Largest budget deficit in history

TREASURER Ian Ling-Stuckey says PNG has its largest budget deficit in its history.
He said over the last eight years, the former regime had dug a deep economic hole for the nation.
He claimed living standards fell from K5,380 in 2014 down to K4, 860 in 2019, a drop of K520 per person.
“Every year over the last five years, the average standard of living of every person in the country went backwards by over K100 –every year deeper and deeper into the economic hole,” Ling-Stuckey claimed.
In contrast to the steady creation of jobs from 2002 onwards, averaging around 15,000 jobs per annum, the regime destroyed about 5,000 jobs every year, he said.
“The former prime minister’s economic mismanagement was widely acknowledged by the international community.
“He pretends that he was praised by international organisations.
“When I moved across to take on the responsibilities of Treasurer on 27 August, I needed to establish the facts.
“I had clearly put on the public record that I had doubts about the accuracy of the budget figures being presented to our people.
“So my first task was to set up a due diligence exercise to determine the facts.
“The findings highlighted major problems.
“The details of the process were set out in my earlier speech on the Supplementary Budget, so enough to say that the exercise uncovered a major black hole in the finances of our country.
“Indeed, the work uncovered a deep budget hole of K2,213 million between the true situation and what was announced to Parliament less than two months earlier in the MYEFO.
“There were some that doubted that such a gap could be so large. So we were lucky that a team from the International Monetary Fund (IMF), were in town and were willing to check the true situation.
“They were told to have a close look at the due diligence work. And their conclusions?
“They (IMF) concluded that things were even worse than revealed by the due diligence work. Not by much, indeed by less than 2 per cent.
“The IMF’s conclusion was that the budget hole was K2,262 million, K50 million worse than the due diligence exercise.
“Contrary to the confused and misleading views of the opposition leader, the Government made very real and painful cuts to the budget, cuts totalling K1,482 million.
“Of course, we also needed to fund the cost blow-outs in areas such as the K850 million extra required for public service and teacher wage costs and an under-budgeting of interest costs and action to start paying off some of the arrears that had been revealed,” he said.