‘So where is the scandal’, NCD Governor asks. PNGi replies.

NCD Governor Powes Parkop has issued a fiery response on Facebook, to a PNGi report published last week.

The PNGi piece drilled into a recent National Court judgement delivered by Justice Shepherd. The judgement centres on a statement of claim made by Bani Investment Limited against the NCDC. Bani Investment alleges it was awarded two road contracts by the NCDC, and suffered damages when the NCDC pulled out of the deals.

In its defence, the NCDC argued that the NCD Governor and his office had illegally entered into the agreements with Bani Investment in breach of the Public Finance Management Act. It was submitted that the Governor and several senior colleagues had abused certificates of inexpediency to circumvent an open tender process.

Certificates of inexpediency are strictly reserved for serious emergencies. This case centred, in part, on sealing a feeder road to a picnic spot in neighbouring Central Province. Justice Shepherd agreed this was not an emergency, in his scathing judgement.

The original PNGi report is available here. The National Court judgement which the report is based on can be accessed here.

Below we provide Governor Parkop’s online statement responding to PNGi’s coverage of this case, and PNGi’s subsequent reply to the Governor.

Governor Parkop's Statement - Facebook 13 September 2021 

“Nonsense. Silly season politics at its best. The fact is I tried my best to sealed this popular picnic spot which is frequented by City Residents. Yes it’s in Central Province but who are the main users – NCD Residents. We also did provide some funding too to the picnic spot at Kuriva and the picnic spot on the way to Viariarata National Park. We also at same time assisted the then Department for Environment and Conservation to seal the road to that National Park. All in Central Province but made on the basis that these picnic spots are mainly used by City Residents.”

“For Crystal Rapids I approved K1.5m from PSIP. The amount is inadequate for the work needed to do a decent job on the road but we wanted at least to start the work. I approve together with our Board under our procurement system and there is nothing illegal about it. It was not successful because it was poorly managed by my then Project Manager. The Contractor who did some work which of poor quality and we only paid him K300,000 or so for work done. NCDC also did not help much in not releasing funds quickly to complete work work.”

“PNGi are lying. They never approached me for my comments. Now I no longer go to Crystal Rapids because of this failed work. It’s embarrassing to explain to the Landowners. There is no scandal. We tried our best to build some infrastructure that will benefit City Residents but due to poor management it failed. The claim for K28m. is probably based on their assessment of loss of profits and income etc. I was never asked to give evidence in Court so I can’t understand how the Court or PNGi is making these findings and conclusions. At the end of the day NCDC have defeated this claim so where is the scandal. It’s silly season so faceless people hiding under PNGi type accounts playing politics again.”

PNGi's Response to Governor Parkop - Facebook 14 September 2021

1. The National Court in a detailed judgement, which followed an extensive hearing, concluded the NCD Governor awarded a palpably illegal contract that led to the waste of public money. Reporting on that decision is not ‘silly season politics’, it is an elementary duty of responsible media to make the public aware of a matter of such significant.

2. Your government, the NCDC, argued that you and your colleagues awarded the contract illegally in violation of the Public Finances Management Act (PFMA). After consulting the evidence, the Judge emphatically agreed.

3. You claim that as Governor you approved the Crystal Rapids feeder road contract, and it was awarded via ‘our procurement system and there is nothing illegal about that’. There is absolutely something illegal about that if the procurement processes observed are in violation of the PFMA and associated financial instructions. The NCDC argued you awarded the contract illegally, again it must be emphasised YOUR government argued this, and the Court agreed, following a careful consideration of the evidence lodged by both parties.

4. ‘The Contractor who did some work which of poor quality’, this ought not to come as a surprise. Open and competitive tender processes are designed to avoid this outcome. This point was underlined by Justice Shepherd, who observed PFMA requirements are not only there to counter corrupt dealings, they are designed to ensure the public gets value for money. In this instance, a certificate of ‘expediency’ was illegally used to circumvent the PFMA requirements, and this was deemed unsavoury and illegal by the Courts.

5. You acknowledge that the road was in another Province of the country, outside your remit of administrative responsibility, but because it is frequented by the NCD public you chose to allocate K1.5 million of your PSIP to the feeder road. NCD residents can make their own mind up whether those roads outside the NCD ought to take priority over city roads, but the fact is a submission which you signed stated that the sealing job was an emergency and thus fitted within the extraordinary circumstances that would permit a certificate of inexpediency to be issued. The court concluded there was no such emergency, such as a civil strife, a natural disaster, a major public health emergency, or a defence emergency.

6. You are an experienced lawyer and an experienced political leader, it is difficult to imagine someone of your experience and knowledge could be unaware of the requirements of the PFMA.

7. PNGi sent detailed questions to your office a week prior to publications, using emails provided on your parliamentary website and NCDC website.

8. ‘I can’t understand how the Court or PNGi is making these findings and conclusions’. Surely Governor you understand a Court is in a position to make a judgement after a statement of claim is put forward, a defence is submitted and both sides provide evidence in support of their position. The NCDC issued a defence and provided evidence, the Court had every right to make a decision, and the media has every right to report on that decision.

9. ‘At the end of the day NCDC have defeated this claim so where is the scandal’. The scandal lies in the fact that to defeat the claim, YOUR government, the NCDC, argued the NCD Governor and NCD Governor’s office, employed flagrantly illegal means to award a contract to a company with virtually no experience, and after having done that you as Governor exerted your power to get the contractor paid. Paragraph 4 of the National Court judgement notes ‘The NCDC denies that it ever entered into binding contracts for the two Projects with BIL, alternatively it says that if the evidence were to establish that contractual relations arose between the parties, then any contracts which came into existence were void and unenforceable for non-compliance with the then applicable public tender requirements of the Public Finance (Management) Act 1995’.