SEC to review quarterly reports of all SOEs

The State Enterprises Commission (SEC) is to start the quarterly review of the reports of 344 State Owned Enterprises (SOEs) to ensure efficiency and protect government interest in these entities, a Finance Committee Report on the 2018 Programme Based Budget Estimates of the Office of Government Machinery has revealed.

According to the report, SEC will conduct monitoring visits to these SOEs and sub-vented agencies as well as undertake performance contract negotiations and sign them with 86 state-owned enterprises.

As part of building its capacity, SEC will organise training workshops for new board members and staff of these SOEs. The SEC, through its monitoring exercise, is also expected to update its integrated database.

The Commission will be looking to achieve these objectives with a budget of GH₵3million, allocated them under the Office of Government Machinery for the 2018 fiscal year.

SOEs are fundamental to the economic growth of many economies, especially for the delivery of public goods and services to aid expansion of the private enterprises.

A 2015 PwC research noted that though the motivations for state ownership can wax and wane over time, state-owned enterprises (SOEs) appear to be an enduring feature of the economic landscape and will remain an influential force globally for some years to come. As such, the research notes, it is important to ensure that – whether held nationally, regionally or locally – the state’s investments actually deliver the societal outcomes desired.

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“In our view, SOEs are likely to remain an important instrument in any government’s toolbox for societal and public value creation given the right context, collaborating with other stakeholders for this purpose in the ‘penta helix’ of private companies, not-for-profit organisations, academia, public sector and citizens. For instance, increased global competition for finance, talent, and resources may mean that countries may increasingly turn to SOEs as a tool to better-position themselves for the future in the global economy,” it said.

In Ghana, the State Enterprises Commission (SEC) was established to oversee and coordinate activities of state-owned enterprises to ensure targets are met. Its impact on the performance of the SOEs, however, has not been felt in the sector.

This has led to its diminished importance over the years. Presently, government holds varying equity interests in about eighty-four (84) companies – comprising forty-four (44) wholly-owned State-Owned Enterprises (SOEs) and forty (40) Joint Venture Companies (JVCs)

Many of these companies have been underperforming compared to their own objectives, while others are incurring losses. Furthermore, the expected returns to government from the SOEs and JVCs have not been commensurate with the level of investments made.

The Executive chairman of SEC, Stephen Asamoah-Boateng, shortly after his appointment said as part of his vision for the Commission he intends to guide and assist, at least, two (2) SOEs to develop to the level of Fortune 500 listed companies within the next 10 years.

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He explained that this will entail the redesign and re-engineering of SEC’s current structure to one that places emphasis on the need to streamline and centralise government’s oversight and management of SOEs in a transparent manner that raises corporate governance standards to new, enviable levels on the international stage.

“The New State Enterprises Commission will be proactive and innovative in building beneficial relationships to bring continuous improvements in SOEs operations. There will be a unified, centralised and digitised Performance Monitoring and Evaluation Framework for the effective, real-time tracking of all SOE operations.

“The New SEC will also be coming up with a model inter-SOE trading arrangement that will be backed by law, so as to maximise your operational and financial opportunities. The proposed amendment to the Public Procurement Act, 2003 (Act 663) will be made to ensure business-to-business (B-2-B) trading activities among SOEs,” he said.

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