Non-performing parastatals must go: President
PRESIDENT Mugabe yesterday said non-performing parastatals and State enterprises must be dissolved as they are stifling economic growth through perennial dependence on the fiscus.
He said some ailing parastatals deserved to be “buried in coffins” as they were grappling with high overheads and under-capitalisation coupled with corruption and lack of good corporate governance.
President Mugabe made the remarks while addressing captains of industry at State House in Harare yesterday.
“I can reveal to you a Cabinet secret,” he said.
“We were discussing this subject on Tuesday. I was very negative about it and I could see the Minister of Finance (Patrick Chinamasa) getting more and more depressed by my speech which ended by these are non-performers what we must do is to find coffins for them and bury them with the words Rest in Peace.
“I said Minister of Finance, well you can
◆ go your own way. Then they said there are
certain ones very important ones, I agree that they should be kept, but the others we should get as many coffins as they are those which have caused us immense expenditure. They should certainly go.”
The private sector had earlier on told the President that it would be better if some parastatals and State owned enterprises were privatised.
President Mugabe said the State enterprises and parastatals sector had the potential to contribute 40 percent to the country’s Gross Domestic Product (GDP).
Currently, the contribution is around 12 percent.
Said President Mugabe: “We certainly share your concerns over underperformance of the State Enterprises and Parastatals sector.
“The enactment of the Public Entities Corporate Governance Act, currently before Parliament is expected to help transform the fortunes of the sector, through enhancing the entities’ compliance with sound corporate governance practices.”
President Mugabe said Zimbabwe had borrowed “these awful money spenders and awful burdens around our necks” from Britain.
He then chronicled how former British Prime Minister Margaret Thatcher undertook a privatisation drive and improved her country’s economy in the 1980s.
“So the Conservative party sang a song of great expenditure, lack of accountability and lack of controls and the next election, Labour Party lost to Conservatives,” he said.
“There was improvement, the economy of Britain started looking up. Margaret Thatcher had succeeded, I am not sure whether (Ronald) Reagan succeeded on the American front. So I say to my people, we also pride, we built lots of parastatals and companies which are as good as parastatals that look after themselves in the name of State companies and you will have one person like (Mike) Ndudzo running the whole of Industrial Development Corporation (IDC) which is a multifaceted company.
“How do you expect (him to manage) even given that he is a sincere man, well trained and recently they wanted to make him auditor in charge of Government expenditure and Parliament rejected.”
President Mugabe said while some parastatals were neglected and “fell into disuse”, some like the Agricultural and Rural Development Authority (Arda) were recovering.
He said the private sector should not disentangle itself from Government if the economy was to improve.
President Mugabe said corruption was also an impediment to the attainment of high-level economic growth, revenue mobilisation and investment generation.
“Fight it in your area as much as we are fighting it in Government,” he said.
“We need a collective approach, cases should not be allowed to go unpunished. Ngavatandwe pamabasa.
“But it begins at the top kunesu vakuru—the issue of discipline, trustworthy and honesty. Government will soon introduce a code of conduct and ethics for senior officials in the public service, while the Anti-Corruption Commission is also spearheading the anti-corruption campaign, as mandated under the relevant legislation.”
President Mugabe’s historic interface meeting was also attended by First Lady Dr Grace Mugabe and several Cabinet Ministers.