Editorial Comment: Parastatals must reform or be ‘buried’
The call made by President Mugabe last week to “bury” some non-performing parastatals and State enterprises should be pursued vigorously.
What makes the President’s call urgent is that a number of such entities have been failing to perform to expectations and have become a burden on the fiscus.
Some of them have constantly been begging for funding from Government, yet the expectation is that they should be the ones declaring dividends to the shareholder.
The truth is that all parastatals and State enterprises have potential to make money.
One of the major reasons such entities have been going down is corruption and mismanagement. In recent years, the Auditor-General’s report has been exposing corruption in a number of Government-linked entities whose managers have since appeared in court facing different charges.
We note that corruption has become so entrenched in some State entities that they have become incapacitated.
This is despite that Government has been doing everything possible to ensure the firms are kept afloat by injecting funds.
Doing away with failed parastatals would help restore confidence in the revival of the economy. Instead of helping turn around the economy, some parastatals have become a stumbling block.
Only parastatals that are still serving their purpose should be spared.
We urge ministers responsible for parastatals and State enterprises to take President Mugabe’s call seriously.
We presume that they already know entities which are not performing to expectations. These ministers should quickly draft acceptable measures and a plan on how to reform or dispose of such parastatals and State enterprises, without causing ripple effects in other sectors.
We note that several ministers have threatened to shut down such parastatals in the past, but nothing happened in that regard.
We hope this time we will see some movement against those parastatals and State enterprises which cannot be saved, especially after President Mugabe pronounced himself clearly on the matter.
For how long will Government continue subsidising failing parastatals?
We view President Mugabe’s call to do away with some of the parastatals as a good option, especially with regards to those which have failed dismally.
For those with room for improvement, the option can be to seek partnerships with foreign investors who can bring in the much- needed recapitalisation.
Recent reports that the National Railways of Zimbabwe (NRZ) has found investors who are bringing in $400 million for its revival are much welcome.
A huge leap forward is expected at Ziscosteel, which has reportedly attracted a $2 billion investment from a Chinese firm.
With such huge investment, it is expected that the concerned parastatals would soon return to profitability. The Accountant-General last week revealed the rot that characterise some parastatals.
We all await the report he promised he will be tabling in Parliament soon, indicating how the Auditor-General failed to do reports on some parastatals because there was nothing to report about.
According to the Accountant-General Mr Daniel Muchemwa, at least 30 parastatals and State enterprises were not audited last year for various reasons, which include the one cited above. These are serious observations which strengthen the need to do away with non-performing parastatals and State enterprises.