Public enterprise refers to a profitable business managed by the central government or local government for the purpose of public benefit. Public enterprise and private enterprise are similar as both pursue profitability but intrinsically different as the former is also concerned about public welfare.
Public enterprise is composed and managed in various forms. It is in the form of either a national enterprise, public-managed enterprise or special corporation depending on its owner. A discussion on the supervision and control of the nation related to the subject of this study is mainly about the special corporation. Special corporation refers to a corporation established by the country or local government for the management and operation of a specific public business.
Most ideally, public enterprise is organized and managed to create synergy effect by combining efficiency of private organization and accountability and public benefiting function of government organization. However if the foregoing ideal is tarnished, combination of inefficiency of government organization and private organization’s attribute of pursuing private benefit leads to various inconsistencies and problems.
Laws on establishment and operation of public institutions have many systems such as management disclosure system, management evaluation system, executive recommendation system and supervision by the government in order to observe the establishment purpose and promote public benefit. Such systems helped to obtain substantial achievements. However, there are some problems in those systems. For instance, the influence of the president and Minister of Strategy and Finance over organization and personnel affairs of public enterprise is very strong, and it is difficult to achieve objectivity and fairness in personnel affairs. This should be identified closely through theories and business affairs, and supplementary measures also be established to address those issues in the future.
Above all, there are no sufficient regulations that guarantee financial soundness of public enterprise. Deterioration in the management of public enterprise will eventually becomes a burden on the people and therefore a system that can prevent such consequence should be prepared. Privatization of public enterprises can be a measure for such problem. However, it is not appropriate to privatize the international airport as it is connected directly with national security and should be directly under the control of the nation and people.