Housing in Papua New Guinea in crisis, needs urgent government action

Caption: Hard copies of the final report can be obtained at the reception counter of the ICCC’s Garden City complex or downloaded from the ICCC website www.iccc.gov.pg

 

Housing in Papua New Guinea is in crisis and needs urgent Government attention through a reform package, according to the Independent Consumer & Competition Commission.

The ICCC said this in its final report on the Review of the Housing and Real Estate Industry (HREI) to the minister for Treasury and Finance, Patrick Pruaitch last Tuesday.

“The final report contains the commission’s concluded views on the housing and real estate industry and recommendations of a reform package aimed at improving supply and making houses more affordable to ordinary Papua New Guinea citizens,” according to ICCC chief executive officer and commissioner Thomas Abe.

“The enormous scale of the housing problem in PNG dwarfs those in other countries and requires a paradigm shift in thinking and taking a completely different approach to that being currently pursued.

“The scale of the housing problem has reached crisis proportions – more than 40% of the people live on less than US$1 a day.

“Trying to ‘transplant’ developed country approaches in PNG will not work as the scale of problems in these countries, their stage of economic development and their business environments are completely different.

“Moreover, some of these approaches now sought to be implemented in PNG have been modified or discarded in those very countries.”

Mr Abe pointed out to the enormous potential for growth of the housing sector which would diversify the economy as a new contributor and generate employment, savings and investment which would raise living standards if this package of reforms was implemented.

“The commission, in devising the reform package for consideration by government, has considered various studies on housing, the current land reform initiatives and the feedback from consultations it has undertaken throughout the review process,” he said.

“The outcome sought to be achieved was governed by the principles of ‘the greatest good of the greatest number’, which provides housing for as many Papua New Guineans as possible, rather than giving weight to sectional interests, which would be inequitable for ordinary citizens.”

Mr Abe said the report described the constraints on the development of the housing sector as being largely attributable to ‘piecemeal’ and sometimes contradictory, attempts to address the symptoms rather than the cause of the malaise, which benefited some sections of society at the expense of others; and had been implemented efficiently.

“What is required was a holistic, externally-consistent, economically-sensible approach that was made known to the market and to the public, who are ultimately affected,” he said.

“This lack of certainty and direction has stifled investment in the sector.

“A key aspect of this review is that it recommends an approach which takes account of the scale of the problem and the limited resources of Government.

 

“Providing monetary assistance for housing to certain segments of society does nothing to resolve fundamental economic bottlenecks – they only create distortions which exacerbate the problems for others.

“Direct provision of housing by Government will not make much of an impression on the housing problems of ordinary Papua New Guineans across the country as budgetary resources are too limited to meet all the housing needs.”

Mr Abe said the review recognised that high prices and lack of affordability were only the symptoms of significant underlying failures, recognised by:

• Inefficient and insufficient supply of ‘raw’ land;
• Conditions of its allocation to developers, which are neither transparent, nor based on objective criteria, hence fail to encourage competition and efficiency at any stage of the vertical chain;
• Organisational deficiencies;
• Failure to address orban drift at its source; and
• Lack of clarity of Government policy, which, in turn, creates the conditions for divergent and sometimes conflicting, initiatives on housing, by various arms of Government.

“A lack of coordination within the National Government, and between that level of government and the relevant arms of the provincial and local level governments, in relation to issues such as zoning, building approvals and other statutory authorisations also holds back residential construction,” he said.

“The package of reform initiatives includes:

·        The immediate freeing up of supply of State land and encouraging the bringing of customary land to market to address scarcity of raw land;

·        Promotion of competition and efficiency at every stage of the vertical chain from release of land under Urban Development Leases (UDLs), through the sub-division stage, to home construction;

·        Generating efficiency and creating space for the private sector by winding back inefficient Government involvement in housing;

·        Encouraging innovation in building materials and design;

·        Implementation of an effective consumer protection regime to prevent exploitation of consumers and address ‘opportunistic’ conduct in the real estate industry and building sectors; and

·        Well-targeted incentives to private sector provider of micro-finance to rural dwellers for community-based housing credit.

“This report includes implementation strategies that cover organisational, sequencing, timing, accountability and probity issues and the adoption of these recommendations and taking a co-ordinated approach to their implementation will not only go a long way to resolving the housing scarcity, but will ‘kick-start’ the residential construction sector and create the conditions for its evolution into a key contributor to national economic growth, with resulting benefits for employment, incomes, diversification of the economy and general improvement in living standards for ordinary Papua New Guineans.”

 

Housing in Papua New Guinea in crisis, needs urgent government action

Caption: Hard copies of the final report can be obtained at the reception counter of the ICCC’s Garden City complex or downloaded from the ICCC website www.iccc.gov.pg

 

Housing in Papua New Guinea is in crisis and needs urgent Government attention through a reform package, according to the Independent Consumer & Competition Commission.

The ICCC said this in its final report on the Review of the Housing and Real Estate Industry (HREI) to the minister for Treasury and Finance, Patrick Pruaitch last Tuesday.

“The final report contains the commission’s concluded views on the housing and real estate industry and recommendations of a reform package aimed at improving supply and making houses more affordable to ordinary Papua New Guinea citizens,” according to ICCC chief executive officer and commissioner Thomas Abe.

“The enormous scale of the housing problem in PNG dwarfs those in other countries and requires a paradigm shift in thinking and taking a completely different approach to that being currently pursued.

“The scale of the housing problem has reached crisis proportions – more than 40% of the people live on less than US$1 a day.

“Trying to ‘transplant’ developed country approaches in PNG will not work as the scale of problems in these countries, their stage of economic development and their business environments are completely different.

“Moreover, some of these approaches now sought to be implemented in PNG have been modified or discarded in those very countries.”

Mr Abe pointed out to the enormous potential for growth of the housing sector which would diversify the economy as a new contributor and generate employment, savings and investment which would raise living standards if this package of reforms was implemented.

“The commission, in devising the reform package for consideration by government, has considered various studies on housing, the current land reform initiatives and the feedback from consultations it has undertaken throughout the review process,” he said.

“The outcome sought to be achieved was governed by the principles of ‘the greatest good of the greatest number’, which provides housing for as many Papua New Guineans as possible, rather than giving weight to sectional interests, which would be inequitable for ordinary citizens.”

Mr Abe said the report described the constraints on the development of the housing sector as being largely attributable to ‘piecemeal’ and sometimes contradictory, attempts to address the symptoms rather than the cause of the malaise, which benefited some sections of society at the expense of others; and had been implemented efficiently.

“What is required was a holistic, externally-consistent, economically-sensible approach that was made known to the market and to the public, who are ultimately affected,” he said.

“This lack of certainty and direction has stifled investment in the sector.

“A key aspect of this review is that it recommends an approach which takes account of the scale of the problem and the limited resources of Government.

 

“Providing monetary assistance for housing to certain segments of society does nothing to resolve fundamental economic bottlenecks – they only create distortions which exacerbate the problems for others.

“Direct provision of housing by Government will not make much of an impression on the housing problems of ordinary Papua New Guineans across the country as budgetary resources are too limited to meet all the housing needs.”

Mr Abe said the review recognised that high prices and lack of affordability were only the symptoms of significant underlying failures, recognised by:

• Inefficient and insufficient supply of ‘raw’ land;
• Conditions of its allocation to developers, which are neither transparent, nor based on objective criteria, hence fail to encourage competition and efficiency at any stage of the vertical chain;
• Organisational deficiencies;
• Failure to address orban drift at its source; and
• Lack of clarity of Government policy, which, in turn, creates the conditions for divergent and sometimes conflicting, initiatives on housing, by various arms of Government.

“A lack of coordination within the National Government, and between that level of government and the relevant arms of the provincial and local level governments, in relation to issues such as zoning, building approvals and other statutory authorisations also holds back residential construction,” he said.

“The package of reform initiatives includes:

·        The immediate freeing up of supply of State land and encouraging the bringing of customary land to market to address scarcity of raw land;

·        Promotion of competition and efficiency at every stage of the vertical chain from release of land under Urban Development Leases (UDLs), through the sub-division stage, to home construction;

·        Generating efficiency and creating space for the private sector by winding back inefficient Government involvement in housing;

·        Encouraging innovation in building materials and design;

·        Implementation of an effective consumer protection regime to prevent exploitation of consumers and address ‘opportunistic’ conduct in the real estate industry and building sectors; and

·        Well-targeted incentives to private sector provider of micro-finance to rural dwellers for community-based housing credit.

“This report includes implementation strategies that cover organisational, sequencing, timing, accountability and probity issues and the adoption of these recommendations and taking a co-ordinated approach to their implementation will not only go a long way to resolving the housing scarcity, but will ‘kick-start’ the residential construction sector and create the conditions for its evolution into a key contributor to national economic growth, with resulting benefits for employment, incomes, diversification of the economy and general improvement in living standards for ordinary Papua New Guineans.”

 

Strong winds cause freak accident in Madang

Captions: 1. Injured local headmaster Simon Douglas being put on a stretcher at Modilon Hospital in Madang.-Pictures by SIR PETER BARTER 2: Local headmaster Simon Douglas, who suffered serious injuries in a boating accident, being wheeled into Modilon Hospital in Madang

 

A banana boat travelling back from Madang last Friday evening capsized at Dungalow village beside the giant Ramu Nico treatment plant at Basamuk, throwing passengers into the sea.

Local headmaster Simon Douglas was pinned between the capsized boat and the shore, resulting in serious head injuries and a collapsed lung along with other possible injuries to the spine. 

Mr Douglas was taken to the small aid post and treated by nursing officer Paul Konare, who managed to contact Kevin Murray who in turn contacted Sir Peter Barter, who went immediately to bring Mr Douglas, Mr Konare and Mrs Douglas back to Modilon Hospital

in his helicopter.  

Director of health Markus Kachau arranged for Mr Douglas’ immediate admittance to the emergency ward.

Sir Peter said despite strong wind warnings which were current, travel by banana boat was extremely dangerous.

“Last week, I visited Karkar and witnessed numerous overloaded banana boats laden with cargo battling against two and three-metre chops, taking in water whilst the passengers continued to bail,” he said.

“Most of these boats do not have floatation, radios of locator beacons, no records are kept of the voyages, the number of passengers or other details pertaining to the type and colour of the boat and remain unlicensed.”

Sir Peter said at the weekend, , another boat  with a full family aboard was reported missing two days after it left Raikos for Madang, and relatives were concerned about the well being of the vessel and the occupants .

“Every year, we lose passengers and in most cases little can be done unless they are reported missing immediately,” he said.

“Their only hope is that they may drift to an island, providing the boat does not sink.

“It is really tragic and could be avoided if only legislation was in place and could be enforced.

“In the case of the accident near the Ramu Nico project, one can only be amazed that such a large project has been constructed without road access, denying the people road access to Madang and forcing them to travel by sea.”

 Sir Peter said he would again bring this to the attention of the company, Government and Department of Transport.

ANZ top brass cruise on Kalibobo Spirit

Senior international executives of ANZ bank spent some time aboard luxury Melanesian Tourist Services vessel mv Kalibobo Spirit in Madang last Friday.

They included Alex Thursby, who is ANZ’s chief executive officer - Asia Pacific, Europe and America.

He is also responsible for leading the group strategy and marketing agenda

Mr Thursby along with Mishael Rowland, CEO Pacific, accompanied by ANZ Asia Pacific executive delegation, flew into Madang in their private jet for a stopover during which time they met a number of Madang people including Governor, Sir Arnold Amet aboard the Kalibobo Spirit and at a dinner that followed at the Madang Resort.

Picture shows Mr Thursby talking to Sir Arnold aboard the Kalibobo Spirit.-Picture courtesy of SIR PETER BARTER

Selling fish for school fees

With the 2010 school year just about to begin, parents and students alike are scrambling to organise school fees.

Young Kapari/Viriolo, Central province villager, Ilamilo Velekiri, is no exception as he took to the sea to catch fish which he smoked to take to market to raise money for his 2010 school fees.-Picture courtesy of DAVID NALU

British High Commission continues fight against domestic violence

The British High Commission has for the third year running extended its partnership with the Port Moresby-based women and children crisis centre Haus Ruth.

“The British High Commission is pleased to continue its strategic partnership with Haus Ruth for the third consecutive year. Our financial assistance enables battered women and children to seek refuge in a safe and secure environment where they are housed, fed and provided with legal assistance. It is a fundamental human right for all women and children to be able to live in an abuse free and peaceful environment and seek legal redress,” said David Dunn, British High Commissioner to PNG.

The UK/Haus Ruth partnership complements the decision in August last year by the British High Commission in Port Moresby to join the successful Meri Seif Ples initiative, an anti-violence programme run jointly by various stakeholders for victims of domestic violence.

The High Commissioner said: “Last August we joined many other partners in Port Moresby and opened our doors to women who are victims of domestic violence by making the British High Commission a Meri Seif Ples.  Domestic violence cannot be fixed overnight but we – hand in hand with partners like Haus Ruth and Meri Seif Ples – have taken a stand against it and so must all Papua New Guineans. Domestic violence is completely unacceptable, there are no excuses, it must stop now."

Haus Ruth manageress Monica Richards thanked the British High Commission for extending its assistance.

“Without such sponsorship by the British High Commission, Haus Ruth would not be able to see the year through. Last year a total of 128 women, teenage girls and children were accommodated at the crisis wing. It is good and very satisfying to see that women and children have a safe haven free from violent and abusive homes in which they can share their experiences with others, seek counselling and hopefully begin to rebuild their lives,” she said.

Haus Ruth is an initiative of the interfaith organisation City Mission (PNG). It was established in 2003 and has since its inception assisted hundreds of PNG women and children escape violent environments.

 

Lae - a story of gross neglect

Potholes along Eighth Street, Lae

A satirical look at Port Moresby and Lae.-From Nasfund Newsletter

Rundown Angau Memorial Hospital, Lae

From Nasfund Newsletter

Living in Port Moresby often means that many of us become too Moresby-focused and we view things through a far rosier prism than we rightly should.

Our media both print and television also suffers from the same Moresby bias.

Even this newsletter can be rightly criticised for being too focused on Port Moresby.

The editorial this month is both sobering and alarming.

It talks about a city in crisis.

Lae is Papua New Guinea’s second largest city and the industrial and manufacturing hub of the country.

It has the largest port facilities and is the gateway to the Highlands.

The Lae gateway and the Highlands Highway is the life line for over 50% of the population of Papua New Guinea who rely on the Port of Lae and Lae town for supplies. Something however is seriously wrong.

The Lae of today suffers from neglect and lack of decisive political leadership due to the inability to work together.

Never have we witnessed such a steady decline of a city than that of Lae.

The heart beat of industry still hums, private sector endures but the decline of infrastructure like roads, water, power and the vital support facilities like the Angau hospital underlie a very serious tale of woe.

The management of Lae city is in a sorry state with a failure to allocate scarce resources in priority areas of road and utility infrastructure.

Political leaders in power prefer the relatively more-lucrative and workable capital of Waigani and when in Lae take refuge in Lae’s “green zone” – two or three comfortable establishments where in air-conditioned comfort; their minders can praise them for their initiatives and tell them what they want to hear over glasses of red wine and cold beer. Outside the green zone a totally different world emerges that should shake the conscience of any one who cares for the city.

Sex workers desperate to etch out a living, bob up and down between the containers that have overflowed on to the old landing strip near town.

If not there, then they can be found under the verandah of Nasfund Haus directly across from the green zone, where lucrative pickings can be! had, from well-heeled hotel guests.

HIV is rife, as it is along the highway right through to the Western Highlands and beyond.

A recent HIV test of workers at one facility found three out of 15 infected.

Young schoolies, whose parents have little, skip classes to join the sex worker throng to buy basics like clothes, food and soap.

Many do it just to ensure they can pay their school fees.

A sophisticated network through mobile phones co ordinate the sex workers with their clients along the Highlands highway including truck drivers and maritime workers from the port.

Through mobile communication, tastes of the clients can be ascertained - whether they use condoms or not, their likes and dislikes, violent, kind or generous – all can be exchanged as part of the workings of this highly visible trade.

Exacerbated by the huge urban drift from the Highlands region, the town cannot absorb the inflow and settlements abound with all the associated ills that such a diaspora brings. Crime from muggings to murder abound and fueled by home brew, grass and alcohol, the hospitals overflow from the rampage of weekend desperation, of disaffected, disengaged youths and communities that have been wearing the brunt of neglect for too long.

Crime is made easy by the collapse in the road system. Not a stretch of road in Lae can be found without potholes, some so deep as to make sections of road impassable.

The two entrances to Lae look more like rural tracks than proud entry points to our second biggest and in some ways our most important city.

The dreadful state of the roads is compounded by the recent “gone missing” of millions allocated to repair a portion of the road system.

The poor state of the roads means that drivers are easy pickings for roadside criminals and ensures that security companies will continue to maintain dominance of the major roads even if it is just to ensure that access to the airport remains unimpeded

Over the last few months security of supply of water and power have both become serious issues.

Water was recently out for three weeks and power remains intermittent.

Once again it begs the question how this has been allowed to develop in what is our manufacturing hub and gateway.

But what is both depressing and beggar’s belief is the cholera camp on the front lawns of Angau Hospital.

Forget the appalling condition of Angau Hospital for a minute; the lack of facilities to treat what in the West would be basic matters; forget the run down wards; or the desperation on the face of women trying to get treatment for breast and cervical cancer. Forget the collapsing hospital infrastructure or the piles of surgical rubbish dumped on a makeshift bonfire to the left of the building.

Let’s just focus on the front lawns - a collection of make shift latrines and tents, a few iron beds in the middle of the lawns and untied black plastic which has failed to hide the camp from road side visibility now flapping in the breeze.

Adults and children lying in tents getting treated for a disease that should not be in Papua New Guinea and certainly not in our second largest city.

Visibility from a major road of those suffering shows how little we respect their privacy and their dignity.

A government cheque for K3 million that was release bounced and so very little has occurred except through assistance from AusAID and other donors.

A government that has pledged K13 million to assist in the cholera outbreak, and still to this day not released anything is a national shame beyond comprehension.

In November, the National government announced its 2050 vision of a people happy and prosperous.

One could possibly not but support such an initiative.

However for the long-suffering people of Lae, they desperately cannot wait 40 years to secure and share that vision.

They need a plan for 2010 - one that delivers better roads, safer and secure water supplies, consistent electricity and major upgrades in the area of health and education.

To continue to ignore Lae, as has been done, is a blight on the nation and corrosive to the collective soul.

Will someone please come forward?