HomeLocal NewsParastatals should comply or else...

Parastatals should comply or else…

-

The government has threatened to crack the whip on state enterprises and parastatals that continue to do business in a lackadaisical manner and has given the parastatals a three month deadline to comply.
The government wants the State Enterprises and Parastatals (SEPs) to regularise salaries of its executives, produce audited financial results, call for annual general meetings and appoint boards of directors.
NewsDay has established that those likely to be the early causalities of the government’s whip include the Research Council of Zimbabwe, Small Enterprises Development Corporation (Sedco), Civil Aviation Authority of Zimbabwe (CAAZ), Central Mechanical Engineering Department (CMED), Zimbabwe Schools Examination Council (Zimsec) and the Zimbabwe United Passenger Company (Zupco).
Gorden Moyo, the Minister of State Enterprises and Parastatals, said government had serious concerns over the manner in which SEPs were conducting business.
Moyo said those who were found wanting had three months to get things right.
Moyo said SEPs had the potential to contribute at least 40% of Gross Domestic Product (GDP) if they operate according to expectations.
“Despite the clear critical and strategic role played by the state enterprises and parastatals, there is general dissatisfaction by the government and citizens with the corporate governance and performance of the SEPs,” Moyo said.
“The government of Zimbabwe as the principal shareholder would like to see State Enterprises and Parastatals transformed into vibrant enterprises which will become the engine of economic growth and development.”
Moyo said the SEPs should shake up and follow corporate ethics and laws that govern their operations with immediate effect.
He said the majority of state enterprises and parastatals were operating outside the laws that govern them.
“We have serious concerns with what has been happening,” he said. “We want to make sure they get back on track and contribute to the country’s economic recovery.”
Moyo said several state enterprises and parastatals had, for a long time now, not held annual general meetings to review their operations while others were operating without boards of directors to direct policy.
Those operating without boards should regularise this anomaly within three months.
The minister said other SEPs had, for a long time, not presented audited financial statements. and parastatals should urgently address these issues.
Salaries and remunerations of individuals holding designated positions in state enterprises and parastatals should be approved by line ministers in consultation with his ministry. As well as board fees and sitting allowances of the parastatals’ boards.
“Our observation is that there are a number of state enterprises and parastatals that have been awarding themselves salaries without approval (therefore) acting in contravention of their enabling Acts,” Moyo said.
“I am not saying cut your salaries. I am saying if you have not regularised do it with immediate effect.”
Moyo said regularising salaries and remuneration would help his ministry check on affordability, sustainability, comparability and whether they were reasonable given the state of the country’s economy, recovering from years of depression.

Moyo said some state enterprises and parastatals entered into joint venture deals without following due process. This, he said, promoted corruption and under-hand dealings.

Recent Posts

Stories you will enjoy

Recommended reading