Lae city expects to generate K20 million in internal revenue next year.
This is a K6 million increase from this year’s K14 million.
Reforming Lae city’s public service machinery has produced outstanding results for taxpayers.
Lae MP and Lands Minister, John Rosso, said K10 million from district services improvement program funds is insufficient for a city of half-a-million people.
The best way to operate is to go back to the basic business concept of cutting your overheads and increasing your revenue.
“1km of concrete road costs about K8 to K10 million,” he outlined. “So if we spend K10 million of DSIP on a concrete road every year, you’d only get 1km. So how do you do that? You cut your overheads and increase your revenue. That’s what I set out to do through the Lae City Authority.
“We increased the revenue; fixed all the stealing, leakages, corruption and everything.”
Minister Rosso said the city used to depend on Lae Urban LLG’s budget of K5 million. After three years of tackling mismanagement and corruption, the city’s revenue increased to K10 million in 2020, K14 million this year and K20 million next year.
An example of cutting overheads was the removal of 504 people from the city council’s (Lae Urban LLG) payroll.
“From 600, we’re cutting it back to 96,” Minister Rosso stated. “Yes, I may lose a few votes and people may be unhappy but who comes first; the taxpayer or the people who are leaching and not doing the work? The taxpayer comes first so I have to make decisions in favour of the taxpayer.
“The people of Lae deserve that money. So to build all these roads and schools and everything, you need to find the money.”
Minister Rosso further extended his appreciation to Morobe Governor, Ginson Saonu, for agreeing to give 20 percent of the GST return to Lae.
“Lae pays all the taxes,” said the Minister. “But all the taxes are given to the Morobe Provincial Government and nothing comes back to Lae.
“But the governor, when I started the pathway of negotiating – it took three years – but he has now come to the table and given us 20 percent, through the intervention also of the Prime Minister.
“With the PANGU Government, it has made it easier for us – the taxpayers of Lae – to have access to that money. That is roughly about K30 million a year. So that K30 million, plus the revenue saving of K20 million – that’s K50 million.
“The DSIP is K10 million so that’s K60 million. And then from other revenue sources and PIP funding, slowly the budget of Lae will go up. My target is K100 million.”