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2007 Assessment

Colombia: Integrity Indicators Scorecard

Colombia: Integrity Scorecard Report > Sub-Category: State-Owned Enterprises
Indicators		Score
64	In law, is there an agency or equivalent mechanism overseeing state-owned companies?	100
65	Is the agency or equivalent mechanism overseeing state-owned companies effective?	40
66	Can citizens access the financial records of state-owned companies?	70

Indicator and sub-Indicator Details

In law, is there an agency or equivalent mechanism overseeing state-owned companies?

64: In law, is there an agency or equivalent mechanism overseeing state-owned companies?

Score:

YES

Comments: According to Law 489 of 1992, state owned enterprises are subject to the oversight of the entity to which they are ascribed. There are two big groups of state enterprises. First, the Industrial and Commercial enterprises which are subject to private law regulations except in their administration and organization. The second group are the Public Service Enterprises such as health enterprises, which are subject to the control of the Superintendencia de Servicios de Salud (Superintendency of Health) and to the Social Protection Ministry. In what refers to fiscal control, State Enterprises are subject to the control of the Supreme Audit Institution (Contraloria General de la República).

References: LEY 489 DE 1998 (diciembre 29) Diario Oficial No. 43.464, de 30 de diciembre de 1998. Por la cual se dictan normas sobre la organización y funcionamiento de las entidades del orden nacional, se expiden las disposiciones, principios y reglas generales para el ejercicio de las atribuciones previstas en los numerales 15 y 16 del artículo 189 de la Constitución Política y se dictan otras disposiciones.

Is the agency or equivalent mechanism overseeing state-owned companies effective?

65a: In law, the agency or equivalent mechanism overseeing state-owned companies is protected from political interference.

Score:

YES

Comments: The oversight of state owned enterprises is in the hands of the respective Ministry or entity to which they are ascribed and to the superintendency that oversees the respective economic activity. Each superintendency, although independent in terms of administration and budget, is subordinate of the respective Ministry. Thus, the Superintendency for Industry and Commerce is ascribed to the Ministry of Industry and Commerce.

The Supreme Audit Institution, which oversees the fiscal aspects of state enterprises, is an independent branch of government.

References: DECRETO 1080 de 1996 (19 de junio) POR EL CUAL SE REESTRUCTURA LA SUPERINTENDENCIA DE SOCIEDADES Y SE DICTAN NORMAS SOBRE SU ADMINISTRACION Y RECURSOS EL PRESIDENTE DE LA REPUBLICA DE COLOMBIA. LEY 489 DE 1998 (diciembre 29) Diario Oficial No. 43.464, de 30 de diciembre de 1998. Por la cual se dictan normas sobre la organización y funcionamiento de las entidades del orden nacional, se expiden las disposiciones, principios y reglas generales para el ejercicio de las atribuciones previstas en los numerales 15 y 16 del artículo 189 de la Constitución Política y se dictan otras disposiciones.

Constitución Política de Colombia 1991. Art. 267

65b: In practice, the agency or equivalent mechanism overseeing state-owned companies has a professional, full-time staff.

Score:

100

Comments: The superintendencies have an independent civil service system and the ministries are subject to general rules on civil service. The pertinence of staff differs for each agency. According to a survey on institutional performance made among public servants, from the institutions that may have responsibilities in overseeing state enterprises, more employees of the Superintendency of Health (51 percent) feel that personnel profiles are not adequate to fulfill the mandate of the Ministry. The Ministry of Mining and Energy has a very good level of staff pertinence and only 13 percent of employees feel professional profiles are not adequate. In the Superintendency of Industry and Commerce and the Ministry of Commerce, about 35 percent of employees feel that ffunctional profiles are not adequate. The percentage is 40 for the Ministry of Social Protection (Health). In any case, as the oversight responsibilities are extended over different institutions, it is difficult to accurately determine the adequacy of the staff that oversees state owned enterprises. Considering that risks of corruption appear to be higher in state enterprises of the health sector, and that the oversight agencies in this sector are the ones reporting more problems with staff and funding, it can be inferred that resources are lacking precisely in the sector where they are most needed.

References: Ley 775 de 2005. Por el cual se establece el Sistema Específico de Carrera Administrativa para las Superintendencias DANE. 2006. Encuesta Ambiente y Desempeño Institucional Superintendencia de Industria y Comercio DANE. 2006. Encuesta Ambiente y Desempeño Institucional Ministerio de Comercio, Industria y Turismo. DANE. 2006. Encuesta Ambiente y Desempeño Institucional Superintendencia de Salud DANE. 2006. Encuesta Ambiente y Desempeño Institucional Ministerio de Minas y Energía DANE. 2006. Encuesta Ambiente y Desempeño Institucional Ministerio de Proteccion Social [ LINK ]

Corporación Transparencia por Colombia. 2006. Indice de Transparencia Nacional Entidades Públicas Nacionales. Bogotá.

65c: In practice, the agency or equivalent mechanism overseeing state-owned companies receives regular funding.

Score:

100

Comments: The superintendencies and the ministries have consistent budgets from year to year. However, the pertinence of funding differs according to the specific agency. According to a survey on institutional performance made among public servants, from the institutions that may have responsibilities in overseeing state enterprises the Superintendency of Industry and Commerce, the Ministry of Commerce and the Ministry of Mining and Energy are the ones where more employees (62 percent) feel that funding is not enough to fulfill their mandate. The percentage is 66 for the Ministry of Social Protection (Health).

In any case, as the oversight responsibilities are extended over different institutions, it is difficult to accurately determine the sufficiency of the budgets for the institutions that oversee state owned enterprises. Considering that risks of corruption appear to be higher in state enterprises within the health sector, and that the oversight agencies in this sector are the ones reporting more problems with staff and funding, it can be inferred that resources are lacking precisely in the sector where they are most needed.

References: Ley 775 de 2005.Por el cual se establece el Sistema Específico de Carrera Administrativa para las Superintendencias DANE. 2006. Encuesta Ambiente y Desempeño Institucional Superintendencia de Industria y Comercio DANE. 2006. Encuesta Ambiente y Desempeño Institucional Ministerio de Comercio, Industria y Turismo. DANE. 2006. Encuesta Ambiente y Desempeño Institucional Superintendencia de Salud DANE. 2006. Encuesta Ambiente y Desempeño Institucional Ministerio de Minas y Energía DANE. 2006. Encuesta Ambiente y Desempeño Institucional Ministerio de Proteccion Social [ LINK ] Corporación Transparencia por Colombia. 2006. Indice de Transparencia Nacionales. Entidades públicas nacionales Bogotá.

65d: In practice, when necessary, the agency or equivalent mechanism overseeing state-owned companies independently initiates investigations.

Score:

100

Comments: The superintendencias are able to initiate investigations and impose sanctions related to the specific service. For example the Superintendencia de Servicios Publicos (superintendency of domiciliary public services) has started 14 investigations in 2007.

In any case, as the oversight responsibilities are extended over different institutions and the information is fragmented, it is difficult to accurately determine efficacy of the initiation of investigations on state owned enterprises.

References: Superintendencia de Servicios Públicos Domiciliarios. INVESTIGACIONES Y SANCIONES 2007.

65e: In practice, when necessary, the agency or equivalent mechanism overseeing state-owned companies imposes penalties on offenders.

Score:

100

Comments: In 2006, the Superintendency of Public Services imposed 527 fines. Although statistics are not desegregated, it is possible to determine that many of those fines were imposed to state owned enterprises. In any case, as the oversight responsibilities are extended over different institutions, it is difficult to determine with high levels of accuracy the efficacy of sanctions on state owned enterprises.

References: Superintendencia de Servicios Públicos. Sanciones e investigaciones 2007.

Can citizens access the financial records of state-owned companies?

66a: In law, citizens can access the financial records of state-owned companies.

Score:

YES

Comments: There is no specific rule for citizens on accessing financial information of state owned enterprises. According to law the main principles of the administrative function are efficacy, efficiency, participation, publicity, responsibility and transparency. Thus, in an indirect way, all the information on state enterprises should be available for common citizens.

66b: In practice, the financial records of state-owned companies are regularly updated.

Score:

100

Comments: At the Web page of the National Planning Department, as well as at the Web page of the enterprises, it is possible to find detailed and up-to-date financial data on state enterprises. According to the most recent Transparency Index of the Corporation Transparency for Colombia, in general all state enterprises have fairly good systems of information available to the public. Thus, their transparency indexes are at medium and medium to high levels compared to the whole universe of state institutions.

References: CIFRAS PRESUPUESTALES - EMPRESAS INDUSTRIALES Y COMERCIALES DEL ESTADO Y SOCIEDADES DE ECONOMÍA MIXTA [ LINK ] Corporación Transparencia por Colombia. 2006. Indice de Transparencia Nacional Entidades Públicas Nacionales. Bogotá.

Peer Review Comments: Financial data is not available, or exists but is consistently superficial or otherwise of no value.

66c: In practice, the financial records of state-owned companies are audited according to international accounting standards.

Score:

100

Comments: Given the fact that state enterprises are formed with public funds, they are subject to the fiscal control of the Supreme Audit Institution (Contraloria General de la Republica) according to article 267 of the Constitution. However, state enterprises are not required to contract external auditing exercises, according to the Sentencia C-290 de 2002 of the Constitutional Court.

They are required to apply the Standard Model of Internal Control that is applied over all public institutions. According to Law 87 of 1993, internal control is a system aimed at organizing information, evaluating and improving performance of state institutions. In 2005, the Administrative Department of the Civil Service (DAFP), in association with the Supreme Audit Institutions, adopted a unified system of internal control for all state institutions which is based in international accounting standards. According to the most recent evaluation of systems of internal control made by the Supreme Audit Institution, most state enterprises evaluated (about 13 out of 20, including social services and commercial activities) obtained a positive score in the evaluation of their systems of internal control, showing that systems are effective in promoting accountability and efficiency.

A good amount of state enterprises (7) obtained negative scores and appeared as having high or medium risks in internal control systems.

References: Contraloría General de la República. 2006. Informe de evaluación y conceptualización del sistema de control interno 2005 [ LINK ]

Concepto SSPD 556 de 2006. Superintendencia de Servicios Públicos Domiciliarios.EMPRESAS INDUSTRIALES Y COMERCIALES DEL ESTADO. No se les aplica el artículo 203 del Código de Comercio [ LINK ][CURR_CAT]=E00530000000000000000000000000000000000000

Concepto SSPD 663 de 2006 EMPRESAS INDUSTRIALES Y COMERCIALES DEL ESTADO.- Obligación de rendir informes a las Contralorìas

66d: In practice, citizens can access the financial records of state-owned companies within a reasonable time period.

Score:

100

Comments: Some records may be available online but it is not the case for all state enterprises. The Web page of the National Planning Department also has some financial information on state enterprises, but it is not constantly updated. According to the most recent Transparency Index made by the Corporation Transparency for Colombia, in general all institutions offer fairly good information systems to the public. Commercial and industrial enterprises have better levels of transparency than public service enterprises. Enterprises in the mining and energy sectors have better transparency levels than enterprises in the health sector.

The lack of a sole system or agency centralizing all information on state owned enterprises may cause delays in obtaining information, as well as the lack of clarity in information for citizens on how to access such information. Thus, there can be important time restraints for obtaining up-to-date information and notable differences on accessibility between enterprises.

References: Departamento Nacional De Planeación. EMPRESAS INDUSTRIALES Y COMERCIALES DEL ESTADO Y SOCIEDADES DE ECONOMÍA MIXTA. [ LINK ]

Corporación Transparencia por Colombia. 2006. Indice de Transparencia Nacional Entidades Públicas Nacionales. Bogotá

66e: In practice, citizens can access the financial records of state-owned companies at a reasonable cost.

Score:

100

Comments: Some records may be available online but this is not the case for all state enterprises. The National Planning Department Web page also has some financial information on state enterprises, but it is not constantly updated. According to the most recent Transparency Index made by the Corporation Transparency for Colombia, in general all state owned enterprises offer fairly good public information systems. Commercial and industrial enterprises have better levels of transparency than public service enterprises. Enterprises in the mining and energy sectors have better transparency levels than enterprises in the health sector. The lack of a sole system or agency centralizing all information on state owned enterprises may cause delays and additional costs for obtaining information, but in general all documents are available at the cost of photocopying.

References: Departamento Nacional De Planeación. EMPRESAS INDUSTRIALES Y COMERCIALES DEL ESTADO Y SOCIEDADES DE ECONOMÍA MIXTA. [ LINK ]

Corporación Transparencia por Colombia. 2006. Indice de Transparencia Nacional Entidades Públicas Nacionales. Bogotá