Reevaluate Unjust Pseudo-Privatization

Reevaluate Unjust Pseudo-Privatization
United Daily News editorial (Taipei, Taiwan, ROC)
A Translation
June 1, 2011

CEPD Chairman Christina Liu recently raised a hue and cry. She said that in order to enhance government efficiency, the government must redouble its efforts at privatization, Her appeal shone a spotlight on the matter. In recent years, numerous obstacles have stalled privatization. Privatization may not be the best way to improve the quality of government services. But privatization has gone on for over 20 years. It is not meaningless. The government should respond realistically to future needs. It should sort out the issues and find a new direction. One of the issues most in need of review is unjust pseudo-privatization.

Consider the larger framework of economic policy on Taiwan. The privatization of public enterprises began in 1989, as part of economic liberalization and internationalization. Import controls were lifted. Exchange controls were relaxed. Interest rate controls were abolished. The banking and telecommunications industries were also liberalized accordingly. These major policies laid the foundation for the current economic miracle. Ever since policies promoting privatization were instituted, 68 state owned enterprises have been added to the agenda. Thirty-eight state-owned enterprises, including the Bureau of Engineering Services (BES) will be privatized. Seventeen state-owned enterprises, including the Kaohsiung Ammonium Sulfate Company, will go out of business. Five state-owned enterprises, including the Bank of Taiwan will not privatize. Eight state-owned enterprises, including the Taiwan Power Company, the CPC Corporation, the Aerospace Industrial Development Corporation, the Taiwan Sugar Corporation, the Taiwan Water Corporation, the Taiwan Tobacco & Liquor Corporation, the Taiwan Railway Administration, and the Chunghwa Post, will work toward privatization. But ever since the Engineering Agency was restructured two years ago, no new steps have been taken toward privatization. The aforementioned eight privatization projects are either in limbo or have been suspended. No one bother to ask about them.

The biggest problem with current privatization policy is not with state-owned enterprises yet to be privatized, but with those already privatized. The government still owns a substantial share in these enterprises. According to the government's definition of privatization, any company in which the government controls less than 50% of the shares, is considered a private company. But the chairmen or managing directors of these companies are government appointees. They control these companies' budgets, personnel appointments, and policies. Thye are subject to no legislative oversight whatsoever. The operational effectiveness of the aforementioned eight enterprises is at least subject to criticism. The persons responsible can at least be identified. By contrast, the quasi-official, quasi-public, "pan-public enterprises" pander to the political needs of those in office. They occupy a no man's land. They are subject to neither public nor private oversight. This leads to confusion in business operations and undermines market competition.

Unclear boundaries between the public and private sectors means increased opportunities for corruption. For example, the chairman or general manager of pan-public enterprises are government appointees. These people may be on the receiving end of political patronage. They may be utterly incompetent. Just exactly whose interests are these officials looking after? Theoretically they represent public shareholders. Theoretically their job is to protect public shareholders. But who decides what is in the interest of public shareholders? Nominally that would be the government. But the actual administrator is a government head appointed by the ruling party. This is precisely how channels in the service of political interests are established. The executive branch is unwilling to relinquish control. The ruling party dominated legislature is only too happy to play along. Worse still, pan public enterprises are public in name only. In practice they merely serve whoever wields political authority. The government heads who control these enterprises are presented with opportunities to maximize their personal interests in the name of public service. The immense resources of pan public enterprises are gradually usurped by personal interests. The abuse of power is rampant. President Ma must open his eyes.

The relationship between privatization and liberalization is ever closer. The purpose of privatization is to ensure fair competition. It also provides greater room for the private sector to grow, and enhances overall competitiveness. But non public, non private, half-baked privatization is pseudo privatization. It negates privatization. It undercuts the effectiveness of industry liberalization. Consider banking liberalization. The government authorized the establishment of new banks. But the privatization of public banks was incomplete. They constituted unfair competition against private financial institutions. The inefficiency of public financial institutions is also due to half-baked privatization. They may even lack supervision. Unclear lines between the public and private sectors lead to finger-pointing that hinders competition. Consider last year's numbers. The total assets of nine pan-public banks accounted for 52% of all domestic banks. But their pre-tax profits accounted for only 36% of the overall profits. This proves that their performance was inferior to private sector banks. In recent years, the financial and insurance industries have accounted for less and less of the gross domestic product. This shows that the financial industry as whole has grown less than the rest of the economy. The connection is obvious. The scale of Taiwan's economy is small. It is subject to special factors relating to cross-Strait relations. We genuinely need public financial institutions. But must the proportion be so high?

The Annual Competitiveness Report issued by the international Institute for Management Development in Lausanne, Switzerland has received a great deal of attention. The ROC's competitiveness rating this year rose to 6th place. But its "government efficiency" rating fell. Its "public interference in corporate activity" rating also fell. Chairman Liu took advantage of the opportunity to enhance competitiveness. She used the issuance of the Presidential Office monthly fiscal report to restart privatization. Pseudo-privatization has led to more and more problems in recent years. President Ma may not have noticed. But Chairman Liu has said she will invite cross-ministry discussions. We look forward to the restarting of privatization.

不公不民的偽民營化要檢討了
【聯合報╱社論】 2011.06.01

經建會主委劉憶如近來大聲疾呼，應重新推動民營化政策，以提升政府效能。這項呼籲就像聚光燈一樣，讓人看到近年民營化的停頓以及種種問題。民營化或非提升政府效能的最優先事務，但這項推動超過廿年的政策也不是食之無味的雞肋；政府應依現實及未來需要，重新梳理出政策層次及推動方向；其中，不公不民的偽民營化是最需要檢討的現象。

在台灣經濟政策的大架構裡，公營事業民營化是政府於民國七十八年揭示的經濟自由化、國際化政策的一環，與解除進口管制、放寬外匯管制、取消銀行利率管制、推動產業自由化（如銀行、電信）等並駕齊驅，都是奠定現今台灣經濟發展基礎的重大政策。民營化政策推動以來，共有六十八家事業納入列管目標，並有中華工程等卅八家移轉民營、高硫等十七家結束營業，除台灣銀行等五家決定不民營化外，還有台電、中油、漢翔、台糖、台水、台酒、台鐵及中華郵政等八家繼續推動。不過，自前年榮工處改制之後，民營化再無任何新進展，前述八家事業的民營化計畫不是沒有下文就是暫緩，也無人聞問。

但當前民營化政策最大的問題，並不在這些尚未民營化的事業，而是那些已民營化，但政府依然持有可觀股權的事業。依民營化的定義，政府持股五成以下就視為民營事業；然而，政府指派這些事業的董事長或總經理，也不時委以政策性任務，並掌握其經營主導權，但其預算、人事、經營計畫完全不受國會監督。相對於前述八家事業，其經營績效至少可受批評、也找得到可責之人，這些半官半民的「泛公股事業」卻依著執政者的政治需要，遊走於既公且民、不公不民的不同治理標準之間，導致事業經營的錯亂，也影響市場競爭效率。

官民界線不清的弊端還有更多。舉例來說，泛公股事業的董事長或總經理都由政府指派，且不論這些人是否為酬庸、有無專業能力，僅這些官派負責人監管的究竟是誰的利益，就存有很大的模糊空間。理論上，他們是公股代表人，當然是監管公股的利益，但公股的利益又是誰決定？名義上是政府，但實際執行者是執政黨派任的政府首長，為政治服務的管道正是由此建立，是以行政部門不願放手，由執政黨掌控的國會也樂觀其成。更等而下之的是，泛公股事業不僅得以「假政府之名，行政治服務之實」，領管這些事業的政府首長或負責人更有機會「假政治服務之名，行個人利益最大化之實」；龐大的泛公股事業資源被個人點滴攫取事小、權力濫用事大，馬總統不能不看清這一點。

民營化與產業自由化的關係更是密切，它既是讓各事業得以公平競爭，也是提供民間部門釋放活力的空間，以提升整體的競爭力。可是，不公不民的半吊子民營化，則是「偽民營化」，破壞了這樣的政策設計，影響了產業自由化的效果。就拿銀行自由化來說，政府開放銀行新設，但公營行庫的民營化不徹底，對民營金融機構形成不公平競爭；公營金融機構的低效率也因民營化只做一半而不見改善，甚至因缺乏監督、官民不分而相互諉責、阻礙競爭。以去年統計為例，九家泛公股銀行的合計資產占本國銀行的五成二，但稅前獲利僅有整體的三成六，證明其經營績效不如民間；近年金融保險業占國內生產毛額比率節節下降，顯示金融產業的成長不如總體，亦與此難脫干係。誠然，台灣經濟規模小，又有兩岸關係的特殊因素，確實需要保留一定規模的公營金融機構，但需要這麼高的比重嗎？

廣受國際重視的瑞士洛桑國際管理學院（ＩＭＤ）的年度競爭力報告，今年雖將台灣競爭力提升至第六名，但認為「政府效能」退步，並直指「公股影響企業活動」倒退最多。領軍督導各部會提升競爭力的劉主委打鐵趁熱，在總統府財經月報正式提出重啟民營化，應是有感於近年偽民營化帶來的公股問題愈來愈多而起；儘管尚未引起馬總統的共鳴，但劉主委已表示將邀跨部會討論。我們期望停頓的民營化能因此重拾應有的節奏。