17 defunct entities owned by government to be sold

Government is to dispose of some 17 defunct entities which have been left to rot for decades. 

The 17 defunct entities include Aboso Glass Factory’s Central Stores, bungalow of the Bolgatanga Meat Factory, Bonsa Tyre Factory’s Clinic, research laboratory of the Ghana Consolidated Diamonds, regional office of the Ghana Food Production Corporation at Srodae and the guesthouse of the State Construction Company at the Dagomba Street in the Northern Region among others.

Cabinet has already approved the processes for evaluation of the assets of the affected entities and within the next few months activities for disposal will begin.

This will save government money being used to pay salaries of security guards and other personnel who keep watch over the 17 defunct entities.

Minister for Public Enterprises, Joseph Cudjoe announced this when he took his turn at the Ministry of Information’s Press Briefing yesterday.

He noted that the disposal of the entities is part of a strategy by his office to restructure the Public Enterprises portfolio in the country.

Aside the disposal the Minister indicated that the other portfolio management strategies included liquidation, listing on the Ghana Stock Exchange and strategic investment

There are 175 Specified Entities operating in various sectors of the economy comprising 53 State Owned Enterprises (SOEs), 47 Joint Venture Companies (JVCs) and 75 Other State Entities

A study undertaken by the government and completed in 2019 estimated the market value of the State’s equity holding in 63 active entities at GH₵‎35.7 billion as at December 2016. 

SOEs accounted for 92% of this value. The remaining 8% represented the State’s equity stake in JVCs.

Mr Cudjoe highlighted the situation of the defunct entities whose current state of disrepair was a sad sight to behold. 

The Minister intimated that it has become imperative therefore that these entities are completely disposed of to save resources and salvage for sale what can be saved.

In view of this, he said Cabinet is considering a Memo to restructure all Public Enterprises or entities which government has interest in.

According to him, the Memo seeks to liquidate, list on the Ghana Stock Exchange, look for strategic investment and or dispose them. 

The Minister outlined the efforts the Secretariat is undertaking together with other agencies of government to streamline the portfolio of public enterprises in Ghana.

Portfolio Management, the world over requires consistent overview and analysis of the interest of the Shareholder to ensure efficiency, economy and profitability at all times.

This approach is no different from what the government of Ghana is currently doing through the Minister for Public Enterprises and the Minister for Finance.

Mr Cudjoe pointed out that the efforts being taken on active entities in which the government has significant stake is to make them more functional, efficient and effective and where they cannot be turned around, to dispose of them.

On specific efforts being undertaken to improve the current stock of entities of the state, he outlined measures undertaken to include, building the capacity of Boards and Board Secretaries in corporate governance, and institutionalization of a code of corporate governance for implementation across all the specified entities.

The rest include the Implementation of the annual stakeholder series, implementation of the annual performance contracts and the Implementation of the Public Enterprises League Table.

It is based on performance indicators provided in the performance contract signed between State Interests and Governance Authority (SIGA) and the Entities.

The PELT is expected to engender a healthy competition among the entities for improved performance and to recognise the best performing entities.

A maiden edition was of the league table was published last year and is expected to be held on an annual basis.

The Minister said the activities are expected to lead to the improvement of systems and processes for the development of the entities and ensure competition and achievement of targets set for them. 

To further consolidate the gains made to include Minister stated that there need to be further improvement in compliance to submission of reports, signing of performance contracts, submission of audited accounts and implementation of restructuring and turnaround plans for entities that require them.

Mr Cudjoe added that there will be an intensification of the engagement with the Parliament of Ghana and digitalisation and revenue leakage risk mitigation.

The Minister said Specified Entities are a key feature of all countries the world over, saying they are used for growth and development of sectors of the economy and to drive the development envisaged for such sectors. 

Mr Cudjoe who doubles as the Member of Parliament for Effia, in the Western Region outlined his achievements in ensuring that Public Enterprises work efficient, effective, and where applicable, profitable and the way forward.

The Minister has had interactions with Boards and Management of some Specified Entities.  To date, he has interacted with 44 entities.

The visits helped to resolve pertinent issues relating to the entities.

It afforded the entities the opportunity to raise challenges they were facing which required support and direction especially from SIGA.