Case Study MS230

Public Services


Case authors

Professor Harpreet Kaur, PhD

Professor Simrit Kaur, PhD

Learning objectives

After you completed this course module, you will be able to conceptually solve holistic management problems within a case study of public services.


The Public Distribution System (PDS) in India is an important food subsidy program that distributes staple cereals—wheat and rice—and also kerosene, and sugar at subsidized prices to rural and urban households. Other items of mass consumption such as pulses, edible oils, iodized salt and spices are also distributed by some state governments through the PDS outlets. The PDS is an auxiliary program that provides only a part of the entire requirements of any or all of the commodities under its purview. Both the central and the state governments share responsibilities with regard to the functioning of the PDS. The central government (through the Food Corporation of India, FCI), is responsible for the procurement, storage, transportation and bulk allocation of food grains to the state governments. The state governments in turn are responsible for the identification of eligible families, issue of Ration Cards and supervision of the operation of Fair Price Shops (FPSs).

Workload units 2


Some introducing thoughts on the public sector

As a global market, the public service sector accounts for a large portion of the worldwide economy. This market is large and diverse, and is made up of many types of different public service agencies and organizations. Some examples of public service agencies include police and fire departments. pubic libraries, and public works and maintenance departments, to name just a few. The main purpose of the public service sector is to take money provided from government funds and put it to use in ways that benefit the public at large. This economic sector is, however, vastly more complicated than that.


Funding for the Public Service Sector

To get a clear grasp of the inner functioning of the public service sector, it is necessary to first understand how it is funded. While funding varies by municipality, province, and country, the most common method for funding public service agencies is the allocation of money collected as taxes. When this is employed, the agencies to receive funds are given a specific budget by the government body which is providing the funding. The balance of that budget is then given to the agency once collected in the form of taxes. In many places, this type of funding is combined with private donations. From the funding standpoint, the goal of the agencies and their government budgetary overseers should be to have a balanced budget that does not rely on private donations in order to operate. When private donations do come in, they can be used to purchase extra equipment or fund expansion of that agency's workforce. However, the agency or institution should, ideally, be able to function without such donations.


Staffing of Public Service Institutions

While exact staffing practices can vary between regions and agencies, there are two primary staffing practices for public service organizations. Under one practice, employees are hired directly to work for the agency in question. In the other practice, outside contractors are hired to perform the tasks of the public service agency. Each practice comes with its own series of advantages and disadvantages, and it is common practice for the staff of a public service organization to be a mixture of permanent employees and specialized contractors retained to perform specific tasks when needed.


Administration of Public Service Agencies

The running of public service agencies can vary widely between agencies, and will also differ significantly country to country. There is, however, a general structure that is implemented in most instances. Usually, an internal administration will handle most of the day to day operations of the agency. In addition to this, administrators from the governmental body which provides the funding to that branch of the public service sector will also provide oversight and direction for larger goals and decisions. In most cases, the function and long term goals of any public service organization are decided upon by the governments that provide the funding.


Different Levels of Public Services

Just as there are different levels of government, there are different levels of public service agencies under those governments. Municipalities are usually responsible for all local public services, such as medical transport, law enforcement, and public works. Provinces or states tend to have less direct involvement, though it is common practice for them to maintain a more cohesive law enforcement agency, as well as provide for maintenance of large highway systems. National governments also participate in the public service sector. In many countries, the national government provides oversight for the lower levels of public services, maintains a national police force, and does little else within the public service sector. In other countries, however, the national government takes an active role, complete with its own public service organizations at the national level. It is also not uncommon for a secretary or minister within the national government to be assigned to oversee and administrate all levels of a particular type of public service, such as public housing or welfare assistance.


Relationship Between Government and the Public Service Sector

As can be seen, the public services sector and government bodies have a strong relationship to one another. Government provide tax revenues to the public service sector, which in turn takes care of many of the broader needs of the public at large. Government agencies are responsible for ensuring that the public service organizations which report to them are carrying out their tasks, as well as making good use of the funds provided to them. In most countries, this relationship is also affected by the people themselves in the form of the electorate. Usually, major changes to the structure of public service organizations and the services they provide will be introduced as a referendum during a normally scheduled election. These referendums give the public a chance to provide feedback on the services which their tax revenues are paying for.


Public Services as a Global Market

Within the larger context of the global economy, the public service sector is a massive market. While global trade of public services is rare, each and every country on earth allocates at least a part of its budget to the provision of public services. As such, this market continues to attract employees on all levels, as the jobs are reliable and will always be relevant. The public service sector also has a large impact on national economies. Funds that are spent on public services find their way back into the free market, thus stimulating the economy of that country. In the more global sense, public services have a significant economic influence, albeit an indirect one. As one of the more costly programs implemented at national levels, national public service funds are often supplemented with bond loans. These bonds allow international investors to loan money to national governments, with the promise of interest on their investment. In this manner, the public services sector has at least some effect on the global bond market.



As can be seen, the public services sector of the world economy is a large and complex creature. The structures described here will vary according to location and the type of public service agency in question, but should provide at least a general guide to their internal workings and their relationships to governing bodies. For the career minded executive, the public service sector is an appealing opportunity, due to its future growth potential and ensured stability. For more information on specific public service agencies and their working, it is advisable to consult with the governing body overseeing that agency.


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