Privatization and the Performance of Public Enterprises in Uganda:A case of Uganda Telecom Limited

Abstract

The study investigated whether performance of public enterprises like Uganda Telecom Limited is affected by privatisation. It specifically looked at establishing the effect of privatization on quality of services offered by Uganda Telecom Limited; on financial sustainability of Uganda Telecom Limited and on operational efficiency of Uganda Telecom Limited. A case study research design was used basing on qualitative approach and quantitative approaches. A target population of 118 respondents was identified for the study. From 118, 87 consisted in the sample size. Respondents were selected using purposive and simple random sampling techniques. Data was collected using questionnaires and interview schedules. Analysis was done descriptively and inferentially. The study results indicated that there is no significant effect of privatization on performance of Uganda Telecom Limited. This showed that privatisation affected quality of services offered, financial sustainability and operational efficiency. The hypotheses were tested and it was found out that all hypotheses tested were not accepted. For instance, privatisation negatively affected the quality of services offered (r=-0.669 & P=0.522>0.05), financial sustainability (r=-0.544 & P=0.139>0.05) and operational efficiency (r=-0.387 & P=0.099>0.05). It was thus concluded that privatisation has weak effect on performance of UTL. The study thus recommended that operational efficiency of UTL needs to be revitalized by making sure that competent staff are in place, financial resources are mobilized, service quality is improved. For financial sustainability, the instrument of accountability needs to be used to make sure that the organisation departments are accountable.