Row intensifies on whether KPHL is answerable to PAC


A ROW has developed between the Permanent Parliamentary Committee on Public Accounts (PAC) and the Kumul Petroleum Holdings Limited (KPHL) on whether it is subject to the Public Finances (Management) Act and is answerable to the committee.
PAC chairman Sir John Pundari had maintained that KPHL was still subject to the committee so long as it was a state-owned entity (SOE) that dealt with public money and property.
This came after KPHL board chairman Andrew Baing said the company was not subject to the Public Finances (Management) Act and was not answerable to the PAC.
The PAC published a notice early this month of their intentions to hold an inquiry into the operations of KPHL and the income generated from the 500-plus shipments it has made since the start of the PNG LNG project in May 2014.
However, Baing said KPHL had only two separate reporting mandates that included reporting to the prime minister and the National Executive Council (NEC).
Sir John called on Baing not to waste public funds on lengthy advertisements in the media to confuse the people and focus on complying with the PAC request for information.
“KPHL chairman Andrew Baing failed to mention that the fourth and the ultimate avenue for accountability of public monies and properties is the national parliament through its oversight role played by the Public Accounts Committee, which is an extension of Parliament itself,” Sir John said.
“Baing being a former Member of Parliament himself ought to know very well the consequences of mixing up public funds (monies that belong to the people) with private funds. Sir John said that KPHL merely collected rent on resources (property) owned by the people of Papua New Guinea.
“And this is where the mandate of the PAC kicks in. Our key function is ‘to examine and report to Parliament on the public accounts of PNG and on the control of and on transaction with or concerning, the public monies and property of PNG.”
Sir John also refuted the denials made by Baing that KPHL never requested for a closed door meeting, saying that they received a letter from KPHL dated July 18 from the managing director Wapu Sonk.
“Through a letter dated July 18, 2019, the managing director of KPHL wrote that, ‘Its senior management is willing to meet with and generally brief the chairman and other members of the committee on matters that are not restricted provided the time and venue are mutually convenient.
“The PAC refused this closed-door meeting with KPHL; if there is going to be any meeting between myself and the KPHL senior management or the board and the chairman for that matter; then it will only be at the open committee inquiry,” he said.
Sir John said that the PAC had given KPHL until Aug 7 to comply.
“Baing and his team must come forward by next Wednesday and present the information that the committee has requested or will be summoned to appear before the committee and if they fail to come they will be arrested,” he said.