President John Mahama has given the strongest indication yet that loss-making State Owned Enterprises (SOEs) will not be tolerated under his watch.
“They’ll strictly be reformed, merged, privatised or shut down,” he said at a meeting with Chief Executives Officers of specific SOEs in Accra yesterday.
The meeting comes on the back of revelations that SOE debts cross GH¢200 billion with the COCOBOD and the ECG leading the pack.
According to President Mahama, “the era of impunity, mediocrity and financial recklessness must end today. It is not going to be business as usual. We are going to reset your entities”.
The 2023 state ownership report by State Interest and Governance Authority (SIGA), he said revealed that inefficiency was affecting many SOEs, a situation which demanded that authorities acted with conviction and courage to tackle the systemic challenges confronting the enterprises.
He noted that the many inefficiencies had left the SOEs burdened by waste, underperformance, conflict of interest, and a complete detachment from national interest.
“Many of our SOEs have been used as mere instruments for generating personal wealth for persons appointed to positions within the entity. Those responsible for these situations are the chief executives, the management and the management boards of these enterprises,” he pointed out.
In the estimation of President Mahama, many of the entities were at their “lowest ebb” in the history of the fourth republic and one of the reasons he was elected was to fix them; a charge he was determined to keep.
“My vision for reform is clear. It is anchored on performance, accountability and national interest. Under my leadership, specified entities will be reformed into engines of growth aligning with our goal of a 24-hour economy that expands job opportunities and drives industrialisation,” he stressed.
At the heart of the reform, he said would be the SIGA which would evolve from a passive observer into an empowered enforcer of national interest.
Key among SIGA’s new focus would be to negotiate and enforce performance contract, conduct regular in-depth assessment of SOE finances, ensure accountability, issue binding directives, implement compliance mechanisms, intervene in underperforming entities, commission audits to identify inefficiencies and financial leakages and set and monitor performance metrics.
He said corruption, procurement fraud and financial mismanagement would be prosecuted strictly and boards that rubber stamp poor decisions would be replaced without delay.
“We appointed you because we have confidence in you and we expect that each of you will live with professionalism and urgency to fulfill your mandates to operate your entities as competitive businesses and not political offices,” President Mahama charged.
The Finance Minister, Dr Cassiel Ato Baah Forson, said the loss-making SOEs posed a risk to the economy and that a turn-around strategy was needed to return the enterprises to profit-making.
The strategies, he said would include capacity building, enhancement of corporate governance training, and financial discipline.
He assured that his outfit would work with the SIGA to ensure compliance at the various SOEs.
Dr Michael Kpessah Whyte, the Acting Director-General of the SIGA, said the Authority was ready to undertake its mandate to help reform the SOEs into profit-making entities.
BY JULIUS YAO PETETSI