Pacific / Papua New Guinea

Former PM O'Neill hits out at new PNG govt's economic policy

11:23 am on 25 September 2019

Papua New Guinea's former prime minister Peter O'Neill has hit out at the new government's leadership over the economy.

PNG PM Peter O'Neill Photo: AFP / Peter Parks

This comes as the new James Marape-led government prepares a supplementary budget to be tabled in parliament next month

Mr O'Neill has found himself defending his former government's economic policies from criticism by the new Treasurer.

Ian Ling-Stuckey said Mr O'Neill crippled the nation's cash flow with wasteful spending and fake budgets, creating an economic "black hole" where public funds disappeared.

But the former prime minister said his government was able to achieve stable credit ratings for PNG with sound economic fundamentals during trying times.

He said the Treasurer is indulging in petty politics and name-calling when he lacks new ideas on how to advance PNG's economy.

Mr O'Neill also said that under his leadership the government never ran to Australia or China desperately seeking money.

This was a clear dig at his successor, with Mr Marape having recently taken a more direct approach to seeking fiscal help from Beijing and Canberra.

"We managed out affairs our self as a sovereign nation should do," Mr O'Neill said in a statement.

"If the current Prime Minister wishes to change policies and risk the threat that this uncertainty imposes on our economy, that is his prerogative."

Mr O'Neill's People's National Congress party still purports to be part of the Marape government although the prime minister recently requested the party leave the coalition, accusing Mr O'Neill of working to undermine his leadership.

MPs in the PNC have told RNZ Pacific they are committed to supporting the new prime minister until the next elections in 2022.

But Mr O'Neill's trenchant criticism of Mr Marape and his Treasurer suggest that the dynamic is more strained than ever.

James Marape Photo: PNG PM Media

The former prime minister challenged Mr Ling-Stuckey, who was appointed as Treasurer last month, to offer credible alternatives if Mr Ling-Stuckley believed his government's economic policies were not working.

He also raised concern at signs that the Marape government is to significantly cut District and Provincial Service Improvement Programme funds.

"There appears to be one policy change in this Government and that is to remove DSIPs and PSIPs," Mr O'Neill said describing the move as a "mistake".

"PSIPs and DSIPs are the only direct funding to our citizens in rural areas, and to remove this will hurt a lot of our people."

Meanwhile, Mr Marape said a 2019 Supplementary Budget was necessary because government revenue collection was under performing by almost K1 billion, and expenditure that is blown out by almost over K1.5 billion.

He indicated this rendered the 2019 National Budget unviable.