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Proper divestiture transitions must be pre-planned
2006-11-09 08:28:00
By Editor
Two institutions created by Acts of Parliament to oversee the country’s divestiture process have over time performed their functions accordingly.
We have in mind the Presidential Parastatal Sector reform Commission (PSRC) and the Loans and Advances Realization Trust (LART).
Due to unforeseen circumstances for example, the tenure of PSRC has twice been extended by the Parliament.
Essentially, the privatization of utilities proved to be an uphill task, prompting double extensions in tenure.
On alert, the Loans and Advances Realization Trust (LART) and LART Recovery Tribunal official tenure ended on 30th June this year.
According to the look of things, nobody in the system had foreseen and bothered to plan for the transition period, taking into account that its mission had not been accomplished.
Official data shows that there are over fifty pending cases in courts, while liquidated and non-performing assets held in trust by various companies and business persons amount to Tsh.150bn/-.
LART’s core activity had been to collect debts on behalf of the government and liquidating non-performing assets which could not be privatized through PSRC procedures.
The LART Recovery Tribunal was supposed to fast-track adjudication of disputes as they arise in the process.
Some members of Parliament, way back in 2004, had anticipated the coming of this blind alley with its legal and financial implications.
LART was there to protect public interests because non-performing assets were public assets heal under trust, and have to be realised.
Something went very much wrong for the system to fail to plan for the sunset period or even at best extends its mandate with some kind of fixed deadline for activities to wind-up.
At this junction, there is no dodging of fire brigade style of saving the sinking boat. Mistakes are just mistakes. No alternative wording.
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