PM: Western trust fund frozen

 PRIME Minister Peter O’Neill has put a stop to the Western people’s dividend trust fund until investigations and issues surrounding the rund are resolved.

O’Neill said he was concerned about how the people’s community mine continuation agreement funds being held in trust had been used.

He said he would direct Chief Secretary Sir Manasupe Zurenuoc to instruct the Mining Department to put a stop to the funds held in the trust account until he had met with the province’s MPs and resolved the issues surrounding the accessibility of the funds.

O’Neill said this when answering questions from Western Governor Ati Wabiro over the arrest of Western provincial administrator Dr Modowa Gumoi on Tuesday over the use of the funds.

Wabiro said Gumoi was arrested after endorsing funds from the trust account for the development needs of the province.

He said the funds were for development purposes as endorsed by the provincial government.

It was alleged that more than K36 million of the trust funds have been paid out without following due processes, resulting in Gumoi’s arrest. 

He is out on a K5,000 bail.

It was further alleged that the funds have been authorised by Mining Secretary Shadrach Himata  and did not follow procedures set out  in the trust instruments that were signed in April 2011 by O’Neill when he was the finance minister. 

According to clause 6 (c1) of the trust instrument, the funds could only be accessed from the trust account by approval of the joint district budget planning and priorities committee (JDB&PPC) and the projects approved by the three districts authorities must be endorsed by the provincial administration and the chairman of each JDP&BPC who then submits a list of projects to the mining minister for approval. 

It was alleged that Himata, who was the chairman for the board of trustees of the non-CMCA trust account, authorised 13 payments without proper tendering processes based on a letter dated Feb 25 from Gumoi who also signed the contract on behalf of the state. 

Gumoi denied the allegations, saying they were fabricated.