SIP policy flawed, not in our interests

THE Services Improvement Program (SIP) policy was introduced by the O’Neill Government when it came to power after the 2012 general elections.
The SIP is a decentralisation policy that includes three tiers for funding – provincial level (PSIP), district level (DSIP) and the local level government level (LLGSIP).
The funding appropriation under each tier includes K10 million per fiscal year which is financed by the National Government.
However, the budget appropriations made under the SIP Program have not been legislated.
This means there is no legislation governing the SIP Policy which perhaps makes it unconstitutional.
Such unconstitutional funding are largely flawed and therefore should not have been included in the yearly and mid-year budgets by the Government. The SIP also is subject to adverse selection due to lack of legislation.
Although every province, district, and local level government are allocated K10 million per fiscal year, the Government can alter the appropriations based on its own selections.
This shows that the budgetary needs have been decentralized but the ultimate authority remains with the central government.
This selectiveness violates the political principles of fairness and equality.
Moreover, there is capacity saturation in the provincial, district and local level government levels.
The allocation of K10 million to each tier will not be absorbed through the production of tangible outputs due to lack of entrepreneurship, management expertise and personnel at the local levels.
This has provided a breeding ground for corruption which has recently gone out of hand with a number of MPs and government officials being charged for fraud relating largely to the SIP funds.
In addition, the funding scale of the SIP is very huge and that an efficient monitoring and evaluation system is paramount to the success of the policy outcome.
At present, the Department of Implementation and Rural Development is handicapped with capacity to monitor and evaluate the SIP policy and therefore depends largely on acquittals submitted by MPs, governors, LLG presidents and their committees.
In such circumstances, quality and cost effective indicators will go unnoticed which further leaves technological standards and corruption unchecked.
The lack of an efficient public finance mechanism is not conducive for the SIP policy.
Since independence, government finance has remained untenable due to the huge untapped economic peripheries and a proportionately large unemployed population.
Thus, the minority has been paying for the majority through income tax, goods and services tax, excise duties, and fines thereby creating a huge free-rider problem.
So the SIP policy will only worsen this situation and worsen government debt thereby resulting in financial crisis.
To conclude, the SIP policy remains a flawed policy and therefore requires an urgent check by the Government.

Mike Haro, via email