October 17, 2019

State owned Enterprises gulp $3billion yearly without appreciable returns – BPE

National Assembly

Calls for privatization of Federal Assets to Fund N2.28trillion deficit of 2020 budget

By Henry Umoru

ABUJA- THE Senate was yesterday told that the 600 State owned enterprises in the country gulp not less than $3bn on yearly basis with little or no returns into the public purse.

The Upper Chamber was also informed that the N2.28trillion deficit in the N10.33trillion 2020 budget could best be funded by proceeds from privatization of moribund national assets than borrowing from foreign and local loans.

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Speaking yesterday in Abuja during   an interactive session with the Senator Theordore Orji, Peoples Democratic Party, PDP led Senate Committee on Privatization, the  Director General of the Bureau of Public Enterprises ( BPE) , Alex Okoh stressed that there was no reason whatsoever for the country to be financing budget deficit on yearly basis with borrowings from foreign and local loans when there are national assets that can be converted into liquid for that purpose.

The BPE boss who noted that  the National Theatre in Iganmu Lagos and the  National Stadium in Surulere as part of the national assets that should have been concessioned for that purpose, said that Privatization / liberalization has done the Nigeria economy and her people more good than bad.

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Okoh said, ” It is not good to keep borrowing on yearly basis to finance deficit budget , when a lot of very valuable national assets are lying fallow and moribund.

“Proceeds from outright privatization or concession  of the moribund  Assets , should   serve  as the best alternative in funding yearly budget deficits since the assets are more or less, becoming national liabilities.”

Okoh who noted that in the telecommunication sector alone, Nigeria had 500,000 land lines and telephone subscribers in pre – year 2000, the subscribers base as at 2019 has grown to 150million, said, “First Bank today is not the same it was while under government control .  While not one  single unprivatized  state owned enterprise is performing , many of the privatized ones are performing by providing the required liquidity in the Nation’s economy.”

The BPE boss who noted that the country was still facing huge problems on getting the privatized power sector to function very well, said,  ” We have huge problems concerning the privatization of the power sector as a result of policy misalignment in the sector.

” Analogically , the problem with the sector is like after surgery mismanagement which is however being critically addressed. As at today , installed capacity for power  generation is 13, 500 megawatts from 2,600 megawatts it was in 2013 before the sector was privatised.”

Speaking further, he promised that  the N320billion expected as revenue from the agency to fund the 2020 budget will be realised by the second quarters of next year from proceeds to be made from some national assets slated for privatization.

In his remarks,  Chairman of the Committee, Senator Theodore Orji ( PDP Abia Central), directed him to furnish the committee with records of the agency’ s 2019 budget performance ahead of consideration of the 2020 budgetary estimates for the agency by the committee on Monday next week.