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Pacific Islands Development Program, East-West Center

With Support From Center for Pacific Islands Studies, University of Hawai‘i


PNG Budget To Focus On Provinces’ Financial Autonomy
Governors call for prudent management of district funding

By Isaac Nicholas

PORT MORESBY, Papua New Guinea (PNG Post-Courier, Nov. 19, 2012) – The Papua New Guinea 2013 Budget that will be handed down by Treasury Minister Don Polye tomorrow will see a major shift of the resource envelope to give "financial autonomy" to districts and provinces, but prudent management and accountability issues remain a major concern.

The Governors that gathered at the annual Governors Conference at March Girls Resort at Gaire village outside Port Moresby last week highlighted accountability issues that must be addressed immediately by the National Government.

This is one of 15 resolutions the Governors passed after the two-day conference.

Prime Minister Peter O’Neill when opening the conference last Thursday assured all the 22 Governors that the 2013 Budget will now centre and contain significant development funding for the Provincial Governments, which represents a major change in the allocation of funding.

The governors acknowledge and appreciate the National Government’s intention to strengthen Provincial and Local Level Governments to deliver basic services, and requested the need to improve Inter-government financing as fundamental to development.

The governors resolved and recommended that the National Government release provincial grants on a timely basis and also on a quarterly basis with 40 percent in the first quarter, 30 percent in the second quarter, 20 percent in the third quarter and 10 percent in the final quarter.

The governors said although they supported District Services Improvement Program (DSIP), they expressed concern about prudent management and use of these funds, because in many cases there were no tangible results to show for the use of these public funds.

The governors resolved that laws, systems and processes that govern the use of the funds be reviewed and amended and proposed amendments to ensure that:

  • Joint district Planning & Budget Priorities Committees formulate District Development Plans upon which the DSIP funds are to be used;
  • DSIP funds support the implementation of Development Plans and submit annual plans and budgets to the PEC and Provincial Administrators for inclusion in the provincial budget;
  • All Capital Goods acquired under DSIP must have an inventory submitted to the Provincial Administration and included in the assets register;
  • All vehicle and earth-moving equipment acquired under DSIP must carry government "Z" plates and be driven by blue or red Government license holders and vehicle or equipment be parked in pools recognized by the Provincial Administration;
  • DSIP funds must be released from National Treasury to the District Treasury and reflected in the provincial budget;
  • District Development Plans must incorporate the priorities presented by the Ward Development Committee (WDC) which have been endorsed by the LLG in the district; and
  • Regular Audits must be conducted on the use of public funds.

The Governors Conference noted the proposed amendments to the Organic Law on Provincial and Local Level Governments and resolved that a specific meeting be organised by Department of Provincial Affairs to discuss the details of the proposal.

PNG Post-Courier: http://www.postcourier.com.pg/
Copyright 2012 PNG Post-Courier. All Rights Reserved.


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