Performance contract for state enterprises, call in right direction
In every society, there are both public and private entities which work for the common good of all.
The performance of both enterprises mostly relies on clearly set goals, focused on the mission and vision, as well as the commitment and performance of the leadership and membership of such organisations towards the realisation of their goals and mandate.
In many instances it is private establishments that are able to significantly realise their goals, and thus become profitable because their leadership ensures that all employees perform their roles efficiently to merit their wages and salaries.
Unfortunately, the same cannot be said of public enterprises, which many in Ghana refer to as ‘aban adwuma’ to wit, government’s work.
In view of that tag, staff of such public institutions perform their duties lackadaisically, invariably because supervision at such places is also lax, and those who choose to work hard are often asked if the work belonged to their father or parents.
Leadership in such establishments also approach supervisory roles in a nonchalant manner; favouritism becomes the order of the day while nepotism reigns supreme.
Their cronies and those who will always do their bidding are given the juiciest roles and promoted, even though they may not possess the expertise or qualifications to carry out the work.
In the short term, it turns out that those at the helm of affairs are unable to do the job, thus making the entire establishment and ultimately the state or government suffer due to non-performance.
This is the sad state at most public institutions, although they have all it takes to excel in their mandates and also rope in a lot of revenue for the state.
One key thing that has also resulted in the non-performance of state enterprises is the fact that they are working according to their own dictates, and as such Key Performance Indicators (KPIs) are either non-existent or, if they are, they have been thrown into the dustbin.
The Daily Graphic, therefore, finds the call by the Director-General of the State Interests and Governance Authority (SIGA), Professor Michael Kpessah-Whyte, for state enterprises to sign performance contracts, as it offers a better framework to evaluate their performance for better delivery, a move in the right direction.
Indeed, if such performance contracts are signed, it will push state enterprises to deliver on their mandate, as there would be repercussions if they do not, as spelt out in the contracts.
We also believe that if in their bid to meet their performance targets there are blockades, those state enterprises would have a justification to demand assistance from the government, which is the ultimate owner of the SOEs. The government would also be obliged to assist them fulfil their mandate.
Just as no one can embark on a journey without a clear destination in mind, so can our state enterprises not be able to function properly if there are no clear targets to meet in the discharge of their duties - that loophole creates room for mediocrity and substandard performance.
We, therefore, urge all state entities to commit to proper corporate governance, particularly by signing performance contracts, to give them a clear vision and the right resources needed to achieve that vision.
We need to see an improvement in the performance of state enterprises in both the next annual State Ownership Report, which assesses the financial and operational performance of state entities, and the annual Institutional Governance and Performance Assessment (IGPA) reports, which also evaluate the governance and performance of individual state entities.
Definitely, when the government ventured out to establish those state enterprises, it had a clear aim for doing so, which was to meet a certain need that the state could handle best. Funds were used to establish those enterprises and we must not let it go to waste; else we would be causing financial loss to the state.
Indeed, as stated by the Presidential Advisor on the Economy, Seth Terkper, recently at a meeting with chief executive officers of state enterprises in Accra on performance contracts organised by SIGA, the value of state enterprises extends beyond just profit-making.
Their performance or non-performance also affects the overall performance of the country.
