What is Public Sector?

The sector, which includes all those enterprises which are managed and owned partly or wholly by the Central or State Government by the Central or State Government is known as Public Sector. The Public Sector is the sector that is involved in the operations of supplying government products and services to the general public. The government owns, controls, and runs all enterprises, agencies, and bodies, whether it is central government, state government, or local government.

There are two types of public sector organisations: those that are wholly funded by the government by collecting taxes, charges, and fees, and those that are partially funded by the government by holding more than 51% of the total share capital of a corporation that comes under several ministries. The enterprises were founded with the goal of providing a service.

Some of them may be non-profit organisations, while others may also engage in commercial activity. Its primary goal is to provide goods and services to the general public at lower prices than private firms. Its primary goal is to ensure the general welfare of a country’s citizens. 

It is the major sector that aims to improve people’s lives by offering the following services :

  • Creation of new job opportunities
  • The postal service
  • Providing low-cost education and healthcare services
  • Providing security
  • Railway transportation services.

Difference between Private and Public Sector

Private Sector and Public Sector are two different types of sectors which include enterprises wholly and/or partly managed and owned by individuals and the Central or State Government.

Table of Content

  • What is Private Sector?
  • What is Public Sector?
  • Difference between Private Sector and Public Sector

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What is Private Sector?

The sector, which includes all those enterprises which are managed and owned by individuals or groups of individuals is known as Private Sector. The private sector is the section of the economy formed up of profit-seeking companies. Companies in the private sector face little state regulation and compete for the money of consumers....

What is Public Sector?

The sector, which includes all those enterprises which are managed and owned partly or wholly by the Central or State Government by the Central or State Government is known as Public Sector. The Public Sector is the sector that is involved in the operations of supplying government products and services to the general public. The government owns, controls, and runs all enterprises, agencies, and bodies, whether it is central government, state government, or local government....

Difference between Private Sector and Public Sector

Basis Private Sector  Public Sector  Meaning  The private sector is the section of the economy formed up of profit-seeking companies. Companies in the private sector face little state regulation and compete for the money of consumers. The public sector is the sector that is involved in the operations of supplying government products and services to the general public. The government owns, controls, and runs all enterprises, agencies, and bodies, whether it is central government, state government, or local government. Objective  The primary goal of the private sector is to earn profit from its business. The primary goal of public sector organisations is to carry out activities that benefit the general public. Capital source  Private sector firms obtain money from their owners or through loans, through issuance of shares and debentures, and other sources. Tax collections, excise and other taxes, bonds, treasury bills, etc., provide funding for public sector enterprises. Employee benefits  Private sector units provide advantages, such as higher salary packages, greater opportunities for promotion and recognition, a competitive workplace, and stronger incentives in the form of bonuses and other benefits. The public sector provides a wide range of employee perks, such as job stability, housing, allowances, and retirement benefits. Stability  Jobs in the private sector are not secure since poor performance might result in dismissal. Companies can also terminate employees in order to minimise costs or scale back operations. Jobs in the public sector are particularly steady and secure since the possibilities of being fired for poor performance are quite low.  Criteria of Promotion  Promotion criteria in private sector units are mainly based on the employee’s merit and job performance. The criteria for promotion in the public sector are typically dependent on employees’ seniority.  Concern Area Information technology, finance, fast-moving consumer products, construction, hotels, pharmaceuticals, and other major fields are within the authority of the private sector. Police, military, mining, manufacturing, healthcare, education, transportation, banking, and other major fields are within the authority of the public sector....