Companies with 25pc government investment face scrutiny
Companies in which the government has a 25 per cent stake could be forced to open their books to the public, as part of amendments approved by parliament yesterday..
Currently only firms in which the government has a 50pc shareholding are scrutinised by the Administrative and Financial Audit Bureau.
However, that could change if the amendment to the 2002 Administrative and Financial Audit Bureau Law approved by MPs comes into force.
The government opposes the move, but was obliged to draft the amendment based on a parliamentary proposal submitted earlier this year.
MPs approved it despite the Cabinet warning in writing that it could result in companies refusing to accept the government as an investor, since they may not be willing to open their books to public scrutiny.
The amendment will now be referred to the Shura Council.
“Current legislation and methods ensure that public money invested in private companies is protected, even if it is a stake of less than 50pc,” said the Cabinet in a letter to MPs.
“It undergoes careful auditing with all outcomes published in the local Press and announced at the end of each fiscal year.”
The bureau has also opposed the bill, saying it was more concerned about improper decision making at companies controlled by the government – not government investments or stocks.
“We are encouraging partnerships with the private sector to push ahead with projects, but this move will simply put the private sector off development,” it said in writing.
Similar concerns have been raised by the Legislation and Legal Opinion Commission.
