PM: Tax credit scheme backs key investments

By HELEN TARAWA
Infrastructure tax credit scheme (ITCS) is an important source of funding to support key infrastructure investments in the country, Prime Minister Peter O’Neill says.
O’Neill, in his address at the launching of the revised ICTS policy guidelines, said the scheme supported a number of important infrastructure projects around the country, particularly in resource areas.
“The improvement on the performance of the new tax credit arrangement is to ensure some of the challenges talked about in the last
two days at the national leaders’ summit can be met on a timely basis,” he said.
“This is merely a Government funding that is being advanced so we can develop some critical infrastructure in the country.
“The new suggestions that have been made to improve this programme are to create some balance.”
O’Neill said the success of the programme, which was introduced in 1992, had resulted in the development of many projects costing close to K1 billion.
He said some of the iconic infrastructure included Apec Haus, National Football Stadium and some maintenance programmes on the Highlands Highway.
O’Neill said there had been failure in scoping and management.
“That is what we are trying to avoid,” he said.
“We have to create some balance with public money to be managed properly and spread equally right across the country.
“Under the new tax credit scheme arrangement, there will be an increase from 0.75 to 2 per cent.
“The spending will be split 50 to project areas and the other 50 to the rest of the country.
“It’s a fair balance which we will manage over the next few years.
“In project areas like Ok Tedi, with community mine continuation agreement (CMCA) and non-CMCA and all the other funding, mismanagement has happened – something that we must not repeat.
“That’s why Cabinet had strongly recommended that there must be strong visibility in public funds that are subject to the Public Finance Management Act.”
O’Neill said the procurement process had to go through a public tendering process to ensure there was visibility and transparency.