State corporations will cause big trouble for the next government
State corporations (DEKO) have been left in a sorry state following SYRIZA’s four-year term in government and the next administration following the July 7 election will have to deal with explosive conditions, especially at Hellenic Post, the Thessaloniki Urban Transport Organization (OASTh), Hellenic Railways Organization (OSE) and of course Public Power Corporation (PPC).
Open issues exist at other state corporations such as the Athens Water Company (EYDAP), Egnatia Odos and GaiaOSE, to name but a few. EYDAP doesn’t have a new concession contract for the capital’s water and sewage service utilization, despite the current one being set to expire at the end of 2019. At Egnatia the way is open for the transfer of staff that may well leave the highway operation company without employees ahead of its privatization.
At railway property utilization company GaiaOSE, the new management will have to handle the hot potato that is the utilization of the Thriasio Freight Center: Its contract was ratified by Parliament in November but has yet to be acted on as approval by Brussels remains pending. The way the SYRIZA government handled this concession suggests the center’s utilization is set to face considerable obstacles.
It is for most of the above corporations that the state asset utilization hyperfund was set up in 2016, which in theory would have led to the streamlining of those corporations and increases in their value. However, more than two years since it started operating, the hyperfund can only claim to have carried out some management changes. No streamlining plans have been promoted to date and the only one drafted was for Hellenic Post – even that has not been implemented.
The DEKO left in the sorriest state is PPC, which on Friday showed first-quarter operating losses of 64 million euros and constitutes a systemic danger.
The power utility is now valued at less than 500 million euros, while in 2013-14 the New Democracy-PASOK government was planning the sale of 30 percent of its assets (known then as the “Small PPC”) for 1.3 to 2 billion euros. That plan was fought tooth and nail by SYRIZA, but today PPC and former subsidiary ADMIE (the Independent Power Transmission Operator that has since departed the PPC fold) add up to just over 900 million euros.
