Inefficient public administration: conflict between Naftogaz and ASAM

For almost a month, the conflict between Naftogaz and the Agency for Search and Asset Management (ARMA) regarding gas stations of the former Glusco chain has been going on.
 
The gas station network was arrested by the court last year in May due to the network’s connection with Russia and Medvedchuk. After that, in May 2022, the network was transferred to the management of Naftogaz, which was actually given 89 gas stations and 2 oil depots.
 
From October 2022 to June 2023, Naftogaz spent almost UAH 26 million on the management of the gas station network. The company assures that the funds were used to restore operations and rebrand. At the same time, for more than a year of operation, the network brought only about UAH 2 million in revenue to the state budget (as of June 2023).
 
In the end, ARMA decided to terminate the contract with Naftogaz, accusing the company of inefficient management and providing unreliable information. Instead, Naftogaz itself disagrees with this conclusion and calls the termination of the contract illegal.
 
Now ARMA proposes to hand over management to another state-owned company, Ukrnafta.
 
It is not clear how this story will end, because there are questions about both the actions of Naftogaz and ARMA. But in any case, we are not surprised by the claims about the effectiveness of state management of Glusco’s assets. The state, as you know, is a bad owner in most cases.
 
Therefore, the best solution will be to privatize the network when it becomes legally possible.