K1.9 billion probe on

Special police unit to investigate fraud claims at National Planning

 

POLICE Commissioner Tony Wagambie yesterday announced an investigation into the purported misapplication of K1.9 billion of the development budget, The National reports.

At the same time, Works Minister Peter O'Neill broke with tradition by calling for the establishment of a commission of inquiry into the use of the development budget.

A police fraud investigation and a commission of inquiry are separate processes.

The man in the hot seat, National Planning and Rural Development Minister Paul Tiensten, denied the allegations of mismanagement yesterday, claiming K1.8 billion had been paid out of the development budget for legitimate and budgeted programmes and projects over the first six months of the year.

Wagambie announced yesterday that he has established and commissioned a special unit within the crimes directorate at police headquarters in Port Moresby to look into the allegations of the billion-kina fraud made by former secretary of National Planning Joseph Lelang.

A report compiled by a private law firm, Korowi Lawyers, as part of investigations to support Lelang's court battle against the state, had alleged K1.9 billion had been paid out over three months, much of which was paid to political cronies and for unbudgeted items.

The report named several individuals and companies involved in these alleged illegal dealings.

Wagambie, who is also chairman of the National Anti-Corruption Alliance (Naca), had made known his intention to convene the board of Naca to initiate separate investigations into the fraud allegations.

O'Neill last week told an audience in Kerema, Gulf, that Acting Prime Minister Sam Abal should establish a commission of inquiry into the management and disbursement of the development budget.

While addressing the launch of that province's development plans, the former finance and treasury minister said: "The development budget constitutes half of the national budget. The people need to know how funds are used.

"We have serious concerns that budget appropriations are being misdirected so as to raise serious breaches of the Finance Management Act.

"The breaches are so frequent and the amounts that are stated are quite large and the country deserves to know.

"In all fairness, this requires an independent commission of inquiry to establish the facts."