ECONOMYNEXT – Sri Lanka’s United National Party said it will place all state owned enterprises under a holding company, whose trustees will be appointed with the agreement of political parties and civil society.
"The government owns the biggest commercial enterprises in the country and this ownership is maintained on behalf of the people," the UNP said in its manifesto for the August 17 general elections.
"Unfortunately, for the past 50 years these enterprises have not been managed properly and therefore suffered huge losses.
"As a solution all state enterprises will be placed under holding company."
Both Malaysia and Singapore have holding companies to own and manage enterprises and also sovereign wealth funds.
The document said trustees to the asset holding company would be appointed after consultations with political parties and civil society organization.
State enterprises where the elected ruling class and bureaucrats plays around and do business with taxes extracted from the people. They make large losses frequently indicating that the gamble with people money is lost.
Some SOEs which benefit from the coercive power of the state also have monopoly powers restricting the rights of citizens to engage in similar activities like the Imperial Mercantilist Dutch East India Company and the British East India Company did.
SOEs also have looser financial regulations or ‘financial independence’ than government departments, allowing the elected ruling class to mis-use them more easily.
As a result the existence of state enterprises have become one of the key causes of corruption in the country.
The UNP which led the way in privatization sharply reducing opportunities for rulers and bureaucrats to steal and mis-use people’s money in the 1980s now have ‘policy fright’ according to some critics.
The UNP said it will also create a pubic wealth trust to manage two retirement funds of private sector workers if it comes to power after August elections.
Both agencies will come under the scrutiny of parliament. (Colombo/July24/2015)