STATE CONCERNS.

Hawera Star, Volume XLVIII, 10 November 1924, Page 6

STATE CONCERNS.

.BUSINESS FIRMS COMPARED. "The age-old question, of how Stateconcerns compare with, business firms arid the factors governing the administration of either, with their relative effect in the sphere of public efficiency, are reviewed by the Public Service Commissioner in his annual report to Parliament. “There is an impression,” says Mr. Verschaffelt, “that there is a- wide dissimilarity between the conduct of Government affairs and private business. This idea is usually founded on premises only partially true. It is assumed that private business is invariably efficiently managed, free from interference and changes of policy, but that Government Departments are overstaffed with incompetent officers, are the subject, to continual political interference, and that if only a business mail had charge of affairs, many,- savings could he effected. « <l W'hile it is obvious that, in any large organisation, there is aßvays scope for economical readjustment, what critics overlook is that, in the nature of things,' there is a wide distinction in principle between State enterprise and private business, in that the main purpose' of the one is public well-being , and the other individual gain. It is a fallacy to believe that, because a man lias been successful in ‘ amassing a great personal fortune, he is therefore best qualified to lay down principles of public administration or finance. The chief function of profit-making'ln the world of business is astute competition. whereas the chief function of the public admibistration is wise co-ordin-atioU. Although there is a wide distinction in principle, in method the difference is not so evident. In this respect, critics' fail to take into consideration the magnitude of the organisation. A comparison of the methods adopted would disclose' that there is a greater/ dissimilarity between a large business and a small one than between the'organisation, of a large Government Department, and a private concern of comparable size. Indeed, it can be claimed that in many Departments modern methods aye in vogue which compare favourably with outside business firms. It may’ safely be asserted that of the faults which are ascribed at times to the administration of Government Departments, ill of them, and in some bases worse could be found in the administration of. many successful business concerns. The fact that public activities ave more open to public review tends to magnify any deficiency in public administration, thereby making it apoear to contrast unfavourable with the conduct of private enterprise.”