State must relook at its entities – report

THE LONG-awaited review of State-owned entities, released yesterday, moots the possibility of collapsing non-viable parastatals but skirts the vexed issue of privatisation.

The report provides government with a range of options, including absorbing ailing State-owned enterprises (SOEs) into line-function departments, turning them into public-private entities, or “completely disposing of them as State entities”.

However, at a press briefing, the deputy chairman of the presidential review commission, Glen Mashini, said privatisation was deliberately not mentioned, though the report acknowledged a universal truth: that some services were better provided by the private sector. “We did steer away from that divisive terminology in terms of whether you privatise or whether you retain.”

He said the committee agreed that in instances where market conditions had rendered a particular entity obsolete, the State “can diversify away from it”.

The review, which was three years in the making, makes 31 recommendations, many aimed at standardising the managing of SOEs – down to the appointment and remuneration of their executives. It also says government must define different categories of SOEs, with some required to return a profit to the state and others primarily designed to provide a service.