Fate of Public Enterprises’ Trustee board under question


The Ministry of Finance and Economic Development (MoFED) commissioned a study to determine whether existence of a Board of Trustees for Public Enterprises is necessary.
The Board of Trustee for Public Enterprises was established in 2000 in accordance with proclamation number 208/2000 that replaces the old Board of Trustee for Privatized Public Enterprises.
The trustee board for Privatized Public Enterprises that was established in 1996 was a responsible government body that followed the privatization or dissolution process of formerly government-owned entities.
Sources stated that a consultancy firm was selected to conduct the study by MoFED, which is the controlling body of the trustees’ board, had submitted the study along with recommendations to the ministry in January 2015.
Particular details of the study and the recommended actions will be pondered on by representatives of relevant government bodies. According to sources, the final decision that determines the existence of the trustee board will be made by the Council of Ministers. Sources said there could be three alternatives the approving body may choose from: to let the board continue in its present form, or to place it under another government office, or to dissolve it. Since its formation, the Board of Trustee has received several documents from the former public enterprises that were privatized or dissolved.
Tsegaye Hailemariam, Director for Public Relation and Information Directorate of the Board of Trustee, told Capital that the huge documents are stored in six warehouses, some of which are leased.
He said that the board does not have the mandate to get rid of unnecessary documents and waits for a decision to solve the issue. The National Archives and Library Agency is the relevant body that shall receive the bulky documents from the Board of Trustee.
“From the total documents, the archives agency might need only five percents,” the public relation head said. According to Tsegaye, storing the documents forces the board to pay for unnecessary costs.
“The documents shall be converted to digital format whose cost we have recommended to be included in the study,” Tsegaye elaborated.
Haji Ibsa, Public Relation Head of MoFED, told Capital that the case is not yet finalized. “MoFED and other government bodies will give their opinion on the study,” he said. He said that detail works remain to be done by the consultancy besides the main study report.
According to Haji, there is yet another option that decides the board’s fate, either to include it under Public Procurement and Property Disposal Service, another organ answerable to MoFED, or put it under the Public Private Partnership that is formed by the private sector and the government.
According to the 208/2000 proclamation, the Board of Trustee have a responsibility to take over documents relating to receivables and debts of an enterprise transferred to it, reconcile receivable and payable accounts with the concerned third parties, and collect receivables and take appropriate measures for their collection. The proclamation also requires adherence to the directives of the Ministry of Finance on disposal of government properties.
The Board of Trustee is mandated by the same proclamation to submit debts to the government to be settled, investigate receivables and debts that cannot be collected and settled and recommend their write off to the government, directly settle debts decided by the court or to which specific delegation has been given by government directives, and to dispose properties transferred to it. The board is further empowered to follow where the privatization modality applied by the agency is an asset deal or whether the restitution of an enterprise to its former owner takes effect.
Since its formation, the privatization agency had followed the privatization and dissolution of over 200 enterprises. According to Tesgaye, in the first half of the current budget year the board has transferred 46 million birr to government treasury that was collected from former public enterprises and employees, and it also settled a 20 million birr payment for 42 organizations and individuals. It has also sold an asset worth 19 million birr which it received from privatized enterprises.
The government still owns several public enterprises that are controlled by the Privatization and Public Enterprises Supervising Agency.