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Pay 15% dividend to govt— Finance Minister to SOEs

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Effective next year, State Owned Enterprises (SOEs) will pay at least 15 percent of their gross profit to government.

The directive issued by the Finance Ministry follows failure of the government companies to declare their profits to the Ministry.

According to a 2017 State Owned Report, all 86 state enterprises refused to submit their audited financial report to the ministry.

The report has also revealed that the companies made a net loss of Ghc310 million  in 2017.

As part of efforts to accrue some revenue from the companies, Finance Minister, Ken Ofori directed SOE’s to contribute 15 percent of their profits to government coffers.

According to him, the huge capital injection government makes into SOE’s demands some returns.

He further revealed that government has initiated the development of a State Ownership Policy to among other requirements streamline the payment of dividends to government.

“It is rather unfortunate that in terms of dividend payment, it has not improved. Only 14 companies paid dividends and they are even Joint Venture companies. This justifies our quest to collect at least 15 percent. So that no matter how bad you run the company, the people of Ghana will have something.”

Total revenue from the SEO’s was 27.34 billion. But the companies made a net loss of 1.29 billion cedis last year.

This include the Electricity Company Ghana Limited, (ECG) which made a loss of 785 million cedis and the Volta River Authority5, VRA which also lost 806 million cedis.

Although profits from the SEOs went up by 59 percent from the figure recorded in 2016 to 4.89 billion cedis, government believes revenue from the government companies are still low.

The report also revealed that all 86 SOEs failed to present their financial report for 2017.

Mr. Ofori-Atta urged the companies to subject themselves to stringent financial reporting and disclosure standards

“It is our expectation that doing so, SOE’s will attract financial resources to expand and improve their operations and profit”.

Companies that contributed to the profits include the Ghana Ports and Harbours Authority, the Ghana Water Company Limited and Ghana Airport Company Limited.”

Meanwhile, Senior Minister, Yaw Osafo Marfo has charged the Finance Minister to sanction heads of State Owned

Enterprises who fail to present edited financial reports on time. According to Mr. Osafo Marfo, Heads of the institutions must be held responsible for the losses.

By Nana Oye Ankrah by/citibusinessnews.com/Ghana

The post Pay 15% dividend to govt— Finance Minister to SOEs appeared first on Citi Business News.

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