Business Studies

Short Answer Type Questions: Explain merits of departmental undertaking.


SOLUTION
Following are the merits of departmental undertaking:
  • Ease of formation: It is formed by the administrative decision taken by the government. It does not include any legal acts or formalities for formation.
  • Accountability: The department is fully accountable to the parliament
  • Control: The government has direct control over it which helps it to achieve government objectives effectively.
  • Social welfare: The objective of departmental undertaking is social welfare. Hence, it focuses on the economic growth and development by effective control over production and distribution of goods and services.
  • Less misuse of funds: Since the government oversees the expenditure incurred by the department, there is less misuse of funds.
  • Secrecy: Secrecy of policies are maintained as there is no one to question the policies or to reveal them. Hence it is best suited for organisations related to National security.
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