Finance Ministry Opposes Umbrella Model for State-Owned Enterprises ({{commentsTotal}})

Source: Photo: Postimees/Scanpix

The Ministry of Finance has said it does not back the Ministry of Economic Affairs' idea to create a umbrella company to oversee all state-owned enterprises.

It said the state should instead concentrate on better communicating its expectations to the companies, ERR radio reported on Tuesday.

Then adviser to the Ministry of Economic Affairs Erkki Raasuke proposed the idea in September, saying it would result in a clearer policy on dividends and investments, and would depoliticize management boards.

He said that the state could earn an extra 75 to 100 million euros annually thanks to increased efficiency.

Tarmo Porgand, acting head of the Ministry of Finance's State Assets Department, was unenthusiastic about the idea.

“Currently it is more important for the ministries under whose areas of responsibility these companies belong to instill clear goals in the companies,” Porgand said.

The Finance Ministry said the state should instead involve more people from the business world in the running of state companies.

Parliament's Economic Affairs Committee is due to open discussions on the idea on Thursday.

The state has ownership of 38 companies, which employ 16,000 staff and have assets worth 4.4 billion euros.