How Great Was The Fall! Part Two

Politicising the Public Service, Non-payment of LNG shares, & High-profile Corruption

This is a continuation of the series “How Great Was the Fall! The Rise & Fall of Peter O’Neil.” To read Part One, click on this link: https://academicnomad.home.blog/2019/06/12/how-great-was-the-fall-the-rise-and-fall-of-peter-oneil/?fbclid=IwAR25iydn-iq5lVQBajmRwHgb8C_62mo_l6dw5sdaXQCGZl23dAhjyDs9c0c

When Part One was published, there were comments suggesting that this posts make Peter O’Neil look smart, that he is a __________. That was not the intention of the posts. Not only did Peter O’Neil hang onto power loner than his peers, second only to Somare’s 2002 – 2011, in the history of PNG politics, but he defeated a vote of no confidence. This is a series attempting to explain why he was able to stay that long, not whether the strategies he used were legal or not, moral or corrupt, smart or manipulator of the dumb and the glutton.

There are questions we are not asking as all get caught up in euphoria. Questions like: Would Marape have resigned if the Supreme Court did not rule the amendment which extended the grace period to 30 months invalid in 2016? If the Supreme Court failed to do that, we would have to wait until February 2020 to start talking about vote of no confidence, not February 2019. Would the MPs have resigned enmasse if the DSIP/PSIP remained at K10-15 million and not slashed to K2 million in 2017? Would the PM fire and hire departmental heads to remain in power if the Supreme Court failed to rule the amendment to the Public Services Commission Act (2014) invalid early this year (2019). Under the amendment, the PM controlled Ministerial Executive Appointment Committee called the shots. We should be concerned about these features not repeating itself in any government in the future. These series are an attempt to remind us of what the government can do (any government), and not let them move the same posts again in the future.

So, Part One dealt with (1) Constitutional Amendments, and (2) Executive’s control of DSIP/PSIP funds, disciplining and rewarding MPs. Now we look at another three factors.

3. Politicisation of the public service 

Since 2012 the O’Neil government secured controlof appointments of senior positions by replacing the role of the Public Services Commission (PSC) by the Ministerial Executive Appointment Committee, by amendingthe Public Services Commission Act (2014). Usually, the Public Services Commission, an independent body makes the recommendation to the National Executive Council as per the Public Service Commission Act. As in a patron-client relationship, appointments to senior positions were made with the expectation that the appointee would support the government. This factor featured prominently with the dismissal of then Police Commissioner Toami Kulunga in 2014 when he approved the warrant of arrest of Prime Minister Peter O’Neill in relation to alleged illegal payments made to Paul Paraka lawyers. Geoffrey Vaki was appointed as the Head of Police. When Vaki became embroiled in a contempt of court case for conspiring to prevent the arrest warrant being served on the Prime Minister, Gary Baki was appointed as the Police Commissioner. Gary Baki prevented the arrest of the Prime Minister by vettinghigh profile cases. Similar accusations were made for departmental heads in the country.

Why did O’Neil fall:On the 2^ndof April 2019, the Supreme Court ruledthat the amendment to the PSC Act was unconstitutional and therefore invalid. This removed the influence the prime minister had over selections of key individuals, and potentially removed the fear for these individuals to follow instructions from Peter O’Neil. Though this factor may not have featured as prominently as other factors in O’Neil’s downfall, it was an indication for those MPs in the government and the ruling party that the prime minister was no longer invincible, and they began to reign en masse.  

4. Dissatisfaction among resource rich provinces

Since 2012, Peter O’Neil had the backing of MPs from the resources rich provinces of the Highlands. Specifically he had the support of MPs from Hela and Southern Highlands provinces where the LNG project is located, and Enga province, where the Pogera Gold Mine is located. James Marape is MP for Tari-Pori Open, a district within Hela Province. He resigned as Minister for Finance and member of PNC on the 11^thof April 2019 following the signing of the USD 13 million Papua LNG gas agreement on the 9^thof April 2019 that allocated only allocated 2% to landowners which is located in Gulf Province. As he resigned, he specifically mentioned the lack of honoring existing resource project agreements such as the 4.25%shares from Kroton, a subsidiary of the state entity Kumul Consolidated participating in the existing LNG project, for Hela and Southern Highlands. Fourteen of the forty-two MPs who either resigned or left the coalition were from the Highlands region, including the governors of Southern Highlands, Hela and Enga Provinces. Seven other MPs from Morobe Province, a coastal resource rich province, also moved to the opposition camp. They were members of the Pangu Pati in the coalition government led by Peter O’Neil. Morobe Governor had taken the government to courtover the signing of the Waffi Gold Mine in early 2019, which he claimed did not benefit the people of Morobe and the landowners.

What Caused O’Neil’s Downfall: The dissatisfaction of the MPs from resource rich Highlands provinces and Morobe Province can best be described as the trigger, for the fall of Peter O’Neil. This is because not all MPs who moved to the opposition side in an attempt to topple the prime minister were necessarily from the resource rich areas. But the movement by MPs from the resource rich provinces was a major crack in the coalition. 

5. UBS Loan, Parakagate, and Corruption

There Ombudsman Commission’s report implicatingthe prime minister for breaking at least 15 laws of the country was leaked via social media in the lead up to the change of prime minister. When the parliament met on the 7^thof May 2019, the opposition camp had 50 MPs, six short of the majority in parliament, and could not stop the government from adjourning the parliament to 28^thof May 2019. After the UBS report was leaked, the numbers of the opposition increased to 63 MPs, six more than the required majority to change the government. The prime minister authorised UBS loan of AUD 1.239 billion to purchase shares from Oil Search on behalf of the state. However, the report showed that the prime minister’s actions amounted to misconduct in office as he failed to comply with relevant legislations, including the failure to get both the National Executive Council and parliament approval. Parakagate is another high level corruption case against Peter O’Neil. In 2014, an arrest warrant was granted for Peter O’Neill in relation to alleged illegal payments made to Paul Paraka lawyers by removing police commissioners at his convenience to avoided arrest. 

What Caused O’Neil’s Downfall: The leaked UBS report was devastating. This report was the first from Ombudsman Commission directly implicating Peter O’Neil for corruption, and for breaking the laws. This may have contributed to more MPs resigning from the party and coalition. 

It is difficult to pinpoint one factor as the main cause for Peter O’Neil’s downfall. It can best be described as an accumulation of factors discussed above. A more important question is: why did MPs start resigning in April 2019, and not earlier. After all, all factors discussed above precede 2018. Peter O’Neil got himself into a situation where, all it required was a crack, and it came from dissatisfaction from MPs from resource rich provinces

In Part 4, we will look at how the emphasis on Districts and Open MPs, and the amendments to the Organic Law on the National and Local Level Governments in 1995 weakened and marganilized the provincial governors. And how they resigned in droves when the crack started. We will also look at how O’Neil rejected advise of his own ministers and dealt directly with the departmental heads. It was the resignation of ministers Marape and Davis, the two senior ministers, who have become PM & Deputy PM, that led to the change of the downfall of PO.