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TRANSCRIPT
University of Nigeria Research Publications
AMALIME, Sylvia Ebele
Aut
hor
PG/MBA/97/20690
Title
The Impact of Privatization and Commercialization Policy in Nigeria :An Assessment of Nigerian
Telecommunications Ltd
Facu
lty
Business Administration
D
epar
tmen
t
Management
Dat
e
March, 2004
Sign
atur
e
UNIVERSITY OF NIGERIA
- - - -
" t a g
KING LAZ BINDERS #9 College Road, Ogui New Layout, Enugu.
THE IMPACT OF PRIVATISATION AND COMMERCIALISATION POLICY IN NIGERIA
AN ASSESSMENT OF NIGERIAN TELECOMMUNICATIONS LTD.
AMALIME SYLVIA EBELE PGIMBA/97/20690
A RESEARCH PAPER PRESENTED IN PARTIAL F'UILF'ILMENT OF THE REQUIREMENTS FOR THE
AWARD OF THE MASTER OF BUSINESS ~ ~ m - 1 4 9 &A) DEGREE IN
MANAGEMENT OF THE UNIVERSITY OF NIGERIA, ENUGU CAMPUS
SUPERVISOR: PROF. AGWU AKPALA DEPARTMENT OF MANAGEMENT FACULTY OF BUSINESS AND ADMINISTRATION, UNIVERSITY OF NIGERIA ENUGU CAMPUS.
THE IMPACT OF THE PRIVATISATION
AND
COMMERCIALISATION POLICY
NIGERIA - AN ASSESSMENT OF NITEL LIMITED
CERTIFICATION
AMALIME SYLVIA EBELE a postgraduate student of the
Department of Management with Registration Number
PG/MBA/97/20690 has satisfactorily completed the requirements of
the course and research work for the award of Masters Degree in
Business Administration.
The work embodied in this report is original and has not been
submitted in part or full for any other Diploma or Degree of this or any
other University.
$;!$& I
F. EWURUM Department
iii
DEDICATION
To Daddy with love,
And 'To,
Walter, Elijah and Junior.
ACKNOWLEDGMENT
It is necessary that I express my gratitude to all, who in one way or the other
contributed in making this work a success.
My special thanks go to the Almighty God for his Abundant Grace and Love.
To Mr. D, Uwaifo who crossed every 't' and dotted every 'i' in chapter one
and whose continuous support, advice and inspiration has liAed me higher.
Mr. Matthew Chuwang, a senior manager with NITEL LTD for putting up
with my ceaseless request for the information used in preparing this thesis.
I am indebted to my Supervisor Professor Agwu Akpala and his wife
Barrister (Mrs.) Sylvia Akpala for the guidance and love they showed to me.
I cannot stop thanking my uncle and his wife, Mr and Mrs. P. C. Madidi for
the parental love they showed to me throughout my academic career.
I am also using this opportunity to express my profound gratitude to my
mother Mrs. Beatrice Amalime for her ceaseless prayers on our behalf and for
bringing us up in a special way. Also, my gratitude goes to courage Arnalime
for being the best companion in school and other Amalimes, you are fondly
remembered.
PREFACE
The central focus of this research work is to determine the impacts of the
privatisation and commercialisation policy in Nigeria An assessment
of NITEL.
This study has five chapters. Chapter one discusses the histoly of public
enterprises in Nigeria, the Nigerian experience of the privatisation and
commercialisation policy, the background of NITEL Ltd and how it was
affected by the commercialisati~n policy. It also highlights the objectives and
import'mce of the study.
Chapter two reviews the related works of different authors and researchers on
the subject and drew meaningful contribution from them for a better
understanding of the work.
Chapter three highlights the research methodology employed in carrying
out the investigation and in determining the sample size used. Here
questionnaires were drafted and distributed.
Chat-' lour deals with the most task bjf the study. It involves the
, w and analyses of data received from the respondents, testing of the
hypothesck . ond drawing meaningful conclusion from them.
Chapter five concludes the study by highlighting the summary of the findings,
recommendations and conclusion.
vii
ABSTRACT
The history of public enterprises in Nigeria dates back to the time of thk
colonial masters. To facilitate their business activities and administrations,
the colonial government undertook the provision of roads, telephone and
postal services, railways, coal, law and order, public safety and so on.
Later, after Nigeria's independence in 1960, the Nigerian government faced
with the problem of under-development also invested directly in industries
and was also involved in the management of the resultant finns for the
purpose of influencing all the sectors of the economy towards rapid industrial
and technological growth. The oil boom of the 1970s further improved these
investments in public enterprises such as NITEL, NEPA, Ajaokuta steel
complex, Nigerian Railway corporation and so on.
However, most of the public companies established to aid industrial and
technological development in the country failed to accomplish the purpose
for which they were set up. Rather, they became 'Sick babies' of the
economy. Thus what started as a theoretical justification for public
intervention ends up in the re-establishing of what is to be reformed or
vi i i
divested.
In line with this, the Federal Government of Nigeria in 1988 announced the
Privatisation and Commercialisation Policy as a reform strategy for ailing public
enterprises. Also in 1998, the government of Nigeria at that time revisited the
Privatisation and Commercialisation policy as a strategy to further improve the
Nigerian economy.
The need to determine how far the strategies have been used to improve our economy
precipitated this research work. To do this, a critical assessment of NI'TEL LTD was
made.
In the cause of this investigation, it was discovered that, Commercialisation policy
has benefited NITEL greatly.
Apart from expanding its Network NITEL has been able to improve the quality of
services provided to customers, generated more revenue and also improve the
working condition of their staff.
With the success of the Commercialisation policy, it is evident that the Privatisation
prograrnm in view will fb-ther improve their operation.
TABLE OF CON --- TENTS
PAGE NO
Title of Research ................................................................. ........................................................................ Certification
................................................. Dedication ................... .. Acknowledgement ............................................................... Preface .......................... ... .. .. ........ Abstract ............. ... .......................................................... Table of contents ..................... .. ..... .... ...............................
CHAPTER ONE:
1.0 Introduction .......................................................... 1.1 Public Ownership in Nigeria: Historical Excursus
1.2 Privatisation and Commercialisation - The Nigeria
........................................................... Experience..
1.3 Statement of the Problem ....................................... ............... ............... 1.4 Objectives of the Study ......
1.5 Importance of the Study .......................................... ............................ 1 .G Historical Background of Nitel
1.7 Commercialisation Policy: The Nitel Experience
CHAPTER TWO:
2.0 Literature Review .................................................... 2.1 Synthesis of the Privatisation and Commercialisation
.................................................................... Concepts
2.2 Analytics of Privatisation .......................................
1
ii
iii
iv
v
vii
ix
................. 2.3 Arguments for and against Privatisation
CHAPTER THIUE . Research Methodology ........... .. ..........................
...................................... Methods Employed .... ....... Scope of the Study ..................................................
............................................................. Population
Sample Size Determination .................................. Method of Analysis ................... .. ........................ Limitation of the study ...................................... Hypotheses Formulation .......................................
CHAPTER FOUR . ......................... 4.0 Presentation and Analyses of Data
............. 4.1 Analysis of Questionnaire from Nitel Staff
........ 4.2 Analysis of Questionnaire from Nitel Clientele
4.3 Testing of Research Hypotheses ................................
CHAPTER FIVE . ............. 5.0 Summary Kecomnlendation and Conclusion
................................................. 5.1 Summary of Findings
.................................................... 5.2 Recomnlendations
................................................................ 5.3 Conclusion
............................................................ Appendixes
Bibliography .............................. .. ..................... Questionnaires .....................................................
CHAPTER ONE
1.0 INTRODUCTION
Falling export revenue in many developing countries is severely hampering
their ability to finance recurrent needs. Devaluation and other austerity
measures have had little impact.
Loss-making companies have further compounded the government's fiscal
needs. Strong voices opposed to the government's continuing participation
in the financing and running, of such companies have touted their surrender
to private ilidividuals or groups. The government of Nigeria on its own part
is determined to correct this econoiilic imbalance by building a truly market
driven economy. According to the 1998 budget, the following were among
the objectives for the 1998 fiscal year'.
* Expanded production
* Improvement of Social and Econornic Infrastructure
* Improved revenue generation \
* Human capital development.
To achieve these policy objectives, the following strategies were adopted:
2
Guided privatisation of the existing state owned enterprises; economic
liberalisation: Commercialisation and so on. It was believed that if these
strategies were well implemented it will not only make the country a member
of the global economy but will launch it into the league of developed nations.
Today, comn~ercialisation and privatisation appear to be the panacea public
companies require to be efficiently turned around and become profitable.
Before we go into details on the benefits of these strategies, let us briefly
examine the history of public ownership in Nigeria.
1.1 PUBLIC OWNERSI-111' IN NIGERIA: HISTORICAL
EXCURSUS
The basis for the intervention in Nigeria has varied from time to time.
During the Labour Government in Brazil after world war 11, the colonial
government in Nigeria adopted the Labour Party's ideological basis for
government intervention. There were, historically, some undertakings
inherited as government responsibilities from the colonial era, such as roads,
telephone and postal services, railways, coal, public safety, law and order.
3
The government also son~eti~nes intervened in production as a result of
perceived imperfectioos in the market or as a result of market failure or to
reduce the strong inequalities in the distribution of income and wealth or to
reduce the perceived exploitation of the consumer or of the worker. In
agriculture, for instance, which shows the classical example of perfect
competition, the producer appeared so weak against the operators in the
world market that the state had to intervene to protect him by organising the
market for his export commodities. This perception led to the establishment
of marketing boards which served their purpose to cushion the peasant farmer
from the vagaries of price fluctuations in the world market.
Later, after Nigeria's Independence in 1960, the country faced the problem
of addressing its economic under-development. The priority of the
government then was to influence all the sectors of the economy towards
rapid industrial and technological growth. Hence, the government invested
directly in industries and was also involved in the management of the
resultant firms. 'I'lius, post colonial governments added electricity, shipping,
airlines, iron and steel, publishing, radio and television. The Nigerian
4
government therefore, intervened in direct product of some goods and
services in part froni colonial heritage and in part on casual empiricism.
Following the oil boom in the early 1970's the government stepped into the
production of goods such as textiles, leather and dairy amongst others,
because indigenous entrepreneurs were not yet ready to undertake the
investment needs of the country. Again, activities that appeared too complex
or required investment well beyond the capacity of local indigenous
investors, seemed viable only if either foreign investment was forthcoming
or government took up the challenge by investing directly in such
undertakings. Examples: Ajaokuta Steel Complex, Delta Steel, River Basin
Developnlent Authority, Northern Nigeria Development Corporation and so
on.
Also, during this period, the government moved into an assortment of
activities like hotels, superniarkets, long distance road transport even while
private domestic investors were ready to enter same activities.
5
For whatever the reason for direct government intervention, the outcome
was, in most cases, either the establishment of a government nlonopoly
which, in time, created more imperfections in these markets or the
establishment of grossly inefficient facilities such as NEPA, NYTEL . . . . . . . . . .
that became white elephants. According to Professor Pita Ejiofor, "these
public enterprises have remained the sick babies of the economyN2. 'Thus
what starts as a theoretical justification for public intervention ends up in the
re-establishing of what is to be eliininated.
Some of the key features wllich militated against the success of these public
owned enterprises include nonchalant attitude of staff towards work,
persistent losses of very high magnitude, large scale fraud at all levels of the
organisations, high degree of inefficiency, nepotism, tribalism, hazy
objectives, inconsistency in policy administration, poor strategic and tactical
planning habits, excessive intervention by controlling government ministries,
poor budgeting and implementation system and nlanagerial myopism.
In its effort to improve productivity and rescue the deteriorating performance
of these firms, the government often had to change the board of directors,
6
increase the subvention level to them on several occasions and retired or
dismissed some of the unproductive or erring members of staff. In addition,
the government took other rnore far-reaching decisions aimed at making some
of its enterprises stand on their feet. For instance, the federal government
handed over the management of Nigeria Airways to a Dutch Firm, KLM,
under a three year agreement and the Nigeria11 Railway Corporation to an
Indian Firm3. These agreements, having been completed, and the foreign
technical partners gone, the companies went back to the woods, hence, one
call say that some key people involved in the management of these firms
were incompetent in carrying out their assignments.
As a result, eminent scholars, seminar groups, economic watchers and other
well meaning Nigerians have arguably called for Privatisation and
Commercialisation as the panacea to the problem. Even the Central Bank of
Nigeria lent its voice to this call4.
Why has privatisation and com~nercialisatio~i suddenly become so topical?
Business Management all over the world requires a set of skills and attitude
7
different from those required by civil administration as a result of
competition. In the past 15 years, most public discussion has stressed the
perceived advantages of privatisation and the consequent need of the
government to divest in business. To them, the benefits of a private sector-
led economy are numerous. The process promises more injection of foreign
capital, improved efficiency, new technology, better nlanagement skills,
increase in the level of foreign direct investment and the general
improvement of the economy.
Encouragirrg reports of some recently privatised infrastructure in African
Countries, other developing nations of Far East and South America also go
a long way in confirming that Nigeria is on a pathway to economic
development by opting for privatisation. The reports of the International
Bank for Reconstruction (World Bank) on SODECI, a privatised water
producer in cote d' ivoire, Cellular telephony in Ghana and the Water Sector
experience in Argentina justify this optimism. SODECI got the right to carry
out all construction works with a value of less than CFA 80 Million. 'Today,
SODECI is a success story. It provides close to the standard of industrial
8
countries at a cost to consumers which is no higher than the neighbouring
countries with similar economic condition. 'The company has also paid taxes
since its inception. 'I'hese reports show that a privatisation programme that
is well implemented in Nigeria will meet our economic needs. Only then can
a sudden change from an inefficient to a cost effective profit oriented system
can be achieved.
1.2 PHIVATISATION AND COMMERCIALISATION - THE
NIGERIAN EXPERIENCE:
The privatisation and comnlercialisation policy in Nigeria was formally
announced on the 6th of July, 1988 under decree No. 25 which is a
supplement of the official Gazette Extra Ordinary No. 425. This was part of
the St~uctural Adjustment Programme (SAP) announced by the federal
government in 1986. The federal military government at that time,
established a Technical Comni ttee on Privatisation and Commercialisation
(TCPC) now Bureau for Public Enterprises (BPE) which was charged wit11
the responsibility of ensuring a thorough realisation of the objectives of the
government in enacting the privatisation and commercialisation decree No.25.
Some of the ob-jectives of the PLeC policy include:
- To restructure and ratiorralize the public sector in order to lessen
the dominance of unproductive investment in the sector.
- '1'0 ensure positive returns on public sector investments in
commercialised enterprises.
- To check the absolute dependelice on the federal treasury for
funding by commercially oriented parastatals, and so encourage
their approach to the capital market.
- To initiate the process of gradual shift of public enterprises to the
private sector which can best manage such
enterprises,(TCPC 1988).
. . Since 1988, Nigeria has been experimenting with privatisation &
commercialisation under the umbrella of the BPE. Apart from the defence
related enterprises, some 574 state owned enterprises were identified, out of
which 111 were marked out for full or partial privatisation and divestiture
and 34 for full or partial conlmercialisation. By July 1993, 87 enterprises
had been privatised covering banking, oil marketing, cement, hotels, textiles,
insurance, colr i l engineeri
beverages et cetera6.
10
and livestock, food and '
The rest of the 11 1 enterprises, lumbering 24, were deemed to be in such
poor technical condition that they needed to be upgraded before any further
action could be taken. These covered cement, newsprint, rolling mills,
sugar, vehicle assembly, airlines etc. 'I'lte 34 earmarked for
commercialisation were engaged in security, printing and minting, railways,
ports, coal, iron and steel, housing, con~mu~~ications, television and radio and
SO on.
Taking a cue from the federal government divestment, many states followed
the same pattern by reducing their holdings in state owned companies and in
some instances, total relinquislunent. For instance, Anambra State, (then
made up of the present Enugu and Anambra States) divested in Premier
Breweries Ltd. Onitsha, Nigeria Mineral Water Industry and Orient Bank of
Nigeria Ltd. Plateau State Privatised the Kuru livestock Complex, Sokoto
State sold its equity holdings in three of its companies to the public, Imo
11
State (then made up of the preselit Imo and Abia States) reduce its holdings
in Imo Newspapers Ltd, Golden Guinea Breweries Ltd and Resin Paint
Industry Ltd and so on.
Having carefully analysed the history of public ownership in Nigeria, how
the privatisation and con~mercialisation programme was initiated in Nigeria
as well as the objectives of the policy, this research now aims at identify the
impact on the performance of government owned companies using the
Nigeria Telecom~nuliications Ltd as case study.
1 .3 STATEMENT OF THE PROBLEM:
The experiences of the Nigerian owned public enterprises over the years have
shown that the objectives for which these government owned companies were
set up have been largely unacconiplished, the issue now becomes how to
solve these problems facing the companies and to determine the extent which
the privatisation and cornnlercialisation policy in Nigeria has reduced or
solved the problems The following key questions therefore become relevant.
(i) Can the problems of government owned companies be solved
thrt: inlisation and privatisati~
(ii) Whatt . , i i l part or total selinquisluuent 01 ! itilly owned
by the government and its agencies have on the problem of
inefficiency as well as the Nigerian economy as a whole.
(iii) What will be the long and short-term impact of the re-
organisation of the government owned companies as profit
making venture to staff welfare, on services provided, on profit
and the Nigerian citizen as a whole.
The following Research Questions were used in carrying out the study.
Has the performance of privatised .and commercialised
government owned companies improved or otherwise since after the
exercise.
With specific reference to NI'I'EL Ltd, how has its performance
fared since after comtnercialisation.
What are the long and short-term benefits of privatisation
to the private investors.
What are the expected roles of the government after such
privatisation am1 coniinercialisation programme in order to ensure
the realisation of the desired objectives.
1.4 OUJECTIVES OF W E S?'UL)Y:
The aim of this study is to assess the effects of the privatisation and
commercialisation policy on government owned companies taking NITEL Ltd
as a case study. The following are the specific objectives the research is
designed to achieve;
(i) To determine if NITEL Ltd has improved in its operations in terms of
service to customers after co~~lniercialisatioi~.
(ii) To determine the financial benefits that has accrued to NITEL
after com~nercialisation and what further improvement is possible after
its privatisation.
(iii) To what extent has this commercialisatio~i exercise improved staff
welfare and what are the likely benefits to them after privatisation.
(iv) To determine what the government and the Nigerian citizens stand to
gain from the privatisation exercise.
(v) To determine the effect of the privatisation and commercialisation
exercise 011 the Nigeria economy as a whole.
1.5 IMPORTANCE OF TI-IE S'I'UDY:
Liberalisation, privatisation and co~nn~ercialisatior~ were among the strategies
adopted by the Nigerian governnlent in 1988 towards restructuring and
improving the revenue generating capacity of the nation. These strategies
were experimented on between 1988-1992.
In 1998, exactly Ten year after, the administration of the Late General Sanni
Abacha re-affirmed the adoption of these strategies to further improve the
economy.
From the experience of NITEL, we shall determine if the strategies above are
the panacea required by the Nigerian public corporations towards
restructuring the economy.
1.6 HISTORICAL BACKGROUND OF THE NIGERIAN
TELECOMMUNICATIONS LIMITED
Prior to 1985, communication activities in Nigeria were undertaken by the
15
Post and Telecommunicatio~is (PStT) department of the ninistry of
communications and the Nigeria External Telecom~nunications Limited
(NET). While the P&T had the responsibility of providing facilities for
domestic telecon~mu~~ication services as well as the switching and
transmission of conununication within Nigeria, the NET was concerned with
providing communication links between Nigeria and the international
communities.
However, between 1979-1981, the Nigerian economy started experiencing a
down-turn in its activities, with progressive decline in revenue generated as
a result of the falling price of oil (the main stay of the economy) in the world
market, the federal government thus decided to rationalize and streamline its
expenditure by merging parastatals with similar functions in order to:
eliminate the duplication of duties found in them: cut down on the cost of
runniilg such parastatals and reduce goverrunent expenditure. This strategy
led to the merger between P&T and NET to form NITEL LTD in 1985.
Nitel Ltd took off as an enterprise with the purpose of providing, developing
16
and maintaining cfficie~lt and effective telecoinmunication services to meet
the needs of the nation. According to NITEL Corporate Profile (1993), the
mission of the organisation is stated as follows:-
"our mission is to maintain our leadership position by continuously
improving our services to meet our customers needs and expectations,
thereby allowing ourselves to prosper as a business and provide an adequate
return to our stakeholder"'. To achieve this mission, the following strategies
were adopted:
- Network expansion
- Facility modernization
- Improved staff welfare
Hence, NITEL became the sole provider of telecommunications services in
Nigeria.
With the promulgation of Decree 75 of 1992, NITEL's monopoly in
providing telecommunications services was broken. The Nigeria
Communications commission (NCC) was set up under the decree to monitor
the deregulation programme and to provide operating guidelines to the
17
telecomn~unications vendors and service providers. With this decree NITEL
LIMITED became COMMERCIA1,ISED IN 1992 and it was removed from
the clutches of bureaucratic/political strings which hampered the growth of
the telecon~munications sector in Nigeria.
ORGNISATIONAL STRUCTUKE OF NI'I'EL:
The company operates a three-tier organisational structure comprising its
corporate headquarters, five zonal offices and 32 territorial administrative
offices. A Board of Directors responsible for developing and determining the
basic objectives and broad polices of the company is at the first level of
management while the day-to-day administration is carried out by the
management team headed by the Managing DirectorIChief Executive Officer.
The last two tiers are administered by Zonal and Territorial Management
Team with some level of autonomy. The whole enterprise is under the
supervision of the Ministry of Communications.
I MD/CEO AND HQ EXECUTIVES I I I I - -
GM GM GM GI,I SE ZONE SW ZONE NE ZONE NI.!
Note: SE = South East
SW = South West
NE = North East
NW = North West
SERVICES OFFEIUD BY NITEL LID:
TELEPHONE SERVICES:
Telephone
Telephone with International Direct Dialling (IDD) facility
Public Pay Phone
Call Office and Public Canteen Services
Operator Assistance Services
Operator Information Services
Emergency Services (eg. Police and Fire).
TELEX SERVICES:
* Domestic Telex
* International Telex
* Telex Delivery Services (TDS).
TELEGRAPH SERVICES:
* Telegraph (Domestic and International Telegraph)
* Registered Telegraphic Address (R'TA)
* Phonogram
LEASED CIRCUITS:
* Private Wire
* Alternate Voice Data
* Transmission and Reception of Real Time
* Television for Network Programn~es.
OTHEK SERVICES:
* Voice Cast and Press Reception
* NIFAX Services
* Training of Telefax and PBX Operators
* Pal-Secam Tape Conversion
* International maritime Satellite Service
* Electronic Mail (National Service Only)
* WordIData Processing
* Teleconferencing
* Collect Calls
* Cellular Radio Telephone
* International and Local Card Pay Phone.
With the removal of NITEL from the civil service system and the re-
organisation of the management for higher challenges and aspirations, the
first stage of the creation of an enabling environmeilt for the industry was set
in motion.
To appreciate the comnlercialisation policy, let us examine how it has
affected NITEL so far.
1.7 COMMERCIALISATION POLICY - TIIE NITEL
EXPERIENCE
Prior to NITEL's coimiercialisation in 1992, the organisation was managed
like the civil service in every respect. It was directly under the supervision
of the ministry of co~nrnunications who monitors and directs its activities.
Major decisions and policies were passed down from the ministry to the
management team of the company. As a result, the company's activities
22
were characterized by delay in decision making, inconsistency in policies
formulated, bureaucracy, limited range of services provided as a result of the
analogue system employed, the use of obsolete equipment in the switching
and transmission of inf'or~nation from one place to the other, excessive
dependence on the government for financial support and so on.
However, after its commercialisation, the board of directors and the
management team had more autonomy to make independent strategic and
tactical decisions affecting the organisation.
Also, the changes in the telecon~munications/equipmei~t sector characterized
by government deregulation, digitalisation of exchanges, new transmission
techniques, computerization and miniaturisation necessitated the need to
expand and modernize equipment. Hence, the company embarked on
programmes and activities that rapidly expanded their network, it also went
ahead to introduce new services that enhanced customer's use of the
facilities. The company spent over BJ 100 billion between 1992 and 1997 for
network expansion and modernization without recourse to government
23
subventions. The telephone-line capacity was increased from about 450,000
lines in 1990 to about 700,000 in 1997.
It was impressive to note that the conlpany introduced the application of the
hi-tech and ultra-modern automatic digital technique in cominunication to
meet the demand of the rapidly expanding and dynamic business
environment, as against the analogue system which was characterized by
delay dialling tones, difficult connection between exchanges, limited
telephone facilities available to subscribers et cetera. The digital system on
the other hand, does not only facilitate easier and better communication from
one end to the other but also satisfy the specialised needs of individuals and
corporate bodies such as banks, oil firms, manufacturing companies,
educational institutions, defence, government offices, newspaper houses
among others. To ensure customer satisfiiction, NITEL installed modern and
automatic digital satellite earth stations and the accompanying international
telecommunication switching centers (I'I'SC) in three different locations
within the country. These projects were coinmissioned in Lagos on the 12th
of December, 1992, 23rd August, 1993 at Enugu and more recently 26th of
24
May, 1998 at Kaduna8. These facilities receives, process and transmit
telecoinmunication services within Nigeria and between Nigeria and other
countries of the world.
Besides these digital facilities, NITEL, is also spending multi billions of naira
in rehabilitating, upgrading and modernizing their existing facilities. One of
such projects in the area of transmission upgrade, was the execution of the
multi-state, multi-purpose Lagos - Escravos - Forcados - Warri - Port
I-Iarcourt - Enugu - Calabar Fibre optic Submarine Cable System located in
Victoria Island, Lagos9. This project is capable of transmitting voice, data,
video and other needs of the sector well into the coming century.
Also, world economies are integrating and merging to the extent that without
adequate business relationship and sustainable telecornmunicatio~~s
infrastructure such globalization of resources will not take place. In line with '
this, NITEL, is investing funds in order to ensure that Nigeria participates
in this trend. Hence, the company is providing internet facility with an
initial capacity of 5500 pots and it is expected to cost DM 5.2 Million, and
25
Lagos will serve as the Internet gateway for International Connectivity1'.
Perhaps the most significant change in NI'TEL after its coinmercialisation is
the revenue generation and collection method. Unlike in the old system
where the mode of revenue generation and collection was so loose that a
subscriber could abandon a telephone-line after accruing as much as
thousands of naira or more, and then, apply for a new line which may be
granted to him without attracting any punitive measure to retrieve the debt,
the new system employs strict and timely collection of revenue for services
provided. To improve on this, the company embarked on the On-Line
Billing project that will give customers their credit status at any point in time
as well as aid the company's revenue generation and collection efforts. This
measure no doubt has paid off considering all the projects embarked on by
NITEL between 1992-1997 without recourse to government subvention or
loans from local or foreign organisations. More to this, the company's
journal revealed that:
"The revenue of the company has grown systematically
since its conunercialization in 1992. For example,
in Ju~le of that year, NI'1'EL's revenue rose by about
200% and by the elid of that year it went up by another
300%, while by May 1994, it had reached 400%. In the
same way, between January and June 1995, the company's
revenue rose by about 33.5% from the 1994 figures"".
Staff welfare also received due attention as a means of motivating the staff
to higher productivity. The company's con~pensation package was
restructured to include monetised fringe benefits and enhanced salaries.
According to the Mallaging Director and Chief Executive of NITEL, Prof.
Buba Bajoga; "only recently, 50 new air-conditioned buses were added to the
staff bus fleet to bring the number of buses in the fleet to 162 while staff
remuneration was reviewed upwards"12. To reward staff who perform
excellently, the company in 1998, planned to re-introduce the national merit
award at all levels. This will boost the morale of workers and motivate them
towards productivity.
In the area of medicare delivery system, the medical and industrial health and
27
safety depwtu~ent was able to ir~crense the levcl of safety consciousness
amongst staff and educated the members of staff on the use of portable fire
extinguishers and in the institution of patient drug profile thereby reducing
treatment failure and drug abuse. In short, the management is doing its best
to ensure and sustain adequate and efficient health care services to the
company's staff nation wide.
The experience of NITEL would be incomplete without mentioning the co-
operation and arm of friendliness which the company extended to the
Private Telecoinmunications Operators (PTOs). NITEL did not only put
up the building which would house the necessary technical equipmentloffice
for the physical link with PTOs but also worked hard to ensure that a cordial
relationship exist between the company and the seven PTOs that have signed
interconnectivity agreeineilt with it.
The Deregulation exercise so far, has ushered in the following PTOs to
compete with NITEL in the Telecommui~ications Industry. They are: Multi-
Links, EMIS, Inter cellular, ITN, Bourdex, VGC and Mobitel. Very soon,
according to the 1998 budget NI'rEL, shall be privalisetl.
In conclusion, with the deregulation of the sector, the con~mercialisation of
NITEL and its feat and the privatisation programme in view, a competitive
and commercblly robust telecornn~unicatioils environment would evolve.
This will contribute to the irnprovenlent of the Nigerian economy in general.
flOTES AND REFERENCES
1. Late General Sani Abacha Budeet Speech Business Times,
February 15, 1998.
' 4 . . 2. P. N. 0 Ejiofor e Our Or~anlsatlons Perform"
Anambra State Public Service Lecture
Series No. 2, October 1984
3. Central Bank ofNi~eria Annual Report 1983,
4. Ibid
5. A Keynote Address by the Managing Director and Chief Executive of
Bank of Credit and Commerce International (Nig). Limited at the 7th
National Seminar on Finance Business Times, Monday March 14, 1988
p. 11
6. Pius Okigbo,
7. Phone Plus User Guide -
'A Layman's Guide To Privatisation'
Business Guardian, The Guardian,
Wednesday, August 19, 1998.
A Publication of Nigerian
Telecommunications Ltd, Lagos
Nigeria.
8. 'WITEI,: READY FOR YEAR 2000" Editorial Review, NITEL
Journal, June 1998 p.2
9. 'NITEL'S vear of C o n s o l i h ' - NITEL Journal, March 1998 p. 18
10. h ITEL NEWS- NlTEL Journal, June 1998, p. 8
1 1 . A Publication of NITEL Journal March 1994, P. 6
12. Prof. Buba Bajoga, 6 L: READY FOR YEAR 2000'
Opcit p. 21
CIIAPrER 7 ' y
2.0 LITEIIA'I'URE REVIEW:
Here, we shall review some of the related works of different authors on the
impact of privatisatio~~ and co~l~~llercial isatio~~ policy in Nigeria and then
see how their views can contribute to a better understanding of the work at
stake.
The current buzz words in international economic and financial discourse are
globalisation, liberalisation, privatisation and commercialisation. They all
turn towards the same goal, namely, to free the economy from strong
government control and particularly from government intervention in direct
production of goods and services for the market. For a good understanding
of these concept we shall give some meaningful definitions.
GLOBALIS ATION:
According to renowned econo~nist, Dr. Pius Okigbo, globalisation is a
concept that suggest that the world has shrunk so much that political and
even cultural boundaries of countries and nations have to be treated as
irrelevant in the transaction of business an1
investment capital'.
30
11t of finance and
It is the congealing of the universe into one village so that individual nations
and countries no longer count as much as they did in the earlier part of the
century. It is presumed that in this free market world, domestic national
economic relations would be deregulated and privatised to give government
no more than minimal function in the national economy.
LIBEIWISATION:
This is when the government decides to open up all the sectors of the
economy for private investment so as to promote competition and efficiency
in the system.
The Nigeria11 economy was coinpletely liberalised in 1998. Late Head of
State, General Sanni Abacha in his 1998 budget speech said that: "With
effect from 1st January, 1998, the private sector can compete with the public
sector in all aspects of the economy and all laws and regulations inhibiting
such activities will be used to encourage enterprises2".
COMMERCIALISATION:
Many public sector enterprises are operated without due regard to financial
costs or returns. Not all such investment is expected to yield immediate
financial returns as some of the benefits are social rather than private in
character, that is, they accrue to the society as a whole rather than
exclusively to some particular or denominated individuals.
Therefore, commercialisation means that the production methods must be
efficient enough so that the prices charged for products or services should at
least, cover the cost of operations3.
A survey of most scholars who attempted to define cornrnercialisaion all
quoted copiously the one contained in the Technical Committee on
Privatisation and Coinrnercialisation (TCPC) document which in turn quotes
directly from the Decree No. 25 of 1988 which established the committee.
It defines commercialisation as the reorganisation of enterprises wholly or
party owned by l~ecleral tiovernr?
ventures4.
32
{olits making commercial
The T.C.P.C. document classifil ; co~nmercialisation into two
categories, viz:
- Partial Conlmercialisation: This simply means that the enterprises so
affected will be expected to generate enough revenue to cover their
operating expenditure. 'The governnlent may however, consider giving
the capital grants to finance their capital intensive projects.
- Full Commercialisation: This means that enterprises so affected will be
expected to operate profitably on a commercial basis without government
subvention. They will also be expected to raise funds from the capital
market without government guarantee. Such enterprises are expected to
use private sector procedures in the running of their business and may be
subject to the regulatory powers of the Federal Government. The
commercialisation of NITEL fall, under this category.
33
In both full and partial cornrnercialisation, no divestment of federal
government's holding will be involved.(T.C.P.C.) This is saying that
what is at stake is not the ownership structure, but the philosophy and
mode of operation.
PRIVATISATION:
F.A. Akintayo defined it as the transfer of government assets or functions to
the private secto9.
Alhaji Mukhatar Ahmed, then acting Managing Director of ICON Limited,
defined privatisation as a process of transfer of ownership interest and control
in an enterprise from government to the private sector6. This implies that the
actual management of the Board is the responsibility of the private sector.
To him, revenue generation is not the primary goal of privatisation. The
most important goal is to increase competitiveness and efficiency. It is
believed that this can best be achieved where there is power of free market.
George Schultz, former United States secretary of states opines that
"Privatization is not just a reduction in the size of government investment
33
In both full and partial comnll 111, no divestment of federal
government's holding will be ir~.,wlved.(T.C.Y.C.) This is saying that
what is at stake is not the ownership structure, but the philosophy and
mode of operation.
PRIVATISATION:
F.A. Akintayo defined it as the transfer of government assets or functions to
the private sectors.
Alhaji Mukhatar Ahmed, then acting Managing Director of ICON Limited,
defined privatisation as a process of transfer of ownership interest and control
in an enterprise from government to the private sector6. This implies that the
actual management of the Board is the responsibility of the private sector.
To him, revenue generation is not the primary goal of privatisation. The
most important goal is to increase competitiveness and efficiency. It is
believed that this can best be achieved where there is power of free market.
George Schultz, former United States secretary of states opines that
"Privatization is not just a reduction in the size of government investment
34
rather, it is a policy to better the services delivered to the general public"'.
Similarly, John Redwood contends that "l'rivatisation efforts have been the
opportunity for individuals and employees to participate in the wealth of the
nation by buying and owing shares in formerly nationalised enterprises which
in Britain, includes British Telephone system and British T e l e c ~ m " ~ . He
concluded that this will help our people to invest their surplus money
meaningfully instead of hoarding funds which would have been put to better
use'19,
From the various definitions outlined above, we can see that these different
strategies all aim at freeing the economy from strong government intervention
while privatisation is the main plank of policy reform. This is so because a
privatisation exercise carried out by way of global offerings with the right
economic and political climate would generate the desired foreign exchange
for the enterprise, in addition to international exposure. The experiences of
countries such as Mexico and Argentina, which have accessed European and
American markets for funds and listings, through privatisation of public
utilities proves this.''. Also, a deregulated economy and comrnercialised
3 5
public sector without adequate participation of the private sector may not
yield the desired result expected from the public enterprise reform. Hence,
privatisation remains the basic principle of policy reform.
Since our focus in this study is on the impact of the privatisation and
commercialisation policy as a strategy for reforming ailing government
enterprises using NITEL as a case study, it is therefore, necessary for us to
emphasise the relationship between the two concepts and see how they
combine to form a good government policy.
2.1 SYNTHESIS OF THE PRIVATISATION AND
COMMERCIA1,ISATION CONCEITS:
From the experience of Nigeria, it is a known fact that most public
enterprises such as NITEL, NEPA, Nigeria Airways and so on have failed
to accomplish the purpose for which they were established. Reasons for this
were outlined in chapter one. Therefore, it became very important to
restructure them towards improving the Nigerian economy.
36
The privatisation and corninercialisation strategy which aims at divesting
government interest either wholly or partially from these ventures involve
selling the shares of government to the private sector. Since these companies
are in bad shape it is necessary to make them attractive to investors by
rehabilitating them before privatisation.
Two options of achieving this restructuring exercise are;
By direct governrneilt funding:
This is where government solely undertakes the
restructuring exercise froin her purse.
By commercialisation:
Here, the tariff fixing and collection method of the companies are
adjusted. This ensure that the production methods are efficient
enough so that the prices charged for products or services at least,
cover the cost of operations". The revenue generated from the
commercialisation exercise is thus plough back into the business
to upgrade and enhance their operating capabilities thereby making
them viable and attractive to investors.
3 7
The experience of the National Salt Company of Nigeria PIC (NASCON) in
October, 1991, highlights the importance of making public enterprises
attractive to investors before putting up offers for sale. The report of
Business Times of October 21, 1991, has this to say. "A search for a core
group investor is now delaying the Federal Government's full divestment in
the National Salt Company of Nigeria PLC (NASCON) under the on-going
privatisation and conlmercialisation prograimne . . . . . . . . . . . . . Recently when
the TCPC announced the allotment result of the offer for sale of all of
government's 14.1 Million ordinary shares in NASCON, no core group
investor had been found to take up about 4 Million (or 25 percent) of the
share on offer which were reserved for it. If the current move by the TCPC
to get a core group fails, the unsold shares would be 'warehoused' just like
the TCPC did in the case of the undersubscribed portions of the federal
Goverrmlents' share in the insurance companies which were offered for
sale"'2.
From the fore-going, it can be seen that commercialisation though quite
different from privatisation must be seen to be an important part of the
reform of the public sector enterprises.
We have seen the definitions of the policies outlined above and we have also
said that conmercialisation must be seen as an important part of the reform
of public sector enterprises, we now need to know the different forms of
privatisation.
2.2 ANALYTICS OF I'RIVA'I'ISATION
According to Dr. Pius Okigbo privatisation could take one or more of several
forms:
1. Change of ownership and management of assets from public to private
hands. At the strictly micro level, major public or state owned
enterprises may be practiced by way of divestiture of ownership or of
management or of both. This form of privatisation does not go to the
root of the dilemma of public enterprises.
2. Transfer only of management from public to private hands either at the
production or distribution levels or both while the ownership of the assets
remains public.
39
Opening up or breaking a public monopoly in a particular branch
of activity. This is done by allowing competition by private
producers or operators, that is, creating alternative producers of
particular goods and services.
Opening up not merely a particular enterprise but a major sector to
private competition. Thus, without privatising the government
monopoly, NITEL, the telecommunications sector can be thrown open
to private enteiprises.
By creating a conducive environment for the private sector to
serve as the prime engine of growth and development. This form
will invoke a complex system of laws, regulations, tax regimes,
foreign exchange management, human resources development, equity and
stability et cetera. This process may come in two phases:
the first stage, an industry or activity may be opened up to private
initiative, as in the fourth mode above, without necessarily divesting the
states of its investment in particular enterprises in that branch of activity.
This form of privatisation relates to activites or industries rather than to state
owned enterprises.
In the second stage, the economy as a whole may be privatised through
changes in the laws, incentives et cetera.
In conclusion, Dr. Okigbo proposed that: "there is a wide difference between
privatising an enterprise, an activity or an economy, and that the last two
taken together represent the form of privatisation that will have a really
serious impact on growth and development of the e c ~ n o m y " ' ~ .
Arguments have been going on between the opposers and supporters of
privatisation since the federal government of Nigeria decided to embark on
the privatisation and commercialisation of government parastatals and
companies. Let us now analyse the views of both the supporters and
opposers. Those views highlight the advantages and disadvantages of the
privatisation concept.
4 1
2.3 ARGUMENTS F0J.t AND AGAINST PRIVATISATION_:_
According to Seun Faluyi, "the path of privatisation chosen by many
countries is the only option for the survival of ailing state owned enterprises
especially in a depressed e c ~ n o m y " ' ~ .
Anaele A.A, opined that advocates of privatisation base their argument on the
following points:
* Government cost reduction criterion
* Profitability criterion and
* Investment criterion.
To him, the three factors above are the net benefits of privatisationi6. He
believes that the adrninistratlon of the state will cost the government much
less if it divest its interest in public enterprises. Privatisation will equally
bring to an end the constant government subsidies given to slumbering
corporations such as the Nigeria Airways, the Nigeria Railway Corporation
and others. Further, Professor Anaele said that the privatisation programme
of the federal government is in the long run interest of the national
economyI7.
42
The World Bank report on Africa Reform stated that: "The public sector is
seen to be highly bloated, unproductive, and incapable of efficient service
delivery. Privatisation can be the right step at the right time to finally
liberate developing countries economies from slow growtl~"'~.
Mark Ogunyemi, an economist, in his analysis of privatisation: Challenges
Ahead, stated that most government parastatals are over bloated with workers
performing no specific function to enhance performance and productivity of
the establishment. A private operator will definitely operate with principles
of Total Quality Management and as such ensure that every worker have
relevance to the goals and objectives of the establi~hment'~.
On the other hand, opposers of privatisation are of the view that the exercise
will pose more problems for the nation.
According to G.A Akamiokhor, some socio-political issues that may
discourage privatisation include:
* That privatisation will lead to the concentration of wealth in the
43
hands of too few people.
* That privatisation may worsen the problems of unemployment as workers
in these organisations to be privatised may be relieved of their jobs and
left to their fate without any protection and any form of security.
* By privatisation, government might lose control of the commanding
height of the economyz0.
Some other critiques feared that privatisation may present an opportunity for
foreign investors to gain control over our industrial development while others
argued that the option offered by privatisatio~~ is not a panacea and is not
always practical2'. Private enterprises involve themselves in many abuses to
maximise operational efficiency. In Nigeria for example, private enterprises
have been accused of such practices as over-invoicing, transfer pricing as
well as tax evasion and avoidance22.
The arguments above highlights the prospects and problems of the on-going
privatisation and commercialisation policy. It is tnue that countries in
Europe, newly Industrialised Countries of South East Asia and even some
4 3
hands of too few pcople.
* That privatisation may worsen the problems of unemployment as workers
in these organisations to be privatised may be relieved of their jobs and
left to their fate without any protection and any form of security.
* By privatisation, government might lose control of the commanding
height of the
Some other critiques feared that privatisation may present an opportunity for
foreign investors to gain control over our industrial development while others
argued that the option offered by privatisation is not a panacea and is not
always practical2'. Private enterprises involve themselves in many abuses to
maximise operational efficiency. In Nigeria for example, private enterprises
have been accused of such practices as over-invoicing, transfer pricing as
well as tax evasion and avoidancez2.
The arguments above highlights the prospects and problems of the on-going
privatisation and commercialisation policy. It is true that countries in
Europe, newly Industrialised Countries of South East Asia and even some
44
African Countries have imple~nented the programme with a feat but it is
necessary for us here in Nigeria, to examine properly what the prescription
of privatisation and cornrnercialisation is supposed to achieve, what is
relevant in our situation and to determine how much, and how far, the
practice elsewhere can, or should, be adopted here and with what
modifications.
1. Pius Okigbo
NOTES AND REFERENCES
'A Layman's Gide to Privatisatioq'
Business Guardian, The Guardian
August 19, 1998, p.18.
2. Late Gen. Sani Abacha 'Budget S~eech ' Business Times
February 15, 1998.
3. Pius Okigbo Op cit P. 19
4. Publication of the Techilical Committee for Privatisation and
Commercialisation.
5. F.A. Akintayo,
6. Mukhtar Ahmed
7. George Shultz,
on - The Benefits and
Necessarv Precautions', Business
Times Monday December 5,1988, P.8
The Role of Capital Market Operations
in the Privatisation Process Bullion
(Publication of the Central Bank of
Nigeria) Vol. 10, No. 2 ApriVJune,
1988 p. 23.
Former America Secretary of States as
Cited by F.A. Akintayo in
"I'rivatisation - The benefits and
Pecessary Precuatiom; Business Times
Monday December 5, I988 p.8
8. JohnRedwood, As Cited by F.A. Akintayo. lbid.
9. lbid
. . . . a 10. Article on 'Attracting Foreign Capital mto w e
Environment: Challen~es and Prospects, lssues in Capital Market
Development. Vol. Two, 1995, p. 55.
1 1. Pius Okigbo, Op Cit p. 191
12. Kene Okafor, b ch for Core Group Investor Stalls
NASCONS Privatisatios Business
Times, October 21, 1991 p. 3
Op Cit p. 19
Breathing life into Ailing Publiq
13. Pius Okigbo
14. lbid
15. Seun Faluyi,
Enterprises. Business Times, Monday
September 15, 1997 p.7
16. A.A. Anaele 'Privatisation: The Nations Economy
for Auction?' Business Times,
October 27,1986 p. 28
17. lbid
1 8. World Bank Report
19. Mark Ogunyemi,
20. G.A. Akamiokhor
n Afiica. Reform Results
and the Road Ahead World Bank,
Washinton 1994.
on: C h w r z e s Ahead
Business World, This Day News Paper,
January, 4, 1999. P.22
' odalities for a Successful
. . . . -n: n e Role of S e c u r m
grid Exchange Commissioq, Bullion -
Publication of the Central Bank of
Nigeria Vol. 10 No.2 ApriVJune 1986.
P.18
'Privatisation and Public Enterprises'
Economic and Financial Review
(Publication of CBN Vol. 27 No. 1
March 1989 p. 62
22. lbid
3.0 LNTKODUCTION
This chapter deals with such elements of the study as methods of gathering
data and information, scope of the study, population size, sample size,
method of administering and analysing the information gathered and the
limitations of the study.
3.1 METHOD EMPLOYED
Three methods of research were employed in carrying out this work. They
are: Case study method, documentary investigation method and the survey
method. In these methods, both primary and secondary sources of data
collection were used.
In the case study method, we related the problem to NITEL LTD in order
to study the impact of the privatisation and commercialisation policy on the
company. Here, first hand information were collected from NITEL Ltd.
46
Under the docu~nentary investigation method, information were collected
through documented evidence. For instance, in this study, information were
collected from the documented material from the Bureau for Public
Enterprises (BPE), published works on the privatisation and
commercialisation of government owned enterprises, past company records,
magazines etc.
The survey method en~ployed irwolved the use of such tools like
questionnaires, interviews and observation. Questionnaires were dispatched
to some members of staff of NITEL and a sample of the company's
customers.
3.2 SCOPE OF TIIE STUDY
The study covered the three territories of the Lagos Zone of the organisation.
These territories are:
Lagos Island Territory
Lagos Mainland "
Ikeja II
47
The conclusioil derived from this study would be generalised and extended
to apply to the other zones of the company.
3.3 POPULATION
NITEL Ltd, as at the time of this study had over seven thousand employees,
hence all the members of staff are inclusive. The population also covers all
the subscribers and customers of NITEL nationwide. However, because of
time constraint and limited finance available to the researcher, a randomly
selected group of staff at the Lagos Zone and some selected clients within
Lagos will be used as the sample population.
3.4 SAMPLE SIZE
The total staff size in the Lagos Zone of NI'TEL is 3000 workers distributed
as follows:
Lagos Zone HlQuarters (ZHQ) = 300
Lagos Island Territory (LIT) = 720
Lagos Mainland Territory (LMT) = 990
Ikeja Territory (IT) = 900
48
For our purpose, only the three territories were considered for the
investigation.
Because we are not 100% certain that the result obtained as the sample size
is a perfect representative of the entire population, a sampling error of 10%
is allowed. The sample size can then be determined using the formular
below:
Where
N = The desired sample size
P = Population of workers
e = The limit of tolerable error
LAGOS ISLAND TERRITORY:
49
LAGOS MAINLAND TEIWTORY:
IKEJA TERRITORY:
TOTAL = 2&!J
Therefore, a total of 269 questionnaire were distributed to NITEL staff as
follows:
MANAGEMENT STAFF = 50
SENIOR MANAGEMENT PERSONNEL = 70
JUNIOR STAFF = 149
TOTAL = - 269
3.5 METHOD OF ANALYSIS:
In analysing the result from the study, a combination of narrative and
quantitative tools were used. Graphical and quantitative tools like tabulation,
5.0
Percentages, averages and where necessary statistical tests were used
to analyse the result from the questionnaire. These were
supplemented with the findings from company records and useful
related comments from the literature review.
3.6 LIMITATION OF STUDY,
This study was highly limited by time constraints. There wls no
enough time to sufficiently administer interviews and questionnaires
to a wider cross section of the employees and customers of Nitel.
Finance was another constraint variable in the study.
Another visible constraint was that of respondents. Although the
questions drawn were easily and relatively understood, there is no
guarantee that the totality of the respondents accorded the
information sought the desired importance. This doubt puts a
constraint to the desired intention of the study.
HYPOTHESES FORMULATION
Since this research work is intended to determine the impact of the
privatisation and commercialisation policy in Nigeria -- An assessment of
NITEL LTD., we shall formulate the following hypotheses which shall be
tested later and used to make decision.
HYPOTHESIS 1
Ho : Effective and proper implementation of the comn~ercialisation
Policy in NITEL LTD, has no impact on Revenue Generation
and Workers Welfare
H,: Effective and proper implementation of the commercialisation
policy in NITEL LTD has a positive impact on Revenue
Generation and Workers Welfare.
OTHESIS 2
Ho: Effective and proper implementation of the commercialisation
policy of NITEL did not improve the quality of
Telecommunication Services provided to Customers.
H,: Effective and proper implementation ofthe commercialisation
policy of NITEL has improved the quality of
Telecommunication Services provided to Customers.
CI-IAPTER FOUR
4.0 PFWSENTATION AND ANALYSIS OF DATA,
This chapter is focused on presenting and analysing the information received
from the questionnaires distributed to the staff and customers of NITEL.
Afterwards the results from the analysis were used to test the research
hypotheses.
4.1
EL STAFE;
DEMOGRAPHIC ANALYSIS,
Two hundred and Sixty nine (269) questionnaires were administered but only
150 were duly completed and received. The analysis is therefore based on
sample size of 150. Out of this number 1 13 are males while 37 are females.
TABLE 4.1 A DISTRTBUTION DATA
CATEGORY
Management
Senior management personnel
Oficer
Junior fi NOTE: (I) LIT = Lagos Island Territory
LMT IT TOTAL 'JAF
LMT = Lagos Mainland Territory IT = lkeja Territory
TABLE 4.1D SEX DATA
NOTE: (ii)
MALE
FEMALE
SENIOR
65
2 5
90
CATEGORY
Senior management
Management
Officers
Junior
TOTAL
JUNIOR
48
12
60
IT
M F
5
14 4
35 15
TOTAL
113
37
150
TOTAL
30
3 0
30
60
150
LIT
M F
8 2
6 1
6 2
20 5
40 10
TABLE 4.1C
LENGTH OF SERVICE.
LMT
M F
5 5 7 3
9 2 9 3
1 0 2 5
14 3
38 12
Below 5 years
5 - 10 years
10 - 20 years
20 and above
TOTAL
10
29
78
33
150
6.67
19.33
52.00
22.00
100
From the table above, it is clear that 52% of the responderits have spent
between 10-20 years in- NITEL, 22% have stayed in the organisation for 20
years and more, while 19.33% have spent between 5-10 years in the
organisation. Also, 6.67% of the respondents have worked for below 5 years.
The response as indicated in the table above shows that majority of the
4.2 WORKERS VIEW ON THE COMMERCIALISATION OF MTEL.
workers i.e 86% were happy with the commercialisation programme, 7.3%
RESPONSES
Positively
Nagatively .
Indifferent
TOTAL
view the exercise as affecting workers negatively and these were mainly from
the officers class while 6.67% froin the Junior workers were indifferent about
it. This may be because they are not well educated and do not get the sense
of the commercialisation exercise.
S.M.P
3 0
- -
I 30
OFFICERS
2 8
2
-
, 30
MGT
3 0
- -
, 30
JUNIOR
STAFF
4 1
9
10
1 60
TOTAL
129
11
10
150
4.3 WORKERS V I V
RESPONSES
- - - -- - - -
More Authority Granted
Less decision taken
from the Ministry
TOTAL
MGT
3 0
-
OFFICERS JUNIOR
STAFF
TOTAL
I do not know G 6
) TOTAL 1 30 I 30 1 30 1 60 1 150
RESPONSES JUNIOR
STAFF
SMP TOTAL MGT OFFICERS
From Table 4.3, above the various levels of workers agree that most decision
were taken by the Management Staff and less by the Supervising Ministry as
against the practice before coinrnercialisation where decision is taken at the
Ministry. This is an indication that the rate of decision making is faster now.
In Table 4.4 9 1.3% of the respondents agreed that the company is keeping
pace with set objectives. 4% from the Junior Staff said they do not know
while 4.67% fiom both the Management level and officers do not agree that
NITEL is keeping pace with set objectives. To them Nitel ought to have
make more progress than it is doing presently. Most of them aid political
interference prevents them fiom takiig prompt and timely decision which on
the long run affects their operations.
4.5 I F F
The 91.3% of the respondents who agreed that NITEL is keeping pace with
set objectives also affirmed that this was possible because of the re-
COMMERCIALISATION,
RESPONSES
Yes
No
TOTAL
SMP
30
-
30
MGT
28
- 28
OFFICERS
25
- 25
JUNIOR STAFF
54
-
54
TOTAL
137
137
organisation and conlrnercialisatioil of NITEL.
4.6 WORKERS VIEW ON IF THERE HAS BEEN ANY MAJOR,
IMPROVEMENT IN TJ3E WORKING CONDITI-
OF STATIONERIES. MEDICALS. TRANSPORTATION,
EE *-
working conditions.
GIVE REASONS FOR YOUR A N S m
RESPONSE
Indifferent
Yes
No
TOTAL 100% of the respondents agreed that there has been major improvement in
TOTAL
0
150
0
150
SMP
0
3 0
0
30
OFFICERS
0
3 0
0
30
RESPONSES
Normal Procedure
Commercialisation
Others
TOTAL
MGT
0
3 0
0
30
JUNIOR
STAFF
0
60
0
60
SMP
3 0
30
MGT
3 0
30
TOTAL
150
150
OFFICERS
30
30
JUNIOR
STAFF
60
60
All the workers (100%) agreed that the conmercialisation exercise led to the
major improvement in NITEL. This they say is because the company's
income has increased significantly sine the exercise.
4.8 S TIJE COMMERCLALISATION EXERCISE ANY EFFECT
ON SERVICES PRQ=
From the table above, 93.3% of the respondents agreed that
commercialisation has some effect on the services provided while 6.66%
responded that they do not know if the commercialisation has effect on
services provided.
RESPONSES
Yes
No
I 'Do Not know
TOTAL
SMP
30
30
MGT
30
30
OFFICERS
3 0
30
JUNIOR
STAFF
5 0
10
60
TOTAL
140
10 - 150
4.9 IF YES. HOW?
I STAFF I RESPONSES
I Very Little Difference I - I - 1 - I - I -
JUNIOR
Quality of Service
Dropped
I Improved Services 1 30 1 30 1 30 1 50 1 140
SMP TOTAL
I TOTAL I 3 0 130 130 1 50 1 140
-
The 93.3% who agreed that the commercialisation of NITEL affected the
services provided agreed that this is so on the positive side. That is, the
quality of services provided has improved.
4.10 0
MCT OFFICERS
- -
RESPONSES
No Growth
Slow Growth
Steady Growth
TOTAL SMP
4
26
Rapid Growth
TOTAL
-
MGT
8
22
-
30
-
OFFICERS
15
15
-
30
JUNIOR
STAFF
38
22
- - -
30
- 60
The response as shown in the table above indicates that revenue generation
in NI'TEL before cormnercialisation was quite poor. 56.66% of the workers . from the various levels agreed that the Company's revenue can'be classified
as having a slow growth while 43.3% said there was no growth at all. This
shows that the perfoimance of NITEL prior to commercialisation was not
impressive.
4.11 JVOW,RS VIEW ON REVENUE GE-ON AFTER
COMMERCIALISATION,
While 70% agreed that there has been rapid growth since commercialisation,
30% agreed that there has been steady growth. This indicate that the
company's performance in terms of revenue generated really improved with
commercialisation.
RESPONSES
No Growth
Steady Growth
Rapid Growth
TOTAL
MGT
-
- -
3 0
30
SMP
- - -
30
30
OFFICERS
- - 10
20
30
JUNIOR
STAFF
- - 35
25
60
TOTAL
-
- 45
105
150
4.12. SOURCES OF FUND FOR THE ON-GOING EXPANSlON
PROJECT.
RESPONSES I SMP I MGT
Government subvention I . I - Loan fiom Banks I - I - Revenue Genmted ( 30 ( 30
Other sources
Total
OFFICERS JUNIOR TOTAL
I STAFF 1 I
30 60 1 150 I I
100% of the respondents agreed that the on-going expansion project is being
financed fiom the revenue generated without any form of subvention fiom the
government or loan fiom the banks.
4.13. WORKERS VIEW ON GOVERlWENT PROPOSAL TO
Good Idea
Bad Idea 2
Not necessary 10
I Indifferent 1 - TOTAL 30
- -
MGT OFFICERS JUNIOR TOTAL
STAFF
It is evident from the table that while 42.66% of the respondent agreed that
the privatisation programme in view is a good idea, 35,33% felt that it is not
necessary to privatise the company, to them, the company is okey the way it
is. Surprisingly, 12.66% both from the management class and the junior staff
are of the view that the intention to privatise NITEL is a bad idea and 9.33%
are neither here nor there. They are indifferent.
ON TISIR EXPECTATIONS FROM 'IT* PRNATISATION
PROGRAMME. THE REPORT IS AS FOLLOWS;
Retrenchment
Foreign capital injection
Quick decision making - since there will be complete autonomy to
operate without government intervention.
It will stimulate competition.
Might increase tariff charged
May reduce prices as a result of competition.
The industry may be controlled by only few wealthy Nigerians
Increase in Tax paid to government
May result in an unequal distribution of the facility.
4.15 B R E S ~ I O N A I W ANALYSIS OF 0 1 ESTIONNAIRFS
FROM NIl'EL'S CLIENTELE,
As mentioned earlier, 50 questionnaires were distributed to NITEL
subscribers in Lagos, these were randomly picked. Out of this, only 30 were
duly completed and returned. Some of the respondents claimed that they lost
their own copies of the questionnaire while others failed to fill it at the due
time. Hence we were constrained to assess the 30 questionnaires received.
Out of this, 18 were females and 12 were males.
4.16 FOR HOW 1 ,ONG HAVE YOU BEEN ANITEL CUSTOMER?
RESPONSES
Below 5 years
5- 10 years
10 - 15 years
NITEL for the period between 10 - 15 years, 30% have been customers with
the company for between 5 - 10 years while 20% have been loyal to the
company for over 15 years. Only 13.33% have spent below 5 years with the
organisation.
15 years and above
TOTAL
MALES
2
4
3
From the table, 36% of the respondents have had business relationship with
3
12
FEMALES
2
5
8
TOTAL
4
9
11
3
18
6
30
4.1 7 HOW WOUL~yoURRDESCRIDE 'm RE-ORGANIZATION
AND OF MTEL?
RESPONSES
Progressive
Retrogressive
Not too significant
L I I I I
All the respondents described the re-organisation and commercialisation of
None of the above
TOTAL
NITEL as being progressive.
MALES
12
4.1 8 DO YOU CONSIDER TELEPHONE AND OTHER SERVICES OF
NITEL TO BE BETTER NOW THAN BEFORE THE
COMI'vERCIALISATION.?
12
FEMALES
18
Again, all the respondents (100%) agreed that services provision in NITEL
is quicker now than before it was re-organised.
TOTAL
3 0
18 30
RESPONSES
Yes
No
TOTAL
FEMALES
18
18
MALES
12
12
i
TOTAL
30
30
4.19. 0 Y O FIN?> TAE DIGITAL LNES TO IMPROVE - RESPONSES I MALES I FEMALES I TOTAL
I Yes I
I TOTAL 1 12 1 18 I 30 1 The table also revealed that all the respondents find the digital lines to
improve communication.
RESPONSES
Costly
MALES
Reasonable
high side. 20% felt the prices are reasonable but none found the bills sent to
them to be cheap. This reveals that unlike when prices were subsidized,
customers now bear the full cost of services received.
8
Cheap
TOTAL
FEMALES
4
TOTAL
16
Majority of the respondents, 80% of them found NITEL charges to be on the
-
12
24
2 6
- 18
- 30
4.21 HOW WOULD YOU DESCRIBLE THE BREAKDOWN OF
LINES NOW _I_q COMPARED TO BEFORE TIIE RE * -
ORGANlSA'TION AND COMME mOFNITE'
I RESPONSES I MALES I FEMALES ( TOTAL I
Most of the respondents were of the view that they experience breakdown of
lines less often now than before. But 16.66% of the respondents still said that
there is no significant difference as far as breakdown of lines is concerned.
More often than before
Less often than before
No significant Difference
TOTAL
4.22 B-D YOU DESCRIBE THE RESPONSE OF NITEL ATION AND
BREAKDOWN OF LINES?
I RESPONSES MALES FEMALES TOTAL
- 10
2
12
-
15
3
18
- 2 5
5
30
Quick
Very quick
Good enough
Not good enough
Slow
Very slow
TOTAL
- - - 3
6
9
18
- - - 4
5
3
12
- - - 7
1 1
12
30
From the analysis, 40% of the customers said that the response to
customers comylairits is very slow, 36.66% said the response is slow while
23.3% find response to complaints as not good enough. None of the
customer voted for quick, very quick or good enough. This is an
indication that there is need for more improvement fiom MTEL, as far as
client service is concerned.
RESPONSES MALES I FEMALES I TOTAL
as a good one.
Good Idea
Bad Idea
Not necessary
TOTAL
4.24 CUSTOMERS VIEW OF PRIVATISATION AS THE PANACEA
RESPONSES MALES 1 FEMALES I TOTAL
All the customers found the decision to privatise MTEl
12
12
l Yes
18
18 '
TOTAL I 12 I 18 I 30
While 63.3% of the respondents agreed that privatisation is the solution
required for public enterprise to be functional and meet the desired
objectives, 36.6% did not agree with them.
4.25 CUSTOMERS OPINION ON THE BENEFITS OF
PRIVATISATION,
This is an open-ended question. The following were customers responses.
Better Management ability
Competition
Competitive prices
Better services as a result of competition
Create job opportunity on the long run
Efficient utilization of resources
Increase the level of investment in the country.
Foreign capital injection.
CUSTOMERS OPINION ON THE DISADVANTAGES OF - Some of the workers may loose their job
May result into unequal distribution of resources
Control may be in the hands of few Nigerians
May lead to Price wars.
NEE The analyses and evaluation of the responses from both the staff and clientele
of NITEL showed that the two groups found the re-organisation and
commercialisation of the company as being progressive. It fiuther revealed
that the benefits realised fiom the commercialisation of NITEL outweighs
whatever shortcoming experienced.
The extent that this assertion is true is ascertained through the hypothesis
testing using the Chi-square distribution.
STING OF HYPOTHESES
The test of the two working hypotheses were done using statistical method
to make a decision of which to accept and which to reject, or as the case may
be.
STING HYPOTHESIS 1
Ho: Effective and proper implementation of the commercialisation policy
in NITEL LTD has no impact on revenue generation and workers
welfare.
Hi: Effective and proper implementation of the commercialisation policy
in NITEL LTD has a positive impact on revenue generation and
workers welfare.
TEST STATISTICS USED: The Chi-square (X2) Distribution was used to
carry out the test.
DEGREE OF FEEDQM
Degree of freedom "V" is given by V = (h - I) (k - 1)
LEVEL OF SIGNIFICANCE:
95% confidence level or 5% level of significance is used.
DECISION CRITERIA: .;imr=m4f;- - - - r ,I
Accept Ho if X2 calculated < X2 tabulated
But reject Ho if X2 calculated > X2 tabulated
For the purpose of testing hypothesis 1 above, question Nos. 8 and 13 from
the questionnaires were used. These questions will constitute our Table 4.27
This test is to determine whether the staff of NITEL view the
commercialisation policy as having any impact on revenue generation and
staff welfare.
The table below shows the responses of the respondents. The responses
obtained from the respondents were taken as the observed fiequencies (Oi)
while the expected frequencies (ei) were calaculated based on the distribution
of the observed frequencies. The expected frequencies were placed in
brackets besides their corresponding observed frequencies.
The detailed computation of the expected frequencies are to be found in
Appendix 1
TABLE 4.27
WORKEERS RATINGS ON WHETHER THE COMMERCIALISATION
POLICY OF NITEL HAS ANY IMPACT ON REVENUE GENERATION
IMPROVED WORKING 1 RATE OF =VENUE GENERATION CONDITIONS
RESPONSE I p- Indifferent
NO OF I RESPONSES I NO OF I TOTAL I RESPONDENTS RESPONDENTS
0 (22.5) I Steady growth 1 45 (22.5) 1 45 I
150 (127.5)
0 (0)
Reauired to test at 5% level of significance using the formular for Chi-square
computation given by:
Rapid growth
No growth
where X2 = Observed Chi-square to be computed
E = ' Expected frequencies
105 (127.5)
0 (0)
0 = Observed frequencies
255
0
X2 =52.94
To find the appropriate X2 value fiom the table, it is important to establish V,
the degree of fieedom. V = (h - 1) (k - 1)
Where: h - - number of rows
k - - number of colums
fiom the contigency table used,
= 2 degrees of fieedom
:. at 2 degree of fieedom, 5% level of significance, Tabulated X2 = 5.991
DECISION CRITERIA:
Since the calculated value of 52.94 is greather than the Table value 5.99 1 we
reject the null hypothesis and accept the alternative hypothesis.
DECISION: Based on the responses and results obtained from the hypthesis
tested, the researcher is 95% confident that effective and proper
implementation of the commercialisation policy in NITEL Ltd has a positive
impact on revenue generation and workers welfare.
TESTING HYPOTHESIS 2
Ho: Effective and proper irnplemetation of the commercialisation policy
of NITEL did not improve the quality of Telecommunication Service ,
Provided to Customers
H 1 Effective and proper implementation of the commercialisation policy
of NITEL has improved the quality of Telecommunication Services
Provided to Customers.
To test this hypothesis, Question No. 3 of the questionnaires'distributed to
NlTEL Clientcle is used.
This constituted our Table 4.28.
The test was to determine whether the clientde of NITEL find the
commercialisation policy to improve services provided.
The data obtained fiom their responses formed the observed frequencies (oi)
while the expected frequencies (ei) were calculated based on the obsereved
fiequencies (see Appendix Il). The expected fiequencies were placed against
their corresponding observed frequencies in the Table 4.28 below.
Table 4.28 CUSTOMERS REPONSE ON WHETER THEY
CONSIDER TELEPHONE AND OTHER SERVICES OF
NITEL TO BE QUICKER AND BETTER NOW THAN
BEFORE COMMERCIALISATION.
Required to test at 5% level of significance
To compute the Chi-square (X2)
RESPONSES
Yes
No
Indifferent
Total
MALES
10 (8.8)
0 (24)
2 (0.8)
12
FEMALES
12 (13.2)
6 (3.6)
0 (1.2)
18
TOTAL
22
6
2
3 0
Observerd Expected
' Degree of freedom V = (h -1) (k - 1)
= 2 degree of freedom at 5% significance. The tabulated X2 - - 5.99 1
Decision Criteria:
Reject Ho if X2 calculated > X2 tabulated
but
Accept Ho if X2 calculated < X2 tabulated
Decision:
Since X2 calculated (7.27) is greater than X tabulated 5.991
We reject Ho. Hence we accept customers response that the
commercialisation of NITEL LTD has improved the services provided to
them.
CIIAPTER FIVE
CONCLUSION
5.1
This chapter summarises all the vital points of this research. The following
were the &dings based on the data collected during investigation.
1. Nitel Ltd like other government enterprises was not dong well before
commercialisation.
2. Lack of proper management and bad attitude to work were the main
factors militating against the success of government enterprises.
3. The commercialisation ofNITEL brought about improved services to
the customer. This translated to more revenue generated by the
company and better welfare package to the staff.
4. As a result of privatisation and conmercialisation, most public
enterprises were able to set realistic goals and achieved then.
5. The govenlment derived the following benefits fiom the privatisation
mld commercialisation programme:
- Annual dividends in the case of partially privatised companies.
- Grants, Subventions and other facilities given to these public
enterprises are now channelled to other areas of the economy.
Increase in productivity and annual profit gave rise to increased
annual tax revenue accruing to the government.
On the part of the investors who took over these companies, the need
to maximise profit may result into charging high tariff to boost
revenue or compromise quality of service.
Some of the workers of privatised firms have been found to loose
their jobs as a result of the re-organisation done by the new owners.
The benefits of privatisation has not been fully realised in Nigeria.
This is because political and economic policies in Nigeria in the last
few years have not been right and stable to strengthen foreign
investors' confidence and stimulate participation in the economy.
This has discouraged the injection of foreign exchange into the
system.
RECOMMENDATIONS;
The enforced interconnectivity pact between NITEL and private
operators negates the spirit of competition. Since operators have no
option than to connect NITEL, they are made to pay NITEL'S
unreasonable tariffs which is passed on to the consumers. Hence,
there is need for two or more national or regional carriers and
operators to be allowed to connect with international hub stations,
licensed in Nigeria, to give NITEL a run for its money.
2. All privatised and commercialised government owned companies
should be restructured and re-organised to reduce to the barest
minimum, the financial mismanagement and other negative vices that
characterised them.
3. The regulatory body of the privatised firms should have a board of
trustees or directors who are representatives of the investors, the
colisuniing community and all other stakeholders including the
government. This is important because, a regulatoiy structure
constituted by the same public servants who ran the system aground
might become an agent of extortion, setting very difficult standards
to force investors to a compromising position.
4. The government through the Bureau of Public Enterprises should
ensure that the shares of the privatised companies are equitably
distributed to the willing public.
5. All public enterprises slated for privatisation should pass through the
capital market. This will ensure that influential investors do not buy
the companies of their choice at give away prices.
6. The provision of infrastructure for small markets and rural markets
should also be of concern. I'his is necessary because investors could
ignore areas where the size of the markets do not justifj) investments.
The government should therefore plough back some of the proceeds
fiom the sale of its utilities to provide physical structures required to
bring such services to such locations. This definitely will encourage
the investors to come in.
7. Employment severance package should be given to workers made
redundant by the privatisation exercise. This will form the required
capital for them to start business. Alternatively, another project which
requires their service can be evolved to retain them. This will help in
reducing the tension within the civil servants and thus help them to
appreciate and support the exercise.
8. The system approach to management should be adopted by the
government in executing the privatisation and commercialisation
programme.
9. Lastly, a mass enlightenment campaign targeted towards investing
public, political authorities, workers and the public should
commence. This will educate the public on the implication of the
privatisation and commercialisation exercise on their daily operations
and the roles expected of them.
5.3 CONCLUSION,
Privatisation and commercialisation are policies currently being adopted in
both developing and developed nations. A catalytic effect of these policies
to economic development is evident in the economic growth and
development of several emerging markets of Asia, Latin America and even
some African countries.
Also, the commercialisation policy as revealed by this study has been largely
beneficial to MTEL as many improvements were noted. Indeed,
commercialisation has improved the quality of services provided, upgraded a
the remuneration to workers and enhanced the profitability and productivity
The proposed privatisation of NITEL and other public entei-prises if properly
implemented especially, if carried out by way of global offering will fiuther
enhance the efficiency of these enterprises and thus contribute towards
improving the Nigerian economy.
APPENDIX 1
To calculate the expected frequencies for Table 4.27
Expected frequency = Grand Total
Where observed frequency (Oi) = 150
Expected frequency (OE) - - l5QX.m 300 = 127.5
(Oi) = 0
(Oi) = 105
(Oi) = 0
(Oi) = 45 (OW = lm&i
300 = 22.5
APPENDIX 2 To calculate the expected fiequciencies for Table 4.28
Expected frequency = -w
(Oi) =
OE =
(Oi) =
OE =
(Oi) =
OE =
(Oi) =
OE =
(Oi) =
OE =
(Oi) =
OE =
Grand Total
- Herbert G. Hicks and M a n a e w MCGraw - Hill
Ray Gullett International Editions. 198 1
Vernon .A. Musselman
and E.H. Hughems Business - Issues and Environmml
8th Edition. Prentice Hall. 198 1
Adam Smith e Wealth of Nat om, Gromwelt
Collier and Macmillan Inc. 1909
Druker P.F.
Ejiofor, Pita
Foyerweather, John
Manament: Tasks Pesponslbll . . . . ibea
Practices, Harper and Row
Publishers New York 1973.
& b . ~ l a p Government ed
_C,omDanies Fourth Dimension
Publishers Enugu, Nigeria, 1987.
McGraw-Hill Book Company,New
York, 1969.
Late General Sani Abaclia Budget Sp& Business Times,
February 15, 1998.
Pius Okigbo
p. 21
6 de to P r i v a t w ~ ' Business
Guardian, The Guardian August 19, 1998,
p.18
Late Gen. Sani Abacha '-gee& Business Times February 15,
1998.
Pius Okigbo Op cit P. 19
A Publication of the Technical Committee for Privatisation and
Commercialisation.
F.A. Akintayo, on - The Benefits and
Necessary P r e c a u M , Business Times
Monday December 5,1988, P.8
The Role of Capital Market Operations in the
Privatisation Process Bullion
Mukhtar Ahrned
George Shultz,
(Publication of the Central Bank of Nigeria)
Vol. 10, No. 2 ApriYJune, 1988 p. 23
Former America Secretary of States as Cited
by F.A. Akintayo in . .
Ibid
World Bank Report ca. R e f o r m s u b and tk
Road Ahead World Bank, W a s h i n t o n
1994.
Mark Ogunyemi, 'Privatuation: C U M . . Business
World, This Day News Paper, January, 4,
1999. P.22
G.A. Akamiokhor a Successful
: The Role of Securities and
J. A. Aremu
Exchange- . . , Bullion -
Publication of the Central Bank of Nigeria
Vol. 10 No.2 ApriVJune 1986. P. 18
on and Pub1 c E n t e m 9
Economic and Financial Review
(Publication of CBN Vol. 27 No. 1 March
1989 p. 62
Ibid
P. N. 0 Ejiofor O ~ l s a b o n s Perform . . e Our 3,
Anambra State Public Service Lecture Series
No. 2, October 1984
Ibid
A Keynote Address by the Managing Director and Chief Executive of Bank
of Credit and Commerce International (Nig). Limited at the 7th National
Seminar on Finance Business Times, Monday March 14, 1988 p. 11
Pius Okigbo, ' de To Privatisation' Business
Guardian, The Guardian, Wednesday, August 19,
1998.
Phone Plus User Guide - A Publication of Nigerian
Telecommunications Ltd, Lagos Nigeria.
& Editorial Review, NITEL Journal,
June 1998 p.2
1.9 vear of Consolidion' - NITEL Journal, March 1998 p. 18
N I n L NEWS-NITEL Journal, June 1998, p. 8
A Publication of NITEL Journal March 1994, P. 6
Prof. Buba Bajoga, 'NITEL: READY FOR YEAR 2000' Op cit
John Redwood,
Ibid
Article on 'm Fore@ C a u t o N w m a L i b e u . . .
P r o w . Issues in Capital Market
Development. Vol. Two, 1995, p. 55.
Pius Okigbo, Op Cit p. 191
Kene Okafor, for Core Group hivestor Stalls
NASCONS Prlvatlsatlon . . . Business Times,
October 2 1, 199 1 p. 3
Pius Okigbo Op Cit p.19
Ibid
. . . . . Seun Faluyi, e a t h e life mto A-
-. Business Times, Monday
September 15, 1997 p.7
'Privatisation: The Nations Economy for
Auction?' Business Times, October 27,1986
p. 28
A.A. Anaele
Business Times Monday December 5, 1988
p. 18
As Cited by F.A. Akintayo. Ibid.
S.E Amalime
Department of Management
Faculty of Business Administration
University of Nigeria,
Enugu Campus,
10th March, 1999.
CHIEF/MR/MRS/MISS ........................
THE IMPACT OF PRIVATISATION AND COMMERCLGLISATION
Dear Sir~Madam,
Please find attached questionnaire on the subject above for your completion
and return.
This research is being undertake as a pre-condition for the award of a Master
of Business Administration ( M A ) Degree in Management by the University
of Nigeria.
I assure you that all the information supplied would be treated in strict
confidence and is purely for academic purpose.
Thanking you for your anticipated co-operation.
Yours faithfully,
Amalime Sylvia E.
W . E a _ r _ Y . F J m w e , N I [ T ~ F F
1. Length of service in organisation:
A. Below 5 Years R. 5 - 10 years
C. 10 - 20 years D. 20 years and above
2. Present position in organisation:
A. Junior Staff B. Officers
C. Senior Management Personnel D. Management Personnel
3. How do you view your work environment?
A. Staisfactory B. Fairly Satisfactory
C. Unsatisfactory D. Good
4. How do you see the commercialisation of NITEL?
A. Positively B. Negatively C. Indifferent
5 . In your own view, how has the commercialisation policy affected
management's fieedom autonomy to take decision and run the
establishment?
A. More powers given to management Staff of NITEL Autonomy
fieedom granted to Managers.
B Decision imposed by the Supervisory Ministry
C. No fieedom
Can you say that NITEL is keeping pace with set objectives?
A. Yes B. No
If yes, do you think it started after cominercialisation
A. Yes B. No
Has there been any major improvement in the working conditions in
terms of Stationeries, Medicals, Transportation, Feeding, and so on
in the last five years.
A. Yes B. No . ,
Eyes, What led to the improvement?
A. Nonnal Organisational Procedure
B. The Commercialisatian exercise C. Others
Has the Commcrcialisatioii exercise any effect on the service provided
A. 'Yes B. No
If yes, How? _. . _
A. Quality of Services Provided Dropped
B. Very little difference C. Improved and Better Services.
How would you classify revemue generation in NITEL before
Commercialisation?
C. Rapid grotvtll ir. Slow growth
13. What nbout revcnur get~cration aAer commercialisation?
A. No growth B. Steady growth
14. M m L embarked on a lot of expansion projects in the past few years,
What was their source of finance
A. Goverment. Subention B. Loan from Banks
C. From Revenue Getieratcd D. Other Sources
15. What do you think of Goverment's proposal to privatise MTEL
A. Good idea B. Bad idea C. Not necessary '
16. In your own words list your expectations from the privatisiltion
Q l J E S T I O l l R NITEL'S CLIENTELE
Please Tick appropriately
1. For how long have you been a NITEL Client?
A. 1-5years B. 5-10yearsC. 15 Years
2. How would you describe the re-organisation and commercialisation
of NITEL?
A. Progressive B. Retrogressive C. Not too significant
D. None of the above I .
3. Do you consider Telephone and other services of NITEL to be I
quicker and better than before the commercialisation?
G I
A. Yes B. No
4. Do you find the digital lines to improve communication. . .
A. Yes B. No
5. Which of tlw following represent your -. , view concerning NITEL'S A -
charges for services rendered?
A. Costly B. Reasonable C. Cheap
6. How would you describe the breakdown of lines now as compared to
before the re-organisation and commercialisation of MTEL
A. More often than Before B. Less often than before
C. No significant difTerence
7. How would you describe the reponse of NITEL Staff to coinplaints
concerning breakdown?
A. Very quick B. Good enough C. Very Slow
D. Quick F. Not good enough E. Slow
8. What is your view of government's policy to privatise NITEL?
A. Good idea B. Bad idea C. Not necessary
9. Do you see privatisation as the Panacea to the problems of public
enterpries in Nigeria?
A. Yes B. No
10. In your opinion, what are the benefits of privatisation? Please list . "
(a) .................... .. .................. (b) .....................................
(c) ...... ;. .................................. (d) ........................................ 1 1. What are the short falls of privatisation? Please list
_.-" - __--
(a) ................................................................. (b) ..............................................................
(d) ................................................................. (e) ................................................................