Problems of revenue generation In government owned companies
(A Case Study Of Pacn Enugu District)
Revenue generation in government-owned companies poses a complex challenge due to a myriad of factors. Firstly, the inherent bureaucratic nature of these entities often results in inefficiencies and slow decision-making processes, hindering the swift implementation of revenue-enhancing strategies. Additionally, the lack of a profit-oriented mindset and competition within the public sector can lead to complacency and a diminished focus on innovative revenue generation approaches. Moreover, political interference and unstable economic conditions can create uncertainties, affecting the ability of government-owned companies to attract investments or devise long-term revenue plans. Furthermore, the absence of performance-based incentives and stringent regulations may discourage employees from actively contributing to revenue growth. Addressing these issues requires a holistic approach, involving structural reforms, promoting a more entrepreneurial culture, and fostering collaboration between the public and private sectors to stimulate sustainable revenue streams for government-owned companies.
This research project was embarks upon to study the problems of revenue government in government owned companies case study of power holding company of Nigeria (PHCN) Enugu district the meaning of revenue was briefly reviewed. The sources of revenue generation and problems of revenue generation in some of the government owned companies via, NITEL, NIPOST, Nigeria stock exchange and other were light lighted. The research was able to study other sauces of government revenue like taxes, tougares etc. The district groups of people were chosen, customers and staff of PHCN. A sample size of 398, customers and 216, staff were used for the study separate questionnaires were designed for the separate samples and distributed among them, interviews were conducted at the office were customers queued up to their bills as a first land source of information Four research questions were given which compiles the in efficiently in meter reading the extent of delay in billing and delay in dispatch of bills, Also tested was the extent of vandalization of PHCN facilities as it affects the PHCN organization and the customers in general. Many information got from the customers of PHCN Enugu district is that they do receive crazy bills and the bills are not received at the appreciate time. Also that at time they do staff in blackout for up to one week without light, information gotten from the staff of PHCN Enugu district is that their greatest enemies are vandals because as a result of that PHCN spent a loge amount of revenue in reforming these vandalized facilities. Based, on these the research made some recommendations on how PHCE can curb these in efficiencies in them and low they can proceed their facilities against vandalization .
COVER PAGE
TITLE PAGE
APPROVAL PAGE
DEDICATION
ACKNOWLEDGEMENT
TABLE OF CONTENTS
ABSTRACT
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
1.2 STATEMENT OF THE PROBLEM
1.3 THE PURPOSE OF THE STUDY
1.4 RESEARCH QUESTIONS
1.5 DELIMICATION OF THE STUDY
1.6 SIGNIFICANCE OF THE STUDY
CHAPTER TWO
REVIEW OF LITERATURE
CHAPTER THREE
METHODOLOGY
3.1 THE DESIGN
3.2 AREA OF STUDY
3.3 POPULATION OF THE STUDY
3.4 SAMPLE AND SAMPLE PROCEDURE
3.5INSTRUMENT FOR DATA COLLECTION
3.6 VALIDATION OF THE RESEARCH INSTRUMENT
3.7 RELIABILITY OF THE INSTRUMENT
3.8 METHOD OF DATA COLLECTION
3.9 METHOD OF DATA ANALYSIS
CHAPTER FOUR
4.1 DATA PRESENTATION AND ANALYSIS
CHAPTER FIVE
DISCUSSION AND CONCLUSION OF RESULTS
5.1 DISCUSSION OF FINDINGS
5.2 CONCLUSION OF THE STUDY
5.3 RECOMMENDATION
5.4 IMPLICATION OF THE STUDY
5.5 SUGGESTION FOR THE FARTHER STUDIES
5.6 LIMITATIONS OF THE STUDY
REFERENCES
APPENDICES
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
A cording to Anyafo (1996) revenue may be defined either in a broad or a narrow sense in the broad sense it includes all in comings or public receipts” in the rerrow sense only those receipts which are included in the ordinary conception of “public revenue ” The chief elements included in the conception of public revenue are receipts but excluded from that of “public revenue” are receipts from public barrowings and from the sale of public assets such as war stores. Furthermore, the Macmillan dictionary of modern economic defines government revenue as all money received other them from issue of debt liquidation of investments and agency and private truest transactions. Government revenue includes fat collections, changes and miscellanies revenue, utility, sale of alcoholic beverages and insurance trust revenue for all funds and agencies of a government. However, the 1889 constitution states under section 160 (9) that “revenue” means any government of the federation To any impartial observer, the problem of the power industry today are not so mush than those are generating and selling electricity. The problems are more related to the degree of economy the authority has, and the financial materials and manpower resources at its disposal Manpower shortage of trained manpower certainly are of the problems with which PHCN has to contend. As it is generally known, it takes time for a professional Engineer or Technologist to become useful and experienced after has academic qualification PHCN’S experience has been that, it is able to recruit staff at the co west level and put them through training programmes, but by the time they have acquired enough experience to carry responsibilities they cave PHCN for other more rewarding jobs in the private sector or surprisingly in other attractive parietals.
1.2 STATEMENT OF PROBLEMS
As there are many sources of revenue generation in PHCN, there are also management problems militating against effective collection and utilization of such resources. The impediment against such resources are
1. Inefficiency of meter reading
2. Delay in billing
3. Delay in dispatch of bills
4. Rampant vandalization of PHCN facilities
1.2 PURPOSE OF THE STUDY
The major purpose of this study is to create awareness of the problems of revenue generation in PHCN Enugu district and to evaluate such knowledge of great importance in PHCN.
1.To ascertain the extent to which inefficiency of meter erasing has effect on revenue generation in PHCN
2. To find out the reasons of delay in billing
3. To ascertain the extent to which delay in dispatching of PHCN bills affect the generation of revenue in the organization
4.To find out the extent to which rampant vandalization of operation infrastructure by some miscreants in the society affect the volume of revenue generation in PHCN.
1.3 RESEARCH QUESTIONS
1. To what extent has in efficiency of meter reading affected the volume of revenue generation in PHCN.
2. To what extent has delay in billing affected revenue generation in PHCN.
3. To what extent has delay in dispatch of bills affected generation of revenue in PHCN.
4. To what extent has the rampant vandalization of PHCN operational infrastructure has affected its revenue generation.
1.4 THE DELIMITATION OF THE STUDY
This work is limited to National electric power authority (NERA)currently known as power holding company of Nigeria (PHCN) It concentrate more or financial administration of PHCN as it regards to the problems of revenue generation in the organization.
1.5 SIGNIFICANCE OF THE STUDY
This research work will be of great importance to the following people as stated below:-
1. Firstly, the result will create serious awareness in the revenue generation department of PHCN .
2. It will serve as a source information as well as a guide to the administrative department of PHCN. Enugu district
3. It will equally serve as a source of information to several students and practioners who may embank on a similar or related topic.
4. 4. It strictly applied consumers of electricity will benefit from not suffering of unusual darkness as a result of vandalisation of PHCN property.
5. Finally, the suggestions and recommendation contained here in would help immensely in eliminating revenue generation problem it strictly applied on PHCN.
Problems of revenue generation In government owned companies:
Government-owned companies, often referred to as state-owned enterprises (SOEs) or government corporations, face several challenges when it comes to revenue generation. These challenges can stem from their unique organizational structure, political considerations, and operational constraints. Here are some common problems of revenue generation in government-owned companies:
- Political Interference: Government-owned companies are subject to political pressures, which can lead to decisions that prioritize political goals over financial viability. Political interference can lead to suboptimal pricing strategies, unproductive investments, and hiring decisions based on political considerations rather than merit.
- Bureaucracy and Inefficiency: Government-owned companies can suffer from bureaucratic inefficiencies due to a lack of flexibility and a complex decision-making process. Bureaucratic hurdles can slow down innovation, delay projects, and increase operational costs.
- Lack of Autonomy: These companies often lack autonomy in decision-making, as key strategic decisions may require government approval. This can lead to delays in responding to market dynamics and missed opportunities.
- Subsidized Pricing: Governments might require state-owned enterprises to provide essential services at below-market prices, which can undermine their revenue generation capabilities. This might be done to promote social welfare, but it can strain the financial health of the company.
- Limited Access to Capital: Government-owned companies might face challenges in accessing external capital due to concerns about political interference, lack of transparency, and poor governance practices. This can hinder their ability to invest in growth initiatives.
- Lack of Competition: In some cases, government-owned companies operate in sectors with limited or no competition. This lack of competition can reduce the incentive for innovation and cost-efficiency, leading to complacency.
- Misaligned Incentives: Incentive structures within government-owned companies might not be aligned with revenue generation and profitability. Employees may not have strong incentives to increase efficiency, reduce costs, or innovate.
- Underinvestment: Due to budget constraints or political priorities, government-owned companies might not receive sufficient funds for necessary maintenance, upgrades, and expansion. This can lead to operational inefficiencies and a decline in revenue generation capacity.
- Lack of Transparency: Transparency in financial reporting and decision-making processes can be lacking in government-owned companies. This lack of transparency can erode investor and stakeholder confidence, making it difficult to attract investment and generate revenue.
- Unfavorable Regulatory Environment: Government-owned companies can face regulatory challenges that differ from those faced by private sector counterparts. Regulatory constraints can limit their ability to adapt to changing market conditions and innovate.
- Ineffective Governance: Poor corporate governance practices, such as the lack of an independent board of directors, can lead to mismanagement, corruption, and inefficiencies that hinder revenue generation.
- Resistance to Change: Government-owned companies might face resistance to change from employees, labor unions, and other stakeholders who are accustomed to traditional ways of operating.
Addressing these challenges requires a combination of reforms that promote autonomy, transparency, efficiency, and accountability. Governments need to strike a balance between social and economic objectives while enabling state-owned enterprises to operate in a competitive and sustainable manner.