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ACCA Strategic Professional · Strategic Business Leader · Public sector governance

The Department of Rural Health, a national government agency, is judged on how well it delivers clinic access to remote communities within a fixed annual grant, with no profit target. Which description best fits the primary objective of this organisation?

The agency's main objective is value for money: delivering the intended public service as economically, efficiently and effectively as possible within its fixed grant. It is not a profit-seeking body, so shareholder returns, market share or dividends are not its primary aims.

  1. AMaximising return on capital employed for its shareholders
  2. BAchieving value for money in delivering a public service within a given budgetCorrect
  3. CMaximising market share against competing private clinics
  4. DMaximising dividends to the national treasury

Explanation

Public sector bodies are typically driven by service delivery and value for money (economy, efficiency, effectiveness) within funding limits rather than profit. Options A, C and D apply commercial profit-based objectives which do not fit an agency funded by a grant with no profit target.

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