GOVERNMENT yesterday announced that it has scrapped financial support to State enterprises and parastatals (SEPs) that do not comply with statutory obligations of Corporate Governance Framework and the Public Finance Management Act with effect from 1 January 2013.
SENIOR PARLIAMENTARY REPORTER
Speaking at a Press conference in Harare yesterday, State Enterprises and Parastatals minister Gorden Moyo announced stern measures on SEPs and outlined the conditions that would qualify them for fiscus support.
“Given the catalytic role played by SEPs in almost all sectors of the economy and in line with the contemporary democratic development state paradigm, the State Enterprises and Parastatals ministry would like all stakeholders to note that from January 2013 onwards, requests for financial support by SEPs will only be considered by Treasury after compliance with statutory obligations, provisions of the Corporate Governance Framework and the Public Finance Management Act,” said Moyo.
“We have noticed as government and the ministry that a lot of parastatals have not done their restructuring programmes and have not provided this ministry and the Inter-Ministerial Committee on commercialisation and privatisation of parastatals their proposals for restructuring, but they continue to ask for support. ”
Moyo said recommendations from line ministries for provision of financial assistance to those SEPs should be accompanied by relevant documentation such as annual budgets and strategic plans, annual reports, audited financial statements and a list of board members.
The minister said some of the SEPs continuously sought financial support from government yet they could sustain themselves through restructuring and properly constituted boards.
“There must be gender equity and skills mix in those boards, and a circular on the above position is due to be sent to all stakeholders,” he said.
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In his document on the progress of SEPs Reform Programme, Moyo noted that out of the 76 SEPs, only 30 submitted compliance reports for the first half of 2013.
He said while some line ministries had appointed boards for SEPs like TelOne, National Railways of Zimbabwe and Zimbabwe Power Company, others like Potraz, Zimpost, Traffic Safety Council of Zimbabwe and the Zimbabwe Family Planning Council were still operating without constituted boards.
