Government of Ghana has signed an annual performance contract with State-Owned Enterprises (SOEs) and their principal shareholder.
In a meeting with the SOEs, Vice President Dr. Mahamudu Bawumia assured in a statement that the Nana administration is committed to supporting the SOEs which he stated are at the heart of the production and delivery of major public infrastructure and services.
"State Owned Enterprises are so critical to this economy.They are really critical.The mismanagement of one state owned enterprise can literally collapse this economy,we have SOEs like Cocobod,GNPC or TOR .These are major enterprises with major financial implications for this economy. If we do not take the performance of the state owned enterprises seriously.It means we are not taking the performance of the economy seriously," portion of the statement read.
Read full statement below:
BY HIS EXCELLENCY DR. MAHAMUDU BAWUMIA, VICE PRESIDENT OF THE REPUBLIC OF GHANA AT THE SIGNING OF THE 2017 Performance Contracts Between SOEs and The Government of Ghana
30th May, 2017
Labadi Beach Hotel
(TIME ALLOWANCE: 10 MINUTES)
Madam Chief of Staff,
Honourable Ministers of State,
Honorable Deputy Ministers of State,
Distinguished Chief Executives and Board Members of SOEs,
Ladies and Gentlemen
It is my pleasure to join you here today for the signing of the annual Performance Contracts between Sate-Owned Enterprises (SOEs) and their principal shareholder, the Government of Ghana.
Mr. Chairman, SOEs are at the heart of the production and delivery of major public infrastructure and services: from electric power, through drinking water to petroleum products.
I am sure many of you, either as participants or observers, have witnessed similar signing events over the years in which we gather, SOEs and government officials, to go through the same routine.
And I am also certain that all gathered here will be asking the same questions they have asked year in and year out: what has changed, and what will be the consequences of not meeting the terms of these contracts?
My answer to these questions are that a lot has changed, we have President Nana Addo Dankwa Akufo-Addo that has changed.
The President is very focused on making sure that there are consequences to failure. We intend to hold your feet to the fire and hold you accountable for the performance contract that you are signing today.
State Owned Enterprises are so critical to this economy.They are really critical.The mismanagement of one state owned enterprise can literally collapse this economy,we have SOEs like Cocobod,GNPC or TOR.
These are major enterprises with major financial implications for this economy. If we do not take the performance of the state owned enterprises seriously.It means we are not taking the performance of the economy seriously.
For the longest time ,state owned enterprises in terms of economic management have almost been seen as being on the periphery other than being at the centre of the economy and so on.We only hear in passing that has happened in this enterprise.
Economic managers do not have their finger on the pulse of what is happening in these state enterprises. We want to know what is happening?
We want to know the monies that are going into your bank accounts and are leaving and for what purpose, so are going to be a bit more interested in what is going on,not waiting till the end of the year but actually trying to get our finger on the pulse of what is going on.
Mr. Chairman, Ghanaians, in no uncertain terms, made their intentions clear that the days of business-as-usual is over. When Ghanaians went to the polls in the last election to vote overwhelmingly for change, they voted with the expectation of real change in the way we govern, in the way we manage state resources and finances, and especially, in the way government delivers public services which invariably means service delivery through the SOE.
The mandate given to government is also a mandate to all SOEs to transform the way they work, and to deliver quantifiable change for citizens.
Our objective as a government is to make Ghana a business-friendly economy that would create jobs and prosperity for all Ghanaians. At the heart of this drive is a private sector working hand-in-hand with, we expect, efficiently-run, capable public sector enterprises.
As the quasi-commercial arm of the state, the role of SOEs in helping achieve the objective of job-creating Public Private Partnerships (PPP) is pivotal as they extend to all critical sectors of the economy, including Energy & Power, Petroleum, Trade, Agriculture, Manufacturing, Housing, Railways and Aviation.
There is therefore an expectation that SOEs will be significant partners in economic development. They can only do this by casting aside the old ways of doing things and adopting modern, and financially-prudent methods of working.
Over the next four years, government’s plan is to roll out a massive integrated infrastructural development programme in the development of our modern Road Network, Housing, Water systems, Aviation, Ports, Harbours and Railways.
This is not just at the national. We will be investing the Ghana Cedi equivalent of US$4 Million dollars in each of the 275 constituencies of the country (US$1 Million each year for four years) in local infrastructure development.
The roll-out of these projects would be undertaken through direct government investment and Public Private Partnership (PPP) programmes.
Local and foreign investors are looking for opportunities to invest in Ghana to take advantage of the enormous upside growth potentials of our economy.
Right in the middle of these energized business, investment, and economic activity will be our SOEs.
What we need to ask ourselves, as we sign these performance contracts this morning, is whether we, SOEs, are sufficiently primed to be equal partners with the private sector. Whether what we bring to the table will create value for Ghanaians.
For example, a major weakness of SOEs is its corporate governance structures. Are corporate governance structures of SOEs, in its present form, sufficiently invested with the requisite expertise, and are they agile enough to keep up with, and get the best deals out of their partnerships with the private sector?
Secondly, have SOEs been good stewards of the public purse?, and going forward, how can you, as custodians of public funds, exercise your fiduciary duties with care, diligence, and with clean hands?
The airwaves over the last week have been awash with the millions of dollars of state funds that have been diverted into the private pockets of public servants and their political counterparts.
Ghanaians are quite rightly fed up with the abuse of office that has become a trend in our recent past. There is no doubt in my mind that Ghanaians will not accept that from people they have placed in charge of state resources and SOEs must stay abreast, and in tune with the change in mood of the long-suffering people of Ghana.
Very soon,the Special Prosecutor's office will come into being and you will see a lot of activities in relation to conducts of SOEs and people being held accountable for their conducts.
Thirdly, an area which must be of concern to us all is the impact of the quasi-fiscal activities of SOEs on the macroeconomic environment. A case in point is the energy-sector debt that has also created systemic risks in the banking sector.
As custodians, my charge to you is that you must, in exercise of the faith we have placed in your hands, be mindful of the implications for the whole economy in the type of contracts and commitments you make which places contingent liabilities on the central government.
The Public Financial Management Act provides for how financial and commercial transactions by state entities should be done, and we will fully expect that you will be applying same.
I entreat all of you ,individually to obtain a copy and keep by your side the Public Financial Management Act and read it,keep referring to it.It is a new act and we have to be familiar with it because it will be applied.
The current state of our SOEs indeed calls for bold and swift reforms if we are to position them to work effectively with the private sector to create jobs and lay a new foundation for growth.
As I said, a lot of the time in the area of economic management we do not think about the state enterprises, we just leave them aside.They are on the periphery and we do not know how their finances are proceeding ,the projects ,the issues and so on.
The Ministry of Finance has already stated that ,there is going to be an annual dialogue with SOEs,that alone is not going to be enough.
His Excellency the President is also going to hold along with the Economic Management Team a half- yearly meeting with SOEs, so that we can review what is going on half -yearly.
We will look at the financial reports, projects and activities that are taking place and the issues that you are facing because some times when we talk regularly, we can solve problems and we can coordinate activities much better and the Economic Management Team and the President will have a very much hands on approach ,finger will be on the pulse and we will all work together as one team to deliver the transformation of Ghana.
As part of these broad reforms, the State Enterprises Commission, as well as selected SOEs, are benefitting from a World Bank Technical Assistant Programme that aims at consolidating the state’s ownership role in SOEs into a Single Entity, which will be the State Enterprises Commission, improving performance and ensuring effective and efficient service delivery by SOEs.
Next year, when, God-willing we come back here, Ghanaians will want to hear that we did not only meet our expectations, but we also have been good stewards and actually exceeded those expectations.
In conclusion, I urge all the boards and management to work with the Commission through the reforms, and to ensure the success of their respective SOEs.
God bless our homeland Ghana.
Thank you and God bless us all.
Source: Ameyaw Adu Gyamfi/Peacefmonline.com/Ghana
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