Uproar over purchase of shares
Papua New Guinea Prime Minister Peter O’Neill is undeterred by mounting high level corruption allegations against him with the latest being his referral for prosecution by a leadership tribunal relating to the Government’s purchase of shares in Oil Search Ltd through a Union Bank of Switzerland (UBS) loan facility of K3 billion (US$1.1b).
This is in addition to his prolonged arrest by police relating to his alleged illegal approval of payments to private law firm. A warrant issued by police for his arrest is on hold while he challenges its legality in court. O’Neill described the latest allegations as somewhat dubious and driven by people with political motivation.
“I will continue to run the affairs of the country. For me personally I have been fighting many challenges since I was born and this is another of these challenges,” O’Neill said of his referral. Earlier this year, the government took out a $AUD1.3 billion loan with the Australian branch of UBS bank to buy shares in the nation’s biggest company Oil Search. The move was controversial, with criticism over the approval and the level of debt incurred by the nation.
It has been alleged “the K3 billion loan has been executed and obtained by the Prime Minister in violation of the express letter of the National Constitution under section 209 and in breach of seven other Laws of Papua New Guinea. Section 209 (1) says the raising and expenditure of finance by the National Government, including the imposition of taxation and the raising of loans, is subject to authorisation and control by the Parliament, and shall be regulated by an Act of the Parliament.
The act of authorisation and control by Parliament is performed through an appropriation law, which comes in the form of an Annual Budget or a Supplementary Budget. It has been however uncovered that the 2014 Budget Appropriation Act does not have any provision for a K3 billion loan and no supplementary budget providing for the K3 billion loan has been approved by Parliament.
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