Advantages of departmental undertakings

Advantages

1. Provides easy information

It is easy to set up departmental undertaking. The departmental undertaking is created by an administrative decision of the government, involving no legal formalities for its formation.

2. Direct control over Parliament or State Legislature

The departmental undertaking is directly responsible to the parliament or the state government through its overall head i.e. the minister concerned.

3. Tax on the Public is lesser

Earnings in this department are paid into government treasury, resulting in the lesser tax burden on the public.

4. Tool for social change

The economic activity and social justice can be promoted by the government through departmental undertaking. It can be used by the government, as a tool for social change.

5. Avoid misuse of Government Treasury

The officers of the departmental undertaking are under the direct administrative control of the ministry. They are guided by the rules and regulations of the ministry, framed with a focus on public welfare.

6. Monitored by the rules and regulations of the Ministry

As the departmental undertaking is subject to the budgeting, accounting and audit procedures of the government, the risk of misuse of public money is relatively less