Source: Govt intensifies parastatal reform | The Herald May 10, 2016
Tendai Mugabe Senior Reporter—
Government has rolled out an ambitious turnaround programme of State-owned enterprises, starting with 11 key parastatals to reduce the fiscal burden and ensure they operate viably. The viability of state enterprises and parastatals is integral to the successful implementation of mega deals signed between Zimbabwe and China during President Mugabe’s 13th State visit to Beijing in 2014.
The programme involves the auditing of the institutions which is currently underway and formulation of turnaround strategies.
The first 11 entities prioritised under this programme include the Industrial Development Corporation of Zimbabwe, Zimbabwe National Water Authority, Civil Aviation Authority of Zimbabwe, Agricultural and Rural Development Authority, Air Zimbabwe, Cold Storage Commission, Grain Marketing Board, National Railways of Zimbabwe, TelOne, Zimbabwe Iron and Steel Company and Zimbabwe Power Company. So far, Grain Marketing Board and Cold Storage Commission audits have been completed while turnaround strategies for TelOne, Zinwa and IDCZ have since been submitted for Cabinet approval.
This was revealed by Vice President Emmerson Mnangagwa while presenting a lecture to senior military officers at the National Defence College last Friday. “As a first step, Government has identified the parastatals and begun to take audits of the first few,” said VP Mnangagwa. “To date, two audits have been completed on GMB and CSC and three turn around strategies submitted for approval to Cabinet for TelOne, Zinwa and IDCZ.
“Decicions have also been made to seek strategic and technical partners in Air Zimbabwe and the National Railways of Zimbabwe. There are plans to unbundle CAAZ into a separate regulatory and commercial entity, while Arda is in the process of establishing joint venture partnerships for several of its farming estates.”
The ultimate goal, VP Mnangagwa said, was to improve oversight and governance of parastatals and strengthen accountability. To this end, VP Mnangagwa said it was important to have best boards of directors appointed on merit in all state institutions. He said in future modalities could worked out to ensure that boards appointed outside the realm of ministers.
“There is need to focus on recruiting the best talent to ensure diversity in terms of skills mix,” said VP Mnangagwa. Responding to one of the officers who had suggested that appointment of boards of directors for State owned institutions should be done by the Office of the President and Cabinet, VP Mnangagwa said: “The current methodology of appointing directors is not the best practice.
“Most of the State enterprises and public institutions are assigned to line ministries and the Act provide that the directors shall be appointed or approved or suggested by the Minister and invariably you will find one way or the other the Minister might appoint a person in some instances it’s because they were at college together or you know the person as a neighbour or you are one of my relatives. We must find an innovative manner where this is done on merit.
“If we have an entity or methodology where the board of directors is appointed outside the realm of the minister himself I think it’s a good idea.” “We need to look for some procedure that removes these possibilities because it turns us into persons who are biased.” VP Mnangagwa said parastatals should work in unison if the State was to yield maximum results from them.
He said Government had adopted a new determinism aimed at reforming the State enterprise sector and had come up with a new governance framework for State institutions. VP Mnangagwa said this was given impetus by the US$4, 3 million solicited from the World Bank under the Zimbabwe Reconstruction Fund.