Finance Minister, Ken Ofori-Atta has revealed that for the past six years 47 public enterprises have submitted no financial statements to his ministry, a flagrant contravention of the Public Financial Management (PFMA) Act 921.
He also disclosed that, only 14 out of 129 State-Owned Enterprises (SOEs) and Other State Entities (OSEs) responded to the requirements of section 93 of Act 921 to submit quarterly reports on their operations.
Speaking at the 2021 Performance Contract Signing Ceremony, the minister said: “These statistics highlight the need for a renewed performance contract between the State and its Enterprises. To recover from the COVID-19 pandemic, we must pursue accountability, transparency, and responsible custodianship.
Our public enterprises are not vehicles to enrich a minority. They are intended to be arms through which the state promotes equality of opportunity and presents its citizens the tools to shape their own lives.
In line with the President’s vision of using the pandemic to recreate our country, the time has come to change the culture of our state enterprises. You must actively align your goals with the Ghana CARES program and be a significant partner in our economic transformation.”
The value of state enterprises is estimated at GH₵110 billion, which represents approximately 27 percent of 2020 GDP. This, the minister said, means that 10 percent return on assets could generate 11 billion to the national coffers and SOEs could be employing more than 700,000 in the public and civil service.
“Both myself and the Hon. Joseph Cudjoe, the Minister responsible for Public Enterprises, share the view that government must improve public service outcomes while achieving the requisite fiscal consolidation to help the economy grow.
Within this context, we have already engaged extensively and have developed a comprehensive policy on state ownership which is currently going before Cabinet for consideration” the minister said.
6 SOEs under sanction
The Director-General of the State Interests and Governance Authority (SIGA), Stephen Asamoah-Boateng, disclosed that six SOEs are currently being sanctioned for their persistent disregard of the Public Financial Management Act (PFMA).
Even though he shied away from disclosing the names of the entities, he said the move is to send a signal to the other state entities that the days of non-compliance is in the past.
Speaking to the B&FT, Mr. Asamoah Boateng said the sanctions have been framed in a way that will deter them from future non-compliance.
“At the moment we have written letters to about 6 SOEs and we have already applied the sanctions. For every sanction we identify, be it financial statement, management practices etc. you pay over GH₵12,000 for each. You can imagine if the infractions are more than two. We want it to be deterrent,” he said.