WHY I MOVED TO THE MIDDLE BENCH

BY SIR MICHAEL SOMARE MP

Mr Speaker I seek leave of Parliament to clarify the issue around some of the statement going through the newspapers and social media over the past few weeks relation to the establishment of leadership tribunals past and present. Mr Speaker, I want everyone in Papua New Guinea to remember that during my time as Prime Minister, in the last Parliament a leadership tribunal was setup by the Chief Justice Sir Salamo Injia. The aim of this process was to look into allegations that as a leader I had failed to submit compete and timely annual returns to the Ombudsman Commission.


The Leadership Tribunal was established after the Ombudsman Commission referred me to the Public Prosecutor for those breaches of the leadership code. Mr Speaker, the reason for my referral was very clear. My office was late in submitting my annual returns as required by the Leadership
Code. Every elected Member of Parliament and some appointed office holders in this country are subject to the Leadership Code. This code or long list of rules demands transparent and accountable
behavior where public interest is concerned. The Leadership Code reminds us according to a clearly written set of rules of our sworn obligations as elected representatives. This is the purpose of a Code
of Conduct in our adopted system of accountable government.

Mr Speaker, I would like to stress that when the Tribunal was setup by the Chief Justice, I did step aside to protect the integrity of the highest office in our country. Before doing so, I appointed Hon Don Polye as Acting Prime Minister.

Personally, I felt that this was an issue of morality. The precedent  it established must be remembered for the sake of the principle of accountability – I knew I had set. To step aside as required by my own
conscience was to instill confidence in the people of Papua New Guinea that I too was subject to every law. After stepping aside, I then applied to the Tribunal requesting to return as the Prime Minister while the tribunal was being run. Due to the administrative nature of  the offence, the Tribunal granted my request.

Mr Speaker, the tribunal found that being a leader I failed to comply with the rules of leadership and after much deliberation that tribunal saw fit to impose a penalty on me of a two week suspension. I was Prime Minister and I was not above that ruling.

Mr Speaker, I have listened with much interest over the last two and a half years while debate has aired over the media about major decisions my government took regarding the commitment of our people’s present and future sovereign wealth - I refer to:
• The IPIC transaction and the Government’s “back-in”,
• And the acquisition of the 19.6% share in the PNGLNG project.
I am compelled now to state that all aspects of the transaction were covered by NEC Decisions and all expenditure items for the transactions in any given fiscal year were covered by appropriation
bills. This commitment of public monies required the consent of parliament prior to the execution of those major commercial transactions involving the Independent State of Papua New Guinea.

Mr Speaker, I am also compelled to ask this parliament as to who is the ultimate beneficiary to this transaction; I can only see OIL SEARCH. I can only see the State taking on the risk of a major
commercial entity. This is because:

• Oil Search walks away with 1.2billion Australian Dollars, a dilution of share volume and no risk of an imminent take over from shareholders on the ASX.
• UBS hold the shares in case of a default and
• The Government of PNG bears the burden of the debt by one of the largest companies on the ASX.

Mr Speaker I am also compelled to advise this Parliament that the right investment would have been a direct investment in the InterOil Project, where the people of Papua New Guinea would not have paid “risk capital” to a highly risky proposition by Oil Search Limited.

This risky proposition for an indirect equity stake of 10.1% with effective returns of about 1.5% if we are lucky. The Government should have allowed IPBC or NPCP to simply exercise the State’s “back-in” rights to own 22.5% direct equity in the InterOil Project at approximately the same price.

Mr Speaker, I further suggest that the time frame for project delivery would have allowed for far greater diligence around a debt management structure in this budget.

Mr Speaker, I would also like to reflect on the past decade of economic growth under my leadership as Prime Minister. I am pleased to say that I led a team of bright energetic politicians, who created a
vibrant policy environment that fostered foreign and local business confidence. Businesses grew knowing that their immediate investments were protected due to fiscal certainty in the longer term and they delivered their projects in our country on time.

Mr Speaker I delivered a stable and conducive environment where heads of departments were communicating with their Ministers and statutory heads of companies and CEOs of State Owned Enterprises were able to grow their asset base and increase their revenue as they were able to interpret clearly articulated government policies and develop strategies to deliver targets that they had set, without fear or favour.

Mr Speaker it is in this context that I now emphasise the absolute need for our leaders to not squander the fruits of the seeds that were sown in much harsher financial conditions. Mr Speaker we have in the last decade created a secure platform for our present and future leaders to launch from. We are in a position where future revenue is guaranteed for generations to come and it is therefore our responsibility now to ensure that we are diligent in our decision-making processes now for our future generations.

Mr Speaker I wish to now advise Parliament I will move to the middle benches beginning today as I do not believe that due process was followed creating a massive debt of over K3billion. Particularly that this debt is not reflected in our total debt stock of Papua New Guinea in our supplementary budget 2014 to 2015.

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