PNG Governance: A Work in Progress

Weaknesses in Financial Management and Accountability Exposed

PORT MORESBY, Papua New Guinea - The Public Accounts Committee (PAC) has released a report highlighting significant weaknesses in financial management and accountability within government agencies in Papua New Guinea. The investigation into government expenditure and processes revealed that nearly 95% of government institutions have failed to manage themselves effectively.

Good Governance Practices are Rare

According to the PAC’s findings, only five out of over 1,000 government agencies demonstrated good governance practices. Experts agree that fulfilling the key elements of good governance, including taking responsibility for decisions, respect for the rule of law, and respect for the position individuals hold, remains a major issue in PNG.

Public Financial Management Systems in Need of Improvement

The report highlighted weaknesses in the implementation of public financial management (PFM) systems and processes. Inconsistent investment in physical and human capital has led to weakened capacity at all levels of government. While there have been improvements in PFM over the years, the process is still plagued by a lack of transparency and accountability.

Procurement Process Under Scrutiny

A World Bank report found significant non-compliance with legislative requirements and poor oversight in PNG’s procurement process. The Auditor-General’s review of procurement procedures and practices revealed that managers were able to override controls, increasing the risk of corrupt activities or other irregularities.

Corruption Remains a Pervasive Issue

Corruption remains a major obstacle to development and progress in Papua New Guinea, with many citizens perceiving it as a significant challenge. The report’s findings serve as a reminder of the need for sustained efforts to strengthen governance and accountability mechanisms in PNG.

Recommendations for Improvement

To move forward, policymakers must prioritize the implementation of effective PFM systems, transparent procurement practices, and robust anti-corruption measures. Good governance is essential for building trust between citizens and government, promoting economic growth and development, and ensuring a more prosperous future for Papua New Guinea.

Key Takeaways

• Nearly 95% of government institutions have failed to manage themselves effectively.
• Only five out of over 1,000 government agencies demonstrated good governance practices.
• Public financial management systems and processes require improvement.
• Procurement process is plagued by non-compliance with legislative requirements and poor oversight.
• Corruption remains a pervasive issue in PNG.