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framework and the Public Finance Management Act.
In an update report prepared for the Office of the Prime Minister recently, Minister of State Enterprises and Parastatals Mr Gorden Moyo said that this was a “major decision” by the Cabinet reached after serious lobbying by his ministry.
“The start of a new financial year presents an opportunity to have a fresh start so as to ensure that performance contracts are in place at all SEPs,” said Minister Moyo.
“Hopefully, the State Enterprises Management Bill will be tabled before Parliament in the first half of the year. Once adopted, this Bill will empower the ministry to ensure that SEPs comply with standards of good corporate governance.” SEPs have over the years been heavily reliant on fiscal support from Treasury.
Minister Moyo also said Government was in the process of establishing a State Enterprises Advisory Council, which will provide advice and ideas on the SEPs management and reforms.
He said the council will act as the SEPs “think tank”.
The council will be composed of chief executives and board chairpersons of identified SEPs.
“The terms of reference for this Advisory Council will include making recommendations on restructuring and also solving inter — institutional problems such as inter-parastatal debt,” said Minister Moyo. He did not, however, indicate the timeframe of when the Advisory Council would be in place.
In 2010, Government identified SEPs that required urgent restructuring but the progress has been slower than anticipated. There has been, however, notable restructuring progress at Agribank, Grain Marketing Board, Air Zimbabwe Holdings (Pvt) Ltd, ZPC, Arda Chisumbanje Project, Zimbabwe Grain Bag, Zimbabwe Iron and Steel Company (now NewZim Steel) and the National Oil Company of Zimbabwe.
Minister Moyo said Agribank would be privatised in the first half of next year as the financial and legal advisors for this transaction have already been appointed.
Minister Moyo expressed concern over “the speed of restructuring process (that) has been hindered by resistance to change and the fear of losing power by those who perhaps benefited from lack of transparency.” He also said there were clear turf wars where some parastatals and ministries choose not to co-operate.
On inter-parastatal debt strategy, which is now over US$1 billion where Government departments and local authorities are included, the Government has started engaging SEPs to implement some of the mechanisms for clearing the arrears. He said, Government would pay an estimated US$124,4 million to SEPs who, in turn will pay their statutory obligations to the Zimbabwe Revenue Authority.
The “flagship” programme of corporate governance would be stepped up. He said it was the responsibility of the line ministries to ensure that the boards are in place at SEPs and the Ministry of State Enterprises and Parastatals would seek the support of the Office of the Prime Minister to ensure that boards are appointed at all SEPs.
Online Reporter