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O’Neill’s K37 billion debt legacy

Ian Ling-StuckeyIAN LING-STUCKEY | Edited

PORT MORESBY - When Peter O’Neill came to power in 2012, Papua New Guinea’s debt was K8.5 billion. When he left in 2019, the figure was K37.6 billion.

So the debt was 4.4 times larger after only seven years. K29.1 billion larger. Not double, not triple, not even quadruple – an extraordinary 4.43 times larger.

Over the next five years of the economically responsible Marape-Steven government, debt is expected to increase by only 0.3 times – what a difference!

People are jumping up and down on social media claiming that all O’Neill’s new debts have been for new projects. This is a lie.

O’Neill’s debt legacy is not just K29.1 billion more debt. K20.7 billion of this new debt has not been for development projects. I repeat - not for development projects.

O’Neill’s increased debt trap consists of K18.1 billion in straight budget deficit financing, and another K2.6 billion in a previously hidden build up in arrears.

Those who support O’Neill and his debt trap legacy need to put their focus on this massive build-up in bad consumption based debt of K20.7 billion, not on arguments about the much smaller build-up in project or investment debt.

So can the O’Neill defenders, including failed former ministers, please justify this K20.7 billion increase in consumption debt?

Overall, at the end of the O’Neill term, the debt hole of K37.6 billion consisted 64% of budget deficit financing, 7% for outstanding arrears, 6% for project financing kept off government books, and only 23% for project financing that was initially in the budget.

This is an extraordinary debt trap legacy. Not just many badly selected and over-priced contracts. At least an over-priced project may still help the economy. Instead, over 70% of the legacy is budget deficit financing and arrears.

The Marape-Steven government is taking deliberate steps to reduce the rate of building up debt as part of its comprehensive economic reform program. This includes budget repair so we start living within our means again.

Budget repair will take many years but we are starting to take back PNG for the sake of our children.

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Paul Oates

If I remember correctly, the claim that half the PNG budget was stolen through corruption was first made public at a conference by a Deputy Commissioner of the RPNGC.

The problem is not how to find out who is stealing or has stolen the nation's money. The problem is merely having the determination to pursue the crimes with a steadfast political will.

Too many deals at too higher level perhaps?

Ian Ritchie

A genuine heartfelt response Arthur. One I think many resonate with, but don't always say it.

How can PNG society, weed out corrupt politicians and public servants? From my observations, the are many, many allegations, but very few criminal charges and even fewer convictions.

A person is innocent until proven guilty, so despite the allegations, each and every politician, public servant and corporate entity tainted by an allegation is completely innocent as long as everyone continues the "head in sand" ostrich approach.

I'm waiting for the ICAC. Given the amount of money allegedly stolen from the public coffers each year, it should have been one of the first things the Marape-Steven government set up.

Stem the flow of that alleged disappearing booty and Treasurer Ling-Stuckey would have the funds to start immediate budget repair. Start genuine prosecutions, with genuine penalties befitting the crimes and it will send enough shock waves through the system to halt at least some of attempts at theft.

Quite a number of years ago, I had a conversation with a senior officer of the Australian Federal Police stationed in POM. He told me about half the annual PNG budget was stolen each year and he was quite emphatic that finding the evidence of major and (as Arthur put it) mind-boggling theft and then tracing the fate of those stolen funds, was actually very easy and more to the point, they had already done those investigations.

I have no idea if he was correct in his claim, nor do I either believe it or disbelieve it, but it is my understanding that the AFP needs to be invited by parliament to become more than an advisory service. Possibly not much chance of that, if the allegations against a number of members of parliament have any factual base.

It is also apparent, that no one seems too concerned about covering their tracks too much, as it seems all one needs to do is lie through ones teeth and that's accepted by those in a position that should actually be able to do something about it, with little more than an occasional bleat of protest.

Perhaps the whistle-blower legislation will work, but without an ICAC with sharp teeth and a true moral dedication, there is little incentive and sizable risk for anyone to blow the whistle.

Arthur Williams

I cringe reading of this huge debt-mountain by the former PM and his gullible, culpable or plain stupid cronies.

In forming the new government Marape was supported by 101 MPs with only 8 against. That means that too many of those that oversaw this destructive government led by O’Neill are back with their noses in the trough yet again as some have been for far too many years despite change of PMs..

I don’t think it is an exaggeration to say that daily I read of the inhuman conditions of too many PNG citizens suffering from the disgusting actions of their leaders over too many years.

Daru has almost 100% of uninhabitable government buildings. Its MPs have had about K100 million over the last ten years for developing his huge district. Surely something could have been done to repair or rebuild at least a few of these condemned buildings.

Often I see pictures of decaying schools, aidposts, hospitals and huge potholed roads with their broken bridges. I read of women giving birth on the floor and lack of basic medical equipment or drugs.

The National reports 35 murdered but my wife says upto 100 killed on Lavongai with almost no action by police…’Mipela nogat bensin!’ or ‘Masin bagerap!’ ‘Solwar emi nogut long mipela can go!’

Yet at the same time we see pictures of PMs or Ministers smartly dressed attending international tok-fests and receiving honours from The Queen for their services. All this while their citizens suffer despite daily millions worth of resource products are shipped overseas.

Most us of us will recall the glowing promises of what huge benefits a new massive project will provide to the nation.

The figures being bandied about in corruption scandals are mind boggling. Gone are the thousands kina cases we once saw as we now read of many millions like that of over six million in the long investigated now being tried alleged fraud by a once Forest Minister in MBP. Something is obviously very wrong with this 45 year old nation trying to showcase itself as the leader of the Pacific Islands.

Just did a quick search of Moresby Homes for sale.
There’s a nice 3 bed, 2 bathroom hut in Gordons which is a snip at K21 million or similar shack in the town area for just K18 million. While if you are prepared to slum it you can get a one bedroom flat for just K9 million in Hohola.

Who the hell are the buyers of such homes? What on earth is their job that pays them enough to purchase such luxury? What are they contributing to the PNG economy?

After all the minimum wage is a mere K280 per fortnight. Would take 1236 years to buy the cheapest I have described as long as you didn’t eat or clothe yourself, pay school fees, have a mobile phone or use a PMV. For the K21 million donga you’d have to work for 2884 years.

Is it the dreaded Resource Curse or is it the stinking bloated maggots that have attacked the sickened weakened body of PNG.

Lindsay F Bond

Not only "failed former ministers", among other 'defenders'.
What of those who were ministers of the 'former government'?

It might seem to many in PNG that the phrase "beggars belief" points to people who are poor. Not quite so.

Really, it is that the poor folk of PNG (that is, all, and who are suffering from not knowing, and those who cannot forget knowing) are also subjected to a stretch of imagination (belief).

They are being led to imagine and to believe what is said to them by politicians, present and past. Really?

Any wonder that belief get thinner on the stretch?

It is the belief that is too thin and is beggarish, needing to be nourished by truth.

By the way, credit to Ian Ling-Stuckey MP for the statement and identifying the sorry extent, a staggering K20.7 billion.

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