By the end of this year, there will be a new law that will transform the State Enterprises Commission (SEC) into an Authority and define its regulatory role over the operations of State Owned Enterprises (SOEs) in the country.
Executive Chairman of the Commission, Mr Stephen Asamoah Boateng says his outfit is being restructured to better manage SOEs and to afford them sustained profitability and efficiency.
“There is a shift away from what has been known as State Enterprises Commission to State Interest and Governance Authority; the Bill is before Cabinet at the moment, it will go to Parliament for passing into law,” Mr Asamoah Boateng said.
The SEC Boss was speaking at the 6thAnnual General Meeting (AGM) of the Ghana Airports Company Limited in Accra last Tuesday.
The SEC Chairman said his outfit had noticed multiplicity of authorities and functions; multiplicity of monitoring functions which had culminated in poor compliance with requisite reporting standards.
Indeed, the 2017 State Ownership report published by the Ministry of Finance identified conflicting objectives, dispersed monitoring systems, lack of transparency and weak lines of accountability as symptoms of the country’s SOE sector.
The law, Mr Asamoah Boateng said would afford his outfit the wherewithal to support the SOEs to operate more efficiently and profitably.
The mandate of the Commission has been to ensure that SOEs are efficient, effective and profitable.
The GACL, Mr Asamoah Boateng said was one of few SOEs that had adhered to reporting lines. He hoped the other enterprises would fall in line, “so they do not attract sanctions that they are liable to suffer.”
Amidst challenging conditions, the GACL bagged a revenue of GH¢448million for 2017, up from GH¢373million in 2016, representing a 21 per cent increase, attributed to the combined growth in aeronautical and non-aeronautical services.
Challenges in SOE sector
The SOE sector in Ghana, even after decades of divestiture/ privatization, remains quite significant and displays a strong sectoral concentration, with the largest SOEs located in the energy, transportation, and financial sectors.
By the end of 2017, the state portfolio contained a total of 86 entities with 45 being wholly owned and 41 partially owned companies. Nine of the companies are publicly traded, of which, 36 are classified as commercial SOEs and the remaining 9 are subvented agencies.
There are 36 commercial SOEs that operate more independently from government. They are expected to cover their operational and capital expenditures, and contribute to government revenue through dividends and taxes.
26 out of the 36 commercial SOEs are Limited Liability Companies (LLCs) and therefore operate under the Companies Code. The remaining 10 commercial SOEs are Statutory Corporations established by Acts of Parliament.