Government adamant on fixing bounced cheques, says Ling-Stuckey

THE Government plans to fix the problems of bounced government cheques, says Ian Ling-Stuckey, the minister assisting the prime minister on treasury matters.
“This has been a major challenge facing the implementation of government programmes,” he said.
“Businesses just lose trust in doing work for the Government if the cheques bounce.
“We want to explore options such as better automated data sharing with the Bank of PNG and the commercial banks, or standardising the requirements of the banks.”
He said at a more technical level, there were even challenges in moving funds in and out of the main Waigani Public Account.
“Even if a payment has been cleared, and the funds come back to account rather than sitting idle in a commercial account, the funds have to be re-evidenced when funds are to go back to the commercial accounts,” he said.
“This sounds like a boring technical issue, but we are trying to move towards a Single Treasury Account.
“This would allow for much better management of the estimated K7.5 billion that is sitting in commercial banks, waiting to be drawn down.
“We are having to pay interest costs on this massive amount of money.
“We need to move to more modern systems, including Electronic Funds Transfer that could reduce our debt levels by many billions of Kina, while making for a better and more trustworthy payments system.”
Ling-Stuckey said people were also facing major issues when trying to open and then deposit funds into bank accounts.
“If you are a cocoa farmer, and have just sold your cocoa at a good price, you may then have real difficulties in putting this money into a bank account,” he said.
“Instead, you have to cash the cheque at a local trade store, and this can be much more expensive.
“Some of the issues are probably the general problems of proving one’s identity.
“But there are also real issues in different bank branches, even of the same bank, applying different standards.”