Privatisation can be defined as the sale of state-owned assets to private enterprises or individuals, including the sale of mere minority stakes in public enterprises.In Nigeria, privatisation as a policy instrument became a popular and viable strategic option with the onset of economic and institutional reforms under the Structural Adjustment Programme, which was introduced in 1988 by the Gen. Ibrahim Babaginda Administration.Specifically, the privatisation programme was prompted and necessitated by the glaring inefficiencies of public enterprises and government parastatals, many of which were recording losses while their counter parts in the private sector were making profits.Consequently, there was the need for government, especially in the face of dwindling earnings and revenue, which made it onerous and burdensome to continue to finance or subsidise the public enterprises, to rationalise its continued involvement and investment in business and commercial activities. Government decided to make the best and optimal use of its scarce resources and re-directing same into more socially beneficial and economically productive ventures, rather than pure economic activities which the private sector enterprises are in better position to operate.This position is anchored on the trite economic principle that government has no business in running business. In effect, privatisation should be seen as a necessary policy step and strategic move to stimulate rapid industrial growth and economic development by tapping and harnessing more effectively the entrepreneurial spirit, skills and managerial ability of the private sector.It goes without saying that effective privatisation engenders innovation, competition, inventions, new ideas as well as the adoption of economic considerations in the decision making process (all of which are the hallmarks of and in tandem with the business orientation of the private sector) thereby leading to increased efficiency and productivity.Also, by encouraging share ownership by private individuals, privatisation leads to a more efficient mobilisation of savings and wealth creation within the economy. We should not also forget the fact that privatisation generates funds for and provides the government with increased revenue, while freeing its resources for developmental purposes.Prior to privatisation, efficiency and productivity in public enterprises were hampered by a number of factors, including, over-regulation and lack of initiative political interference and unnecessary bureaucratisation of their operations, the use of selective principle, as well as subjective and irrelevant criteria, such as federal character/zoning, political considerations, nepotism, cronyism, in board and executive appointments, corruption, lack of financial discipline, transparency, probity and accountability et cetera. All of these are the direct opposite of what obtains in the private sector.It is instructive and pertinent to note that under the framework of the privatisation and commercialisation Decree 25 of 1988 (and later the Public Enterprises Act of 1999), about 137 government parastatals and public enterprises were initially listed for full privatisation/commercialisation or partial privatisation/commercialisation. The listed public enterprised included banking institutions, oil marketing companies, hotels, steel rolling mills, fertiliser companies, petrochemical companies, paper mills, sugar companies, salt companies, cement companies, newspaper companies, automobile assembly companies, and airlines.The two government agencies saddled with the general policy direction on the modalities, management and implementation of the privatisation programme are the National Council on Privatisation and the Bureau of Public Enterprises.It is, however, regrettable and dishearteningaccording to the outcome of a recent probe of the activities of the BPE by a Senate ad-hoc committeethat the privatisation exercise was allegedly fraught, riddled and bedeviled with fraud, corruption, breach of due process, among other shortcomings.The probe report indicted and reprimanded former and subsisting directors-general, as well as other highly-placed officials of the BPE for their ignoble and ignominious roles in the sale of Federal Government enterprises from 1999 to date.Furthermore, the ad hoc committee also recommended the revocation of the sale of some government enterprises, parastatals and agencies sold by the BPE on the grounds that they violated the stipulated rules for the privatisation of the enterprises. Towards this end, the committee recommended that the National Council on Privatisation should rescind the sale of some enterprises for failure of the core investors to deliver on the fundamental provisions of the share purchase agreements/post acquisition plans.While Im of the view that the privatisation exercise/process should be reviewed and refocused to ensure that it does not derail, detract or deviate from its original purpose and objectives, I wish to align myself with the recommendations of the Ad hoc committee that "the management of the BPE should be reorganised to make it effective and efficient, that presidential interference in the privatisation process should be avoided in the future.I believe that if the above recommendations are fully and effectively implemented, it will go a long way in rejuvenating, revitalising and reinvigorating the privatisation programme.Oluwa wrote from the Executive Business School, Lagos. He can be reached vide oluwa95@yahoo.com
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