PM blames Bougainville missing budget on ‘administrative error’

The Bougainville flag … a critical year for the referendum on independence next year. Image: Bougainville News

By RNZ Pacific

The Bougainville President, John Momis, says he has been assured by Papua New Guinea’s Prime Minister, Peter O’Neill, that the absence of a vital grant from the 2019 Budget was an “administrative error”.

Both leaders met last week in Port Moresby

PNG’s budget, announced last week, makes no mention of the Restoration and Development Grant which is constitutionally guaranteed under the Bougainville Peace Agreement.

READ MORE: PNG budget reports lack transparency, says economist

Momis said Bougainville relied on this grant for essential projects and a failure by the national government to pay it would reflect badly on both Port Moresby and Bougainville.

The budget did feature a cut to recurrent funding for the Autonomous Bougainville Government.

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Next year, 2019, will be a critical year with a referendum on Bougainville’s long term political future scheduled to take place in June, Momis said.

The PNG and Bougainville governments must ensure that together they provide the funding and support needed to allow the vote to take place and for the important work of peace building to continue, he said.

O’Neill has promised to rectify the issues.

This article is republished under the Pacific Media Centre’s content partnership with Radio New Zealand.

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MIL OSI – Source: Evening Report Arts and Media

Timor-Leste’s opposition alliance set for win after fractious election

Xanana Gusmao of the AMP (Allianca Mudanca ba Progresu) coalition delivering his speech during a last day campaign in Dili before the weekend’s election. Image: Valentino Dariell de Sousa/SBS-AFP

Pacific Media Centre Newsdesk

With more than 99 percent of votes counted in the poll, Timor-Leste’s opposition Alliance of Change for Progress (AMP) was leading at the weekend with 49.59 percent of the total votes and is set to break the country’s political deadlock.

The coalition squeaked across the line with an absolute majority, preliminary election results showed yesterday, after a fractious campaign marred by violence and mud-slinging, reports SBS-AFP News.

It was the second general election in less than a year for the half-island nation of 1.2 million that is struggling to boost its oil-dependent economy, after a months-long political impasse saw Parliament dissolved in January.

READ MORE: Timorese election resolves political stalemate

Provisional Timor-Leste general election results.

With 97 percent of votes from Saturday’s election counted, the three-party Parliamentary Majority Alliance (AMP) – led by independence hero Xanana Gusmao – had about 48 percent of the votes.

The result means the alliance – which includes the National Congress for Timorese Reconstruction (CNRT) led by Gusmao, the People’s Liberation Party (PLP) and the youth-based Khunto – has secured an overall majority of 34 seats in the 65-member legislature.

The provisional line-up in Timor-Leste’s Parliament with the AMP Coalition (blue) and Fretilin (black) commanding most of the seats in the new Parliament.

-Partners-

The former Portuguese colony won independence in 2002 after a brutal, 24-year occupation by neighbouring Indonesia followed by 2 1/2 years of UN stewardship.

Fretilin, which narrowly won last July’s poll, had about 36 percent, leaving it with 23 seats.

No reports of unrest
Despite a fractious campaign and fears of violence on election day, there were no reports of unrest.

Clashes broke out the previous weekend between Fretilin and opposition supporters, with more than a dozen people injured.

Parliament was dissolved and new elections called in January amid tensions between former Prime Minister Mari Alkatiri’s minority government and the opposition centred around Gusmao’s CNRT.

Dr Alkatiri’s Fretilin party-led government collapsed after its bid to introduce a policy programme and new budget were thwarted by a hostile opposition.

“This outcome should produce a return to political stability in Timor-Leste and may allow Xanana Gusmao time to again consider looking to a replacement leader from the next generation after a suitable amount of time has elapsed,” said Professor Damien Kingsbury, coordinator of the Australia Timor-Leste Election Observer Mission.

“In terms of economic policy, it will be business as usual, which raises questions about the longer term viability for Timor-Leste,” Dr Kingsbury added.

Big challenges ahead
The incoming government will face big challenges, especially as the clock is ticking fast on its disappearing oil and gas reserves.

Oil and gas pay for the bulk of government spending but oil revenues are in steep decline and the country has few other productive economic sectors.

About 60 percent of Timor Leste’s population is under 25, according to the World Bank, while some 40 percent of its people live in poverty.

Providing jobs for young people and reining in public spending – especially on large infrastructure projects – will be key tasks for the new government, commentators say.

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MIL OSI – Source: Evening Report Arts and Media

PNG’s opposition blasts O’Neill over ‘fake budget, fake revenues’

MIL OSI – Source: Evening Report Arts and Media

Headline: PNG’s opposition blasts O’Neill over ‘fake budget, fake revenues’

A tale of two newspapers … contrasting front page views of the Papua New Guinea Budget. Image: Screenshot/The Pacific Newsroom

Pacific Media Centre Newsdesk

Papua New Guinea’s opposition has declared it will fight a good fight to expose and oppose what it describes the 2018 state money plan as a “fake budget”, reports the PNG Post-Courier.

However, the rival daily newspaper, The National, quotes Prime Minister Peter O’Neill as decribing the K14.7 billion (NZ$6.6 billion) Budget as Papua New Guinea’s “best in 16 years”.

The opposition’s Shadow Minister for Treasury and Finance Ian Ling-Stuckey presented the “alternative government” 2018 Budget response titled “Fake Revenues, Fake Loans and a Fake Budget”, the Post-Courier reported.

He said the 2018 Budget was filled with misguided spending priorities, failed plans for financing and yet another huge deficit that would burden “our children” with too much expensive debt.

“Put simply, when I look at the budget, I think of PNG as being similar to a very large and diverse company-PNG Government Limited,” Ling-Stuckey said.

“Is PNG Government Ltd broke? Our people are feeling the pain through a lack of jobs, a lack of incomes, a lack of foreign exchange and a lack of important government services.”

-Partners-

Ling Stuckey said that since 2011 debt had grown from K8 billion (NZ$3.6 billion) to more than K24 billion (NZ$10.8 billion) in just five years.

‘Fake revenue’
“The 2018 Budget has, at this early stage, some K2 billion in ‘fake revenue’. This is not the ‘building block’ that the Minister for Treasury promised. So where is this K2 billion in fake revenue?”

He said to assume that revenues were going to increase as much as 20 percent from K10.6 billion to K12.7 billion in 2017 was wrong.

He said the opposition supported the increase in health expenditure of K285 million but relative to the 2015 Budget, health had been cut by 16 percent in real terms.

“It’s no wonder our health services are declining. It is good that more funds are being provided for medical supplies. However, the underlying issue is a lack of transparent competitive tendering in the medical supply contract,” he said.

Ling Stuckey said the biggest winners in this budget were interest costs, administration, health and APEC.

“Are some of these really the right priorities at this time of severe economic pain and failing government services?

‘Bad signal’
However, The National’s Clifford Faiparik reported that Prime Minister O’Neill criticised the opposition budget response, calling on Ling-Stuckey to withdraw his “fake budget” remark.

“This is very disappointing as it will give a bad signal to our international investors. I’m calling on the Shadow Treasury Ian Ling- Stuckey to withdraw his statement,” he said.

“This is by far one of the best budgets that I have ever seen since I have been in this Parliament for 16 years now. That includes the budget that I have presented as well.”

O’Neill had served as a treasurer in the Sir Michael Somare-led government.

“I say this because this budget is now putting us on a course to make sure that this country’s economic base and growth will be such that it can be self-sustainable,” he said.

“So it is quite disappointing that some of the terminologies that he [Ling-Stuckey] used are unbecoming of leaders of this honourable House. We have to be careful of how we portray the image of our country, our parliament and ourselves.

“Sometimes for short political convenience and point-scoring we say things and do things that are not really in the best interest of our country. We have to be constructive.”

The Post-Courier and The National are Papua New Guinea’s only two daily newspapers.

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Keith Rankin’s Chart of the Month: Budget 2017: New Zealand’s ‘Universal’ Basic Income up to $195 per week

MIL OSI – Source: Evening Report Arts and Media

Headline: Keith Rankin’s Chart of the Month: Budget 2017: New Zealand’s ‘Universal’ Basic Income up to $195 per week

Keith Rankin’s Chart of the Month – Budget 2017: New Zealand’s ‘Universal’ Basic Income up to $195 per week.

Increase in unconditional Public Equity Benefit. Chart by Keith Rankin.

The big unnoticed story of last Thursday’s Budget is the increase in New Zealand’s quasi Universal Basic Income (UBI), from just under $175 per week ($9,080 per year) to precisely $195 (annual $10,140).

It’s actually particularly pertinent that Stephen Joyce acknowledged, by including these ‘tax cuts’ in his ‘family assistance package’, that ‘raising the tax thresholds’ represents in fact a form of benefit increase. I call the unconditional benefit that is embodied within our tax scale, the Public Equity Benefit (PEB).

(I claim naming rights because nobody else has bothered to name this unconditional benefit that is implicit within traditional graduated tax scales. Also, the name ‘Public Equity Benefit’, which embodies the visionary concept of public equity, offers much more for the future than the prosaic alternative name ‘personal tax credit’. Language matters.)

From the chart, we can clearly see that the PEB is not a true UBI. Persons grossing less than $70,000 per year do not get the full amount. However, we can say that most people grossing less than $70,000 do receive some conditional cash benefits which, when added to their unconditional PEB, take their total weekly benefits to $175 (or more).

In a fiscal sense, the cost of topping up so that all adults’ unconditional and conditional benefits total at least $175 per week is minimal. (An interesting case, however, affects my teenage son. He receives a ‘student loan living allowance’ which represents the same amount of cash as a student allowance. In the future, he will be required to ‘pay back’ his quasi student allowance, by means of a tax surcharge. The logic of universal unconditional benefits requires that ‘student loan living allowances’ should be no more subject to being ‘paid back’ than the unconditional Public Equity Benefits which all salary/wage earners receive.)

An important feature of the 2017 Budget is that, in line with the announced increase in the unconditional PEB to (upto) $195 per week, there have been significant increases in income-tested cash benefits – Family Tax Credits and Accommodation Supplements – to many of those people who have been short-changed by present anomalies in these benefits.

The 2017 Budget represents a significant step towards the inevitable acceptance of a genuinely universal ‘basic income’. Once this conceptual milestone has been achieved, we will then be able to understand that inequality and poverty are largely a consequence of the present tax rate (33%) and the present ‘universal’ basic income ($175 per week) both being too low.

Raising the weekly ‘universal’ basic income to $195 is a handy first step towards reducing inequality without resorting to increased ‘redistribution’ (and all the tragic bureaucracy that targeted redistribution entails).