PNG MPs Continue to Receive Massive Salary Increases Since Sir Michael Somare's Time

Over the years, politicians in Papua New Guinea (PNG) have been receiving staggering pay increases, with no signs of slowing down. 

Sir Michael Somare's time as Prime Minister

The trend started during Sir Michael Somare's time as Prime Minister, and within just seven years, parliamentarians would be enjoying an astounding 82% increase in their salaries alone.

It all began in November 2010 when Sir Michael Somare's government unanimously approved a whopping 52% pay rise, just before the Christmas holidays. 

This unprecedented increase set a new standard for politicians' salaries in PNG.

Increase for politicians' salaries in PNG

The trend continued in November 2013, when Puka Temu, the then Public Service Minister in Peter O'Neill's government, announced another pay raise of 7%, which was backdated to January 1, 2013, and paid to every Member of Parliament just before their Christmas holiday. 

But that's not all - the minister also declared a separate increase of 7.5% and 2.5% to be paid from 2014 to 2016 to every public sector worker, including the MPs.

To clarify, the 2013 increases were in three parts: 

• a one-time payment of 7%,
• a 3-year increase of 7.5% of the actual gross salary, and
• a 2.5% of the average salary. 

The average salary is calculated by dividing the combined salaries of all earners by the number of earners.

Staggering 30% Spike in MPs Pay

The increase means that every public servant, including MPs, would receive a 7.5%/2.5% increase in instalments over a 3-year period from 2014 to 2016. 

If the government stays true to its promise, public servants would have seen a staggering 30% spike in their annual pay by 2016, equivalent to a 10% increment every year.

The impact of these increases is significant. 

By the end of 2016, the annual salaries of PNG's politicians would have nearly doubled compared to what they earned in 2010.

PNG MPs Salaries

• Prime Minister earns over K364,000
• Speaker of Parliament earns over K296,000
• Deputy Prime Minister earns over K271,000
• Opposition Leader earns over K271,000 (same as Deputy Prime Minister)
• Government Ministers earn over K211,000
• Other MPs earn over K106,000
• Provincial Governors earn over K74,000

These amounts are exorbitant and raise questions about the morality of such increments. 

The salaries earned by politicians are more than enough to live with their people and serve their constituencies. 

However, it appears that they want even more to sustain a lifestyle elsewhere, away from their localities.

The trend of massive pay increases for politicians in PNG, which started during Sir Michael Somare's time as Prime Minister, continues to persist. 

These unprecedented raises have resulted in exorbitant salaries for politicians, raising concerns about the moral implications of such increments. 

In conclusion, as the salaries of politicians skyrocket, it's crucial to ensure that public funds are being used responsibly and in the best interest of the people of Papua New Guinea.

Provincial Education Advisers and Administrative Officers Are Misusing Teachers' Leave Fares

By M Steven Reoghberths 

(former Education Officer in charge of teachers' leave fares in Morobe)

Pic courtesy: Post Courier Newspaper Jan 2015

The teachers leave fares issue has been ongoing matter mostly due to misappropriation by Division of Education heads in all provinces. Funds allocated purposely for leave fares were usually tampered with and diverted to cover up for shortfalls in other votes or items.

I am speaking from experience especially in Morobe where the highest allocation is given. Yet this is forever an issue year in year out. As the person formally in charge of teachers leave fares in Morobe, I can attest that the fault entirely lies with the provincial authorities and financial delegates in form of provincial education advisers and provincial administrative officers.

Every year funds have always allocated with delivery mechanism designed and in place to have all teachers receive their entitlements, but this all seemed on paper only as half of the funds has always been diverted to cover up for excessive travels, hire cars, hotel bills and travel allowances especially by senior officers.

The Department of Education and Teaching Services Commission should also shoulder blame as this is an overdue issue that should have been resolved a long time ago. Policies and TSC Act Section 130 that manages the teachers leave fares is outdated and should be updated with proper delivery mechanism in place that allows paying of leave fare without obstacles. The current delivery mechanism is effective, but needs tighter stringent measures on this funds so there is no diversion and misuse by provincial authorities, means the Finance Management Act also comes into play so this also has to be updated with stringent control on its use.

Morobe Province being the largest with highest number of teachers is a classic example of how funds meant for teachers leave fare has always had funds diverted by the education adviser and his administrative officer. Every year problems faced by teachers in regards to this has always been ignored and repeated the next year without anything being done by higher authorities.

Papua New Guinea Teachers' Association Must Stand Up For Teachers Without Media Bashing

There is no need to go on strike yet. Teachers from Elementary to Secondary schools in each province have reps. They form the PNGTA. There needs to be a collaborative effort from them to fight for teachers' remuneration and benefits. 

Papua New Guinea Teachers' Association

Unlike before, Facebook (and access to it) has changed the way Papua New Guineans communicate. PNGTA (Papua New Guinea Teachers' Association) Chairman and reps from 22 provinces should, first, create an avenue for discussion. FB would be a good place to start. 

Papua New Guinea Teachers' Association to communicate with teachers' reps

They must stay in touch with teachers - communicate: find out if they have received their pay increase, Boarding and Duty allowances...etc. They have to have facts and figures at their fingertips. 

That information must be presented to the National Department of Education, Teachers' Service Commission and Education Minister on regular basis - this is their job. They MUST do that as well as 'media-bashing'. 

PNGTA must fight for teachers

The PNGTA must pursue legal challenges to ascertain irregularities in teachers' entitlements if they have to. They must ensure that the govt remains true to its PROMISES of pay increases. 

As I posted some time ago, by 2016 every public servant will have realised a 30% increase in their salaries - this includes the teachers. 

Recently, there is another increase in PNG Public Servants' pay (2022-2024) but the poor teachers will have to find out exactly what they are getting.

PNGTA has to ensure that the government does what it says

That implies that the PNG government has made a promise to pay the increase. So, PNGTA has to ensure that the government does what it says. If teachers are not receiving the increase or other entitlements over a year, they have to determine why. 

Finally, the onus is on PNGTA and teachers' reps in each province. If the association feels that there is a need to call for strike action,  by all means, they must do. 

But, going on strike (or pretending to go on strike by going to the media like the PNGTA chairman did) is not the best way forward.

ExxonMobil-PNG To Take Defensive Measures By Cutting PNG Jobs Amidst Energy Price Collapse?

The tumbling oil price has forced major oil and gas companies to slash cost. FTSE 100 Oil and gas major, Tullow Oil, has cut back US$2.3 billion on expenses. Other companies in the energy sector are also cutting back as they are hit by over 60% drop in the Energy price in just seven months – Brent Crude Oil for example, has fallen by nearly 50% from US$110 a barrel to US$48 a barrel.

So, where does the huge fall (and continual dip in price) leave Papua New Guinea’s much-talked-about gas development led by ExxonMobil-PNG?

Pic Courtesy: ExxonMobilPNG Twitter

The PNGLNG development has moved onto production since April 2014. That meant that it has completed exploration and development phases of the initial project. To date, over 50 shipments have left the country.

At the peak of energy price, the Prime Minister of PNG (in a response to the Opposition questions) said one shipment was valued at, an average of, US$50 million – yes that is 50 million US Dollars. If price fluctuated at US$50 million ExxonMobil-PNG would have recovered the development cost in less than five years. This also means that if the company continues production at current rate, the time it takes to recover development cost would double. Would ExxonMobil-PNG want to recover US$19 billion development cost in 10 years, instead of 5 years?

The prime minister gave his response to the Opposition MPs when Energy price was at record US$110 a barrel. The price has, since, dropped to US$48 a barrel. Here is what ExxonMobil-PNG’s accountants would have worked out by now – value of a shipment would have averaged at US$25 million.

There is prediction that the price is likely to fall even further based on the fact that Opec countries have not slowed down on production to spike energy price. Major Oil and Gas producing countries like Russia, USA, Venezuela, Nigeria, Saudi Arabia, Libya, etc. have not reacted at all.

What can ExxonMobil-PNG do? 

Apart from shelving any plans for exploration and further development, one thing is for sure – ExxonMobil-PNG does not have to cut down on production. The company must produce at full capacity. This has to be done as the Opec group of countries are not cutting down on production, either. Their economies are dependent on oil and reducing production would have drastic consequences on government’s revenue. Russia, for example, whose economy is very much dependent on Oil has considered its options.  

A BBC report indicated that many oil and gas dependant countries have not cut down on production to spike Energy price. If they had cut-back on production their economy would have been shaken to the ground.

There are two defensive measures ExxonMobil-PNG can (has to) contemplate on doing. Look within its structure and readjust main expenditures. That would imply that ExxonMobil-PNG would have to either make adjustment to its expanses or increase production (and increase revenue).

Here is one option.

First, ExxonMobil-PNG would have to reconsider its employees’ remuneration and benefit. Many top level employees may have to take a pay cut or agree to some in-house cost cutting measures, like halting fly-in-fly out arrangements.

Second, casual employees the company has used during (and in) exploration and development phases will have to be laid off. This also applies to apprentices, interns and others on the job training exercises. This could, probably, affect their awareness and charity programs too. 

Third, the project developer would have to evaluate performance of contractors. Those who have been given chance to partake in contracts awarded by the company will have to prove their worth to remain with it. 

Another option would be to increase production like what many Opec counties are doing by producing at full capacity - even increase production capacity. By doing this the company does not have to take the three measures highlighted above, but expand on each area.

This will create more opportunities and increase production – a win-win situation for the company, PNG government and every stakeholder who participates in this project.

All in all, it is eminent ExxonMobil-PNG takes defensive measures now by finding areas where cost can be minimised. But, any cost cutting measure taken in the name of maximising revenue for the company must not compromise Papua New Guinean jobs.