BPE to convert redundant assets to cash

The Bureau of Public Enterprises (BPE) has said it might put up more redundant public assets for sale in 2020 to meet its N477 billion fiscal budget.

According to the Director-General of BPE, Mr Alex Okoh, redundant national monuments are assets that shouldn’t be kept to a point where they are becoming federal liabilities when they can be privatized or concessioned to raise cash to fund other social imperatives of BPE fiscal budget.

“We can’t continue to keep federal redundant assets to an extent they are beginning to turn into liabilities when we can convert them to values.

“For me, that’s throwing good money after bad assets. We should convert those assets to value, privatize those that can be privatized; concession those that can be concessioned and use the proceeds to fund other social imperatives of our fiscal plan,” said Alex Okoh.

Meanwhile, the BPE, which has a budgetary funding target of N220 billion in the 2019 budget, out of which it has only raised N135 billion with a balance of N85 billion to meet up, said its contribution to the 2020 national budget would be slightly higher.

Mr Okoh also said instead of increasing the country’s debt servicing and incurring cost through subvention, the funds raised from privatization or concession of these redundant assets could be used to finance the national budget.

“We can convert them to values, to cash, and use the proceeds to fund a national budget rather than resort to borrowing to fund expenditure when we have these assets lying over there. And these assets are even making serious demands on government’s purse by way of subvention. It doesn’t make sense.”

Citing an example, Mr. Okoh said, “If you look at the National Theatre, for example, that is an asset that is just lying there redundant; degenerating on a daily basis. For those kinds of assets, rather than regard them as monuments, we should be able to convert them to value. If you go abroad and visit New York, for example, you can see what they have done out of the 911 memorial. It’s not just a memorial for people to visit, it generates money for the City of New York. So, this idea of looking at national assets as just monuments rather than assets and liabilities, we need to change our mentality. “Government doesn’t have the money to keep subsidizing and providing for the maintenance of the assets, including the National Stadium.”

This could be a source of revenue generation and cost reduction for the Federal Government, if and when it decides to walk the talk.