FINDINGS OF FEDERAL PARASTATALS IN ENUGU STATE

By

ONU PROMISE .O.

Presented To

Department of Accountancy

TABLE OF CONTENT

COVER PAGE I

TITLE PAGE II

APPROVAL PAGE III

DEDICATION IV

ACKNOWLEDGEMENT V

TABLE OF CONTENT VI

CHAPTER ONE

1.1 INTRODUCTION 1

1.2 HISTORY 4

1.3 PURPOSE OF STUDY 6

1.4 DEFINITION OF TERMS 11

CHAPTER TWO

2.1 REVIEW OF RELEVANT LITERATURE 14

2.2 ROLE OF FEDERAL PARASTATALS 17

2.3 PARASTATALS AND CITIZENS 21

2.4 SOURCES OF CAPITAL 27

2.5 STATUTORY 30

2.6 OTHERS 30

CHAPTER THREE

3.1 SUMMARY 33

3.2 FINDINGS 33

3.3 CONCLUSION 34

3.4 RECOMMENDATION 35

BIBLIOGRAPHY 37

CHAPTER ONE

1.1 INTRODUCTION

Every government runs its economy in such a manner it considers convenient to maximize satisfaction for its entire citizens. For this solitary reason, there are several economic that can be adopted by a choice government.

Mixed economy as in practice in Nigeria, Inter-alid is an economic system. The system allows for the private hands in the running of the state, economically in the rein, the private individual. Can own and operate the factors of production.

The more ownership and operation of these factors and resources of production to not really herald satisfaction. It does not herald economic growth and development. It is pertinent to mention at this juncture that economic development entails an increase in per capital income as well as improved standard of living.

The objective and goals for the formation of the private enterprises nay be defeated except the issues that boarders on profit making. Though practically, the profit making lost for a time for a point in time, the excess profit maximization enterprise may not have enough profit to service it's manpower requirement due to lowered patronage. The inability of these enterprises to service it manpower requirement is due to the fact that it lacks the patronage of the majority poor masses. While the once vibrant enterprise private enterprise is gradually its viability the poor masses are experiencing.

A similar phenomenon a reflection on himself and the economy is of course plunged into an abyss. As a revival and a negation to those adverse phenomena came the parastatals, a brain child ministries and public corporation.

Incidentally, these parastatals and very many as to conveniently serve the people.

These parastatals are the business owned and ran by the government with the interested of the people at hear. These parastatals are not profit oriented. The services they render from transportation, marketing, companies, to agronomy and animal farms to name but a few. One may wonder since they are not profit oriented, what do they do to survive to the business world?.

Financial which is the live wire of business enterprises need to be fed into the parastatals but then how?. Concise were put in place upon the conception of the this idea for positively touch every aspects of the masses live but sub-conscious and unconscious effects were and are still being unlashed to match and deter the structure. In this context, the issue of the deterioration the of the parastatals shall not occupy our fancy but basically the funding.

However, wherein, we unavoidably delve into their deterioration shall be seen and treated as a trivial issue.

HISTORY

The parastatals are not accidental products of the economy manager but a thoughtful act to alleviate of the poor masses the impact of the hardship in the economy precipitated by the shy lack entrepreneurs and gives them the sense of belonging.

Thus, in 1958, Professor R.H Bareback was entrusted with the task of producing the blue-prints for economic growth. One can see that foundations for the federal parastatals was laid during the colonials era when administered Nigeria as one of her overseas dependencies.

Parastatals quesi government department or public authorities came into being with the lacking of relevant legislation. At the federal levels, the parastatals were establish by the act of parliament or decree. The act will state to objectives and aims of the parastatals and specified its power and how it is ran. The earliest of the parastatals is the Nigeria port Authority established by the Act of parliament 1995. the Federal Parastatals in Enugu state are the Federal Radio Corporation of Nigeria (FRCN), Nigeria Railway Corporation (NRC), Nigeria National Petroleum Corporation (NNPC), National Electrical Power Authority (NEPA), Central Bank of Nigeria (CBN), Nigeria Telecommunication (NITEL), Federal Airport Authority of Nigeria(FAAN), Ministry of Finance. The parastatals were all established at different times to assist the government in the provision of essential services, avoidance of wastes social service etc. For the parastatals to efficiently discharge their duties, they were made to be as independent of the federal government as possible. For this reason, they are ran by Board or council each of which has a chairman and rankle some as the Board of Director of a company. Each parastatals has a General Manager or its equivalent who is the chief Executive, reporting to the Board or council.

1.2 PURPOSE OF STUDY

Business enterprises are being established with the primary aim of making profit. This aim will probably be seconded by its ensure survival in the business community. One will recall that fund is a factors of productions. Production a criteria for business which ensures returns. A business public or private may be funded by periodic funding or subvention (capital introduced).

However, parastatals or statutory bodies were established by the government to carry out specific polices and they are empowered pursue such polices by any legitimate means within their power. They are supported by around grants or subvention. Provided they do not deviate from their policies laid down by government, they remain free to operate at their discretion and are in certain case expected to make profit. But principally, they are not profit oriented, with the of are mentioned in mind, comes the impetus for these researches work the funding of Federal parastatals in Enugu state.

The study undertakes to unveil the sources of find available to the Federal parastatals viz

ì They statutory allocation

ì Other sources

ì The adequate of the finds.

1.3 SCOPE AND LIMITATION

The parastatals found in Enugu State in about same in number in other states but there may be in elements in numbers especially in the River state where they may be agencies such as coastal agencies etc. Thus, the scope of the stuffy is limited to Enugu state and the year in context one between 1993-2003. There are also some inevitable to the research owing to the administrative bureaucratic bottle neck of some officials of the parastatals or prevalent in the parastatals and the Central Bank of Nigeria to avail the researchers of relevant information.

Moreover, there is the issue of the death a disappearance of some relevant information from among the stick of file.

These and several others from the scope limitation of the research.

1.4 PROBLEMS OF THE STUDY

The Federal parastatals are the long term of the ministries extended to reach the citizens in very nooks and craning of the country. It is embedded in the social services industry.

The manner in which the parastatals are being administered has been of almost concern to the entire citizenry. It is attracted criticism from all walks of life. The staff of the parastatals interest groups. Individual in private practice and even the government that flrated the parastatals.

The point of criticism range from the amount of the annual grants or subvention, bank loans internally generated funds to the inability of the parastatals to live up to the dream of a service oriented organization, the unruly behavior of the workers easily carried with the under employment suffered by the staff of the workers easily carried with the carried with the underemployment suffered by the staff of the parastatals due to inadequate funding.

Sometimes, the stone are thrown at the glass houses erected by the services that could be best described as sub turban ear rendered by the parastatals. Imagine a structure set up to alleviate but is actually was aggravating poverty.

Why is the service of the parastatals not easily afforded by the masses? Why are they being made to pay through their noses to have these services?

Why are the private enterprises unarguably but literally monopolizing the services the services industry? Why are speedy, affordable services the bane of the private Enterprises when they actually should be bane of the parastatals?

Why is the laizes -faire attitude predominantly shredding the effects to club sufferings?

Why? Infact there are many why. Perhaps why are the parastatals expected to make a mountain out of a molehill? Or may be mould blocks with out said or sand? This is an in-depth study to as certain the reasons behind all the whys yet to be answered thrown at the federal parastatals in Enugu State.

1.5 DEFINITION OF TERMS

Some of the terms used in this research may not really be the same in meaning, as they would in our every day live. These terms are quasi government department, public corporation or bodies, statutory bodies, statutory allocation, subvention, parastatals, mixed economy and Acts.

(a) QUASI GOVERNMENT DEPARTMENT: These refers to direct government department which have commercial or semi-commercial functions. Though they are not backed up upon by act, Decree or law, they are part and parcel of the relevant government ministry and report back directly to the minister.

(b) PUBLIC CORPORATION: The government corporations are enterprises, which are normally established at the federal level by an Act of the Parliament or Decree, which specifically refers to the corporation.

(c) STATUORY BODIES: This is the generic name given to public corporation. They derive their name statutory from status which are law of the country backing up their establishment as a body set up by the government.

(d) STATUTORY ALLOCATION: Statutory allocation is the money provided for the statutory bodies by the statutes establishing them. It may interest one to know that these statutory allocations are periodically provided for the statutory bodies to enable the discharge their duties effectively.

(e) SUBVENTIONS: Subvention are the money given to the statutory bodies by the relevant government to able the statutory bodies keep the prices of their services at a desire point usually affordable to the common man.

(f) PARASTATALS: The parastatals are the agencies of the ministries set up to enable the ministries effectively discharged their services and they are answerable to the relevant ministry.

(g) MIXED ECONOMY: This is the mid -way between socialist economy and the capitalist economy. While the former allow for only the state to own and control the resources. From the foregone, one can deduce that mixed economy is an economic arrangement, which permits both private hands and the government own and control factors and resources of production.

(h) ACTS: Laws made by the parliament which have the constitutional effects of law.