Demerits of Government Companies are:
• Lack of accountability: A government company is not fully responsive to the parliament or the general public. It enjoys special privileges. It may not act for the public interest.
• Political interference: In actual practice politicians and bureaucrats interfere in the functioning of Government companies. Such interference cause lack of ness in management and adverse effect in proficiency.
• Indifferent management: Government companies are generally managed by Government servants and other Government officers. They are not hardworking and take little personal interest in running the company on a sound business line. The efficiency of operations is low. Operational costs are high.
