In face of a boom, PNG’s top echelon digs itself deeper into the mire
THE AUSTRALIAN JUNE 21, 2014 12:00AM
Michael Somare conquered the national election in mid-2012.
Peter O'Neill emerged from the chaos of two governments.
WHAT a tangled web is being woven in and by Papua New Guinea’s elite this week.
Everyone is struggling to extricate themselves, especially the Prime Minister, Peter O’Neill, who is stuck in the centre.
But the harder they contend, the deeper they sink.
The details have become so gothically complex that they almost no longer matter. The core issue is that PNG’s leaders have again descended to scrabbling about the spoils, about power and enforcement.
This is happening just as the country is entering a period of massive new income from its first, $19 billion, liquefied natural gas plant — concluded just ahead of time and almost on budget. This is driving the world-beating 21 per cent national economic growth forecast for next year.
O’Neill emerged from the chaotic period of two governments — Michael Somare leading the rival team — as the clear winner, and went on to conquer convincingly in the national election in mid-2012. He soon consolidated his grip on power, and still controls the support — even after ministerial sackings and other events that have seen some MPs slip into opposition — of about 95 of the 111 parliamentarians.
Earlier in his term, it appeared that the country’s usually fissiparous elite was preparing to bury, for a time, longstanding differences and jealousies because the opportunities for material advancement were becoming so considerable that there would be room for all at the feast, even if those closer to the top fed first.
But there has been a colossal falling-out, and the bitterness has become palpable. O’Neill would like to bulldoze his way ahead, as he has since becoming Prime Minister, the rapidity and range of his ambition for the country ensuring, he had thought, that whatever administrative mistakes and incidental irregularities, whoever the collateral damage, the extent of long overdue progress would be sufficient to win widespread applause.
This worked for a while, but the recent unravelling has been alarming even by PNG’s political standards.
The story starts back in 2010. An incendiary, 812-page report was completed by a commission of inquiry comprising two judges and a top businessman, which revealed that a cabal of top public servants and lawyers had hijacked PNG’s government chequebook, plundering more than $300 million through sham compensation claims, within the brief period investigated. The thefts clearly did not start or end there though.
It had taken three years to conclude the report, after numerous legal battles. But when then prime minister Somare tabled it in parliament, lawyer Paul Paraka — named throughout its 812 pages — obtained a court injunction banning any publication of its findings within PNG.
Among 57 people recommended for criminal prosecution were PNG’s finance secretary and his predecessor; the former chief secretary; a former attorney-general and former solicitor-general; an MP; several prominent lawyers and others.
Finally, six months ago, Paraka, the sole partner and owner of PNG’s largest law firm, with 22 branches, was charged with conspiring to defraud the state of $28.8m. He remains out on bail.
Paraka Lawyers’ core modus operandi has been to defend people charged with serious crimes without receiving a brief, and then to bill the state afterwards. The owner’s extraordinary network of contacts ensured such bills were usually paid in full, and promptly, a very unusual combination in PNG. Paraka said: “A law firm with operations covering the entire nation would naturally have huge operational costs. It is supposed to make money.”
But his core relationship unravelled fatally. O’Neill set up early in his term Taskforce Sweep, led by young, crusading lawyer Sam Koim to target administrative corruption, and stressed that he would not stand in its way, whoever it wished to pursue. Paraka was suddenly exposed.
O’Neill issued a statement about the scams that had been revealed by the commission of inquiry: “If I have to sack everyone including the tea boy at Finance, I will do so to clear the place up.”
But after Paraka was charged, a letter (which O’Neill says is a forgery) was widely circulated in PNG’s social media. In the letter, dated January 24, 2012, O’Neill instructed Treasury to pay to Paraka a similar amount to the sum he was accused of stealing.
Taskforce Sweep, which earlier this year agreed the letter was a forgery, changed its mind following further analysis of the signature. On Monday, it issued an arrest warrant against O’Neill for corruption, against which he obtained a stay order, describing it as “a politically motivated stunt”.
Police commissioner Tom Kulunga was told by cabinet that day to retire after being sentenced to seven months’ jail for contempt.
The attorney-general, Kerenga Kua, was sacked, and his successor, Ano Pala, was initially rumoured to have been arrested.
O’Neill appointed widely respected Australian judge Warwick Andrew to head a commission of inquiry into the corruption claim against him.
Taskforce Sweep was disbanded on Wednesday for being “politically compromised”: its chairman Koim saying, “when you get closer to the sun, you get burned”.
Deputy police commissioner Simon Kauba was sacked for failing to obey government directions. Kauba had earlier arrested incoming police commissioner Geoffrey Vaki and questioned him over fraud claims.
O’Neill has also lost the support of key establishment figures, notably former prime minister Mekere Morauta. He was chairman of OK Tedi Mining Ltd, which was taken over by the government last year, and of the PNG Sustainable Development Program, the vast mine’s main shareholder. He claimed that SDP did not deserve “vicious attacks” by the government, adding: “We live in fear, with our mouths shut.”
An eminent persons group, established to reconcile Morauta with O’Neill, has failed to make progress.
The fight against corruption, a plank of O’Neill’s electoral mandate, has only had mixed success.
The Independent Commission Against Corruption that the government wants to establish has not been fully legislated. Four years ago, ombudsman commissioner Chronox Manek was shot outside his home, never fully recovering. He died two years later, and no one has been charged.
Former senior minister Paul Tiensten was jailed in April for nine years, with hard labour, for corruption. He is a rare exception of a top leader being convicted.
The latest train of events, chaotic and unresolved, will reinforce the negative perception among most Papua New Guineans of both politicians and lawyers. But among the ambitious young, including those from the populous Highlands, these professions will have gained appeal, their adversarialism providing a perfect cultural fit.
However, the winner-takes-all strategy is provoking growing resistance, with a host of leaders from the Prime Minister down at risk of being embroiled in prolonged legal stand-offs, causing the country’s governance to lose coherence even as the elite stretch towards those gas billions.
