Board director cuts save $234,000

A cut to the number of directors serving on public boards by 52 is estimated to save the public purse $234,000 a year, says the Chief Executive Officer of the Ministry of Public Enterprises, Elita To’oala. 

The change follows new amendments to the law to reduce the number of members sitting on a Board from 179 to 127 members. 

“The appointments were made in December 2019 but could not be announced until after the passing of the Miscellaneous (Board of Public Bodies) Act 2020,” said Ms. To’oala. 

“Except for N.U.S. [National University of Samoa] all other 26 Public Bodies now have their Board composition as per [the] Act. 

“That is not less than three or more than five members.”

The C.E.O. says there are now 127 Directors down from 179 in July 2019: “Based on the reduced number of Directors there [are estimated] savings of $234,000.”

There were at least 200 applications submitted for the Independent Selection Committee to review for the Board of Directors. 

The role of boards in public bodies have been criticised in the past where Cabinet overrules decisions from the members. 

One of the recent cases involves a decision from the Samoa International Finance Agency (S.I.F.A.) Board of Directors to reappoint its former C.E.O. was overturned by Cabinet. 

In defending the decision, Ms. To’oala, in previous correspondence, said the role of the board is to make sure the organisation is well managed; that its financial situation is sound. 

She said it was the directors' role to ensure organisation is providing an efficient and quality service that is expected of it by the community and that Government’s interest as the major shareholder is protected. 

“The Board provides the strategic leadership necessary to ensure public bodies meet their performance expectations both those that are legislated and those that are policy driven,” she said. 

“One of the most crucial obligations the board has is to protect Government’s interest.

“Sometimes decisions are made by boards that are not aligned to the current interest of Government. Where that happens it is the prerogative of Cabinet to re-align that decision with that ‘national interest’.”

In terms of recruitment of public body C.E.O’s, Ms. To’oala said such is the primary responsibility of the Board. 

“[Boards oversee] the process and [make] a recommendation to Cabinet,” she said. 

“According to the S.I.F.A. Act 2005 section 10 (1) makes it specifically clear that it is Cabinet that appoints the SIFA CEO. 

“The S.I.F.A. Board is responsible for overseeing the recruitment & selection process and making a recommendation to Cabinet.”