|Director General, Bureau of Public Enterprises (BPE), Mr. Benjamin Ezra Dikki|
But he expressed regrets that there had been no corresponding returns on investment to the Nigerian economy as the enterprises largely served as drain pipes.
Speaking in Abuja during a presentation titled: “The Nigerian Reforms and Privatisation Policy, Processes, Gains, Challenges and Prospects” to members of the Ibrahim Badamasi Babangida (IBB) International Golf and Country Club, he added that only 500,000 jobs were created even as the affected enterprises had over 5,000 board seats.
In a statement by BPE spokesman, Mr. Chigbo Anichebe, the DG disclosed that a substantial part of the then non-performing debts owed to the London and Paris Clubs were mostly loans to some of the enterprises which also owed salaries and left huge pension liabilities amounting to over N2 trillion to the be borne by the federal government.
According to him, "Public enterprises consumed over $3billion (about N480billion) annually in subventions and subsidies, tax deductions at source were not remitted to the tax authorities and no dividends were received or reasonable service provided by them despite their monopoly status.”
He said several studies commissioned by government from 1969 to 1984 revealed that public enterprises were inefficient, corrupt, misuse monopoly powers, depending heavily on the treasury.
He added that they had defective capital structure and suffered incessant political interference.
He said: "Nigeria’s economy experienced declining growth, increasing unemployment, galloping inflation, high incidence of poverty, worsening balance of payments, debilitating debt burden and increasing unsustainable fiscal deficits."
Dikki also noted that the twin policies of government direct investment in the Nigerian economy and an attempt to indigenise the economy did not produce the desired economic results as enterprises could hardly break-even and became a huge burden on the government budget.
However, he argued that the setting up of the Technical Committee on Commercialisation and Privatisation (TCPC) in 1988 which later metamorphosed into the (BPE) was to free government from businesses and to bring in private hands.
He listed the gains of privatisation to include the utilisation of proceeds for other socio-economic objectives, non-allocation from the treasury to privatised enterprises, payment of corporate tax and heavy investments by the new owners that grew the companies and the economy.
On the power sector reform, the DG said an estimated 90 million Nigerians were living without access to electric power and government did not have the resources to reach them, thus the need to privatise the power sector to increase the reach.
He said the reforms carried out in telecoms, pensions, debt management and other sectors were already impacting positively on the Nigerian economy. (Source - Thisday)