Budget reply far from credible

 THE Opposition’s reply to the Budget was just as Prime Minister Peter O’Neill described, “a political slideshow with no credible facts or data to support their claims”.

We could not agree more, especially when the Opposition budget spokesman Don Polye says the Government’s 2015 money plan is “nothing more than a hoax, a deceitfully planned deception, for theft and corruption”. 

Twelve months ago Polye, as treasurer, handed down what he termed “the most modern and transparent” budget Papua New Guinea had ever produced.

Besides an increase of slightly over K1 billion, the 2015 budget is somewhat similar to the current money plan and maintains the O’Neill Government’s key priority areas of infrastructure, education, health and provincial/district development.

Interestingly, Polye said in his 2014 budget speech: “We cannot allow hard-earned macroeconomic stability and discipline from the past to be eroded. 

We are making historic investment decisions from a position of economic strength.”

A year later, new treasurer Patrick Pruaitch said in his 2015 Budget speech: “The Government is making historic investment decisions from a position of economic strength while continuing to fund key development programmes to meet the country’s development needs.”

Their statements are almost identical. 

Not surprisingly, Polye has made a complete turnaround in his views about the economy since his dishonourable discharge from Cabinet earlier this year over the Government’s borrowing of K3 billion from the Union Bank of Switzerland (UBS) to buy shares in Oil Search Ltd.

The Triumph Heritage and Empowerment (THE) Party leader is rankled over his sacking by O’Neill and seems determined to trash the new budget and anything else the Government comes up with. 

His recent reunion with Opposition leader Belden Na­mah is either a political marriage made in heaven or a disaster waiting to happen. Time will tell whether they will be a force to be reckoned with.

In his budget reply on Tuesday, Polye accused the Government of:

• Spending public funds exorbitantly in a few centres and on non-priority areas;
• blowing the budget out of proportion by K879.3 million;
• committing the people and the country to a huge debt of K3 billion, a costly commercial loan raising the public debt level to K17.48 billion;
• breaching the country’s Constitution and the laws and breaching the Government’s own macroeconomic policies; and,
• Giving jobs and contracts to preferred contractors and family businesses, hence depriving Papua New Guineans of shared wealth distribution and inclusive growth. “The record set by this Government is very negative for PNG, thus, the nation will experience even more perilous times in 2015, in the medium term and in the long term, if this reckless behaviour continues,” he said.

Most of his concerns lack credible facts but there is some merit in Polye’s criticism of the Supplementary Budget “blowout” of K879.3m.

While the Government feels it is justified in topping up the current budget to fund outstanding infrastructure programmes such as the 2015 Pacific Games facilities and the National Capital District and Lae road projects, these are additional expenditure to the original money plan.

As Dr Osborne Ogis Sanida of the National Research Institute warned in an analysis this week, “The use of supplementary budgets to legitimise overspending or spending outside of original budgets is bad practice. 

“Supplementary budgets should have a clear purpose otherwise they will become a process for legitimising unbudgeted spending.”

We agree with Sanida but understand the Government’s need to ensure that the Pacific Games projects and programmes are completed on time.

According to Sanida, the main winners are provinces, heath, education and law and order; and those from whom the government has borrowed money. 

The Opposition should wise up and take heed of good advice and analyses of the budget provided by experts like Sanida.