86. Establishment and dissolution of a state corporation (1) A state corporation may be established or dissolved only with the prior approval of the Cabinet, which approval may be given only after taking into account any recommendations made by the National Treasury regarding the financial implications of establishing or dissolving the corporation.

(2) Regulations shall prescribe the criteria to be used in establishing or dissolving state corporations and the regulations shall be tabled in Parliament for approval.

87. Restrictions on national government investing in government-linked corporations (1) The national government or national government entity may not invest— (a) in a state corporation; or (b) in a government-linked company, without the prior approval of the Cabinet, which approval may be given only after taking into account any recommendations of the National Treasury regarding the financial implications of the investment.

88. Cabinet Secretary in charge of state corporation to monitor its performance (1) The respective Cabinet Secretary responsible for matters relating to a state corporation is responsible for monitoring— (a) the financial performance of that state corporation and governmentlinked corporations; and (b) the performance of that state corporation and the activities affecting its financial performance; and reporting to the Cabinet on the financial performance of the state corporation.

(2) The Cabinet Secretary shall— (a) analyse financial and other reports that are required to be prepared by a state corporation under the State Corporations Act (Cap. 446) or any other relevant Act; (b) report to the Cabinet on the financial performance of those state corporations; and 63 No. 18 of 2012 Public Finance Management [Rev. 2020] (c) make recommendations to the Cabinet as to how a particular state corporation or government-linked corporation could improve its financial performance.

89. Annual reporting by the Cabinet Secretary responsible for matters relating to public investments

(1) The Cabinet Secretary responsible for matters relating to public investments shall prepare and submit to the National Assembly, not later than four months after the end of each financial year, a consolidated report summarising the extent of national government involvement or investment in, or funding of, all state corporations and government-linked corporations for that financial year.

(2) The report under subsection (1) shall include information on— (a) the date of incorporation and objects of the corporation; (b) the amount of national government shareholding, directly or indirectly, in the state corporation; (c) any changes in the shareholding of the state corporation during the financial year; (d) the amount of any funding in the form of grants or subsidies provided by the national government to the state corporation or governmentlinked state corporations, excluding profit-making state corporation, during the financial year; (e) the amount of any loans made by the national government to the state corporation, and the amount of any guarantees issued by the national government in respect of the state corporation, during the financial year; (f) the cumulative amount of undischarged loans and guarantees in respect of the state corporation; (g) the amount of the profit or loss of the state corporation for the financial year; (h) the amount of any revenue received by the national government from the state corporation during the financial year, including dividends, interest and proceeds from any divestiture of assets of the state corporation; (i) the amount of payments made, or losses incurred, by the national government to meet contingent liabilities as a result of loans or guarantees during the financial year, including payments made in respect of guarantees, loan write-offs or waiver of interest on loans; and (j) an assessment of the financial and related non-financial performance of the state corporation for the financial year.

(3) Once every three years, the Cabinet Secretary responsible for matters relating to public investments shall prepare a report on the assessment of the national government’s continued involvement or investment in, or funding of, the state corporation or government linked corporation.

(4) The Cabinet Secretary responsible for matters relating to public investments shall submit copies of the reports referred to in subsections (2) and (3) to the Cabinet Secretary, the Controller of Budget, the Commission on Revenue Allocation and to the Auditor-General. 64 [Rev. 2020] Public Finance Management No. 18 of 2012