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Papua New Guinea - Corruption

The political system has become dysfunctional since independence in 1975, whereby corruption, weak governance and tribal loyalties have eroded governmental capacity and undermined the power of parliament and the stability of cabinets. As a result, tough economic decisions have been avoided and the nation's development has been left largely forgotten and struggling, in favor of short-term gains and maintenance of political careers.

Transparency International (TI) defines corruption as the ‘misuse of entrusted power for private gain’ which can affect institutional performance in political, economic, social, and environmental domains. TI conducts yearly surveys on countries and territories, ranking them on a scale from 0 (highly corrupt) to 100 (very clean) based on perceptions of trust in their public sectors. From 1996 to 2012 PNG has consistently rated poorly against corruption. Its corruption perception index for 2012 rated PNG 25 out of 100, among the most corrupt countries with a ranking of 150 out of 176. PNG’s performance in dealing with corruption is below satisfactory levels set by the United Nations Convention against Corruption (UNCAC) of which it is a signatory. The convention came into force on 9 December 2003.

While corruption in PNG has not yet reached the level of state capture, it is suggested that petty, grand and political forms of corruption are prevalent in PNG because of institutional weaknesses as the country is still fragile and developing. Some traditional practices that have been associated with corrupt tendencies include the ‘big man mentality’ and obligations to fulfil social norms of the wantok system and kinship relations sometimes in the form of local ‘redistribution’ of favors or gifts. Traditional norms and expectations, weak bureaucratic processes, and lack of resources to fight corruption make it difficult to prosecute perpetrators of corruption.

Corruption in PNG has involved: bribery to acquire preferential service or treatment; theft of public money and illegal acquisition of assets by abusing positions of authority; disregard and by-passing of official processes to acquire services or select appointees; lack of compliance with the Public Finance Management Act which included breaches in procurement processes; conflict of interest in public decision making; and nepotism which resulted in recruitment and retention of unqualified staff.

Corruption also existed in the private sector in the form of bribes or using personal influence to rig the tendering process. Issues of weak institutional transparency and accountability are serious problems the country has been grappling with.

The law provides criminal penalties for official corruption; however, the government did not always implement the law effectively, and officials often engaged in corrupt practices with impunity. There were numerous reports of government corruption during the year. Corruption at all levels and in all organs of government was a serious problem due to weak public institutions and governance, lack of transparency, politicization of the bureaucracy, and misuse of public resources by officials to meet traditional clan obligations. Corruption and conflicts of interest were of particular concern in extractive industries, particularly the logging sector, and in government procurement.

The Ombudsman Commission and Public Accounts Committee are key organizations responsible for combating government corruption. The Ombudsman Commission’s mandate includes the investigation of alleged misconduct by governmental bodies, alleged discriminatory practices by any person or government body, and alleged misconduct in office by public officials under the leadership code. The constitution provides for the Ombudsman Commission’s independence. The government allowed the appointment of the chief ombudsman to lapse in May and did not meet to appoint another chief ombudsman during the year, leaving two of the three ombudsman positions vacant. The former chief ombudsman believed his appointment was allowed to lapse due to his efforts to investigate the prime minister for corruption-related offenses.

The Public Accounts Committee is a permanent parliamentary committee established by the constitution with a mandate to examine and report to Parliament on public accounts and national property.

The Ombudsman Commission met with civil society and at times initiated action based on input received. Although civil society organizations engaged with individual members of the Public Accounts Committee, the committee was less receptive to public input and generally did not seek to engage with civil society. The Public Accounts Committee generally operated independent of government influence, but lack of trained staff hindered its effectiveness. Neither body had sufficient resources to carry out its mission.

In 2011 the government established Investigation Task Force Sweep (ITFS), a temporary interagency body with the mandate to arrest, charge, and prosecute government officials engaged in corruption. ITFS investigated 350 cases and submitted 91 cases to the courts. In 2014 the government launched a Fraud and Corruption Track in the National Court to expedite these cases and reduced judicial processing from two years to four months.

In 2014 the government shuffled the attorney general, solicitor general, and police leadership and attempted to fire the chairman of the ITFS for their roles in corruption investigations against Prime Minister O’Neill for alleged illegal payments to the law firm, Paraka Lawyers. The government also attempted to appoint another ombudsman, who did not meet the position’s statutory qualifications. The government allowed the chief ombudsman’s appointment to expire and left the Ombudsman Commission with two empty seats (out of three). The government stopped funding the ITFS after the National Court nullified government attempts to disband the organization. The legality of payments to Paraka Lawyers and the role of the prime minister in the affair remained under investigation.

In March 2014 the National Court sentenced former minister for national planning Paul Tiensten to nine years’ hard labor for misappropriating 10 million kina ($3.2 million) of public funds while serving as a state minister. Other politicians were found guilty of corruption but remained free while their cases were on appeal.

In Papua New Guinea, legislation has been passed that has substantially addressed the Anti-Money Laundering and Counter-Terrorist Financing Measures [AML/CFT] deficiencies and has facilitated removal from the Financial Action Task Force’s (FATF’s) gray list.





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