The National, Wednesday 4th January 2012
THE government is considering setting up an Independent Infrastructure Authority to rehabilitate national assets like roads and bridges which will be financed by the Sovereign Wealth Fund.
Public Enterprises Minister Sir Mekere Morauta revealed this in an article he wrote for Australian National University’s EastAsiaForum.org website published on Monday.
Sir Mekere said the government was developing a concept for an independent infrastructure authority that “will oversee the maintenance of national infrastructure”.
“The key features will include an independent board made up of government, donors and independent nominees; a predictable funding stream from the SWF to finance maintenance of national infrastructure; and high standards of transparency and probity in the contracting out of this work to the private sector.
“By including multilateral and bilateral donor representatives, we hope donors will direct funds to the infrastructure trust and thereby integrate donor funding more effectively with national priorities,” he said. Sir Mekere said the state-owned public enterprises would also receive priority funding from the SWF.
“In some sectors like electricity, telecommunications, ports, aviation and water, strong private-sector participation has improved services.”
“In others, public enterprises are slowly sinking. Finding credible private-sector partners to run these businesses will be tough without first undertaking some emergency rehabilitation, restructuring and recapitalisation.
“Consequently, some SWF funds, during the first 10 years of its operation, will be used to steer public enterprises toward a more sustainable path, while at the same time facilitating the entry of private-sector providers.
“Another part of this funding will be for community service obligations. Funding will not be limited to public enterprises, but rather private-sector businesses will compete for funding to deliver essential services in remote or non-commercial areas,” Sir Mekere said