SUSPENDED Telikom chief executive officer Peter Loko admits that a regulation covering financial dealings had been broken but laid the blame on red tape and bureaucracy for some of the breaches.
SUSPENDED Telikom chief executive officer Peter Loko admits that a regulation covering financial dealings had been broken but laid the blame on red tape and bureaucracy for some of the breaches.
He said in a statement that the board, which included a member of the Independent Public Business Corporation (IPBC), had endorsed all the deals and they were sighted by the IPBC.
Loko was suspended by State Enterprises Minister Sir Mekere Morauta early last month for “illegally entering into numerous contracts involving the payment or receipts of more than K1 billion”.
Morauta, who also replaced Telikom’s board, said the company had failed to seek approval from theTreasurer to spend over K1 million.
“I was charged for not complying with Section 46 B of the IPBC Act,” said Loko, who has been CEO since 2006.
“That particular section restricts all state owned entities from not spending any money beyond K1 million unless approved by the Minister for Finance. This clause came into play in 2007.
“The interesting thing about this section is that it does not allow an SOE an advantage in a highly competitive market and Telikom and a number of other SOEs have asked for this section to be changed.
“It does not allow for quick delivery of services.”
Loko said Telikom had to make drastic investment decisions, or go into extinction in the face of competition.
“A company like Telikom, operating in a multi-million kina industry, cannot effectively compete, if the IPBC Act requires the organisation to obtain both IPBC and then the Minister of Treasury’s approval, for every expenditure above a million kina.
“From past experience this process sometimes takes almost three to six months, until final endorsement is given to spend money.
“If this process was quicker it would not be a problem. Telikom and other SOE concerns were raised two years ago.
“I sincerely hope something is done about this section. One thing I can guarantee our people is that the money was put into good use.”
In a challenging business environment, Telikom had to commit to improving services throughout the country.
“Telikom had to have access to money to invest in these projects so it persisted with funding particularly over the past 18 months,” Loko said.
Telikom had been faced with many challenges and many opportunities since its incorporation in 1997, especially when the company was expected to generate profits on the one hand, while at the same time, providing services as part of government’s community service obligations.
“These coupled with inheritance of an ageing telecommunication network and staff predominantly with public service mentality, it doesn’t make things any easier.
“Even with those challenges our team has shown true grit,” Loko said.
Loko said the value of Telikom had grown over the past nine years to just under K780 million in 2010 and had declared a net profit of K7.6 million at the end of last year.
