8 Responses

  1. Peter Graves
    Peter Graves November 29, 2016 at 9:36 am

    Thanks Stephen

    The name “ANGAU” is particularly poignant in the context of Australia/PNG relations, both prior to 1975 and currently. Excuse me while I provide further background, from https://en.wikipedia.org/wiki/ANGAU_General_Hospital. STARTS:
    ANGAU stands for the Australian New Guinea Administrative Unit, which was an Australian Army unit that was formed on 21 March 1942 during World War II and was responsible for the civil administration of the Territory of Papua and the Mandated Territory of New Guinea. Following Japan’s entry in the war, the civil administration of both Papua and the Mandated Territory of New Guinea was taken over by an Australian Army military government and came under the control of ANGAU from February 1942 until the end of World War II
    In September 2013, it was reported that the hospital had deteriorated over the last 20 years and that its buildings had become infested with termites. The renovation of the hospital is a core condition of the asylum-seeker deal between Australia and PNG made on July 19, 2013. ANGAU has only 12 of the 32 specialists it needs, and just 55 per cent of its 729 total staff.[7]

    In February 2014, the Australian Minister for Foreign Affairs, Julie Bishop, stated: “The Australian Government has committed to redevelop the ANGAU Hospital. The original hospital is now 50 years old. It was built in 1964 and is run down, it has been attacked by termites over time, there is asbestos in the building, so we need to work very hard to lift the standards to something that is world class.”[8]

    Over K300 million has been invested in the redevelopment of Angau, including the master plan and 50 percent of the capital cost of renovation works. It will take two years to plan and design the new Angau hospital, while the major construction work will commence in 2016–17. ENDS

    So – is the PNG Government cutting back because Australia is picking up the slack ?

    1. Stephen Howes
      Stephen Howes November 30, 2016 at 10:28 am

      Hi Peter,

      I think what this shows is the complete lack of leverage the Australian government has in PNG. The Manus agreement under which Australia committed to pay for 50% of the Angau reconstruction also committed the PNG Government to pay for the other 50% and for PNG to meet “ongoing recurrent operational costs” See http://dfat.gov.au/geo/papua-new-guinea/Pages/joint-understanding-between-australia-and-papua-new-guinea-on-further-bilateral-cooperation-on-health-education-and-law-and.aspx

      Yet not only is Australia proceeding with the reconstruction without any funding from PNG (as Daniel Flitton has reported) but we are proceeding in the face of PNG slashing recurrent funding for Angau.

      It’s not that PNG is cutting back because Australia is picking up the slack (the major investments are still to be made) but rather PNG cutting back and Australia proceeding regardless.



  2. John Domyal
    John Domyal November 24, 2016 at 4:42 pm

    Thanks Stephen

    Your discussions around MP funds is interesting to the fact that it increases over the last few years. Maybe you referred to other MP funds as well but the most popular top-up is DSIP funds currently stands at PGK15 million per year, in a 5-year term of Parliament, its equivalent to PGK75 million. This is a lot of money for an electorate and everyone has to fight tooth and nail to get into power and control it.
    This DSIP fund is legally pegged against all social development aspects (education, health, agriculture etc) in district, which the MP and his/her committee now called the DDA will have to formulate budget for it. A small portion from this funding (DSIP) is regarded as discretionary funds for MP. That is the allocation which MP can decide where and how to use, but not to personal use.
    So concern raised by many is on the use of this PGK15 million in the district and nothing tangible is on ground to show. Also the mechanism in place to monitor expense of this public funding is weak and subject to manipulation. However, few of those subject to honest monitoring and audit resulted in some MP being prosecuted before the laws for miss appropriation and thieve.
    At the same time this current government introduces “free education and health care services” and poured money directly into district, but this should not give MP or DDA the leeway to cease funding allocation to education and health in the district with DSIP funding.
    The reality now is that, MP is the CEO of DDA and appoint his/her cronies to DDA board, influence DDA to entertain paper proposals along cronies and tribal loyalists. They walk away with fatty cheques while some put huge claims for little cost or value of job done. To paint the situation in the district look better, most MP bought vehicles and presented to schools, health centres and ward counsellors as gifts with slogan like “donation by MP…..”. People see and thought this MP is performing well, but if you go down to the school with the new vehicle donated by MP, the classrooms are run down, no desk for students and even no teacher house, the same goes to health centre with the new donated vehicle.
    To change this model of MP funds is up the legislators themselves or need an honest prime minister to propose a review to this MP funds. Otherwise they knowingly create this system to appease their hunger for wealth and power.

  3. Joe Roach
    Joe Roach November 18, 2016 at 12:17 pm

    I am now a little out of touch, but the great tragedy of MPs funds is not its magnitude per se, but how little is actually accomplished with it. National Audit Office reports and Provincial Audit Committee reports – where such committees exist and are active – tell a shameful story. Is it the same country-wide? I do not know, but some information highlighting better and worse performances would help PNG citizens hold poor performing MPs to account, and give reasons to re-elect MPs who have not just spent funds, but delivered results.

  4. Stephen Howes
    Stephen Howes November 15, 2016 at 10:35 am

    Thanks for these comments. I stand corrected, James. My assertion was based on our “Lost Decade” report. Our Figure 7.2 has PNG MP funds at 9% of total expenditure and Solomon Islands at 8%. But that was a couple of years ago, and it sounds like Solomon Islands has changed since then. Philippines and Kenya were the only two other countries we could find where such funds made up more than 1% of total spending.

    That chapter has some useful information re your question Jo. It is hard to know how much of the MP funding ends up with schools and hospitals, but our survey in 2012 did find it was an important source of funding for them – and that was before the massive scaling up. For example, we found that 20% of schools and 23% of health clinics reported having benefited from MP funds. Most of the projects involved building something. You can read the analysis here (http://devpolicy.org/publications/reports/PEPE/PEPE%20Chapter%207.pdf) but the most telling statistic I think is that 41% of the schools and 45% of the health clinics believed that their MP-funded project would never be completed.

    Tony also makes an important point. 30% of the government’s payments to schools are now made to MPs! (see Grant Walton’s post: http://devpolicy.org/creeping-re-centralisation-pngs-education-sector-20160615/. So that should really be counted in the MP funding. That’s an additional K 200 million or 1.5% of total spending.

  5. Jo Spratt
    Jo Spratt November 12, 2016 at 1:31 am

    Great post, thanks. Does anybody have any data or reasonable estimates regarding if and how much MPs spend from their funds on health and education, and what the nature of this expenditure is? I’m aware of all the problems/issues, etc. regarding constituency funds, just curious.

  6. Anthony Swan
    Anthony Swan November 10, 2016 at 10:06 am

    Also, the cuts to education and health funding are arguably made worse by the protection (in nominal terms) of “free” education and health policy funding in the budget. Free health policy is probably not providing any additional support to health clinics that were previously raising funds through user fees, and the same might be true for schools now that there are reports that a substantial proportion of TFF funds that were previously paid directly to schools (in lieu of abolished tuition and project fees) are being diverted to the control of district authorities. Again, something has to give within these sectors, and so the actual cuts to funding of goods and services that support education and health service delivery will be larger than what you have reported.

  7. James Batley
    James Batley November 10, 2016 at 9:01 am

    Stephen – thanks, fascinating post. If I could pick you up on just one point, that is your statement that ‘PNG makes more reliance on spending through MPs than any other country in the world’ (at 9% of total expenditure). My analysis of recent Solomon Islands budgets suggests that equivalent spending through MPs now represents over 14% of total SIG-funded outlays (recurrent and development budgets) in that country. Either way, both countries are international outliers in terms of the amounts allocated to such schemes.

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