Govt starts paying rental arrears

THE Government has presented K50 million as first instalment towards settling its K130 million rental arrears.
Speaking at the presentation on Friday, Finance and Rural Development Minister Sir John Pundari thanked Nambawan Super Ltd for working with the Government to resolve outstanding commitments.
“The Department of Finance and Nambawan Super will discuss strategies to settle the balance of the amount owed moving forward,” he said.
“The fact that they are owned by Papua New Guineans makes this a genuine commitment to support our local economy.
“Government is one of the largest contributors to the PNG economy.
“The Government has been prioritising outstanding Government commitments as part of its strategy to stimulate our economic growth since last year.
“These are legacy outstanding arrears carried over many years by previous governments with no serious thought to settle.
“The Government continues to commit and prioritise outstanding Government arrears as a key economic driver.
“We have prioritised the payment of arrears to the Health sector.
“By the end of the (next) year, the Government will have no outstanding arrears owing to medicine suppliers and the logistics companies that distribute the vital medicines. The Government will continue its arrears verification and settlement programme next year.
“We will continue to address SMEs, infrastructure and key project arrears.
“The verification and vetting of Electoral Commission arrears will be a priority of the outstanding balances as we start preparations for the 2022 elections.”
Nambawan Super Ltd (NSL) chairman Reg Monagi said: “We appreciate that Prime Minister James Marape, Sir John and the State have shown their commitment to meet this obligation with the first payment of K50 million.
“We are grateful to the Departments of Finance and Treasury who after extensive discussions and negotiations have helped us to achieve a payment schedule that is mutually satisfying.
“Our members will also be grateful to hear that payments are coming through before the end of the year as it will add to our calculations for the interest component of our payments to members for 2021.
“The State has been an important investment partner for NSL on several projects in the past and we intend to continue working closely with the various State departments and agencies on future projects for the benefit of our members.”
NSL is a significant lender to the State through the purchase of weekly Treasury Bills and periodic purchases of the longer-dated Inscribed Stocks.
The parties have agreed to settle the rental arrears using this approach and on terms that are attractive to the State.
Monagi said: “This arrangement required close collaboration between the Department of Treasury, Central Bank, Department of Finance and the fund.
“As such, we would like to thank all parties concerned for their cooperation in addressing this long outstanding issue.
“The fund is aware of the State’s ambitions to own and operate some of the properties in which it is a tenant and will progress discussions between the parties on this matter from next year and onwards.”