HomePoliticsParastatals still without board of directors

Parastatals still without board of directors

THE majority of parastatals and public-owned entities in the country are still operating without a board of directors, forcing State Enterprises and Parastatals minister Gabuza Joel Gabbuza to seek cabinet intervention to restore accountability.

The country has about 70 parastatals, the majority of which are performing badly due to a myriad of problems that could potentially be solved if boards of directors were in place to ensure good corporate governance, Gabbuza told the Zimbabwe Independent on Wednesday.
Some of the parastatals, it emerged, have gone for years without any boards after the terms of previous ones expired.

“The majority of the parastatals are operating without any board of directors and we have quite a number of those parastatals but I cannot name them now as the information is classified and has to go for cabinet and the cabinet is waiting for that information,” said Gabbuza.

Gabbuza blamed line ministries for failing to appoint relevant boards despite requests from his ministry.
Previously, ministers were responsible for appointing respective boards to state enterprises that fell within their jurisdiction. Following the formation of the inclusive government last year, ministers have to liaise with the Ministry of State Enterprises and Parastatals before making such appointments.
“Some of the boards’ terms of office have expired while the majority of the parastatals have not had any boards for years now,” Gabbuza said.

It also emerged that in some cases, the line ministries were not appointing the board of directors for the parastatals as some politicians and ministers were benefiting directly from the parastatals’ lack of leadership.
Government sources, who declined to be named, said some officials were reluctant to see state-owned entities operating efficiently as they were feeding from the decay at the institutions.
“We know there has been abuse of the state-owned entities. In most state-owned entities the politicians and ministers do not want boards in place because they want to direct managers on what to do on issues that benefit them directly,” said a source.

Some of the parastatals and companies that do not have boards are the Central Mechanical Equipment Department, struggling public transport firm Zimbabwe United Passenger Company and postal services entity Zimpost.

Parastatals have remained a drain on the national fiscus and the majority of them have failed to provide audited financial statements and remuneration details of their chief executive officers to the Ministry of State Enterprises and Parastatals as demanded by Gabbuza’s ministry in January this year.
Gabbuza said the government had identified 11 parastatals that it wanted privatised.

Companies that have been identified for privatisation are NetOne, Cold Storage Company, Grain Marketing Board, Agribank, Ziscosteel, National Oil Company of Zimbabwe. Allied Timbers, Air Zimbabwe, TelOne, Infrastructural Development Bank of Zimbabwe, and the Zimbabwe Institute of Public Administration and Management.

Loughty Dube

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