...4.0 GOVERNMENT PRIVATIZATION POLICY; SUCCESS OR FAILURE? The implementation of Government Privatization Policy in Malaysia can be considered as success. This is because, this policy design able to achieved almost all the objective of government privatization policy. Therefore, our opinion about the government privatisation policy is success due to achievement of these objectives. 4.1 Relieve the financial and administrative burden of government The successful privatization should bring gain to the government in term of reduce financial burden of those entities that suffer losses .For example is Malaysia Airlines (MAS). According to Tun Dr Mahathir, MAS should be privatize since ten years ago due to loss of RM 10 billion in term of capital injection and government also did not received dividend during the 5 years to 1985. As we can see now days, there are so many problems facing by MAS. For instance the accident of MH370 and MH17 that make MAS become worse. In order MAS to success they need to reconstruct the management structure from top to bottom to make a better decision making and become more perform. Besides that, the privatization also undertaking and maintain services and infrastructure, for example according to the Privatization Master Plan Policy (PMP), proceeds from sale of government equity in privatize companies has generated RM1.88 billion, while the government is said to have saved more than RM8.2 billion in capital expenditure for infrastructure development...
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...Privatization Trends in Government in the 1990's e University of Submitted to: Prof. Submitted by: D el 6 7 May PRIVATIZATION HAS BECOME INCREASINGLY ATTRACTIVE TO GOVERNMENTS AT ALL LEVELS BOTH IN THE UNITED STATES AND AROUND THE WORLD. PRIVATIZATION, HOWEVER, POSES A DIF~ERENT SET OF PROBLEMS FOR PUBLIC ADMINISTRATORS. THE GOAL OF PUBLIC ADMINISTRATOR IS TO RUN HIS/HER AGENCY AS EFFICIENTLY AS ) .' ''I ,J• . 1 , POSSIBLE. BUT IN TIMES OF FISCAL CONSTRAINlj PRIVATIZATION IS SEEN AS A SOLUTION TO BUDGETARY PROBLEMS. AS WITH ALL ISSUES THERE ARE TWO SIDES. PROPONENTS OF PRIVATIZATION FEEL THAT THE PRIVATE SECTOR CAN DELIVER THE SAME SERVICES THAT GOVERNMENT CURRENTLY PROVIDES FOR LESS MONEY, BETTER QUALITY AND WITH MORE VERSATILITY. ON THE OTHER HAND, OPPONENTS FEEL THAT PRIVATIZATION REDUCES THE QUALITY OF SERVICES, LEADS TO THE DESTRUCTION OF PUBLIC EMPLOYEE UNIONS AND CORRUPTION AND IN THE PROCESS WEAKENS GOVERNMENT J CONTROL OF THESE SERVICES THAT ARE CONSIDERED ESSENTIAL TO THE PUBLIC. THESE OPPONENTS FEEL THAT IF THE PRIVATE SECTOR COULD HAVE DONE THESE JOBS AT A REASONABLE COST IN THE FIRST PLACE GOVERNMENT WOULD NOT HAVE HAD TO PROVIDE THEM AT ALL. PROPONENTS FEEL IT IS THE FACT THAT GOVERNMENT HAS GOTTEN SO BIG THAT THEY CAN NO LONGER PROVIDE THE SERVICE AT A RATE LOWER THAN THEIR PRIVATE COUNTERPARTS AND THAT HAS GIVEN BIRTH TO A VARIETY OF PRIVATE CONTRACTORS WILLING TO PROVIDE THESE SERVICES AT MORE COMPETITIVE PRICES. GOVERNMENT HAS...
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...Privatization on Service Sector Preface We know that the countries which are developed today are getting very strong in service sector day by day. Without having a very significant service sector it is impossible to retain the development of the economy of a country. Service sector is the accelerator of an economy. And Bangladesh is one of the least developed countries of the world with a huge number of different problems but most importantly with an emerging service sector. Really this is a great tonic for this underdeveloped country on the way of development. So to utilize this potential setting up of a lot of service organization is needed. But the service organization should not be public rather private. Because we all know about the poor service quality and negative profit of the public service organizations of Bangladesh. So the privatization of service sector is one of our desired initiatives. It is one of the leading aspects with a very bright potential to boost-up the economy of this third-world poor country. Prepared by: Md. Abdul Hai – 07882860 Essence of Privatization Despite a significant degree of public ownership in health, education, communication, utilities and energy sectors in the pre-independence period, Bangladesh inherited basically a private sector dominated economy at the time of independence in 1971. A set of three inter-related reasons are put forward as rationale for privatization in Bangladesh. These are: • Improvement of the governments’ fiscal...
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...BUSINESS introduction Privatization is the process of transferring an enterprise or industry from the public sector to the private sector. The public sector is the part of the economic system that is run by government agencies. Privatization may involve either sale of government-held assets orREMOVAL of restrictions preventing private individuals and businesses from participating in a given industry. Privatization is an ongoing trend in many parts of the developed and developing world. Proponents of privatization maintain that the competition in the private sector fosters more efficient practices, which eventually yield better service and products, lower prices and less corruption. On the other hand, critics of privatization argue that some services -- such as health care, utilities, education andLAW ENFORCEMENT -- should be in the public sector to enable greater control and ensure more equitable access. CON Parents will want to save money— Every child needs access to an education and privatizing it will cost many children the chance at going to school. Not every parent isFINANCIALLY responsible and it eventually causes their kids to suffer. Education is a gateway in allowing a child to transcend economic and social status. We must not take away children's education at the expense of saving money. Parents may think if they have a family business, that their children can take over, but by doing that, you’re taking away your childrens right of having an education and exploring...
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... 02 Privatization in Bangladesh: Problems and Prospects Muhammad Ruhul Amin( Showkat Ara Khanam(( Abstract: Privatization has been advocated in the development literatures as the gateway of the growth and development of the countries all around the world. Despite the phenomenal expansion of privatization programs, the results differed from country to country. Some could achieve the desired goals and some failed enormously. However, the World Bank and the IMF continued their campaign of privatization for less developed countries (LDCs) including Bangladesh to stimulate their growth and development. Some LDCs have adopted privatization programs of their own volition. The central theme of this paper is to examine the implications of privatization for the overall development of Bangladesh. The paper raises a number of issues in this regard. The issues involve meaning, significance, approaches, strategies and effectiveness of privatization. While seeking solutions to these issues, the problems inherent in policy formulation and its implementation strategies have been clearly spelled out in the paper. The authors suggest that in order to make privatization efforts a success, an indigenously designed pragmatic policy needs to be undertaken. They warn that the policy prescriptions of external sources including donor agencies, pressure groups and political lobbyists should be handled with great care and caution. 1. Introduction Privatization has been...
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...The Meaning of Privatization Copyright 1988 by Paul Starr. Seite 1 Readers may redistribute this article to other individuals for noncommercial use, provided that the text and this notice remain intact. This article may not be resold, reprinted, or redistributed for compensation of any kind without prior written permission from the author. If you have any questions about permissions, please contact the author at (609) 258-4533 or by e-mail at starr@princeton.edu. Preferred Citation: Paul Starr, "The Meaning of Privatization," Yale Law and Policy Review 6 (1988): 6-41. This article also appears in Alfred Kahn and Sheila Kamerman, eds., Privatization and the Welfare State (Princeton University Press, 1989). The Meaning of Privatization Paul Starr Privatization is a fuzzy concept that evokes sharp political reactions. It covers a great range of ideas and policies, varying from the eminently reasonable to the wildly impractical. Yet however varied and at times unclear in its meaning, privatization has unambiguous political origins and objectives. It emerges from the countermovement against the growth of government in the West and represents the most serious conservative effort of our time to formulate a positive alternative. Privatization proposals do not aim merely to return services to their original location in the private sphere. Some proposals seek to create new kinds of market relations and promise results comparable or superior to conventional public programs. Hence...
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...ENTERPRISE INEFFICIENCY AND THE ROAD TO PRIVATIZATION IN BANGLADESH Tanweer Akram Abstract This essay provides an overview of public enterprises inefficiency and discusses the main issues concerning the privatization program in Bangladesh. The paper points out how the country’s privatization program can be improved. Keywords: Privatization, Public Enterprises, Bangladesh. The Scope of this Essay This essay provides an overview of public enterprise inefficiency in Bangladesh and issues related to the problem of privatization of public enterprises in Bangladesh. The main argument of this essay is that there is ample scope for improving the country’s privatization program. The terms and conditions of sale must be well defined and upheld. The potential buyers must have access to material information about the firms. The financial sector must be disciplined. In order to show the importance of financial sector discipline, empirical findings on the debtdefault status of privatized enterprises in Bangladesh are presented. The proceeds from privatization can be used for workers’ compensation and labor training since in the short-run labor retrenchment due to dismissal of excess workforce may lead to social and political problems unless alternative arrangements are available for workers. Prudential regulatory environment is required to protect the interests of the consumers when public monopolies are transferred to the private sector. Privatization program needs to be carried out within...
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...Privatization of Government We have all heard politicians talk about the benefits of privatizing government can save money. In actuality, the savings are not always there. Obscured fees for items such as contract monitoring and sub-par administration can end up costing more than the cost to perform the same tasks in-house. The Government Finance Officers Association estimates that hidden and indirect fees add up to 25% of the actual contract price. The Government of Accountability office found that the way the consultants were conducting the financial reports make cost savings appear greater than they really were. In 2007, a survey by the International City/County Management Association, 52% of governments ended up bringing services back because the savings did not add up. In Wisconsin, the Legislative Audit Bureau revealed that Department of Transportation for the state ended up squandered well over $ 1 million dollars by outsourcing to private contractors. The report also revealed that 60% of the outsourced positions, had they been done in-house, would have not only been cost effective but also saved the state about $1.2 million. Another myth is that private corporations tend to do a better job than the local sector. However, studies show that many private contractors fail to deliver. Many companies even leave communities without the services promised or any way to recover any assets. Another downside to this with any private corporation, they main goal is profit, by...
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...India should privatise railways for better efficiency India’s booming economy which is considered one of the fastest growing in the world demands better performance in transportation, especially when it comes to the case of gigantic sloth of Indian Railways (IR)! The behemoth public sector enterprise runs more than 18,000 trains daily and is comfortably one of the biggest rail networks in the world. However, it is yet to economise on the concept of modernisation and automation. In order to make the system more efficient, most of the nations across the world have privatised their mass transportation system. Undoubtedly, a better experience of travelling and transport can only be achieved by private participation and eventually it will also enhance the bottomline that has been looming at $48 billion as of 2009. IR currently suffers from dearth of resources. Sadly, the infrastructure and manufacturing capacity available to IR is never enough to meet the increasing demand of locomotives and wagons! Nor does India stand a chance to meet the international safety standards, efficiencies and finesse of the railway services of Europe and North America! The service efficiency post-privatisation in aviation sector should be replicated by IR for better management. The main chasm between the promise and the delivery is created by the monopoly of IR. Undeniably, competition in Europe has enhanced railway services there in abound. In India, it is astonishing to note that even manufacturing...
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...Impact of Privatization on Organization’s Performance Abstract The proposed research is intended to assess the impact of Privatization on Organization’s Performance. The main theme is to examine its impact on profitability, output, efficiency and employment. It will be analyzed to compare the performance of public and private sector organization in Pakistan. Keywords: Privatization, profitability, output, efficiency and employment Introduction Despite frequent changes in the governments since 1985, five regularly elected and six care takers, there has been consensus on the continuation of privatization policy and as such it is expected to be cornerstone of all the future government policies, at least in the near future. Instead of arguing the merits or demerits of the privatization policy, we explore its impact on the levels of efficiency. A large number of public sector units have already been divested and a number of other public enterprises including telecommunications and thermal power stations have been placed on the privatization list. Nevertheless, serious doubts have been expressed about transparency of the bidding process and the impact of privatization on efficiency, investment, production, prices, employment and fiscal deficit. Accordingly, there is a need to identify constraints in realizing various objectives of privatization with a view to suggesting concrete policy measures that may be taken to overcome the constrain and to improve...
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...advantages and disadvantages of privatization and nationalization of industries or firms. The essay will conclude by suggesting which of the two would be viable for future policy consideration in Zambia. The term privatization is often loosely used to mean a number of related activities, including any expansion of the scope of private sector activity in an economy and the adoption by the public sector of efficiency enhancing techniques commonly employed by the private sector. The term privatization may be taken to mean a financial transaction-the sale of a publicly owned asset to the private sector or the transfer of the authority to make resource allocation decisions from the government to the market place (Gabel, 1987). While acknowledging that no definition of privatization is water tight, for the purpose of this essay, privatization will be defined as the transfer of productive asset ownership and control from the public to the private sector (Ibid). In Africa, many governments have embraced the idea of privatization, brought to the fore mainly as a part of the adjustment and stabilization programs of the mid-eighties and the nineties. Privatization now frequently features in government policy statements and in conditionalities from donors. The past decade has also seen the World Bank and other donors get increasingly involved in lending operations towards parastatal sector reforms that included privatization components (Landis, 2000). Privatization is therefore a capitalist...
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...came to power in the United Kingdom. This trend continued after independence such that by 1999, it was estimated that successive Nigeria Governments have invested up to 800 billion Naira in public owned enterprises (Obasanjo, 1999). THE CONCEPT OF PRIVATIZATION Although the concept of privatization is an is an emotive, ideological and controversial one evoking sharp political reactions, its political origins, meaning and objectives are not ambiguous. Iheme (1997).defines privatizations as: …any of a variety of measurers adopted by government to expose a public enterprise to competition or to bring in private ownership or control or management into a public enterprise and accordingly to reduce the usual weight of public ownership or control or management. However, in a strict sense, privatization means the transfer of the ownership (and all the incidence of ownership, including management) of a public enterprise to private investors. The later meaning has the advantage of helping one to draw a line between privatization and other varieties of public enterprise reform. It is also the sense in which the term has been statutorily defined in Nigeria. In a similar vein, Starr (1998) defines privatization as a shift from the public to the private sector, not...
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...The Impact of Privatization of Public Services on the Public Sector Employment in the U.S. Literature review Privatization is one of the most discussed topics in the modern era of public management. Traditional norms of public management are getting unclear day by day because of the increased consideration for the efficiency and effectiveness of affairs of public sector organizations. One of the way governments adopted to increase the efficiency and effectiveness is the privatization of public services. Varner (2006) in his report titled ‘Government Privatization History, Example, and Issues’ given the definition of privatization as “Privatization is the process of transferring property from public ownership to private ownership and/or transferring the management of a service or activity from the government to the private sector”( Varner, 2006, p. 1). This paper assumes and proposes the privatization as independent variable and analyzes its impact on unemployment. So being an independent variable in a study it is very much appropriate to identify different aspects related to privatization. The significant contribution of Varner (2006) is that he has specified the forms of privatization as; “Complete Privatization, Privatization of Operations, Use of Contracts, Franchising, and Open Competition” (p. 1). In addition, he said that moves address the idea of reason what may be the causes ultimately ends up in privatizing the public entities. The provided list of seven reasons...
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...OVERVIEW OF AVIATION PRIVATIZATION IN EUROPE, AFRICAN AND ASIAN COUNTRY PREPARED BY: NUR IZZAH IWANI BT IBRAHIM@ABD RAHMAN 2010554633 NURUL HARYANIE BT MISRAN 2010572197 WANDEE BT JAMIL 2010558697 GROUP : AC220 8B PREPARED FOR : ASSOCIATE PROFESSOR DR. ASMAH ABDUL AZIZ PERSONAL BIOGRAPHY NUR IZZAH IWANI BT IBRAHIM @ ABD. RAHMAN 2010554663 NURUL HARYANIE BT MISRAN 2010572197 WANDEE BT JAMIL 2010558697 Contents ABSTRACT 3 KEYWORDS 3 INTRODUCTION 4 OVERVIEW OF AVIATION PRIVATIZATION IN EUROPE, AFRICAN AND ASIAN COUNTRIES 5 Argentina – Its pitfall and the problems behind it 5 Turkey – A Privatization through BOT 7 Kenya Airways – A Successful Story 9 Malaysian Airlines Considering Privatization 10 Germany-Fully privatized and partially privatized 12 Privatization in United Kingdom 14 IMPLICATION OF PRIVATIZATION 16 RECOMMENDATIONS 17 REFERENCES 18 ABSTRACT This paper focuses on the privatization of airports in six different countries which are Argentina, Turkey, Germany, United Kingdom, Malaysia and Kenya. The analysis aims to highlight the objectives, implementation and the government rules towards privatization of airports. This paper also aims to identify to what degree privatization contributes to or enhances the performance of the airports. The study measures the change in any given indicator of performance whether the privatization on the airports...
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...Privatization of Telecoms in Asia John Ure and Araya Vivorakij* Privatization viewed as a panacea for the most pressing problems besetting the modernization and development of telecommunications has become, in recent years, a widely accepted part of orthodox thinking. Wellenius, Stern, Nulty and Stern (1989) illustrate the point. ‘How should privatization be defined?’ asks the International Finance Corporation (IFC, 1995). ‘A generous stance would admit any transfer of ownership or control from public to private sector. A more exacting definition would require that the transfer be enough to give the private operators substantive independent power.’ 1 Hence, by privatization is usually meant the transfer of state-owned assets to private sector ownership, management and control typified by the sale of part or all of the shares of a state owned (and operated) telecommunications enterprise (SOTE). We shall argue that the ‘more exacting definition’ is exactly appropriate for the experience of Western economies from which it originates - see below - while it is too narrow, too precise, insufficiently ‘generous’ to capture the less clearly defined lines of demarcation between public and private capital in the context of Asian telecommunications. We shall argue that this is because the delineation between state (political society) and civil society is less well developed in Asia, certainly less well articulated in law, and unevenly developed even within single large Asian countries...
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