Peter O’Neill – serial raider leaves PNG with a bare cupboard
20 July 2016
SIR MEKERE MORAUTA
PAPUA New Guinea can no longer afford Peter O’Neill’s raids on public institutions to keep himself in the prime minister’s chair.
The cupboard is bare, and everyone knows it.
The prime minister is a serial raider, but there is nothing left to raid. He has nowhere to go except overseas and borrow at high interest rates.
Mr O’Neill’s history is littered with the wreckage of his raids – National Provident Fund, Papua New Guinea Banking Corporation, Finance Pacific, Resource and Investment Finance Corporation (RIFL), the Treasury coffers, and state-owned enterprises.
He raided PNGSDP [PNG Sustainable Development Program] by illegally expropriating Ok Tedi Mining without compensation. He has raided OTML itself and is still trying to raid PNGSDP and get his hands on the $US1.3 billion in its long term fund.
The reported K60 million raid on landowner funds last week is, if true, another chapter in a sorry history. Where could that money have come from? Trust accounts? What purpose was given for these deals?
Now we hear he has raided Treasury to pay out K111 million in District Services cheques immediately before a vote of no confidence.
The prime minister should come clean on these reports and state whether they are true or not.
Every time Mr O’Neill touches a public institution it ends up requiring rescue and rehabilitation – and most of all injections of taxpayers’ money, which should be going to schools, hospitals and other essential services.
Where we are economically and socially as a nation, and the struggles we face, is a reflection of his destructive history.
Mr O’Neill states that Papua New Guinea needs political stability. Yes it does. But not if that stability is used to destroy the country.
What we need right now is dedicated people with integrity, a sense of public good and a capacity for hard work in the national interest, not self-interest.
The country needs a well-planned economic and financial rescue plan that is properly funded, has the support of the people and is backed by Papua New Guinea’s international friends and multilateral partners.
The country also urgently needs another mini-budget to correct the prime minister’s mistakes in the original 2016 Budget, mistakes he should have learned in 2015.
The nation cannot be kept alive by more raids on state-owned enterprises or random, high-cost borrowings.
"These are real regardless of whether they are done on debt."
This is the rationale of elite capitalists who do not feel the pinch of taxation and inflation, nor suffer the salt sprinkled on their wounds when basic services such as health and education are underfunded.
It is easy to state that PNG has "a demonstrated record of never defaulting to any creditor in 40 years as a nation state."
It is not as easy to explain how our most basic development indicators have benefited from these loans.
We can see the roads, but close our eyes to health statistics.
We can see the classrooms, but don't see the teachers and materials.
We can see the events in POM, but don't see the distribution of wealth.
"We call development the trenches dug between us for wealth".
Posted by: Michael Dom | 21 July 2016 at 02:35 PM
Peter, The borrowed funds are not entirely for "recurrent expenditure".
There are capital expenditure components included in them as well.
It's simplistic to label all borrowed money of late as for recurrent purposes.
Posted by: Corney Korokan Alone | 21 July 2016 at 02:01 PM
Corney, I don't know where you gained your public finance or economic expertise from but you seem to forget the basic fact of life - call it economic or just common sense - that borrowing money to pay for recurrent expenditure, which is what in effect is happening with PNG at the moment, no matter what the budget papers or politicians may say to the contrary is fraught with danger and leads to eventual bankruptcy whether done on a nationwide or personal capacity
Posted by: Peter Sandery | 21 July 2016 at 12:39 PM
There's scant evidence of bona fide expertise when one has a record of being a supposed coach of a plundering crowd when they are in power - in surplus budget years......kidding the country with some K70 million bridge that never got built....goes to sleep and becomes clueless on basic development aspirations of the people.
After landing in the opposition side, there is a sudden inspiration to preach that, it is unwise for a government committed to infrastructure development through deficit budgets for boldly and successfully doing so.
People are not easily sold, I am afraid.
The O'Neill-Dion government is spearheading road infrastructures (all over the country), airport redevelopments (Jacksons, Kagamuga, Hoskins), refurbishment of three different government offices saving massive lease rental fees, school fee subsidies and classroom building constructions and hospital maintenance (Port Moresby General amongst others) - the people are appreciating the changes that are taking place. These are real regardless of whether they are done on debt.
So stuff the unceasing bacchanals on the country's debt situation. We have a demonstrated record of never defaulting to any creditor in 40 years as a nation state.
The authentic analysis of the country's economic state have come out from the central bank of PNG and the treasury. Interpretations on these that focuses on one's paranoia needs to be taken with a pinch of salt.
Posted by: Corney Korokan Alone | 21 July 2016 at 06:52 AM
What winds a-blow, laurabada or lahara
What wills bellow, likeable, err, litigable
What wishes blown, lifesaving or likes-salving
What whims are lough, loch-like brimmed or locked tiding
What wins beknown, life-lifting or strife-piping
What wimps below, law non-biding, limply sniding
What wisdom shows, lawful binding follows finding.
Posted by: Lindsay F Bond | 20 July 2016 at 10:35 PM
Dubious accusations leveled against the author in order to avoid discussion on the veracity of the information provided, which was the central point of my request, does not suffice.
If you have a better economic opinion, please expound it, rather than attempt to sully the good reputation of an adviser who has little vested interest in the outcome of PNG's economic standing, other than his commitment to his profession.
Posted by: Michael Dom | 20 July 2016 at 04:11 PM
Let's face it Corney, there are precious few politicians in PNG who can honestly claim that they've had the people's welfare as a top priority.
Don Poyle doesn't inspire me greatly either.
What bothers me though is that if O'Neill pulls off his ruse it will be a trigger for a general public uprising.
You might rue your support of him then.
But keep commenting - your views are interesting.
Posted by: Philip Fitzpatrick | 20 July 2016 at 04:10 PM
Tell me about Paul Flanagan's economic policies he helped craft for his political groupings in PNG when they were in power and oversaw the budget surplus years and how those improved the lives of citizens.
Then I will assess if his recent commentaries are worth serious consideration.
Posted by: Corney Korokan Alone | 20 July 2016 at 02:52 PM
The comedy of Comey Korokan Alone continues.
Posted by: William Dunlop | 20 July 2016 at 01:22 PM
Corney, your response is thickly laced with invective and ridicule in every single line.
That's impressive. And I thought that I was critical of our leaders...well done!
Since you have much savvy in economics perhaps you would care to enlighten us lay persons on the state of the economy, perhaps in response to Paul Flanagan's latest post, which no doubt, you would dispute with the same strong emotion.
Posted by: Michael Dom | 20 July 2016 at 12:51 PM
Sir Mekere Morauta would conveniently like everyone to forget that, a so-called "well-planned economic and financial rescue plan" peddled by the IMF and the World Bank are the only workable models in town.
PNG doesn't need these two monsters and doesn't need Sir Mekere anymore too with his sales pitches.
Why would an unsecured syndicated loan be easily sourced when the cupboard is bare? His hollow argument is destroyed here.
There's a massive distinction between a secured loan and an unsecured loan. The big difference with an unsecured loan is in the high credibility (credit) rating of the borrower, hence no collaterald and equities are required.
Sir Mekere's so-called economic wit is becoming more insipid and laughable to serious readers of economics and business.
People are wondering why he appears to be more vocal these days?
He lost the international arbitration tribunal when the court ruled that he has no standing as an investor on the Ok Tedi shares.
It's clearly time for him to retire with the residue of respect he has left rather than barking ludicrously all over the place in a used car salesman's coat.
Posted by: Corney Korokan Alone | 20 July 2016 at 09:23 AM
So, if in fact the cupboard is bare, what will be used to buy the loyalty of those who have reportedly only owed their allegiance to whoever can bribe them with the best 'financial incentive'?
It begs the question of how the PNG political 'pork barreling' has descended into personal bribes. The DSIP has been revealed as nothing more then financial bribes to keep an MP loyal to whoever is paying.
Comments by Ben Micah have removed any doubt about it.
So will whoever might succeed in eventually becoming PM continue with this bribery and how will they do this if the government bank account is empty?
There is a limit to how much paper money can be printed and one only has to look at the Zimbabwean experience to see what not to do.
Posted by: Paul Oates | 20 July 2016 at 07:41 AM