“For too many years, the vital development budget kept losing out to uncontrolled increases in wages and goods and services expenditure,” stated the Treasurer, Ian Ling-Stuckey.
“One key element of budget repair is to spend the money we have much more wisely. For too many years, the development budget has been squeezed due to rapid increases in the operational budget which covers wages and goods and services expenditure. This was a major structural problem in the budget.
“The Marape-Steven’s government has now introduced an expenditure rule into the budget process to stop this problem. This rule is that the operating budget will be reduced as a share of non-resource GDP. Specifically, wages and goods and services expenditure will be reduced from 16 percent of non-resource GDP in 2019 down to 10.6 percent by 2024 - a very major reduction.
“While making significant reductions in the wages and goods and services budget, there will be major increases in capital spending. Capital spending will increase from K4,715 million in the 2019 Supplementary Budget to reach K8,584 million by 2024. This represents a very major shift in the structure of the budget. This is one high level element of spending the money we have more wisely.
“Of course, many other actions are also required to spend money wisely. This includes better management of procurement – and we are operationalising the National Procurement Commission to strengthen value for money policies and reduce the chances for corruption and just contracts to cronies.
“We will continue to move overall sectoral funding in line with the priorities set out in the Marape Manifesto. We will provide more support for and expect more accountability from all departments, provinces and districts on their spending.
“We will ensure more projects under the Public Investment Program support an approach of ‘economic roads to markets’ rather than ‘political roads to nowhere’. The focus will be enabling our agriculture and other economic sectors to thrive and connect to national and international markets.
“These are all examples of getting our expenditure house in order. Focusing on the right things and doing those things well for all the people of PNG,” stated Treasurer Ling-Stuckey.
(Loop file picture of Treasurer, Ian Ling-Stuckey)