by BRIAN GOMEZ
Review development strategies

THERE is an urgent need for the National Government to set up a task force to review national planning goals and to totally update the medium term development strategy (MTDS).
As part of this review Bottom Line’s first ever plea in favour of free primary school education can be considered as part of the overall strategy and in line with increased budgetary capacity.
It is unconscionable in this day and age to condemn some 25% of our youth to a life of illiteracy and virtual disability.
Numerous studies have confirmed that there is a greater return on investments in primary and secondary schooling than at the tertiary level, notwithstanding the greatly increased levels of income generally enjoyed by university graduates.
Even though there are only about 15,000 students in all tertiary institutions and colleges versus over a million primary and secondary school kids, the recurrent budget this year for the latter group is only K100 million as against K136 million for tertiary education.
It must be remembered that the vast majority of graduate lawyers, accountants, economists and engineers will end up in corporate sector jobs and generally have a mindset that does not conform to that of risk-taking entrepreneurs.
It is these same graduates in high flying corporate jobs that are more likely to be investing in properties in Cairns or the Gold Coast despite the prospect of better returns evident in Papua New Guinea.
In PNG, as in many other countries such as Malaysia, Thailand, China or even Australia, many of the most successful entrepreneurs are people with a primary or secondary education.
They tend to be the key drivers of various local business activities, especially among the small and medium-sized enterprises but some of them end up becoming the biggest corporate giants in these countries.
There are probably up to a quarter of a million kids out there who are unable to be in school this year and most parents could certainly appreciate the mental anguish or feelings of hopelessness if all their kids are unable to attend school.
There is an urgent need to review the funding requirements in order to satisfy the challenge of meeting the United Nations goal of ensuring six years of primary education for all children. Detailed funding and implementation needs will have to be identified.
As in any other country there are a myriad of activities to be undertaken by the Government, from construction and maintenance of national and rural infrastructure to the provision of health services and other modern amenities.
Such programmes will ultimately drive many more people into the workings of the national and global society and steadfastly lift the living standards of people condemned to lives of abject poverty and a subsistence existence.
While I have hitherto focused on the education area and the big increases in expenditures, it will require, at the other extreme end, planners have also to grapple with an area that appears to absorb excessive expenditures, possibly to the detriment of overall national planning and potential development.
Some readers may be taken aback by the suggestion that this may be the case with the so-called Highlands Highway, the nation’s key economic artery that links the provincial capitals of Mt Hagen, Goroka and Kainantu to the coastal industrial city of Lae and onwards to Madang.
Inordinate amounts of funds have been channeled to rehabilitate and maintain these roads every year as if it is a bottomless sinkhole, due largely to calamities like landslides and floods.
It is in fact a sclerotic artery not just because of perennial problems with potholes and other forms of destruction but also because road transport companies cannot operate around-the-clock due to law and order problems that sometimes is a convenient short-hand for extortion and theft on the Highways.
A proper cost-benefit analysis needs to be carried out on the Highlands Highway along with an in-depth analysis to ascertain if alternate routes may be more easily maintained even if they are slightly more circuitous.
But I raise the question of the Highlands Highway and the huge amounts of public funds it continues to absorb only because of the crying need for a separate road connection between the capital city, Port Moresby, and the rich hinterland of the vastly more populous Highlands region.
Until such a connection is built and adequately maintained, the national spirit will be stymied and much of the nation’s dormant entrepreneurial energy would remain unharnessed.
Now that natural gas from the Southern Highlands will be piped to Port Moresby by the end of this decade, an arterial road would well be a welcome accompaniment.
Among other items, fresh vegetables and fruits could be trucked into Port Moresby with fuel tankers from Napanapa taking petrol, kerosene and other products to the Highlands.
The prioritisation of these plans and expenditures need to be a key part of the updated MTDS now that the country appears to be setting world records for the bringing down of supplementary budgets.
There were three last year and one more is due shortly.
This is really a shotgun approach to planning and will not bring optimum results, especially in view of constraints in the supply of skilled labour and materials.
Regular Bottom Line readers will remember that I had been critical of the MTDS mainly on the grounds that any plan that only proposed growth of around 3% was worthless because it represented a plan under which most people would be worse off in per capita terms.
Fortunately, the commodities boom, reasonably sound management of the economy and increasing investment activity has meant that the MTDS forecasts have become virtually irrelevant.
The allotment of vast quantities of funding under supplementary budgets, while keeping in mind that this is an election year, would result in a lot of wastage and possibly increased graft.
Some of these funds could be put aside for a rainy day — and especially if there are serious deleterious impacts from an El Nino climate change, as some anticipate.
One way of actually doing this is by paying off foreign debt. This will create increased spending capacity in future budgets by reducing capital and interest payments on the outstanding debt. At the same time it would increase the Government’s ability to increase future borrowings if the need arises.
In setting up a multi-skilled task force to optimise development planning, the Government may need to consider the possibility of inviting the participation of some foreign expertise in the exercise.