Comply to avoid penalties: Ngangan

State agencies and public servants have been urged to comply with the revised and improved Public Finance Management Act 2016 to avoid severe penalties.


This is the warning from Finance Secretary Dr Ken Ngangan, during the announcement of the revised Act in Port Moresby today.

The PFMA 2016 contains wholesale changes to the PFMA 1995 which aims to improve compliance and clearly stipulate functions and procedures dealing with public finance. 

Dr Ngangan said the revised PFMA has set clear guidelines and anyone seen to be circumventing or not complying with the stipulated regulations in the Act will be dealt with accordingly.

“So I appeal to you all, we will be carrying out intensive awareness making you all aware of the requirements of the new Public Finance Management Act, as it will help us do our jobs better but at the same time, there are requirements in there that will hold us strongly accountable to the actions that we perform in managing public finances.

“The penalties are severe, and I must warn you. I urge everyone in public service, performing public finance management functions to study the contents of the new PFMA because ignorance is no excuse. You will be liable under the new Act,” said Dr Ngangan.

The revised PFMA follows on from the Public Expenditure & Financial Accountability (PEFA) Review which was made public in September 2015.

Immediately following this a decision was made to follow through with the revision of the PFMA 1995 after the review was passed by Parliament in August 2016.

EU Ambassador to PNG, Ioannis Giogkarakis-Argyropoulos, said the decision to review the PFMA was crucial to improve efficiency, transparency, accountability, and service delivery in PNG.

He said he looked forward to PNG being a leader in public financial management in the region however, this required a lot of hard work. The EU supported the exercise with funding.

“The European Union is ready to support other ambitious and necessary reforms measures to transform Papua New Guinea,” said the Ambassador.

Following the revised PFMA will be the Procurement Act which has been completed and is expected to be tabled in Parliament in March 2017.

Dr Ngangan said the passing of the Procurement Act will completely overhaul the accounting and procurement processes in PNG. This he said will save the country a lot of money.

The announcement of the revised PFMA coincided with the launching of the PNG Association of Government Accountants (AGA) & Public Finance Manager (PFM) Inc.

Also present at the launching was Finance Minister, James Marape, Chief Secretary, Isaac Lupari, Public Service Commission Chairman, Dr Philip Kereme, and staff of the Finance Department.

Cedric Patjole