Question

What do you understand departmental undertaking?Mention there feature,limitation and merits

Answer 1

Answer:

Departmental Undertakings are the common and more established form of establishing public enterprises. These enterprises are formed, operated, and part of the department of the ministry.

All the government works and activities are accomplished through this department, and cannot be entitled as independent or autonomous entities.

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Features:

• This is the oldest and most traditional form of organizing public enterprises.

• The funding of these enterprises comes directly from the Government Treasury.

• They are subject to accounting and auditing controls, as applicable to other Government entities.

• Example:  Railways , Post Office

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Limitations:

• They are insensitive to customer needs and do not give sufficient services to them.

• Employees are not allowed to take an independent decision. Therefore, it leads to a delay in decision making.

• It doesn’t have flexibility which is essential for a business to run smoothly.

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Merits:

• The revenue collected by the business is directly credited to the treasury which becomes a source of income for the government .

• It has direct authority and guidance of the ministry, therefore, for national security, it is the best kind of undertaking.

• These assure public accountability.

Hope it helps!

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