Growth stymied by big-man rorting

BEHIND Papua New Guinea's resource-fuelled growth - 9 per cent this year - and its febrile uptake of mobile phones and social media lies a world, hidden in misty valleys and on remote islands, of grinding poverty.

We might have learned more of such poverty's true dimensions from a national census conducted in mid-year. But there are growing signs that the census, already postponed for a year because of inadequate funding, has effectively failed.

Such issues need to weigh on the minds of leaders from PNG and Australia as they meet in Canberra today. While Julia Gillard holds talks with new PNG Prime Minister Peter O'Neill, eight PNG ministers, including former prime minister Mekere Morauta, will be meeting a group of Australian counterparts.

The Australians, who will include Finance Minister Penny Wong, Trade Minister Craig Emerson and Pacific secretary Richard Marles, will be led by Foreign Minister Kevin Rudd.

They will discuss replacing the 12-year-old bilateral aid agreement with a broader treaty that reflects PNG's decreased reliance on Australian aid - now 11.7 per cent of the budget - as well as the creation of sovereign wealth funds to quarantine windfall earnings from PNG's new gas projects, and refocusing aid on education and health.

Australia has been offering technical support for establishing sovereign wealth funds for the best intentions: to prevent the huge anticipated earnings from being looted by politicians and others as has routinely happened with resource income in the past.

But Papua New Guineans need services now, not postponed to a supposedly more correctly governed future. Tragically, rampant politicisation has pushed large pools of public money towards supposed infrastructure projects administered by MPs, very little of which is spent in ways that make any developmental difference.

What is needed is a shift in the political culture from big-man style deal-broking to overseeing basic service delivery, with a commensurate upgrading of depleted administrative skills. Recurrent spending per person is today less than half what it was at independence in 1975.

Setting aside 22 seats for women at the next election should help; by definition, they are not eligible for big-man status.

Ross Garnaut and former PNG prime minister Rabbie Namaliu lament in a report on higher education released this week that adjusting for inflation, the funding per student is now one-fourteenth the level in the early years after 1975. They urge a joint program to refurbish PNG's universities and schools.

Stephen Howes, director of the Development Policy Centre at the Australian National University and author of last year's joint governmental review of the aid program to PNG, says the relationship should move on to one of equality: "Australia-NZ is the right vision for Australia-PNG", he says, adding that although an election was due next year, O'Neill had "a unique opportunity to get the country back on track after years of increasingly corrupt and paralysed government under Somare".

Meanwhile, CARE and the ANU yesterday released a survey of 262 rural families that underlines the extent of the country's challenges.

More than 60 per cent of those surveyed earned less than $92 over the past month, all from coffee sales. More than 70 per cent had no formal education. Only 27 per cent were literateMore than 90 per cent of the households had eaten no animal protein in the last month, relying on sweet potato. More than 75 per cent had consumed no fruit.

There are no easy answers to such problems.


ROWAN CALLICK - THE AUSTRALIAN

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