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Editorial CommentOpinion & Analysis

We need to do more than just talk

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Malawi has more than 100 parastatals and, as the International Monetary Fund found out in 2002, each has its own legislation and many of which take quasi-fiscal activities.

Admarc, established primarily as an agriculture commodities’ marketing body, is the best example because it has a large commercial portfolio with interests in other sectors too.

What is worrying is the financial state of these parastatals, as they do have a poor financial history characterised by overstaffing and massive inefficiencies.

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This means that taxpayers have to keep on bailing them out through government subventions,year in, year out.

That thousands of Malawians toil in companies that form part of the relatively unproductive parastatals, a traditional mainstay of formal employment in Malawi, is largely seen as a benefit not a problem.

The government embarked on reforms to fix this same problem. We remember that the reforms were designed to force parastatals to take a business-like approach.

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This was meant to improve service delivery and generate revenue that could boost revenue for government.

The reforms were supposed to make parastatals competitive and bring operational efficiency

This is the reason we cannot ignore the warning issued by Comptroller of Statutory Corporations, Stuart Ligomeka, over the weekend. He warned chief executive officers (CEOs) for parastatals to conform to public service reforms that are underway or face the chop.

He is right because the CEOs for these companies are well looked after despite the loss making operations they preside over each year.

Their cars are gas guzzlers, their homes are expensive and their children go to very expensive schools, all at our expense. They [parastatals] receive regulatory protection that helps them relative to private sector rivals.

But we wished Ligomeka said more. These parastatals are failing because they are still politicised. Escom, Macra and all water boards tell us the same old story of abuse and bad service delivery.

Ligomeka also bemoaned tendencies among some CEOs in parastatals who, he said, recruit people without considering capacity of their organisations.

Remember the reforms were described by commentators as a bold step to take out politics from statutory corporations. We need more than just warnings. If government recruited CEOs for these government-owned companies who are qualified and not politicised and if we had boards that are not full of chiefs and cadets just for appeasement, we could do better and make the parastatals better.

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