Question

Attempt the following.

Merits of Statutory Corporation.

Explain the merits of a statutory corporation.

Answer 1

The merits of a statutory corporation are as follows:

1. Internal Autonomy: Statutory corporations enjoy substantial autonomy in their daily operations, free from political interference by ministers and bureaucrats. This autonomy allows boldness, enterprise, and flexibility that government departments often lack.
2. Quick Decisions: They can take prompt decisions and quickly adapt to changes in technology and market conditions because they are free from prohibitory government rules on public expenditure. This reduces red tape and bureaucratic delays.
3. Motivation: Employees in statutory corporations typically have better service conditions than government servants, providing greater incentives for hard work and performance.
4. Parliamentary Control: Their performance is subject to scrutiny and discussion by Parliament, which ensures accountability and the proper use of public funds. The service motive protects consumer interests.
5. Efficient Management: Boards often include professionals and experts from various occupations, enabling business-like management. They can borrow money from the public to finance expansion without undue delay.
6. Economies of Scale: Usually large and often monopolistic, statutory corporations benefit from economies of large-scale operations. They enjoy stability irrespective of government changes and can make long-term policy decisions.