10 Major Differences Between Public and

Private Administration
In order to get a clear and accurate idea about the nature and scope of public administration, it is
necessary to know the similarity and differences between public and private administration.
This article will help you to draw the dividing line between public and private administration.

In general, the concept of administration, whether public or private, is universal. If we understand

administration to mean cooperation in the conduct of business, then the presence of administration
is essential, whether in the private sector or in the public sector. Although the importance of
administration is recognized in both public and private sectors, the form and style of public and
private administration are not the same. There are a lot of differences between public and private
administration.

Differences Between Public and Private Administration

Points of
Public Administration Private Administration
Comparisons
Public administration refers to the Private Administration refers to the
Definitions activity of governmental activity of privately owned
organization or institution organizations or institution
Goals and Objectives Public welfare Maximisation of profit
Governed by the directors of the
Legal Framework Governed by a statutory law
organizations
Accountable to the people for its Only accountable to the owner of the
Public Accountability
actions organization
Freedom of Action Limited freedom of action Its freedom of action is much wider
Run by political direction and
Political Character Completely separated from politics
regulation
Approach Bureaucratic approach Egalitarian approach
Revenue or Income Taxes, duties, fees, etc. Seles of products and services
Scope Much wider in scope limited in scope
Question of control by Not controlled by any economic Fully depends and controlled by
economic interests interest economic interest
10 Major Differences between Public and Private
Administration [Details]
There are some key differences between public and private administration. Paul H. Appleby,
Herbert A Simon, and Peter Drucker have made a clear distinction between public and
private administration. They are –

1. Differences in the definition.

2. Differences in goals and objectives.
3. Differences in the legal framework.
4. Differences in public accountability.
5. Differences in discretion and freedom of action.
6. Differences in terms of the political character.
7. Differences in approach.
8. Differences in revenue or income.
9. Differences in scope.
10. Differences in the question of control by economic interests.

1. Differences in the Definition

When the word administration is used for government activities and organizations, it is called
public administration. (All government offices)

On the other hand, private administration refers to the activities of a private organization. (All
privately owned company or organizations)

2. Differences in Goals and Objectives

The purpose of public administration is to perform its functions keeping in view the interest or
welfare of the people. The success of government administration depends on the protection of the
public interest or the acceptance of the basic demands of the people. The prime goal of the public
administration is to implement public policy introduced by the government.

The private administration as a whole is not engaged in public interest. Here the administration is
employed according to the needs and interests of the management of a private or non-government
organization. The main goal of the private administration is to fulfill the personal aspirations of
the owner of that particular organization. So it can be said that private administration is a profit-
oriented administration.

3. Differences in the Legal Framework.

Another fundamental difference between public administration and private administration is that
public administration is governed by a statutory law, which is also created by a particular political
authority. Therefore, the activities of public administration are limited to the limits of this
particular law.
Although the administration of a private organization is governed by law, there is no obligation to
do so within the limits of the law. In the case of private administration, the director may change
the law if necessary.

4. Differences in Public Accountability

Public accountability is the backbone of public administration. The government is accountable to

the people for errors in public administration. The failure or success of the government depends
on the failure or success of the public administration. Public administration is directly accountable
to the government and indirectly accountable to the citizens.

On the other hand, private administration is not accountable to the people. Their prime goal is to
generate maximum profits.

5. Differences in the Discretion and Freedom of Action

The discretion and freedom of action of public administration is limited compared to the private
administration. The executive branch of the government directly controls public administration by
enacting several laws in the legislative branch of the government.

On the other hand, private administration is not controlled by the government. Its freedom of action
is wider than public administration. Its rule regulations are frequently changing in terms of their
requirements.

6. Differences in terms of the Political Character

The most important thing which differentiates public administration from private administration
is its political character. Public administration is run by political direction and regulation. The main
task of public administration is to implement public policies.

On the other side private administration completely separated from politics. There is no political
influence in the operation of private administration. Its functions are directed by market forces.

7. Differences in Approach

The bureaucratic approach is used for running public administration, but private administration
has an egalitarian approach.

8. Differences in Revenue or Income

The main sources of revenue of public administration are mainly taxes, duties, fees, etc. whereas
private administration generates their income from selling their products and services.

9. Differences in Scope
There is a big difference between public and private administration in terms of their scope. Public
administration is much wider than private administration. The citizen can get almost every service
from pubic administration like food, health facilities, education, communication, housing,
transportation, and so on.

But on the other hand, private administration deals with those sectors from which they earn profits.

10. Differences in the Question of Control by Economic Interests

Public administration is usually not controlled by any economic interest. As the goal of public
welfare becomes the main one, in the case of public administration, financial gain or profit-making
does not get special importance. The question of making a profit does not arise in the case of
police, defense, or government service activities.

On the other hand, the competence and efficiency of the administration of a private organization
are tested on how the administration can raise the financial goals of the organization.

Must-Read- New Public Administration: 4 Major Landmarks, And Principles

Similarities between Public and Private administration

While there are some fundamental differences between public and private administrations, there
is no denying that there are similarities between the public and private administration.

Many Administrative thinkers like Henry Fayol, M.P Follet, Luther Gulick, and Lyndall Urwick
deny the distinction between these two. According to them all administrative systems, it’s either
public or private administration they have to perform similar kinds of functions. The similarities
between public and private administration are-

1. Follow Same Principles

2. Training
3. Service-Oriented
4. As a Group Efforts
5. Facing Problems

1. Similarity in Functions

Both the administrations are governed by a number of general principles. Henry Fayol speaks of
14 principles, Luther Gulick calls this general principle as POSDCORB (Planning, Organizing,
Staffing, Directing, Coordination, Reporting, and Budgeting).

2. Training

Another similarity between the two administrations is that they provide appropriate training to
employees in need of special administrative experience and skills.
3. Service-Oriented

The activities of some private administrations like public administration can touch public life in
terms of service. Privately owned transport systems, power supply, etc. are as important as public
administration nowadays.

4. As a Group Efforts

In both the public and private spheres, the administration is a kind of group effort, where different
levels of employees execute a particular objective through mutual interaction or means.

5. Facing Problems

Both public and private administrations may face a number of specific problems such as decision-
making problems, problems in managing director-management relationships, problems in the
production or supply of consumer goods. However, the form and character of the problem may
vary depending on the field and the environment.

Must Read– Development Administration: Meaning, Features, and Challenges

Conclusion
From the light of the discussion on differences between public and private administration, it
can be concluded that there are a lot of fundamental differences between public and private
administration, but it is true that there are some similarities also.

Many emphasize the differences between public and private administrations, while others
emphasize the similarities between the two. The Public Private Partnership (PPP) is very important
today. Many things in public administration today can be achieved with the help of private
administration. That’s why Recently, the line between private and public concepts has not been
clear.

Judging by the necessity of the administrative system as a whole, it can be said that it is not possible
to have any real purpose in verifying the differences between the two or the errors of both. What
is needed is a joint effort of both private and public administration.

The goals and objectives of the government administration cannot be achieved without the help of
non-governmental organizations or private administration. It is possible to build a healthy and
strong administrative system through the skills, cooperation and coordination of both and this
environment is beneficial for both government and non-government organizations.