricity and Irrigation water supply are often arranged for the farmer at subsidised prices This is done with a view to encouraging the production of foodgrains and other agricultural commodities for the benefit of the people in general. The Public Administration also comes forward to undertake many activities in which the private sector does pot dare’to venture. Construction of bridge, highways, etc! belongs to this category.
(l) Monopolistic Nature of Activities. Many of the services provides by the Public Administration are monopolistic in nature. For example, the railways, post and telegraph, electricity to which are mainly provided by the Get eminent are run cm monopolistic lines. It does not mean that all the Government undertakings are monopolistic. Nor does it mean that there are no monopolies in the private sector.
However, the difference remains that the Government often creates its undertakings as monopolies while it exercise strict control against the development of monopolies in private field. Most of the anti-trust laws are meant to guard against the possibility, of emergence of monopolies. Perhaps one of the reasons for inefficiency in the Government undertakings is their monopolistic nature.
(m) Prestige. There is a great deal of difference between the prestige attached to the employment in the public sector and private sector. In developing countries Public Administration enjoys a great deal of prestige to which Private Administration cannot easily aspire. Although remuneration of public servants in these countries is often much less compared to the private sector., it. is amply compensated by the prestige that the public servant enjoys. This is partly because of the colonial past of these countries and partly on account of the pivotal role the administration has to play in the development of the country.
In the developed countries, however, the position is different. For example, in United State private employment often carries much greater prestige than public employment. The remunerating in the private sector is * higher than in the public sector. The prestige attached to the private employment is also correspondingly higher.
Conclusion: In conclusion it may be said that there are some significant differences between the Public Administration and Private Administration. However, with the expansion of the activities of the Government into business field, the distinction is becoming more and more blurred. In a number of activities; the Government has to compete with the private business. It has, therefore, to follow business practices which are similar to those followed by the private sector. The obvious example is provided by the Government corporations which have adopted the business practices of private corporations. These Government corporations are also expected to earn reasonable profits so that they do not act as a perpetual drain pn die resources of the Government.
On the other hand, the private business is also to some extent to provide good service to the people. No private organisation can continue to flourish for any length of time unless it provides satisfaction to the people. Moreover, v the private organisation, specially those in the business field, are subjected to a large number of restrictions imposed by the Legislatures. Any business, activity which seeks to make money by endangering the safety, health or , morals of the people would not be tolerated. A number of laws have been % enacted to regulate the business activities to ensure that they serve tire social interests. Special protection is provided against die serve the exploitation of -workers and consumers. Unfair practices are being forbidden.
It is, therefore, not proper to say that the private sector is completely, insensitive or immune to the considerations of public good. In democratic countries the private sector is particularly not immune from public accountability. If any private organisation acts in a manner prejudicial to the public interest, the public opinion acting through its representatives may force the organisation to change its methods. In some areas like Torts, the liability-of private corporations much more than that of the Government. The private organisation have to accept full responsibility for the damages caused by their agents. The povemment on the other hand, does not usually accept responsibility for the torts committed by its employees in respect of the so called governmental functions.