Public sector businesses - Part 2
Yvonne Harvey, Contributor

Tivoli Gardens competes against St. Andrew Technical High in this schoolboy hockey match at the Mona hockey field, on Tuesday, January 30. - Winston Sill/Freelance Photographer

Hi. This week we will continue with our look at the types of businesses in the public sector of a mixed economy by considering local authorities. This type of business is also known as local governments, parish councils, boroughs and municipal corporations.

Such entities are under the authority of the Parliament of the country. A minister of central government is put in charge of local government affairs. These bodies are set up to deal with matters of local concern. The councillor in charge is elected at local government elections by those who live in the area concerned and his or her powers, duties and functions are defined by an act of Parliament.

Each local government consists of a council with a chairman or mayor at its head. This chairman or mayor is elected from among the councillors and presides over the meetings of the council. He or she also represents the town or district on important civic occasions, such as the opening of a new hospital or sports stadium.

Where there are a large number of councillors, small groups called committees are formed and assigned specific tasks. They work at the 'grass roots' level in order to understand people's needs. These are presented at council meetings.

The powers of the local authority differ from country to country. However, in most countries, they are responsible for such things as water supply, drainage, sewerage, garbage disposal, street cleaning, community health services, maintenance of roads, parks, markets and gardens; cleaning of drains and gullies; bushing of roads; provision of fire services and poor relief, and the maintenance of sports facilities. These entities also oversee and report on projects undertaken in the community.

Financed through grants

The local authority is financed through central government grants, rates (property taxes) and loans. The central government ensures that the money is properly spent by employing auditors whose job it is to examine and check the accounts of the local authorities.

Local authorities play an important role in the commercial and economic development of the country.

Advantages

• The people at the local level have a say in what goes on in their community. Therefore, they actually participate in the decision making at this level.
  
  
• The input of the people helps to guide and shape the overall policies of government.
  
  
• Social, physical, economic, political and other issues are addressed at the local level.

Disadvantages

• The continuity of projects and activities is affected by a change of government.
  
  
• Resources are not always available; therefore, local authorities experience setbacks in their projects and activities.

Now, it is time to give you your assignment for the week.

(a) Define local authorities. (2 marks).

(b) Briefly describe the organisational structure of the local authority. (3 marks)

(c) Discuss ONE area that local authorities are in charge of. (2 marks)

(d) State ONE source of finance for local authorities. (1 mark)

(e) State ONE advantage of local authorities and ONE disadvantage of local authorities. (2 marks)

Total marks: 10

You should attempt this question after revising the information in this lesson, and after doing some additional reading on the topic.

Next week, we will continue to study public sector businesses. Have a good week.

Yvonne Harvey teaches at Glenmuir High School.