2014 pip report

1 2014 Annual Public Investment Program Implementation Report

Department of National Planning & Monitoring

2014 ANNUAL

PUBLIC INVESTMENT PROGRAM IMPLEMENTATION

REPORT

FOREWORD BY THE MINISTER

Papua New Guinea is a fast growing developing country

with unprecedented economic growth inthe last five

years. The economic boom emanating from the mining

and petroleum industry and other cash crop industries

through export earnings within that period of time has

also contributed immensely to our annual budgets

since. While we appreciate the level of revenue inflow

from growth of these industries, at the same time it is important to take note of the

expenditure and its implementation, performance and reporting, that as the Minister for

National Planning & Implementation I am responsible by virtue of the Fiscal

Responsibility Act (2006) to inform the Government and all our key stakeholders on the

implementation of the Development Budget through the Public Investment Program

(PIP) on an annual and midterm basis. The Public Investment Program is a vehicle

through which the Key Policy Instruments of the National Government’s development

policies and priorities are translated and implemented that will impact on the

improvement of people’s livelihood and wellbeing of this beautiful country, blessed with

vast natural resources, fauna and flora, taking into consideration the effects of climate

change, as a responsible Government. It is also important apart from the Government

that all relevant stakeholders are informed of the status of all the programs and projects,

major achievements, issues and challenges entailed in the implementation of the 2014

Public Investment Program Performance Report. It is important for me now to highlight

some of the key achievements made in the 2014 fiscal year. Amongst the many

achievements recorded, the following are the notable ones;

Successful funding and implementation of the South Pacific (SP) Games Venues

Infrastructure;

Rehabilitation on the Highlands Highway is continuing. Upgrading and

construction of various roads in Port Moresby including the Kookaburra Flyover, 6

mile and Gordons industrial area roads, Erima to 9 mile, 2 mile hill, 9 mile to

Gerehu to Poreporena (via Baruni) arterial road and the Paga ring road. Lae City

Roads have been completed and maintenance on Hiritano, Magi, and Buluminsky

Highways have been completed with support from the World Bank;

Completion of Lae Port Development Project while the POM port relocation

discussion are continuing;

Completion of the Batch 1 of the Civil Aviation Development Investment Project

which saw the upgrade of Jacksons International Airport and runway extension for

Hoskins airport.

Strengthening of our health care systems through the Rehabilitation and

Development of Provincial Hospitals. (Port Moresby General Hospital Accident

and Emergency Ward has been fully rehabilitated with key hospital equipment

being purchased, MadangModilon hospital will soon have the state of the art

operating theatre). Establishment of Provincial Transit Medical Stores to progress

delivery of medical drugs and equipment and Rehabilitation of Health Training

Institutions to train more health workers;

Tuition Free Education rollout was a success in 2014 which saw increase in

classroom intake, Funding for Teacher Training Institutions was increased and

University Infrastructure Program saw the completion of the University

Accommodation Dormitories in Goroka and Vudal and the concept development

of the Western Pacific University;

Iconic infrastructure projects such as successful completion of the Wutung Border

Trade and Investment Centre and the Marea House nearing completion;

Successful rollout of the PSIP, DSIP and LLGSIP to provinces and sub-national

levels of Government coinciding with the establishment of the District

Development Authorities (DDA) to strengthen service delivery;

The Police Modernization program has delivered three 80 persons accommodation

units at Bomana, 10 duplexes at Morata, School of excellence at Bomana and also

established partnerships with the Australian Federal Police for capacity

enhancement.

Successful rollout of the National Identification Program and the establishment of

the Civil Registry Centre;

Waigani Court House Complex construction and the Legal Training Institute

relocation are in preparatory stages;

Rollout of the Land and Housing Program in which the Government will ensure

thatpublic servants own an affordable and decent house;

Upgrade of the Ramu Power Supply and acquisition of Diesel Generators for Port

Moresby and Lae;

Successful roll-out of the various SME programs such as the Microbank and Stret

Pasin Stoa scheme.’

Agriculture support was focused on Price and Freight support for copra, cocoa and

coffee, successful rollout of nursery, rehabilitation and extension programs, value

addition and downstream processing and pest and disease mitigation.

I am pleased on behalf of the O’Neill/Dion Government, and as Minister responsible for

National Planning & Monitoring,to introduce to you the 2014 Annual Public Investment

Program Implementation Report. The Report presents the key features of the 2014

Budget, physical and financial performance of the budget in the 2014 fiscal year and

captures the detail program and project implementation status, highlighting the generic

and specific issues of implementation and provides appropriate recommendation for

future improvement and sustainable development going forward.

The Report will be made available for public consumption and to ensure that the

Government is seen to be transparent and accountable to all its stakeholders and most

importantly to the people of this country on the use of Public Finances.

___________________________

Hon. Charles Abel,MP

Minister for National Planning

ACKNOWLEDGEMENT BY THE SECRETARY

The 2014 Public Investment Program Performance Report is hereby presented on the 2014 development budget outcomes reflected under Key Policy Instruments of Government, specifically focusing on the seven key MTDP outcomes, after a rigorous and robust analysis undertaken by Monitoring & Evaluation Division under the PIP Wing of the Department of

National Planning & Monitoring. As a central government agency mandated to plan, program, coordinate and monitor development funds on behalf of the Government, it is imperative that appropriate performance reports are provided in a timely mannerto inform the Government, Development Partners and other key stakeholders on the implementation and performance of the 2014 Public Investment Program. The Department of National Planning & Monitoring is empowered by the Fiscal Responsibility Act 2006 to provide Annual and Mid-Term Public Investment Program Implementation Reports to National Executive Council and Parliament on the development expenditures, but most importantly the status of implementation and achievements of projects and programs relating to Key Policy Instruments of Government. This report covers the Sectors of Economic, Infrastructure, Social and Administration including the Provinces. A sector and sub-sector summary are provided in each of the Sector Reports for all to appreciate the performance of each of the Sectors, the development thrust being the seven key MTDP enablers of;Higher Education, Primary and Secondary Education, Law and Order, Land Administration, Key Infrastructure & Utilities, Health, andSustainable Development. There were a number of challenges noted in the 2014 Public Investment Program Development Report relating to Budget Implementation that are considered to be systemic, but whilst these challenges are daunting, in the analysis of this report, recommendations have also been made for future improvements and we are all encouraged to take ownership going forward. As the Secretary of the Department, I commend this 2014 Public Investment Program Performance Report to all users and stakeholders. _________________________ Hakaua Harry Secretary Department of National Planning & Monitoring



TABLE OF CONTENTS TITLES PAGES

INTRODUCTION 5 – 10

• 2014 Capital Expenditure in Line with MTDP Enablers............................. 6

• Key Features of National Budget & Financing............................................ 6

• Development Partners.................................................................................. 7

• Sectoral Distribution of the Total Public Investment Program...................... 7

• Fixed Commitments Funded in 2014........................................................... 8

• High Impct Projects Funded in the 2014 Development Budget.................. 8-9

• Expenditure against the Appropriation........................................................ 9

• Implementation Challenges.......................................................................... 9-10

• Recommendations........................................................................................ 10

ECONOMIC SECTOR 11 – 86

• Sector Summary........................................................................................... 12-18

• Department of Environment and Conservation........................................... 19-21

• Department of Agriculture & Livestock...................................................... 22-29

• Department of Lands & Physical Planning.................................................. 30-31

• Department of Mineral Policy & Geoharzards

Management................................................................................................. 32-34

• Department of Commerce & Industry......................................................... 35-38

• Office of climate Change............................................................................. 39-40

• Small Business Development Program........................................................ 41-42

• Mineral Resources Authority....................................................................... 43-48

• Kokonas Indastri Koporesen........................................................................ 49-53

• Office of coastal and Inland Fisheries.......................................................... 54-55

• PNG Cocoa Coconut Institute...................................................................... 56-60

• National Fisheries Authority....................................................................... 61-62

• Fresh Produce Development Agency.......................................................... 63-66

• Coffee Industry Corporation........................................................................ 67-72

• Tourism Promotion Authority..................................................................... 73-74

• Oil Palm Industry Corporation.................................................................... 75-76

• National Agriculture Quarantine & Inspection Authority........................... 77-78

• Cocoa Board................................................................................................ 79-83

• Livestock Development Corporation........................................................... 84-86

INFRASTRUCTURE SECTOR 87-144

• Sector Summary........................................................................................... 88-92

• Department of Works.................................................................................. 93-120

• National Airport Corporation....................................................................... 121-126

• PNG Air Services Limited........................................................................... 127-128

• PNG Accident Investigation Commission................................................... 129-130

• National Maritime Safety Authority............................................................ 131-132

• Independent Public Business Corporation................................................... 133-137

• Department of Information & Communication........................................... 138-140

• PNG Power Limited.................................................................................... 141-144



SOCIAL SECTOR 146-206

• Sector Summary........................................................................................... 147-154

• Department of Health................................................................................... 155-158

• Hospital Management Services.................................................................... 159-175

• Department for Commuinity Development.................................................. 176-178

• PNG National Sports Commission............................................................... 179-181

• National Aids Council Secretariat................................................................ 182

• Institute of Medical Research....................................................................... 183

• Department of Education............................................................................. 184-192

• Department of Higher Education, Science, Research and Technology........ 193-198

• University of Papua New Guinea................................................................. 199-201

• University of Technology............................................................................. 202-204

• University of Goroka.................................................................................... 205

• University of Environment and Natural Resources...................................... 206

LAW & JUSTICE SECTOR 208-216

• Sector Summary............................................................................................ 209-212

• Judiciary Services......................................................................................... 213

• Department of Attorney General.................................................................. 214

• Department of Defence................................................................................ 215

• Constitutional Law Reform Commission..................................................... 216

ADMINISTRATION SECTOR 218-284

• Sector Summary........................................................................................... 219-224

• Office of the Governor................................................................................. 225

• Department of Prime Minister & NEC....................................................... 226-233

• Department of Finance................................................................................ 234-237

• Department of Treasury................................................................................ 238-241

• PNG Customs Services................................................................................. 242-243

• PNG Fire Service.......................................................................................... 244

• Internal Revenue Commission..................................................................... 245-247

• Department of Foreign Affairs.................................................................... 248-252

• Department of Personnel Management........................................................ 253-256

• Department of National Planning & Monitoring......................................... 257-277

• PNG Electoral Commission......................................................................... 278

• Department of Provincial & Local Level Government Affairs................... 279-281

• Department of Labour & Industrial Relations............................................. 282-283

• Border Development Authority................................................................... 284

PROVINCES 286-415

• Provinces Summary...................................................................................... 287-291

• Southern Regional Summary........................................................................ 292

▪ Western Province.............................................................................. 293-297

▪ Gulf Province.................................................................................... 298-304

▪ Central Province............................................................................... 305-308

▪ National Capital District.................................................................... 309-313

▪ Milne Bay Province.......................................................................... 314-317

▪ Oro Province..................................................................................... 318-321



• Highlands Regional Summary...................................................................... 322-324

▪ Southern Highlands Province........................................................... 325-329

▪ Enga Province................................................................................... 330-341

▪ Western Highlands Province............................................................ 342-345

▪ Simbu Province................................................................................ 346-353

▪ Eastern Highlands Province.............................................................. 353-358

▪ Hela Province.................................................................................... 359-364

▪ Jiwaka Province................................................................................. 365-368

• Momase Regional Summary......................................................................... 369-370

▪ Morobe Province............................................................................... 371-378

▪ Madang Province.............................................................................. 379

▪ East Sepik Province.......................................................................... 380-383

▪ Sandaun Province............................................................................. 384-389

• New Guinea Island Regional Summary........................................................ 390-392

▪ Manus Province................................................................................ 393-397

▪ New Ireland Province....................................................................... 398-404

▪ East New Britain Province................................................................ 405-407

▪ West New Britain............................................................................. 408-410

▪ Autonomous Region of Bougainville............................................... 411-415



INTRODUCTION The 2014 Annual Public Investment Program Performance Report has been prepared to inform the

Government, Development Partners and other key stakeholders on the implementation performance of

Public Investment Program in the 2014 fiscal year. The Report entails the key features of the 2014

Development Budget and a detail analysis of the program and project implementation. The Public

Investment Program is a vehicle through which the Government policies are delivered. The Department

of National Planning & Monitoring is empowered by the Fiscal Responsibility Act 2006 to provide

Annual and Mid-Term Public Investment Program Implementation Reports to National Executive

Council (NEC) and the Parliament on the development expenditures and most importantly on the

status of implementation and achievements of projects and programs. The report also entails

challenges, issues and risks encountered in the process of Public Investment Program Implementation

with appropriate recommendations for future improvements.

The 2013 & 2014 Development Budget formulation was based on the foundation of the Medium Term

Development Plan (MTDP) mainly focusing on the seven key MTDP enablers;

1. Higher Education,

2. Primary and Secondary Education

3. Law and Order, 4. Land Administration,

5. Key Infrastructure & Utilities

6. Health

7. Sustainable Development.

Furthermore, 2014 National Budget was strategized around the key priorities of Government as

outlined in the Treasury’s 2014 Mid-Term Fiscal Strategy;

Maintain Papua New Guinea’s macroeconomic stability through the adherence of the principles

of the Medium Term Fiscal Strategy (MTFS);

Implement major infrastructure projects currently under construction as well as the efficient

expenditure of the higher levels of provincial government funding;

Ensure an appropriate alignment between the construction of new roads and the provision of

funding to maintain them. Likewise, ensuring funding is available for staff when new health or

education buildings are constructed, through integrating the Recurrent Budget’ and the

introduction of multi-year budgeting;

Continue to expand funding in the education and health sectors. This will include expansion of

fee-free education policies, funding for vocational education and ensuring enough teachers are

available to meet increased demand for access to education;

Establishment of the Sovereign Wealth fund and consolidation of mineral and petroleum assets;

and

Strengthen law and order, modernization of police and defence and creation of Independent

Commission against Corruption (ICAC);

Improve the enabling business environment for the agriculture sector as well as small to

medium enterprises.



Source: 2014 Development Budget Press Lock-up Presentation

The total capital expenditure was K7.471 billion. About 83% of the total capital expenditure

appropriation was aligned to the MTDP.

KEY FEATURES OF THE NATIONAL BUDGET & FINANCING

The 2014 total appropriation for the Recurrent and Development/Capital Investment Budgets was

K15, 103.8 million. The Capital Expenditure component comprises Government’s ongoing and new

commitments based on the 7 key enablers focused on key investments on sustainable growth for the

country. Of the K15.104 billion Budget, Capital Expenditure Component was appropriated at K7.471

billion. This comprises 66% of Government direct financing at the value of K4.915 billion, 21% project

support grants from the development partners (DPs) valued at K 1.555 billion, 12% was the estimated

concessional loan draw-downs (K871.0 million) and 2% estimated to be spent under the Infrastructure

Tax Credit Scheme valued at K130.0 million.

Source: Public Investment Program 2014-2018, volume 3.

Land Mobilization 1%

Law, Order and Justice

4%

High Impact Infrastructure

41% Primary and

Secondary Education 8%

Technical, Higher Education and

Training 3%

Improving Health Outcomes

12%

SME Support and Agriculture

8%

Sustainable Development

1%

Utilities 5%

Non-MTDP 17%

2014 CAPITAL EXPENDITURE IN LINE WITH MTDP KEY ENABLERS

0.00

1,000.00

2,000.00

3,000.00

4,000.00

5,000.00

6,000.00

Direct GovernmentFinancing

Grants Concessional Financing Tax Credit

Ap

pro

pri

atio

n(K

'mill

ion

s)



DEVELOPMENT PARTNERS

The Australian Government’s grant accounted for K1, 206.4 million or 78 per cent of total donor grants

in 2014. There was an increased funding from Australia in 2014 because of the Joint Understanding on

the Management of Asylum Seekers negotiated earlier in 2013. In 2014 the major new projects to be

funded under the Joint Understanding include: the rebuilding of Angau Hospital K45.2 million with the

Government of PNG providing counterpart funding of K20 million to meet the full costs of construction

of the hospital, deployment of Australian Federal Police K86.5 million, and rehabilitation of

infrastructure at the University of Papua New Guinea K40.6 million.

Other key Development Partners in 2014 include New Zealand K33.4 million, Peoples Republic of China

K86.5 million plus K296.0 million in loans, Japan K35.8 million plus K55.8 million in loans, European

Union K61.6 million, United States K3.5 million, United Nations K102.8 million, World Bank K24.8

million plus K77.6 million in loans and Asian Development Bank K441.9 million in loans.

Source: 2014 Budget Volume 1, Economic & Development Policies

SECTORAL DISTRIBUTION OF THE TOTAL PUBLIC INVESTMENT PROGRAM

Source: Public Investment Program 2014-2018, vol. 3

The sectoral distribution of the total Public Investment Program are as follows; Economic sector –

K437.9 million, Infrastructure sector –K2,471.2 million Social sector – K1,150.6 million, Law and Justice

109.4 million, Administration sector -K1,175.3 million and Provinces-K2,041.8 million. Infrastructure

sector has been appropriated the biggest slice of the budget due to Government’s continuous emphasis

on infrastructure as one of the key development priorities. Infrastructure sector commands about 33

1,206.4

33.4

382.5

91.6 61.6 3.1 102.8 102.4

441.9

-

200.0

400.0

600.0

800.0

1,000.0

1,200.0

1,400.0

DFAT NZ China Japan EU UnitedStates

UnitedNations

WorldBank

ADB

(K'0

00

)

Development Partners Contributions

Economic 6%

Infrastructure 33%

Provinces 28%

Social 16%

Law and Justice 1% Administration

16%



percent of the total budget appropriation while provinces sector get the second largest slice of budget

with about 28 percent. This reflects the on-going funding of DSIP and PSIP programs. While Social (16

percent), Administration (16 percent), Economic (6 percent) and Law & Justice (1 percent). The low

appropriations in the above sectors reflect on the low number of projects and programs funded under

these sectors. It does not necessarily mean the less priority placed on these sectors.

FIXED COMMITMENTS FUNDED IN 2014 BUDGET

Fixed Commitments for 2014 2014 Appropriation (K millions)

Loan Counterpart Funding 462

High Impact Projects 50

Infrastructure Development Grants (inc New Ireland IDG) 123

Grants Commitments 43

Church State Partnership 25

Memorandum of Agreements 3

Special Support Grants 94

District Services Improvement Programme 890

Provincial Services Improvement Programme 445

Local Level Government Services Improvement Programme 157

District Support Grants 56

Autonomous Region of Bougainville 115

TOTAL 2,462

Source: 2014 Development Budget Press Lock-up Presentation

HIGH IMPACT PROJECTS FUNDED IN THE 2014 DEVELOPMENT BUDGET

High Impact Project

Revised Appropriation

Expenditure to Date

Progress Status and Remarks

Pacific Games K59.2 million K59.2 million Pacific Games Projects implementation is on track.

Port Moresby City Roads

K170.0 million K170.0 million Construction is currently in progress on selected roads. About 50% of the roads have been completed while other city roads are still in progress.

Highlands Roads K240.0 million K186.0 million Highlands Roads are all in progress.

Lae Port/Wharf K270.0 million K270.0 million Phase 1 of the Lae Port is completed in 2014 while the phase II of the Wharf Extension is underway.

Lae City Roads K100.0 million K74.4 million Many of the city roads have been completed.

National Broad Band Network

K45.0 million K45.0 million

NDB SME Credit Fund

K70.0 million K65.0 million Recapitalization of the NDB lending portfolios have been ongoing with a lot of SMEs have been supported.

NID/Biometrics Project

K10.0 million K10.0 million The project is in progress. Pilot NID to be rollout in 2015.

Housing and Land Development Project

K61.0 million K61.0 million This project is slowly taking shape with survey and all sub-divisions done and many public servants are in the process of getting their land titles.

The key challenge to successful implementation of these high impact projects is the proper

coordination at the highest levels with all the relevant stakeholders.



EXPENDITURE AGAINST THE APPROPRIATION

Against the total revised development budget appropriation of K4, 528,248,500, the aggregate

expenditure was K4, 467,582,144. This reflects only the GoPNG component of the budget and accounts

for about 90 percent of the total development budget appropriation. The remaining balance of 10

percent was reallocated to other priority commitments during the 2014 supplementry budget. The

expenditures from the development partners’ financed projects are not considered in this report as

their expenditures are normally outside the mainstream public budgeting system (PBS). Proper and up

to date information needs to be solicited from the respective development partners to ensure that the

report accurately reflects the actual expenditure incurred against the total appropriation. Also, the Tax

Credit Expenditures are not captured in this report as well due to expenditures being incurred by the

project developers outside the normal PBS. As such tax credit expenditures are difficult to solicit and

reconcile. Breakdown of the expenditures by sectors are as follows;

Economic Sector – K297,297,050.50 Infrastructure Sector – K1,365,841,802.71 Social Sector –K244,782,423.65 Law & Order Sector – K47,257,750.0 Administration Sector – K599,485,680.83 Provinces – K1, 912,917,436.73.

The high expenditure level at the provinces reflects the significant budgetary resources appropriated to

the provinces in terms of the District Services Improvement Program (DSIP), Provincial Services

Improvement Program (PSIP) and other constitutional grants. This reflects the O’Neill/Dion

Government’s focus on the empowerment of the sub-national levels of government to be effective in

maintinaing minimum standard of basic services. The Law & Justice Sector expenditures remain the

lowest compared to other sectors, which reflects again the low sectoral appropriations. The overall

expenditure patterns have been indicative of the appropriation level.

IMPLEMENTATION CHALLENGES

There are number of implementation challenges faced in the 2014 Development Budget

implementation and considered to be systemic in most development budget implementations. These

include:

The agencies have serious capacity issues in successfully implementing their projects and

programs. This is a common feature of poor project implementations by various agencies. The

agencies often failed to admit their capacity constraints during the budget consultation in fear

of losing out on funding.

Work Plans and cash-flow submissions has been very slow for most of the agencies and thus

affecting release of warrants on a timely manner.

Reporting has been very poor for most of the agencies which tend to reflect poorly on the

agencies in terms of accountability and transparency. Agencies by virtue of statutory

requirements are expected to submit reports on a quarterly basis. Compliance remains obvious

challenge to all the implementing agencies.

Political commitments without proper and design and scope has been problematic when

budget write-ups are made for those projects. Department of National Planning & Monitoring

has often being starved with appropriate information on these projects. A real improvement

needs to be made with politicians being made aware of due budgetary processes.

Effective monitoring & evaluation has been absent for sometimes due to lack of comprehensive

M&E framework. However, this issue is being addressed with M&E framework development

currently in progress,



Certain agencies have been affected by management crisis and political infighting. This had

direct impact on project implementation causing unnecessary delays and even cause for project

failures.

RECOMMENDATIONS

While these challenges are daunting, the following recommendations have been made for future

improvements;

1. The agencies that failed to submit work plans and cash-flow should not get funding unless they

comply;

2. Proper due diligence and assessment of agency capacity must be undertaken before the budget

consultation process and funding approval. The Budget Screening Committee (BSC) should

ensure that all the agencies report adequately on their capacity;

3. Project Steering Committees are immediately set up for all the Public Investment Programs and

Projects to provide appropriate oversight to project implementation;

4. The sector agencies should properly consult their respective Ministers prior to the budget

consultation process in order to solicit their views and endorsement on the type of investment

projects that they want so that it is captured in the agency’s budget rather than Ministers

interfering with the due process during the budget consultations;

5. The Monitoring & Evaluation Framework should be completed as a matter of urgency by the

Department of National Planning & Monitoring to ensure effective monitoring and evaluation of

projects and programs. This will compel agencies to respond by way of submitting reports.



ECONOMIC SECTOR



Code ECONOMIC SECTOR AGENCIES No of PIPs

2014 Approriations

(K’millions)

245 Department of Environment & Conservation 2 6,300

247 Department of Agricutlure & Livestock 7 16,100

252 Department of Lands & Physical Planning 2 30,2774

254 Department of Mineral Policy & Geoharzards Management 3 4,600

255 Department of Petroleum & Energy 0 0.0

261 Department of Commerce & Industry 3 41,000

511 Office of Climate Change & Development 1 1,000

531 Small Business Development Corporation 1 3,600

535 Mineral Reources Authority 5 1,900

536 Kokonas Industry Corporation 4 17,000

543 National Development Bank 3 77,000

549 Office of Coastal Fisheries Development Agency 1 40,000

550 Cocoa Coconut Institute 4 10,000

551 PNG National Fisheries Authority 2 0.0

553 Fresh Produce Development Corporation 3 6,000

554 PNG Coffee Industry corporation 5 29,200

556 PNG Rubber Board 1 1,900

557 PNG National Forest authority 0 0.0

558 Tourism Promotion Authority 1 3,000

559 PNG Oil Palm Industry Corporation 1 2,000

562 National Agriculture Research Institute 0 0.0

563 National Agriculture Quarantine Inspection Authority 1 2,100

566 PNG Cocoa Board 4 16,800

568 Livestock Development Corporation 1 0.5666

TOTAL 55 310,344,000



I. SECTOR SUMMARY The Economic Sector comprises the economic sector programs and projects funded through the Public Investment Program. The programs are implemented by the various sector agencies and are aimed at generating revenue for the nation and hence in doing so, the sector contributes to progressing key Government policy initiatives on economic growth and development. This will subsequently result in promoting income earning opportunities with the intention to achieve poverty alleviatiion, particularly in the backwaters of our country. There are three key subsectors under the Economic Sector and they are; (1) Renewable Resources, (2) Non-renewable and (3) Commerce. The main programs under these sub-sectors are: Environment & Climate Change, Agriculture, Forestry, Fisheries, Petroleum & Mining, and the Small & Medium Enterprise (SME).

II. 2014 SECTOR APPROPRIATION (a) GoPNG Direct Financing The Original Appropriation for the Economic Sector in 2014 was K358.8 million. This comprised four percent (4%) of the total estimated funding of K4.915 billion of the 2014 Development Budget. The O’Neil/Dion Government’s commitment to rural empowerment and capacity building at sub-national levels as per the Alotau Accord resulted in over 70% of the funding appropriated to the Provinces, which include Districts and the LLGs and the Infrastructure Sector specifically targeting the upgrading of major roads infrastructure in the country. Over the last four (4) years commencing 2011, funding appropriation for the sector has been inconsistent in relation to the funding requirements of the MTDP. Major programs that usually affect the funding levels of the economic sector are the National Agriculture Development Program (NADP), Infrastructure Development Grants (IDG), National Land Development Program (NLDP), Pacific Marine Industrial Zone (PMIZ), funding for projects under the Mining MOAs and various credit facilities parked under the National Development Bank. Inconsistent levels of funding to these programs over the years have caused fluctuations in the trend of appropriation to the sector. The Figure 2.0 below shows the level of funding appropriation to the Economic Sector in the the last three (3) years.

The funding level in 2011 was low for the sector compared to2012, 2013 and 2014. This reflects the commencement of the implementation of the PNG Development Strategic Plan 2030 through the Medium Term Development Plans (MTDPs). The level of funding increase progressive over the years due to initiatives such as DSIP, PSIP and other key inistiatives within the sector. However, compared to other sectors, funding to economic sector has been low to moderate. Apart from the Land Development

2011 2012 2013 2014

Economic Sector Appr. (K'000) 139,088.00 214,480.00 215,172.00 358,800.00

-

100,000.00

200,000.00

300,000.00

400,000.00

Ap

pro

pri

atio

n

Figure 2.0 Economic Sector Appropriation 2011 to 2014

Admin 13%

Social 7%

Infra 36%

Economic 4%

Law and Justice

1%

Provinces 39%

Figure 1.0 Distribution of 2014 GoPNG Funding by Sector



Original App(K’000) Revised App (K’000) Grants (K’000) Loans (K’000) Total Appr (K’000)

2013 113,172.00 215,172.00 82,270.00 99,153.00 396,595.00

2014 358,800.00 310,344.00 32,200.00 69,000.00 411,544.00

0.0050,000.00

100,000.00150,000.00200,000.00250,000.00300,000.00350,000.00400,000.00450,000.00

Ap

pro

pri

atio

n

Figure 3.0 Economic Appropriaton 2013 and 2014

Program and establishment of the economic corridors with the major focus on the Petroleum Resource Area Economic Corridor (PRAEC), programs and projects in Agriculture, the Petroleum and Mining industries, Tourism and the SMEs are considered low priority sustainable development enabler1in the Medium Term Development Plan 2011 – 2015. As a result, the funding for the economic sector between 2011 and 2013 were low averaging around 2.8% of the total Development Budget and usually at inconsistent levels. The sector was not able to achieve real impacts in many of the major development policies and on specific policy outcomes. In 2014, the economic sector received a record 71% increase from 2013, which reflects government’s emphasis on the sector. These increases were experienced in the Agriculture and Commerce sectors. In line with the Performance Agreements signed at the Leaders Summit in August of 2013, all three (3) priority impact projects in the agriculture sector were considered for funding, while substantial funding was allocated to Department of Commerce and Industry and National Development Bank to promote the Government’s focus on the SME sector. The table below shows the funding allocation for the Economic Sector in 2014 in comparison with 2013.

Table 1.0 2014 Appropriation in comparison with 2013 Appropriation

The original appropriation for the sector in 2014 was K358.8 million. However, the Revised Appropriation shows a decrease of 14% (K48.5 million). The decrease in the original appropriation was affected by the following;

K3.9 million from the Department of Agriculture & Livestock (DAL) was not released due to non-submission of cashflow & workplans and recalled back to the consolidated revenue;

K10.0 million for the PMIZ Project and K10.0 million for Sepik Plains Project under the Department of Commerce and Industry (DCI) were withheld and forteited back to the consolidated revenue;

K13.0 million for the National Development Bank (NDB) was not released for the SME and the Microbank rollout program;

K4.0 million for the National Fisheries Authority (NFA) earmarked for the Aiyura Aquaculture Redevelopment Project was not released; and

K7.4 million for the Livestock Development Corporation (LDC) was withheld due to reports of mismanagement of PIP funding.

The above funding was not reallocated within the sector but all forfeited back to the consolidated revenue. (b) External funding (Donor Support)

1 Key Enablers: Higher Education, Primary and Secondary Education, Law and Order, Land Administration, Key Infrastructure, Utilities, Health and

Sustainable Development.

No of

Projects

GoPNG

Original Appr.

(K’000)

GoPNG

Revised

Appr.(K’000)

Grants

(K’000)

Loans (K’000) Total Appr.

(K’000)

2014 55 358,800.0 310,344.0 32,200.0 69,000.0 411,544.0

2013 36 113,172.0 215,172.0 82,270.0 99,153.0 396,595.0



Commerce 50%

Renewable 46%

Non Renewable

2%

Environment &

Climate Change

2%

Figure 5.0: Distribution by Subsector

As mentioned earlier that while the Economic Sector had a significant increase in the GoPNG direct funding for 2014, Grants support however, experienced a massive 61% decrease. Further to that the sector also experienced a 30% decrease in Loan support in 2014. The decrease in the Grants appropriation were caused by the ceasing of funding for Smallholder Support Services Pilot Project (SSSPP) by New Zealand Aid to Department of Agriculture and Livestock (DAL), United Nations REDD Program funded by the United Nations (UN) parked under Office of Climate Change & Development (OCCD) and the Kokoda Track Initiative and the ACIAR program funded by the AusAID through Department of Environment & Conservation (DEC) and National Agriculture Research Institute (NARI) respectively. Loans experienced a minor decrease due to the ceasing of the World Bank Mining Sector Support Project also the lack of draw downs for the PMIZ funding from the EXIM Bank of China. The chart below shows the level of funding support by different external development partners in 2014.

External counterpart funding for the sector continues to be dominated by loans from the World Bank for programs in Agriculture, Energy, Mining and SME sectors, while the loans from the Chinese Exim Bank is for the much published Pacific Marine Industrial Zone and the road infrastructures. The UN continues to provide overwhelming support for Environment, Climate Change Adaptation and Disaster Risk Management Programs. NZ support for the sector in 2014 was concentrated on capacity building for Department of Mineral Policy and GeoHazards Management (DMPGM) and Mineral Resources Authority (MRA). Support from JICA was mainly targeted at smallholder rice programs and forest preservation. Though, there were decrease in grants and loans in the 2014 development budget appropriation, it should be noted that 2014 GoPNG appropriation for the sector is by far the largest ever allocation received by the sector to date III. ANALSYSIS OF THE 2014 SUB-SECTOR BUDGET DISTRIBUTION The Commerce Subsector received the highest portion of K154.88 million (50%) compared to other sectors. This portion of funding supported total of ten (10) projects. The K77.0 million of the total appropriation for this sub-sector was allocated to NDB for the SME credit facility and Microbank rollout and K25 million was allocated to Department of Lands & Physical Planning (DLP) for the National Land Development Program. The Renewable Subsector received K148.97 million or 46% of the total economic sector appropriation to finance a total of thirty-two (32) projects. In line with

China Govt NZ Govt JICAUnitedNations

World BankChina Exim

Bank

(K'000) 870.0 769.0 3,923.0 28,603.0 33,454.0 43,800.0

-

10,000.0

20,000.0

30,000.0

40,000.0

50,000.0

(K'0

00

)

Figure 4.0 External Funding by Donors for the Economic Sector Projects (2014)



the O’Neil Dion Government’s Alotau Accord and commitment to public service and rural empowerment, three (3) priority projects were supported for DAL and the Commodity Boards involved in the tree crops sector. There were also three (3) projects totalling K7.3 million funded in the Environment and Climate Change sub- sectors. The Non-renewable subsector received only K6.5 million or 2% of the total sector appropriation which was used to support six (6) projects in the sub-sector. Most of the funding for the Mining MOAs was reduced as a result of State meeting 90% of its MOA commitments over the lifetime of the MOAs to date. Due to infrastructure nature of most of the MOA projects, there were arguments that these projects should be captured by the Department of Works while Mineral Resources Authority (MRA) should only focus on regulation of the mining activities in PNG. A total of fifty one (51) projects were funded under the economic sector in the 2014 Development

Budget. There was an increase of thirty-three (33) projects compared to number of projects funded in 2013. These projects were spread amongst the twenty-one (21) sector departments and agencies. Notable omissions were PNG Forest Authority (NFA), National Agriculture Research Institute (NARI) and Department of Petroleum and Energy (DPE).

Table 2.0 Distribution of Economic Sector Public Investment Programs (PIP) by sub-sectors.

The major PIP projects funded in 2014 were (1) National Development Bank SME Credit Fund (K85.0 million), (2) NDB Credit Micro Bank (K15.0 million), (3) Customary Land Acquisition (K25.0 million) under the Department of Lands and Physical Planning (DLPP), (4) Wharfs and Jetties Rehabilitation and Construction (K40.0 million) under Coastal Fisheries Development Agency (CFDA), (5) Special Economic Zone – Sepik Plains (K50.0 million) (6) Pacific Marine Industrial Zone under Department of Commerce

Sectors

Agencies

No of projects

Total 2014 Appropriation (K’000)

Agriculture DAL and all commodity Boards 30 106,500.00

Forestry, PNGFA 0 0

Fisheries, NFA 2 44,000.00

Petroleum DPE 0 0

Mining, DMPGM, MRA 6 7,700.00

SME DCI, NDB, SBDC 4 103,600.00

Commerce, Trade, Investment, DCI, NDB 4 61,000.00

Land Development, DLPP 1 32,977.4

Tourism, TPA 1 3,000.00

Environment and Climate Change.

DEC, OCCD 3 9,000.00

TOTAL 55 358,800.0

1%

17%

7%

7%

1% 52%

1% 14%

Tourism

Agriculture

Com & Trade

Fisheries

Mining

Land

Env & Climate

SME

Fig. 6.0 : Economic Sector Fund Distribution



and Industry (DCI) (K10.0 million) and (7) Coffee Price Subsidy (K11.0 million)under Coffee Industry Corporation (CIC). Agriculture Sector received the highest appropriation of K106.5 million followed by the SME Sector with K103.6 million. This funding appropriation is directly in line with the Governments focus on empowering the rural population that depends on the agriculture and the SME sectors. The Infrastructure Development Grants (IDGs) appropriation of K120.0 million was parked under the Department of Treasury and is normally rolled out through the established Trust Accounts for the various Petroleum Development Licenses (PDLs). Payments of funds for the various projects as per the MOUs for Central Province, Hela Province and Southern Highlands were commenced in July to the respective Provincial Governments. IV. 2014 WARRANT AND EXPENDITURE In 2014 an estimated 95% total warrants were released to the economic sector PIP projects against the Revised Appropriation. That also equates to about 95% Actual Expenditure incurred by all sector agencies implementing seconomic sector PIP projects. Table 3.0 shows the warrant & exoenditure report for the sector in 2014 Table 3.0 Warrants and Expenditure Reports

Agency Original Budget

Revised Budget

Cashflow YTD

Warrants YTD

Actual YTD Actual Spend

DEC 8,000,000 6,300,000 8,000,000 6,300,000 7,908,774 7,908,774

DAL 20,000,000 16,100,000 17,500,000 16,100,000 17,448,678 17,448,678

DLPP 25,000,000 30,277,400 32,977,400 30,277,400 30,273,719 30,273,719

DMPGM 4,600,000 4,600,000 4,600,000 4,600,000 2,353,569 2,353,569

DCI 61,000,000 41,000,000 51,000,000 41,000,000 25,445,710 25,445,710

OCCD 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000

SBDC 3,600,000 3,600,000 3,600,000 3,600,000 3,600,000 3,600,000

MRA 2,100,000 1,900,000 1,200,000 1,200,000 700,000 700,000

KIK 12,000,000 17,000,000 17,000,000 17,000,000 17,000,000 17,000,000

NDB 100,000,000 77,000,000 80,000,000 80,000,000 80,000,000 80,000,000

CFDA 40,000,000 40,000,000 40,000,000 40,000,000 40,000,000 40,000,000

PNGCCI 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

NFA 4,000,000 0 0 0 0 0

FPDA 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000

PNG CIC 29,200,000 29,200,000 29,200,000 29,200,000 29,200,000 29,200,000

PNG RIB 0 1,900,000 1,900,000 1,900,000 1,900,000 1,900,000

TPA 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

OPIC 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000

NAQIA 2,500,000 2,100,000 2,100,000 2,100,000 2,100,000 2,100,000

PNGCB 16,800,000 16,800,000 16,800,000 16,800,000 16,800,000 16,800,000

LDC 8,000,000 566,600 566,600 566,600 566,600 566,600

TOTAL 358,800,000 310,344,000 328,444,000 312,644,000 297,297,051 297,297,051

V. IMPLEMENTATION STATUS

The midterm review was conducted in July in which only eleven (11) out of the twenty (20) agencies that received funding participated in the review. Most of the agencies were not prepared for the mid-reviews, thus reflected in their presentations which lacked detailed information against Work plans and Cash flows. It was also noted that out of those agencies that participated, very few agencies submitted their mid-term reports. Implementation was slow for most of the projects in the first and the second quarters due to late release of funding. However, by August most of the agencies were implementing their projects as most of the funds were released by then. Agencies that received substantial funding but were slow in



implementation were Department of Environment & Conservation (DEC), Department of Agriculture &Livestock, Department of Mineral Policy and Geohazards Management (DMPGM), Small Business Development Corporation (SBDC), KIK, CFDA, NAQIA and Cocoa Board. VI. ISSUES AND CHALLENGES The issues and challenges noted during the implementation or the 2014 Economic Sector appropriation are somewhat generic. These issues can be noted across other sectors and are usually related to delay in submission of Workplans and Cash flows, lack of capacity within the agencies, lack of timely reporting, NEC approved projects without proper scoping such as Lands &Geogrpahical Information System (LAGIS), Sepik Plains Agriculture Project and Price Subsidy Program for CIC, and delay in procurement processes by CSTB. Specific issues and challenges faced by the sector are as highlighted below;

Management crisis and infighting between agencies have seriously impeded on project implementation. DAL and the Rubber Board have an ongoing tussle on the Rubber Rehabilitation and Expansion program funding, which is still pending in Court and the removal of the Livestock Development Corporation (LDC) Mnagement has further affected project implementation. While coordination and implementation of projects by DAL continues to be a challenge, DAL still maintains the administrative role for managing LDC and Rubber Board;

Most of the Mining MOA funds in the past have been used on projects outside of the Mining MOAs. Consequently, funding to Mineral Resource Authority (MRA) has been reduced in 2014. MRA is a regulatory agency and does not have the capacity to implement all infrastructure projects in the Mining. Therefore, the Department of Works should take charge of these infrastructure projects and coordinate their implementation. Landownership threats to projects within the Mining and Petroleum industries are a continuing problem and hence, the MOA review is important in assessing current trends and proposing solutions;

Lack of adequate GoPNG counterpart funding to loan financed projects have impacted heavily on

the loan drawdowns, particularly the World Bank, Asian Development Bank (ADB) and the EXIM Bank of China.

Slow and insufficient release of funding by the Department of Treasury against the work plans

and the cash-flows have affected smooth implementation of PIP projects. Furthermore, Project implementation delays are experienced when there are less funding released.

VIII. RECOMMENDATION The following recommendations are noted for the sector:

No funding is to be released to departments and agencies that have projects which are stagnant and also those projects that myriad of implementation issues. Furthermore, funding should be released based on the submission of the progress reports.

All implementing agencies of PIP projects must establish Project Steering Committees (PSC) to

provide an oversight to project implementation. The PSCs are important forum to iron out any project related issues and address through collective stakeholder participation.

Work plans and Cash-flows must be formalised in December rather in the first quarter of the

implementing year. This will give the agencies the ample time to prepare their work plans and cash-flows on time and submit them. Fundings should only be released as stipulated by the Work Plan and Cash flow.

Capacity of project implementation needs to be assessed critically before a project is being

funded so that in the first year of implementation, funds are not wasted on mobilisation and capacity building



245 DEPARMENT OF ENVIRONMENT AND CONSERVATION (DEC)

AGENCY SUMMARY

Mission Statement To ensure our natural resources are managed to sustain environmental quality, human well-being and support improved standards of living. Scope of the Public Investment Programs The DEC was allocated funding for two projects in the 2014 budget appropriation. These programs/projects are:

1. Kokoda Track Initiative (K3.0 million) 2. Global Environment Facility (K5.0 million)

Key Issues

Collaborations and Interactions between DEC and DNPM are extremely weak; DNPM needs to be proactive in the implementation of DEC Projects; and The status of the project outputs and achievements are yet to be noted by DNPM due to the late

implementation of the project. 2014 level of funding and expenditure Project Original

Budget RevisedBudget

GoPNG Appr. Donor

Total Funding

Kokoda Track Initiative 3,000.0 3,000.0 3,000.0 3,000.0

Global Environment Facility

5,000.0 5,000.0 5,000.0 5,000.0

TOTAL 8,000.0 8,000.0 8,000.0 0.0 8,000.0

Recommendation Implementation of these projects is unclear and therefore funding for 2015 should be withheld until DNPM has met with DEC and noted the progress and outputs of the projects.



Objective To support and implement the Joint Understanding between the Government of PNG and the Government of Australia through the Kokoda Development Program (KDP) and Kokoda Track Authority (KTA) by assisting the PNG Government through the provision of vital services to communities and promoting tourism. Components & Scope of Works

Kokoda Track and Owen Stanley Range Management; and Analysis of potential benefit streams; Development Program; Capacity Building; Rehabilitation of the Variarata National Park. Mobilisation and Feasibility studies; and Rehabilitation of Infrastructure.

2014 Progress and Achievements The status of the project outputs and achievements are yet to be noted by DNPM due to the late implementation of the project. A private contractor working on the Variarata road maintenance has provided a report on the project. 2014 level of funding and expenditure

Year 2013 2014 Original Approp.

Revised Appro.

Actual Exp

Funding Level 2,000.0 2,000.0 2,000.0 2,000.0 1,725.0

Issues and Risks

DEC did not participate in the midterm review DEC has not reported on the project, though the contractor working on the Variarata Road

maintenance has provided a separate report. Recommendation The project reports will be required before any further funding is appropriated.

Agency Department of Environment & Conservation

Project Name Kokoda Track Initiative

Status Ongoing



Agency Name Department of Environment & Conversation

Project Name Global Environment Facility

Status Ongoing

Objective The main objective is to support the global initiative on forest, coastal and marine conservation. Components & Scope of Works

Institutional Strengthening and capacity building; Policy and Legislative Frameworks; and Project Administration.

Progress and Achievements No report was provided to highlight the progress of the project. The status of the project outputs and achievements are yet to be noted by DNPM due to the late implementation of the project. 2014 level of funding and expenditure

Year 2013 2014 Original Appro. Revised Appro. Actual Exp

Funding Level

0.0 5,000.0 5,000.0 5,000.0 3,520.0

Issues and Risks

DEC did not participate in the midterm review; and DNPM is not aware on the full scope of this program and its objectives.

Recommendations The project report and further consultation between DEC and DNPM will be required before any further funding is appropriated to support this grant facility.



247 DEPARTMENT OF AGRICULTURE AND LIVESTOCK (DAL)

AGENCY SUMMARY

Mission Statement

To guide the overall development of the agriculture sector and to facilitate the allocation of resources to development programs and activities consistent with the priorities identified in the sector and to improve agriculture sector performance through efficient resources allocation and effective coordination of development efforts based on the development and implementation of a comprehensive National Agriculture Development Plan. Scope of the Public Investment Programs The DAL was allocated funding for seven (7) projects in the 2014 budget appropriation. A total of K20.0 million was appropriated to DAL in 2014 and the ongoing programs/projects are:

Productive Partnerships for Agriculture Development (PPAP); Mt Hagen Rice Project Smallholder rice Project Phase 2; While the new projects are Agriculture Statistics and Information Project; Agriculture Resource Centres Development Project PNG Agriculture and Livestock Industry Development; and National Rubber Rehabilitation, Expansion and Nursery Program.

Key Issues

Though a PMU has been established to coordinate the implementation of the PIP projects; There are issues surrounding the Rubber Industry Board with the Secretary DAL. Reporting is still weak. During the midterm review, DAL was not able to provide a good

presentation; there is speculation of misapplication of PIP funding for activities unrelated to project implementation.

2014 Funding: (K’000) Project Original

Budget Revised Budget

GoPNG Appr.

Donor Total Funding

Productive Partnership for Agriculture Development

3,500.0 3,500.0 3,500.0 8,719.0.0 12,219.0

Mt Hagen Rice Project 500.0 500.0 500.0 870.0 1,370.0

Smallholder Rice Project Phase II 1,000.0 1,000.0 1,000.0 2,023.0 3,023.0

Agriculture Statistics and Information 5,000.0 5,000.0 5,000.0 0.0 5,000.0

Agriculture Resource Centres Dev 5,000.0 5,000.0 5,000.0 0.0 5,000.0

PNG Agriculture & Livestock Industry Dev 2,000.0 2,000.0 2,000.0 0.0 2,000.0

National Rubber Rehabilitation, Exp. and Nursery Dev.

3,000.0 3,000.0 3,000.0 0.0 3,000.0

Total 20,000.0 20,000.0 20,00.0 11,612.0 31,612.0

Recommendation DALs overall performance was quite poor, marred by issues of mismanagement of PIP funds. DAL needs to provide proper reports accounting for the K20.0 million received in 2014.



Agency Name Department of Agriculture & Livestock

Project Name Productive Partnerships in Agriculture (PPAP)

Status Ongoing

Objective

The main objective of the project is to improve the access of smallholder markets by strengthening Public and Private Partnerships to enhance provision of support services and increase investments in market access infrastructure.

This will in turn improve the livelihoods of smallholder cocoa and coffee producers through the improvement of the performance and sustainability of value chains of cocoa and coffee producing areas.

Components and Scope of Works Component 1: Studies and training, with associated facilities. This will include:

The expansion of the CB office, Development and installation an Information Management system for the 2 commodities, Review of the financial management of the 2 commodity boards and Development of organic

production for niche markets. Component 2: Establishment of PMUs, overseeing 25 Partnership Agreements with a total value of K28.00 million, monitoring of individual farmers garden operations Component 3:

Road rehabilitation and bridge construction Processing facilities – fermentaries in the case of cocoa and wet factories for coffee.

Progress and Achievements A number of communications / awareness activities have been conducted. All approved partnerships between Agribusinesses and Smallholders have been executed successfully and are now under full implementation for the provision of market access, technologies and services. All recruitment for the PMUs have been completed.The achievements include 24 PPAP partnerships executed,18000 farmers have benefited from partnership agreements and 41 priority feeder roads have been identified. 2014 level of funding and expenditure (K’000)


Funding Level 3,000.0 3,500.0 3,500.0 3,500.0 3,500.0

Issues and Risks

Project is implemented well and therefore a PSC needs to be established quickly; and DNPM needs to undertake a project site visit as this is the third year of implementation and we

need to know what exactly has this project achieved. Recommendation This project has been funded for some time and hence an intensive monitoring trip has to be undertaken.



Agency Department of Agriculture & Livestock

Project Name Mt Hagen Rice Project

Status Ongoing

Objective: To promote rice production in the Highlands region through institution teaching both Agriculture students and local farmers throughout the region rice cultivation and techniques to improve food security. And provision of necessary farming materials to grow dry rice and vegetables by demonstrations. The project consists of Chinese agriculturalist testing Rice seedlings varieties in the Highlands Agriculture College and to select the variety that is suitable to be cultivated in the High altitude areas. The suitable varieties are identified, tested and distributed to the communities surrounding the college. This project is also in line with the NDAL food security and domestic Rice farming policies. Components & Scope of Works

Testing of Rice Seedlings & Soil testing; Training of local farmers and college students; Post Harvesting Techniques; Pests control and disease control; and Site visits to model local farmers and interested schools and institutions.

Progress and Achievements Implementation Status is unknown due to lack of reporting by DAL. Though there may be some achievements, these cannot be stated due to lack of reporting by DAL at this time. 2014 level of funding and expenditure (K’000) Year 2013 2014 Original Appro. Revised Appro. Actual Exp

Funding Level 800.0 500.0 500.0 500.0 500.0

Issues and Risks This project needs to be visited as it has been implemented for a number of years now. Reports are yet to be submitted by DAL. Recommendations All funds have been released and therefore DNPM needs to follow up on implementation report and undertake a trip to HAC to assess implementation.




Project Name Smallholder Rice Project Phase II

Status Ongoing

Objective The overall goal of the project is to promote rice as a food security crop at the smallholder level to improve food security status of rural people, which would be achieved by enhancing the capacity of smallholder rice farmers to engage in sustainable subsistence rice farming and the provision of necessary inputs and support services to sustain their rice farming activities. Components and Scope of Works

Continuation of Baseline Survey on Rice Production and Consumption for the target provinces and non-target rice growing provinces for Policy Support and Development;

Provincial Monitoring and review workshops; Establishment of Guideline for National Extension System for Promoting Smallholder Rice

Production System for PNG; Consultations to Provinces for MF concept; Publication of information Workshop on JCC Training of Provincial Staff on Model Concept and Training of farmers to become MFs with

Counterpart funding to targeted provinces in Phase II; Implementation of Local Government Supporting System for the MF Approach Rice Extension

System. Progress and Achievements Implementation Status is unknown due to lack of reporting by DAL. Though there may be some achievements, these cannot be stated due to lack of reporting by DAL at this time. 2014 level of funding and expenditure (K’000) Year 2013 2014 Original Appro. Revised Appro. Actual Exp

Funding Level (GoPNG) 1,000.0 1,000.0 1,000.0 1,000.0 1,000.0

JICA 1,000.0 2,023.0 2,023.0 2,023.0 2,023.0

Total 2,000.0 3,023.0 3,023.0 3,023.0 3,023.0

Issues and Risks This is a project that has also been implemented over the last 5 – 6 years. A monitoring trip needs to undertake to assess the impact of this project. Reporting remains weak Recommendations Since this project has been implemented over a long period, a full impact assessment needs to be undertaken before any further GoPNG funding is commited through the counterpart arrangements.




Project Name Agriculture Statistics and Information Project

Status Ongoing

Objective To collect and compile a coherent, reliable, and efficient and demand driven Agricultural Statistics that supports management and policy formulation for the Agriculture Sector.The project aims to provide necessary knowledge to the 82% of PNGs agriculture community through the production, dissemination and delivery of needed and relevant agriculture information and materials on timely basis to support and boost increased agriculture productivity and production in PNG. Components and Scope of Works

Administration and coordination of major activities relating to surveys and awareness Consultants and advisors engaged by the project Public Awareness Campaigns Provincial Coordinators workshops / regular meetings with stakeholders (21 meetings) Four Stakeholder workshops Standardizing Data collection format Pretesting and piloting in selected Districts and Data Collection / survey / administration

training Training of Ward recorders and enumerators for data collection and verification ICT personal recruitment (Systems and Data Administrator) DAL HQ

Progress and Achievements Four regional workshops have been held however, implementation status is unknown due to lack of reporting by DAL. Though there may be some achievements, these cannot be stated due to lack of reporting by DAL at this time. 2014 level of funding and expenditure (K’000) Year 2013 2014 Original Appro. Revised Appro. Actual Exp

Funding Level

(GoPNG) 0.0 5,000.0 5,000.0 5,000.0 4,000.0

Issues and Risks Agriculture data collection nationwide is a huge activity that will require substantial funding and therefore is quite slow. However, this needs to be piloted in specific districts, fine-tuned and to be rolled out across the country. Recommendations This is an important program that needs to be continued However, DAL needs to show some real commitment to implementation and reporting. The status of this project is unknown and therefore, DNPM needs to meet with DAL urgently and discusses the progress the issues before any assistance is provided to continue this project.




Project Name Agriculture Resource Centres Development Project

Status Ongoing

Objective The objective of the project is to enhance agricultural productivity and production of famers in order to promote subsistence and semi-subsistence farmers to small and medium enterprising entrepreneurs in the agriculture sector to empower farmers throughout the country in support of the Government’s aggressive drive to promote small and medium enterprises (SMEs). The project is aimed at building four (4) Agriculture Resource and Development Centers in the four (4) regions. These centres will be used as resource centres where information and extension services will be based. These Centers will be used to package technical information, capacity building training, facilitate resources and inputs required to assist and support farmers to improve levels of productivity and production. It is anticipated that through this centres the Agriculture Value Chain will be greatly enhanced and strengthened. The Centers will be built in Erap, Morobe Province, Highlands Agriculture College (HAC), Mt Hagen, Sogeri, Central Province and Warangoi, ENBP. The ARDC project is designed to address the complete lack of government support to rural farmers in the districts who collectively have the capacity to mobilize their land and labour resource to participate in agriculture development. Components and Scope of Works

To construct Building Infrastructure for four (4) regional Centres; To construct and establish infrastructure facilities for information and communication; To procure and supply planting materials and breeding stock; and To train and up-skill farmers to participate in SME.

Progress and Achievements A project site visit was undertaken to Warankoi to observe the Resource Centre. Discussions will commence with UNRE to determine the cost sharing options before any improvements are commenced on the project site. Implementation status is unknown due to lack of reporting by DAL. Though there may be some achievements, these cannot be stated due to lack of reporting by DAL at this time. 2014 level of funding and expenditure (K’000) Year 2013 2014 Original Appro. Revised Appro. Actual Exp

Funding Level (GoPNG) 0.0 5,000.0 5,000.0 4,500.0 4,500.0

Issues and Risks The project implementation is quite slow as a result of capacity issue within DAL. Though a total of four project sites were supposed to be under rehabilitation, no actual work has commenced yet on all project sites. Recommendations It is recommended that the issue mentioned above be addressed between DAL and DNPM through PSC or review meeting to iron out project implementations progress.




Project Name PNG Agriculture & Livestock Industry Program

Status New

Objective The objective of the project is to enable the public sector to develop and maintain coordinated delivery of agricultural services in PNG. The project will increase the capability agricultural will increase the capability of agriculture policy, planning and delivery agencies to deliver to food security outcomes relevant to PNG and the region.This program was initiated a result of an MOU signed between the Queensland DPI and DAL with the objective of promoting and fostering agriculture cooperation in areas of extension services, animal and plant health, sustainable agriculture practices and other areas of capacity building. The project aims to address the significant gaps in agriculture service delivery between the Government Agencies and the rural farming communities. The program intends to provide specific training in upgrading skills and competencies in specific areas of stock inspector, plant health and extension services and support. Components and Scope of Works

Establishment of policy partnerships between Queensland DPI and DAL; and Training of Staff in appropriate fields to enhance skills and knowledge.

Progress and Achievements Though there may be some achievements, these cannot be stated due to lack of reporting by DAL at this time. 2014 level of funding and expenditure (K’000)

Year 2013 2014 Original Appro.

Revised Appro.

Actual Exp

Funding Level (GoPNG)

0.0 2,000.0 2,000.0 2,000.0 1,500.0

Issues and Risks The project is implementation is quite slow as a result of capacity within DAL. DAL should consider rolling out these programs by outsourcing to the provinces. Recommendations This project should not be continued as a result of lack of implementation. This is also a recurrent activity.




Project Name National Rubber Rehabilitation, Expansion and Nursery Program

Status New

Objective The objective is to rehabilitate, expand and modernise the rubber industry by replanting under the expansion program with high yielding bud grafted planting materials from the 2000 series. Components & Scope of Works

Rehabilitation of all rubber blocks in the country by engaging potential private sector companies to partnership in the redevelopment program;

Promote new establishment with interested farmers and modernise the smallholder sector through appropriate extension programs;

Rehabilitation of access road infrastructure; Rehabilitate and privatise the Cape Rodney Rubber Factory to provide efficient market outlets

for farmers; Institute standards and grading parameters in rubber production; and Improve Capacity – staff training and skills upgrade.

Progress and Achievements Some funds were released in the first quarter of 2014 but there is no report highlight activities undertaken at Cape Rodney Rubber Estate. Though there may be some achievements, these cannot be stated due to lack of reporting by DAL at this time. 2014 level of funding and expenditure (K’000)


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 2,000.0 2,000.0 2,000.0 1,100.0

Issues and Risks A court injunction has been taken by DAL management stopping the Rubber Industry Board from accessing the PIP funds. No additional funds have been released to date. Recommendations This project will not be supported as RIB is now a standalone entity.



252 DEPARTMENT OF LANDS AND PHYSICAL PLANNING (DLPP)

AGENCY SUMMARY Mission Statement To improve and facilitate better land management and planning in Papua New Guinea and make it flexible for the Investors and the central public to excess to use the land, not only state land but also for customary Land as well.

Scope of the Public Investment Programs

The Department of Lands and Physical Planning (DLPP) was allocated PIP funding in 2014 for:

1. LAGIS Enhancement and Development Program 2. Customary Land Acquisition.

The program was originally appropriated K25.0 million for the Customary Land program and in the revised a further K7.977 million was appropriated of the LAGIS Program. Key Issues

LAGIS was an NEC approval and hence there is no clear scoping of the program for 2014; and Customary Land Acquisition program is already a component of the Land and Housing Program

under DNPM. This program was approved by at the NEC level and is a duplication of the NLDP. 2014 Funding: (K’000) Project

Original Budget

Revised Budget

GoPNG

Donor

Total Funding

Customary Land Acquisition 25,000.0 25,000.0 25,000.0 0.0 25,000.0

Total 25,000.0 25,000.0 25,000.0 0.0 25,000.0

Recommendation A full report on the implementation of this project needs to be obtained from DLPP and this project should not be supported in future as per the key issues.



Agency Department of Lands and Physical Planning

Project Name Customary Lands Acquisition

Status Ongoing

Objective To provide an environment for developing a framework in mobilisation, acquisition and development of customary land in PNG. Components & Scope of Works The major focus is on the development framework on mobilisation, acquisition and development of customary land. Progress and Achievements The Expenditure report indicates that the funding has been expended however there is nothing to report on at this stage due to lack of reporting from DLPP 2014 level of funding and expenditure (K’000)


Revised Appro.

Actual Exp

Funding Level

(GoPNG) 0.0 25,000.0 25,000.0 25,000.0 22,455.7

Issues and Risks

This project has been implemented over two years and is clear duplication of the components of the

NLDP.

Recommendations A full report on the implementation of this project needs to be obtained from DLPP and this project should not be supported in future as per its issue mentioned above.



254 DEPARTMENT OF MINERAL POLICY AND GEO-HAZARD MANAGEMENT (DMPGM)

AGENCY SUMMARY

Mission Statement

To ensure that PNG’s geological resources are properly documented, effectively promoted and sustainable and managed for the long term benefit of the people of Papua New Guinea, and to mitigate the risks of geo-hazards against human lives and properties. Scope of the Public Investment Programs

The DMPGM was allocated funding for two (2) projects in the 2014 budget appropriation. These

programs/projects are:

1. Rabaul Volcanological Observatory Relocation 2. Landslides Hazard Mapping – Highlands Highway

The projects were appropriated a total of K4.6 million. Key Issues Funds were release in late and expenditure shows that implementation is stagnant. Reporting is also a problem for this agency and this need to improve in 2015. 2014 Funding: (K’000) Project Original


GoPNG Donor Total Funding

Rabaul Volcanological Observatory Relocation

3,000.0 3,000.0 3,000.0 0.0 3,000.0

Landslides Hazard Mapping – Highlands Highway

1,600.0 1,600.0 1,600.0 00 1,600.0

Total 4,600.0 4,600.0 4,600.0 0.0 4,600.0

Recommendation DNPM to follow up with and ensure DMPGM submit monthly and quarterly reports on the implementation of the projects.



Agency Department of Mineral Policy and GeoHazards Management

Project Name Rabaul Volcanological Observatory Relocation

Status Ongoing

Objective The objectives of the project are to monitor volcanic activities in the country, conduct research to better understand the behaviour of volcanoes in order to improve eruption forecasting and to conduct volcano disaster mitigation activities such as planned evacuations. Components & Scope of Works

The construction of the Rabaul Volcanological Observatory; and The construction of 2 x residential units.

Progress and Achievements The status of the project outputs and achievements are yet to be noted by DNPM due to the late implementation of the project. A more informed report can expect in the third quarter. 2014level of funding and expenditure (K’000) Year 2013 2014 Original

Appro. Revised Appro.

Actual Exp


Issues and Risks The funding was not fully spent as indicated by our expenditure reports and therefore DNPM needs to establish why this occurred. Recommendations Due to the late implementation of the project a site visit is to be taken and the reports need to be followed upon.



Agency Department of Mineral Policy and GeoHazards Management

Project Name Landslides Hazard Mapping – Highlands Highway

Status Ongoing

Objective The objective of this project is to mitigate potential damage to properties and minimize the loss of lives by identifying the risk areas of the highlands highway prone to landslides and slope instability. Components & Scope of Works

Purchase of satellite imaging equipmenand geotechnical instruments; Survey of the Highlands highway.

The project will be co-funded by the Pacific Islands Applied Geosciences Commission (SOPAC), who will fund labour (consultants) and partly fund equipment and training.

Progress and Achievements

This project commenced in October 2012 as a Pilot Landslide Hazard Project in the Simbu Province under the DRM Mainstream Program 2010 for PNG that ended in December 2013. The program was fully funded by SPC-SOPAC in 2012 with counterpart funding from GoPNG in 2013 under this program.

The findings from this investigation and reports including maps were presented to all stakeholders in the Simbu Province in March 2014.

The Reports are:

- Public Awareness Campaign on landslides and walkover survey of landslides areas along the

Mangiro-Koronigle section of the Okuk Highway, Simbu Province, PNG; - Mapping and susceptibility –hazard assessment of the landslides along the Mangiro-Koronigle

Section of the Okuk Highway, Simbu Province, PNG. The program was to be extended to the Eastern Highlands in 2014. Funds were release in June and hence activities were conducted in first and second quarters, detailed mapping of the Daulo Pass in progress. 2014 level of funding and expenditure (K’000)


Revised Appro.

Actual Exp


Issues and Risks All funds have been for this project have been released, however the funds were released only in June; and in the PSC meeting, issues were identified and steps were taken to resolve the hiccups. The warrants were released late and this has hampered the implementation of the project as well as its reporting. Recommendations The project was initially implemented well as reported but a project site visit needs to be undertaken and current updated reports need to be collected from the agency.



261 DEPARTMENT OF COMMERCE & INDUSTRY (DCI)

AGENCY SUMMARY

Mission Statement To promote international trade, development of domestic industries and regulate all trade and business activities in the country and it will also increases the employment opportunities and economic growth. Scope of the Public Investment Programs The DCI was allocated funding for four projects in the 2014 budget appropriation. These programs/projects are:

Pacific Marine Industrial Zone (PMIZ) – ongoing Special Economic Zone Corridor; Special Economic Zone – Sepik Plains; and Ulaveo Industrial Centre.

A total of K61.0 million was appropriated in the revised appropriation for the projects Key Issues

Funding for PMIZ was reappropriated due to lack of drawdown from the EXIM Bank; The Department’s (DCI) ability to effectively coordinate and implement many of these projects

successfully remains a serious challenge; DNPM needs to be proactive in the implementation of these projects to ensure projects are

implemented on schedule and funds are released on time. 2014 Funding: (K’000) Project Original



Pacific Marine Industrial Zone (PMIZ) 10,000.0 0.0 0.0 0 0.0

Specials Economic Zone Sepik Plains 50,000.0 40,000.0 40,000.0 0 40,000.0

Special Economic Zone – Corridor Development

0.0 0.0 0.0 0 0.0

Ulaveo Industrial Centre 1,000.0 1,000.0 1,000.0 0 1,000.0

Total 61,000.0 41,000.0 41,000.0 0.0 41,000.0

Recommendation DCI has provided a good report to DNPM. However it is obvious that there are challenges faced by DCI in implementing these huge capital investment projects perhaps due to capacity constraints therefore DNPM needs to be proactive in the initial collaborations before implementation so that the challenges are acknowledged and efforts to address implementation are appreciated and progressed effectively and collectively.



Agency Department of Commerce and Industry

Project Name Pacific Marine Industrial Zone (PMIZ)

Status Ongoing

Objective To encourage onshore processing of tuna resources and create economies of scale, reduce post-harvest losses via the construction of an integrated modern port complex. Components & Scope of Works

Shipping infrastructure development which includes the construction of appropriate storage sheds wharves and other utilities (like Fish Port Container terminal, Fuel farm, Telecom facility, Water supply facility, Waste water treatment plant, Power supply facility and Landfill),

Project Management and, Consultation with other Melanesians Spearhead Group countries and the fishing industry.

Progress and Achievements Negotiations are still underway for lift on the hold on the loan and CEB maintains that the original scope of the project be maintained. Staff recruitment on hold pending outcome of negotiations while Geotechnical study has been awarded to CSYIC who will also conduct oceanographic and geological surveys.SEZ bill Drafting bill is before the NEC for its commenting while all other intended activities are pending awaiting the outcome of the loan lifting negotiations. So far Meetings with CEB continuing; Geotechnical Investigations and Oceanographic Survey contracts awarded to CSYIC; and SEZ Bill Drafting Instruction before the NEC. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000.0 10,000.0 10,000.0 0.0 0.0

Issues and Risks China Exim Bank has been acknowledged and hence is a positive way forward for the progress on the loan access; and no activities have been delivered due to lack of drawdown on the loan. Recommendations DNPM needs to be proactive in this important project. Funding should not be appropriated until all outstanding negotiations are concluded and the loan has been cleared.




Project Name Special Economic Zone – Sepik Plains

Status Ongoing

Objective

To Transform the vast Sepik plains into an agric economic devotement zone; To provide vital infrastructure to investors who will use the facilities to process goods mainly for

export; To encourage both foreign direct and domestic investments and will act as a major industrial

investment incentive to boost and promote PNGs resources; and To promote transfer of capital, technology know-how and create numerous professional and

semi-skilled jobs Components & Scope of Works

Develop 100,000 hectares of oil palm project in the Sepik Plains, Yangoru Sausia, East Sepik Province.

Build support infrastructures in and around the Project location; and Catalyse income earning opportunities and other business opportunities in the impoverished

rural areas surround the project site. Progress and Achievements The investor, Wilmar International has been engaged to undertake all feasibility studies. So far soil analysis has been completed but the feasibility studies are yet to commence. Project agreements are still under negotiations. CAO for state land at Urimo and Kanauki under DAL has been transferred to DTCI in March 2014 and valuation has also been completed. Work on supporting infrastructure has also commenced. The achievements include, Soil analysis completed, 36,000 ha of DAL signed over the DCI, Awareness on land mobilisation commenced, Tenders have been called for the construction of the Yangoru Mobile Police Barracks, K5.0 million committed to Water PNG for Yangoru Town Water Supply, Road upgrading from Kwahue to Yangoru has commenced, Feasibility study on the Wewak wharf has commenced and Electrification program is progressing smoothly. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG) 0.0 10,000.0 50,000.0 40,000.0 25,445.7

Issues and Risks

Wilmar wanted 70% Equity Stake in the JVC which the State allowed for 60%; Wilmar wanted to make outright purchase of the project which the State does not allow; State will mobilise both State land and customary land and contribute its equity in the JVC; Wilmar requested for 25 year tax holiday, which the state only allows 10 years.

Recommendations The project has been delayed due to the unavailability of information on Project Feasibility Report from Investor. The State Negotiating Team is not in a position to finalise and execute any Project Agreement due to lack of information. DNPM needs to be proactive in this important project. Any further funding should be withheld until all outstanding activities produce results.




Project Name Ulaveo Industrial Centre

Status Ongoing

Objective The objectives are to develop infrastructure facilities to enhance economic growth in the rural district to promote access opportunities or our people to participate equally in the business development process and also to allow investors to move into the districts to do business. Components and Scope of Works To establish Building Infrastructure and supporting services; Progress and Achievements Though funds have been released the reports show that no funding has been expended and therefore no implementation has been undertaken. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 1000.0 1000.0 1000.0 0.0

Issues and Risks This was project supported and implemented by ICDC over a three year period without any clear outcome from 2008 - 2010 Recommendations This is failed project. The funding should be diverted to other meaningful projects. Ulaveo is also right next to Kokopo which among the fastest growing towns in PNG. All services required of Ulaveo are available only a stone’s throw in Kokopo.



530 OFFICE OF CLIMATE CHANGE

AGENCY SUMMARY

Mission Statement To ensure that Papua New Guinea’s economic and social development objectives are climate-compatible and that Vision 2050, particularly Pillar Five on Environmental Sustainability and Climate Change, is achieved by ensuring our natural resources are used in a way that does not negatively impact future generations of Papua New Guineans and are managed equitably. Protecting the people, assets, heritage and environment of Papua New Guinea and giving them the knowledge and the tools to enable them to be resilient to natural and human disasters and environmental change Contributing to the global effort to reduce greenhouse gas emissions and mitigate the negative impacts of climate change. Scope of the Public Investment Programs The OCCD was appropriated K1.0 million for the REDD+ Readiness Pilot Program Key Issues Funds were released late in August due to late submission of the Workplan and Cashflow 2014 Funding: (K’000)

Project Original Budget

Revised Budget


REDD+ Readiness Pilot Program.

1,000.0 1,000.0 1,000.0 6,600.0 7,600.0

Total 1,000.0 1,000.0 1,000.0 6,600.0 7,600.0

Recommendation OCCD projects are important but seem like core function activities of the OCCD. DNPM needs to be proactive to appreciate the project so that proper support on funding can be provided.



Agency Office of Climate Change & Development

Project Name REDD+ Readiness Pilot Program.

Status Ongoing

Objective To identify and formulate REDD+ Readiness demonstration activities. The readiness actives will enable PNG to participate and benefit from REDD+ opportunities. Components and Scope of Works

REDD+ Intervention in the Forest Sector to reduce Green House Gases (GHG) Emissions; REDD+ intervention in the Agriculture Sector to reduce Green House Gases (GHG) Emissions; Low Carbon Growth through supporting use of low carbon energy and energy efficiency

improvement initiatives; and Cross cutting issues and continuation of 2012 activities.

Scope of Works for 2014

Project Administration; Awareness on REDD+ and related activities; and Capacity building.

Progress and Achievements Though our reports show that 100% of the funding has been expended, the status of the project, outputs and achievements are yet to be noted by DNPM due to the late implementation of the project and lack of reporting. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG) 0.0 1000.0 1000.0 1000.0 0.0

Issues and Risks

OCCD did not participate in the midterm review Late submission of the Workplan and Cashflow resulted in late implementation of the program.

Recommendations This seems like a core activity of the OCCD and hence DNPM will need to be proactive with OCCD in its implementation of the project to understand the technical areas where capital investments support is warranted so that support is continued where necessary.



531 SMALL BUSINESS DEVELOPMENT PROGRAM (SBDC)

AGENCY SUMMARY

Mission Statement

To encourage and promote the development of the small business activities in Papua New Guinea and to impart knowledge on sustaining these activities in the long term. Scope of the Public Investment Programs The Small Business Development Corporation (SBDC) was allocated funding for one ongoing project under the 2014 Development Budget. The project is Nationwide SME Development Program and was allocated K3.6 million. Key Issues

SBDC has to be well organized in implementing the Nationwide SME Development Project including merging and prioritization of activities.

All funds had been drawn down by June There are so many SME programs implemented in isolation and hence clarity is required to

understand what each agency is really implementing interms of the overral SME Policy. 2014 Funding: (K’000)


Revised Budget


Nationwide SME Development Program 3,600.0 3,600.0 3,600.0

0 3,600.0

Total 3,600.0 3,600.0 3,600.0 0.0 3,600.0

Recommendation Full funding for the project has being drawn down and hence SBDC needs to clearly report on implementation.



Agency Small Business Development Corporation

Project Name Nationwide SME Development Program

Status Ongoing

Objective The objective of the project is to support various aspects of the development of the SME activities in the country. The project also aims at the possibilities of providing credit facilities for Papua New Guineans involved in the SME sector. Components & Scope of Works

SME Entrepreneurial Skills Training Provide advisory and consultancy services Establish and maintain resource centre Provide credit facilities and credit guarantee for SMEs

Progress and Achievements There was a 2nd Quarter PIP Report for this year provided by SBDC, however, there is still not much said about implementation status as the report only has figures for warrants and expenditures. The reports show that the project has fully expended its funding and therefore DNPM needs to follow up on the report. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG) 5,000.0 3,600.0 3,600.0 3,600.0 3,600.00

Issues and Risks

Needs to provide a detail report to DNPM identifying the implementation status and achievements.

Did not attend the 2nd Quarter Development Budget Review by DNPM. Recommendations DNPM needs to follow up the reports and organise for a meeting with DCI and SBDC regarding clarity on the various SME programs.



535 MINERAL RESOURCES AUTHORITY

AGENCY SUMMARY

Mission Statement Effectively promote a healthy and sustainable mineral industry; and provide a regulatory environment which maximizes mining opportunities to ensure optimum benefits for the people of PNG. Scope of the Public Investment Programs The MRA was allocated funding for five projects totalling K3.1 million. Only Ok Tedi and Lihir MOAs were maintained while all other major mining MOAs will be reviewed in 2014. Women in mining and Advance Mining Projects were also given support in 2014.The projects are listed in the table below. Key Issues

MRA had a huge reduction in funding in 2014; Funds for previous MOA projects were used outside of MOA commitments; Reporting by the Agency remains weak; and Funds were not released in the first 6 months and therefore most activities were delay into the

third quarter. 2014 Funding: (K’000) Project Original



Ok Tedi MOA 300.0 300.0 300.0 0.0 300.0

Lihir Liaison 1,000.0 1,000.0 1,000.0 0.0 1,000.0

Women In Mining 500.0 500.0 500.0 0.0 500.0

Advance Mining Projects 500.0 500.0 500.0 0.0 500.0

MOA Reviews 800.0 800.0 800.0 0.0 800.0

Total 3,100.0 3,100.0 3,100.0 0.0 3,100.0

Recommendation

MRA’s biggest challenge seems to be diverting the funding from the original scope of the MOA and

implementing projects outside of the MOA using the MOA funding. The State has also completed most

of its MOA commitments and hence no MOA should be supported until the review has been fully

completed.



Agency Mineral Resources Authority

Project Name Ok Tedi MOA

Status Ongoing

Objective To capture the commitments of all stakeholders the objective of the project is to implement State commitments under the MOA and its agreements are funded and implemented. Components and Scope of Works

The current major component is the Kiunga Water and Sewerage Agreement which is the maintenance of the Kiunga Water and Sewerage plant, and socio-economic and environment consultancy fees. Progress & Achievements Payment was made to OTML for the maintenance and consultants were paid to assist the National Government by providing assessment of the socio-economic and especially the environmental impacts of the mine. There has been no report submitted on the 2013 budget implementation. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG) 772.0 300.0 300.0 300.0 200.00

Issues and Risks

Project needs to specifically report on the Kiunga Water and Sewerage development. The project did not receive the full appropriation in 2014 and reports show that the project only

spent K100, 000.0 Recommendations

A report on the project is crucial to establish the status of this MOA commitment and that Water PNG

should be involved in this project so that this service sustainability can be addressed through this State

agency.




Project Name Lihir Liaison

Status Ongoing

Objective The objectives of the project are to implement the National Government's commitments in infrastructure funding in the MOA and to assist in the mitigation and arbitration of problems and issues which transpire. Components and Scope of Works

Lihir ring road (Currently in progress of implementation) Upgrading and maintenance of Buluminsky Highway (Outstanding MOA project) Kavieng Wharf construction (Not feasible to be built) Namatanai Hospital upgrade and maintenance (Completed) Kavieng Airport extension (To be undertaken under CADIP in 2013 - Outstanding MOA project)

Progress and Achievements Most of the work was not completed satisfactorily as per the terms of the contract due to capacity including manpower and equipment. This resulted in the abandonment of the project in the 2013. DOW with the capacity will implement the project. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

4,000.0 1,000.0 1,000.0 1,000.0 1,000.0

Issues and Risks Lack of reporting by the agency Recommendations A report needs to be provided by MRA and a site visit should be undertaken to the Buluminsky Highway.




Project Name Women In Mining

Status Ongoing

Objective The objective of the project is to build the capacity of women in the mining impacted areas. Components & Scope of Works

Awareness campaigns; Trainings; and Establishment of Resource Centres.

Progress and Achievements The 2014 funds were slow in drawing down therefore no report has been provided. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


0.0 500.0 500.0 500.0 200.0

Issues and Risks Full funding of the project was not released for unknown reasons. The project did not receive the full appropriation in 2014 and reports show that the project only spent K100, 000.0 Recommendations Funding allocated for 2014 of K100, 000 needs to report on to show its spending as per scope of work.




Project Name Advanced Mining Projects

Status Ongoing

Objective The objective of this project is to assess and improve the socio and economic benefits flows from the mining affected communities in the country, while simultaneously assessing to improve the sector’s environment performance in line with the GoPNG broader vision of achieving prosperity as indicated in Vision 2050 and in accordance to international best practise standards. It is purposely for feasibility studies & Social Maping. Components & Scope of Works The main components of the project include feasibility studies and social mapping which will involve land investigation, genealogical, environment impacts and socio-economic studies and environmental baseline studies. These activities will be undertaken for the Frieda project including Consultancy Fees to conduct land investigation, genealogical, environmental and socio-economic studies Progress and Achievements Tenders have been completed and contracts are now being finalised for the work commenced in year 2014. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

500.0 500.0 500.0 500.0 200.00

Issues and Risks Full funding of the project was not released for unknown reasons.There is no reports to report on the project. This project also did not receive the full appropriation in 2014 and reports show that the project only spent K100, 000.0 Recommendations

Tendering process been completed. DNPM needs to follow up on the progress of this project.




Project Name MOA Reviews

Status Ongoing

Objective The objective of the project is to ensure that all current MOAs under review are completed and signed Component The major components are administrative costs related to facilitating the reviews. Progress and Achievements The MOA reviews for Simberi, Tolokuma and Sinivit Gold mines were completed in 2013 whilst in 2014; MRA has so far completed the Ok Tedi MOA review. Other MOA reviews that are being conducted this year are for the Porgera, Lihir and Hidden Valley Mines. MOAs are also being negotiated for new projects such as Solwara 1 and Woodlark in the Milne Bay province. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 800.0 800.0 800.0 200.00

Issues and Risks

The review is crucial in ensuring continuation of current mine operations and also new developments that are currently been looked at; and

The project did not receive the full appropriation in 2014 and reports show that the project only spent K200,000.0

Recommendations

DNPM needs to follow up on the progrss of this project and produce a matrix of the review activities to

keep check on the progress.



536 KOKONAS INDASTRI KOPORESEN (KIK)

AGENCY SUMMARY

Mission Statement A coconut industry that focuses on economic growth and income generation aimed at poverty alleviation and rural development in line with MTDP and the government policy on economic recovery. Scope of the Public Investment Programs There were four (4) projects supported:

Price Subsidy for Copra (ongoing); The project will facilitate the movement of coconut products, mainly copra from remote parts of

the five (5) major coconut growing districts namely, Pomio in ENB, Namatanai in NIP, Bali / Vitu and Kandrian Glouster in WNBP, Rai Coast and Karkar in Madang, and the islands of Milne Bay Province.

Coconut Product Supply Chain Contaminants (new); to address the supply chain contaminants that are related to smoked copra and moisture content. The project will address it through the establishment of Hazard Analysis Critical Control Point (HACCP) and the distribution of fabricated Copra Dryers.

Market Trade & Development (new); the project will complement the downstream processing project by PNGCCI to assist the packaging and promotion of locally made coconut products such as oil, soap, charcoal etc.

Climate Resilience (new); the project aims to introduce coconut replanting and rehabilitation as a basis for climate chance impact on food security and poverty reduction. The project is an initiative of the Asia Pacific Coconut Community.

Key Issues The major issue with the program is the small amounts of funds release by Department of Treasury as a result of the monthly cash ceiling. Because it is dealing with a number of stakeholders, large sums of funds are required to be remitted to exporting companies to commit to large purchases. To deal with the issue, KIK accumulates the small amounts to reach required levels before it can start remittance to implementing agencies. 2014 Level Of Funding And Expenditure Project Original


GoPNG Appr.

Donor Total Funding

Price Subsidy for Copra 5,000.0 5,000.0 5,000.0 0.0 5,000.0

Coconut Product Supply Chain Contaminants

2,000.0 2,000.0 2,000.0 0.0 2,000.0

Market Development & Trade 3,000.0 3,000.0 3,000.0 0.0 3,000.0

Climate Resilience 2,000.0 2,000.0 2,000.0 0.0 2,000.0

Total 12,000.0 12,000.0 12,000.0 0.0 12,000.0

Recommendation The projects are implemented well and the agency has complied with our reporting requirements.The projects need to be considered for further funding.



Agency Kokonas Indastri Koporesen (KIK)

Project Name Price Subsidy for Cocoa and Copra

Status Ongoing

Objective The objective of the program is to subsidize freight costs especially for all copra and cocoa in the remote areas of the major cocoa and copra producing provinces. Components and Scope of Works The major components of the project are:

Conducting awareness to the 5 identified provinces on the freight subsidy; for a coordinating committee with Cocoa Board, PNGCCI and provincial DALs as collaborating partners;

Develop MOAs and sign with the exporting agencies as partners; Have the copra buyers use the copra weight note in the KIK Act 2002; Set up agreements with commercial banks for facilitating the subsidy funds transactions; and Set up the Project Steering Committee

Progress and Achievements Through this project a Price Subsidy MOA was established for the participation of Copra Exporting Companies to sustain the copra prices at a threshold of K600 per tonne. When prices fall below K600, the price support will be provided as a government subsidy. Seven (7) exporting agencies signed the MOA and are participating in Milne Bay, Madang, ENBP, NIP and ABG. These companies provide acquittals to KIK which are attached as part of the report provided to DNPM. No activity has been conducted in relation to this project due to the stabilisation of the copra prices in 2014. The project has not being implemented in 2014 due to increase in Copra from K634.0 per tonne in February to K1016.0 in June. Copra production has improved dramatically as a result of this project stabilising price. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG) 7,000.0 5,000.0 5,000.0 5,000.0 0.00

Issues and Risks The funds are parked in a trust account and will be accessed once the price falls to the K600.0 per tonne threshold; and In the event the price stabilises or improves, the program should focus on freight support. Recommendations This project is important. A project steering committee needs to be immediately formed to discuss other options such as freight in the event that price stabilises.




Project Name Coconut Product Supply Chain Contaminants Project

Status Ongoing

Objective To develop a system framework to assess and control the contaminant risk within the copra production chain therefore improving the quality of the coconut product produced. This will be achieved through implementing HACCP based systems to identify contaminant risk along the copra supply chain. The project is intended to address two (2) notable contaminants in copra production currently affecting the industry. The first issue is related to smoke copra produced by drying copra over open fire resulting in smoke (dioxin) tainted copra, which reduces the quality substantially. The second is in regards to copra with high moisture content resulting in the growth of toxic mould (aflatoxin) on copra which reduces oil content significantly. Components & Scope of Works The project will be implemented in two parts. 1. Establishment of Hazard Analysis Critical Control Point (HACCP) framework which will be established to address quality issues along the copra production value chain; and 2. Fabrication and distribution of copra dryers. The major components are:

Identify improved production techniques to reduce aflatoxin and dioxin contamination in copra or coconut for local processing;

Identify suitable handling and processing techniques to reduce aflatoxin and dioxin contamination;

Determine consumer specification (sanitary and phyto –sanitary specification) to ensure copra is processed and packaged to meet the needs of copra mills and copra exporters;

Develop industry standards (based on HACCP principles and analysis) for production of copra and other coconut products; and

Fabricate and distribute kiln pipes for copra dryer to farmers and farmer groups or stakeholders engaged in copra.

Progress and Achievements Consultative meeting conducted with all copra inspectors and a training manual has been completed with specific requirements for quality copra. The survey is yet to be conducted. Metal fabricators have been identified and engaged to produce the design dryer for ENB, Buka and Madang. 30 high copra producing sites have been selected to trial the dryer. The Project Manager, a qualified food technologist has been recruited to oversee the successful implementation of the project. 2014 level of funding and expenditure Year 2013 2014 Original


Actual Exp

Funding Level (GoPNG) 7,000.0 2,000.00 2,000. 2,000.0 1,800.00

Issues and Risks Funds for the project were released late and therefore implementation was delayed. Furthermore, capacity has been limited and therefore the recruitment will greatly progress the project. Recommendations The project should be continuously supported to improve our copra production practices.




Project Name Market Development and Trade

Status Ongoing

Objective The broader objective is to assist the smallholder coconut farmers and entrepreneurs engaged in processing and marketing of quality coconut by-products to be competitive in the domestic and global markets. Components and Scope of Works The major components are:

Processing standards for all value added coconut by-products developed and appropriate technologies promoted and distributed. Activities will include: Disseminate Board approved standards for all value added coconut by-products, Regulate the manufacture of all value added coconut by-products andIdentify and promote appropriate modern processing technologies and provide technical assistance to stakeholders;

Organic certification and accreditation process established for all coconut by-products. Activities will include: Set up technical team of experts, Conduct coconut research, study and survey on different organizations in PNG or overseas that have acquired accreditation, Develop standards and regulations for organic certification of coconut by-products, Set up a body to facilitate and administer organic certification of coconut by-products and Conduct awareness and training.

Quality standards for packaging and labelling of all value added coconut by-products developed and disseminated to stakeholders and clients. Activities will include: Conduct study on the domestic and international standards on packaging and labelling, Set standards for packaging and labelling of all value added coconut by products, Conduct awareness and training on packaging and labelling of products andProvide technical and initial financial assistance for designing of package and labels of coconut by-products to coconut SMEs.

Progress and Achievements A total of six SMEs across the country were visited and facilities inspected. Consultative meetings were held with IPA to conduct training on Pathway to Market covering packaging and labelling. Training was held in November. 30,000 containers for packaging virgin coconut oil have been acquired for the six SMEs. Labelling designs will be finalised and done by Imprint Ltd (Graphic Designer). Other equipment procurement still in discussions with Production Company in Malaysia 2014 level of funding and expenditure Year 2013 2014 Original


Actual Exp

Funding Level (GoPNG) 1,500.0 3,000 3,000.0 3,000.0 3,000.0

Issues and Risks

Most of the project activities were delayed due to late releases of funding from Treasury; Three planned workshops were delayed due to other government commitments; and A technical person is being sought from the Philippines to progress overseas market

opportunities for PNGs coconut products. Recommendations The Project needs to be supported but KIK has to aggressively address empowering the local SMEs involved in coconut products production.




Project Name Climate Change Resilience Project.

Status Ongoing

Objective The ultimate project is to reduce poverty by enhancing food security, nutrition and income; and to protect and improve the environment in coconut growing provinces. Components and Scope of Works The major components of the project are:

To test the technical feasibility and financial viability of seven climate change preparedness interventions and develop a model to expand the food and income base in every household in pilot poor coconut growing communities of Papua New Guinea;

To institutionalise the use of the resulting climate change preparedness-poverty reduction model in Madang province; and

To promote the adoption, replication and up scaling of the climate change preparedness-poverty reduction model in all coconut growing provinces of PNG.

Progress and Achievements Madang Province has been identified as the project site for the project and the three pilot sites are Transgogol, Karkar Island and Manam resettlement site. KIK will coordinate while the Madang Provincial PMU will implement the project. Census was conducted by PMU, Madang PA and plans for replanting in place. A four (4) hectare nursery site has been developed and all nursery materials have been purchased. MOA has been drafted and signed for the participation of KIK, PMU and OCCD. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


0.0 2,000.0 2,000.0 2,000.0 2,000.0

Issues and Risks

Project is initiated by the Asia Pacific Coconut Community; External funding is still being negotiated by DNPM and OCCD; and Discontuation of the program will affected the implementation of the project due to its cascading

acitivities. Recommendations Funding for this program needs to be release promptly for the PMU to effectively conduct its activities in mobilisation and initiating activities in the three pilot sites.



549 COASTAL FISHERIES DEVELOPMENT AGENCY

AGENCY SUMMARY

Mission Statement

The purpose of the Coastal Fisheries Development Agency is to honourably serve the needs of coastal communities engaged in fishing by providing innovative products and services and empowering them to improve their income levels, quality of life, food security; and in doing so graduate from a subsistence fishers to commercial fishing whilst preserving the marine ecosystem. The CFDA is an office established in 2009 by NEC Decision 151/2009 with the objective of bridging the gap between the commercial fishing industry and rural fishing sector; and linking national, provincial and local level governments to the rural masses as far as coastal fisheries and marine resources are concerned. CFDA aims to develop the rural fisheries sector comprising 14 provinces and an estimated population of 1 million people in by empowering the artisanal fishermen and women through harvest and post harvest management practices, and access to commercial and international markets with the view to alleviate poverty and conserving the fishery ecosystem. Scope of Public Investment Program The NEC Decision had approved a total of K67.8 million to support the implementation of the Decision over a period of five year to cater for the six strategic areas of intervention as outlined in the Strategic Business Plan 2011 – 2013. These are listed below:

Policy, Administration and Legislation Development Community Mobilization and Enterprising Development Extension Services Capacity Building Market Development and Monitoring and Evaluation.

In 2013 and 2014, CFDA has been tasked with rehabilitation of all wharfs and jetties around the country. A total of K55.0 million has been appropriated for this program over the two years. Key Issues It is unclear if CFDA is fully established with its capacity and structure. There is a significant lack of implementation and achievement in relation to the level of funding received by the agency over the period of program duration. The Wharves and Jetties Rehabilitation is a core function of the PNG Ports and the Department of Works to implement. Coastal Fisheries Development Agency should concentrate on rural fishing empowerment through such oriented programs. 2014 Funding Appropriation (K’000) Project Original


GoPNG Appr.

Donor Total Funding

Wharves and Jetties Rehabilitation and Construction

40,000.0 40,000.0 40,000.0 0.0 40,000.0

Total 40,000.0 40,000.0 40,000.0 0.0 40,000.0

Recommendation: The implementation is slow due to delays in the CSTB process that need to be addressed effectively so as such high impact programs can be implemented promptly.



Agency Office of Coastal and Inland Fisheries

Project Name Wharves and Jetties Rehabilitation and Construction

Status Ongoing

Objective The project aims to address the deficiencies of the rural fisheries sector in ensuring there are available markets for local fisherman to sell their catch for a higher income. The intention is to rehabilitate the existing wharfs and jetties that can have facilities that will benefit rural fishermen. Components & Scope of Works: The major components of the project include: Infrastructure rehabilitation (wharves and jetties)

1. Services and access facilities (ice making and cool storage facilities, fishing equipment and supplies, boat making and maintenance facilities, fuel deport), and

2. Appropriate fish marketing infrastructures Progress and Achievements The scoping for project sites for Morobe, Madang, ENBP, NIP, Gulf and Central has been completed. Costings for tender process have also being completed. Payments for the Rabaraba jetty in Alotau have been forward to Alotau District. 2014 Level of Funding:


Revised Appro.

Actual Exp


Issues and Risks

Reports provided on time as requested; A monitoring trip needs to be taken by a DNPM to verify projects.

Recommendations The agency is a small organisation tasked to under a massive engineering project. Capacity will remain a major challenge for organisation and should the organisation propose outsourcing certain activities, it will cost the organisation dearly. A proper monitoring needs to be undertaken to verify the capacity of the organisation and its ability to implement a huge project as such.



550 PNG COCOA COCONUT INSTITUTE

AGENCY SUMMARY Mission Statement To contribute to improvements in the lives of people who grow cocoa and coconuts in rural communities. It shall achieve this by maintaining high standard of research in cocoa and coconut production, protection, processing and marketing, and in the communication of the results of such research to growers and industry groups, through appropriate and effective extension systems. Scope of the Public Investment Programs There are four projects supported in 2014:

National Cocoa & Coconut Production Improvement Program (NCCIP) Phase II aims to impart knowledge and skills to cocoa/coconut smallholder block farmers on block management and to increase productivity and yield through appropriate training and integrated pest management. Phase II will focus on undertaking an evaluation of the impact of the program over the last 3 years and out-scaling farming technologies.

Coconut Census & Development Project in PNG aims to identify all rundown and abandoned smallholder coconut blocks and plantations in the 14 coastal provinces with the aim of assessing their viability for rehabilitation, sorting out ownership issues and providing appropriate policy intervention.

Cocoa Pod Borer and Bogia Coconut Syndrome project will focus on research and field work that will subsequently eradicate or mitigate the Bogia Coconut Syndrome (BCS) in Madang Province and PNG should it be found in other coconut growing provinces and continue research work on the 10 CPB clones that have been bred to be released to public.

Downstream Processing of High Value Cocoa Coconut Products is to research and promote downstream processing of high value products of both Cocoa and Coconut.

Key Issues

The projects will be implemented in collaboration with KIK, Cocoa Board and NAQIA; and The agency has established a Project Steering Committee chaired by the CEO PNGCCI comprising

representation from DAL, DNPM, Treasury, CEO Cocoa Board, CEO KIK and regional representatives.

2014 level of funding and expenditure Project Original


GoPNG Appr.

Donor Total Funding

National Cocoa Coconut Production Improvement Program

3,000.0 3,000.0 3,000.0 0 3,000.0

Coconut Census and Appraisal Project 2,000.0 2,000.0 2,000.0 0 2,000.0

Downstream Processing of High value cocoa coconut Products

2,000.0 2,000.0 2,000.0 0 2,000.0

Cocoa Pod Borer and Bogia Coconut Syndrome

3,000.0 3,000.0 3,000.0 0 3,000.0

Total 10,000.0 10,000.0 10,000.0 0 10,000.0

Recommendation The projects are implemented well and this agency is a very high performing and transparent agency which deal with the cocoa farmers and hence the Government needs to continue to support it.



Agency PNG Cocoa Coconut Institute

Project Name National Cocoa Coconut Production Improvement Program

Status Ongoing

Objective To equip farmers with technical knowledge and appropriate management skills in all aspects of cocoa and coconut smallholder block management to maximise production, crop protection (including the best practice in CPB management), processing and marketing; and to provide farmer support in terms of production and distribution to high yielding planting materials; in an effort to increase productivity, production and income earning capacities. Components & Scope of Works The purpose of NCCPIP phase 2 was to do a follow-up assessment of the impact NCCPIP implementation over the last three years. The major components are:

Train extension officers from the cocoa and coconut growing provinces and Model famers on concept of IPDM and CPB Management.

Conduct farmer training courses on the IPDM and CPB Management concept Conduct farmer training courses on coconut downstream processing Conduct Livelihood courses for Farmers; Establish and Rehabilitate / Expand ten provincial Bud wood gardens Establish and Maintenance of Ten Provincial Nurseries; Production and Distribution of Hybrid Cocoa Clone Seedlings and high yielding coconut plantlets; Develop Partnerships with Provincial Governments and Private Service Providers.

Progress and Achievements This is a very high performing project and hence the achievements include:6 Sustainable Livelihood training in Central, Oro and ENBP,18 LCB training on IPDM and CBP for Cocoa, 2 LCB training on High Value Coconut Products, 10 follow up visits were done for above trainings, 4 in MBP, 2 in NIP and 4 in ARB, 42 existing Nurseries were maintained and 14 new nurseries established, 20 new budwood gardens were established for distribution of clones, 72 farmer group meetings and two advisory visits, 93,597 hybrid cocoa clones were distributed to farmers during first two quarters, 800 coconut seedlings (local tall breed) and Cocoa Curriculum developed and approved for trial in ENBP. In terms of awareness, 3 field days, 27 radio programs, and 5 articles released, 11 outreach visits were done to farmers surrounding model farms and more than 275 farmers attended the outreach programs in Oro, MBP, NIP, ENBP and ARB; 2014 level of funding and expenditure



Issues and Risks Lack of of continous funding for this very important program affects communities that have fully integrated the farming technologies to mitigate CPB and increase production. Recommendations The project provides the much needed extension support to the farmers and therefore needs to be continuously supported.




Project Name Coconut Census and Appraisal Project

Status New

Objective The objective is to conduct a nationwide census of the current coconut stands and diagnostics assessment of their current status and propose intervention strategies. These will include provision of planting materials and organize farmers into cooperatives and provision of management or capacity building (management, value adding and marketing) thereby empowering them to redevelop and manage their own farms thus creating income earning opportunities for rural families. Components & Scope of Works

Census and appraisal conducted on all rundown and abandoned smallholder farms/blocks and plantations and ownership status verified;

Database Established and Outcome Report formulated; National Coconut Redevelopment Policy Formulated; District coconut development plans formulated; Pilot District projects

Progress and Achievements While the project has focused on NIP for 2014 and indicated through the midterm review the following Inception workshop was conducted;

Training for NIP enumerators and census has commenced; and Awareness conducted for the project in NIP.

2014 level of funding and expenditure


Revised Appro.

Actual Exp


Issues and Risks

Late and inadequate releases of funding by Treasury; Capacity issues relating to nationwide survey; and PNGCCI needs to collaborate with DAL to share resources and capacity for this project

Recommendations This project should rightfully be implemented by KIK which is the regulating agency.




Project Name Downstream Processing of High Value Cocoa Coconut Products

Status Ongoing

Objective To evaluate and recommend selected, high value coconut and cocoa products and appropriate agri-business models for adoption by small to medium enterprises in PNG. The project is intended to support and strengthen downstream processing of cocoa and coconut products. Currently there are farmers who are engaged in downstream processing of coconut products such as soap, virgin coconut oil, soap, cream, and charcoal. Other APCC countries able to produce the above mentioned and also coconut sugar and biscuits. The project aims to enhance current processes of downstream processing, mobilize farmers and promote improved practices that will add value to downstream processing. KIK will play an important final role in assisting the farmer in areas of packaging and marketing through the Market Development and Trade of such products. The project firstly will determine the commercial viability of selected projects under the two (2) commodities then identify appropriate small to medium size agribusiness models for downstream processing of coconut and cocoa products. Components and Scope of Works

Complete establishment of Coconut Downstream Processing Facility in Stewart Research Station (SRS), Madang for medium scale processing;

Investigate and identify existing markets and new market possibilities for downstream processing products;

Capacity Building of PNGCCI staff; Establishment of a mini cocoa processing facility; and Smallholder partnerships in SMEs.

Progress and Achievements Achievements include; Discussions completed with potential partners, 1 TOR drawn up and signed, Trip to Asia and negotiated with Supplier of downstream processing machinery and Recruitment of staff. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level (GoPNG) 0.0 2000.0 2000.0 2000.0 2000.0

Issues and Risks Funds for the project were released quite late and therefore implementation was slow. And excellent presentation was made during the midterm review, however a report for the project could not be obtain for this report though numerous attempts were made. Recommendations A full report needs to be provided to the Department and further PNGCCI needs to do a presentation on what they have achieved in this very critical project and propose the way forward through an appropriate policy framework.




Project Name Cocoa Pod Borer and Bogia Coconut Syndrome

Status Ongoing

Objective The objective is to research and develop research induced technologies and management strategies to control and mitigate the negative impacts of Cocoa Pod Borer (CPB) and Bogia Coconut Syndrome (BCS) and to build the capacity of PNGCCI to address potential incursions of new pests and diseases. Components & Scope of Works

The programs will focus on conducting a nationwide delimiting survey and random sampling of coconuts in all coconut growing provinces to establish the extent of the syndrome, which will then lead to the development of quarantine strategies. The activities will focus on:

Conduct awareness to prevent the spread of syndrome Conduct eradication and sanitation programs in Madang and other provinces where BCS is

detected; Conduct mitigation programs; Conduct monitoring of continuing BSC activities and affected areas; and Conduct a restitution program.

For CPB, research work will be continued in progressing the release of the 10 identified CPB tolerant clones. Progress and Achievments Attempts to obtain reports from PNGCCI for this project were unsuccessful and therefore no progressive report will be provided at this time. 2014 level of funding and expenditure Year 2013 2014 Original


Actual Exp


Issues and Risks PNGCCI needs to take a sector approach involving NAQIA and Cocoa Board in implementing this project. Recommendations It is reccomended that the above issue is done to progress on the implementation of the project.



551 NATIONAL FISHERIES AUTHORITY

AGENCY SUMMARY Mission Statement The purpose of the National Fisheries Authority is to pursue our Vision through the operation of best practice service in order to fulfil our national and global obligations Scope of the Public Investment Programs The scope of the 2014 budget is to rehabilitate the Aiyura Aquaculture Development Centre in Eastern Highlands province to meet the demand of the growing inland fisheries sector. The project was appropriated K4.0 million in 2014. Key Issues

The centre has been neglected for over two decades and is in dire need for rehabilitation; Funds have not been released for this project; and DNPM has no proactive relationship with NFA.

2014 Funding: (K’000) Project Original


GoPNG Appr.

Donor

Total Funding

Rehabilitation of Aiyura Aquaculture Development Centre

4,000.0 4,000.0 4,000.0 0.0 4,000.0

Total 4,000.0 4,000.0 4,000.0 0.0 4,000.0

Recommendation DNPM needs to establish further the level of need for the reestablishment of the Aiyura Aquaculture Centre.



Agency National Fisheries Authority

Project Name Aiyura Aquaculture Development Centre

Status Ongoing

Objective To rehabilitate and upgrade the Aiyura Aquaculture Development Centre to ensure it is delivering the needs of the inland fishing sector. Components & Scope of Works

Scoping and feasibility studies; Tendering for appropriate contractor; and Actual Construction and maintenance.

Progress and Achievements The appropriate funding was not released in 2014. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 4,000.0 4,000.0 4,000.0 0.0

Issues and Risks Funding has not been released. Recommendations DNPM will need to meet with NFA to discuss the project and the way forward inorder for funding to be released.



554 FRESH PRODUCE DEVELOPMENT AGENCY

AGENCY SUMMARY Mission Statement The organization’s mission is to maximize the efficiency and productivity of female and male farmers and others in the value chain to enhance development of a commercially and economically viable and sustainable the horticulture industry. Scope of the Public Investment Programs Fresh Produce Development Agency has submitted a total of three (3) projects for consideration in the 2014 Development Budget and all three received funding appropriations. The projects are targeted at promoting the bulb onion industry, seed accessibility and strengthening extension services in the horticulture industry.

The three (3) projects are: National Bulb Onion Development Project; Improving Accessibility & Availability Seed Planting Material for Commercial Crop; and Village Extension Worker

Key Issues

Delays caused by weather to access the remote locations. Funding not enough to cover all remote coffee growing communities. FPDA is the only commodity agency that does not collect any levy. It is totally dependent on the

Recurrent allocation; There exists a short supply of seeds and other planting material of demand in the horticulture

industry; PNG consumes about 3800 tons of bulb onion of which 85% is imported; and Lack of extension services exist in the rural communities.

2014Funding: (K’000) Project Original


GoPNG Appr.

Donor

Total Funding

National Bulb Onion Development 2,000.0 2,000.0 2,000.0 0.0 2,000.0

Improving Accessibility & Availability of Seeds & Planting

2,000.0 2,000.0 2,000.0 0.0 2,000.0

Village Extension Worker 2,000.0 2,000.0 2,000.0 0.0 2,000.0

Total 6,000.0 6,000.0 6,000.0 0.0 6,000.0

Recommendation These projects are all economically vital projects that require more financial support.



Agency Fresh Produce Development Agency

Project Name National Bulb Onion Project

Status Ongoing

Objective To improve socio-economic well being of the rural communities by bringing income into the farming households. It is aimed at import substitution with subsequent view for total replacement and making PNG self-sufficient on bulb onion. Simbu is known for its limestone dominated topography in which cash crops such as coffee and other fresh produce crops are not capable of being grown. As a result bulb onion was trial in Gembogl as an alternate cash crop which resulted in positive outputs in terms of farmer participation and income generation. Since its quick success, the aim is to progress the project at Gembogl and expand it to other parts of Simbu and other provinces where the potential is. The project focuses on promoting bulb onion as an alternate high earning food crop for its storage capability. The program intends to improve post-harvest and product quality, establish appropriate curing methods, and build a central warehouse in Kundiawa and formation of Cooperative Groups. Components & Scope of Works

Post Harvest Technology; Capacity building and networking of bulb onion farmers; Establishment of markets; and Infrastructure building – warehouse.

Progress and Achievements Attempts to obtain reports from FPDA for this project were unsuccessful and therefore no progressive report will be provided at this time. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


Issues and Risks Agency reporting on project status has been weak. Recommendations Funding was received late and implementation was slow and therefore DNPM needs to follow up on the udpdate report.




Project Name Improving Accessibility & Availability of Seeds & Planting

Status Ongoing

Objective To improve accessibility and availability of seed and planting material for fresh crops (fruits and vegetables) of commercial significance to growers so that they can consistently produce sufficient quantities for high quality fresh produce and supply the increasing demand of markets in PNG. The project basically targeted at improving the availability and accessibility of seed and planting material for vegetable, fruit and nut crops of commercial significance to address the needs of the farmers dependent on gardening. At present the farmers find it difficult to have access to good quality seeds and planting materials because the right varieties and quantities are not available at the time they need it. The program aims to identity underlying problems causing seed shortages and try to improve the situation by:

Mapping out seed imports; Mapping out supply and distribution network; Identifying impediments and issues faced by the seed industry; and Develop appropriate strategies to address the issues.

Components and Scope of Works

Seed and planting material sourcing; Conducting surveys and variety evaluation trials; Establishing nurseries for vegetables, fruits and nut trees; Multiplication and distribution; and Identifying suppliers for importing and distributing seeds.

Progress and Achievements There are no progressive reports for this project. Attempts to obtain reports from FPDA for this project were unsuccessful and therefore no progressive report will be provided at this time. A presentation was made during the midterm review but the information was not reported for the benefit of this report. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


Issues and Risks Reporting needs to be improved by the Agency Recommendations Funding was received late and implementation was slow and therefore DNPM needs to follow up on the report.




Project Name Village Extension Worker

Status Ongoing

Objective The objective is to improve and expand the Village Extension Worker (VEW) extension model to improve productivity in the farming communities. The VEW extension model is a community based low cost extension approach. The VEW extension model is a model development by FPDA with its main focus to engage marginalized persons especially women in the rural communities to engage in food production for self-consumption and sales. The model has been achieving some success in the provinces where FPDA has implemented programs. The project will review the current VEW Operation Plan and suggest ways to improve aspects of cost effectiveness and efficiency so that the program can be expanded to cover a wider range of communities and thus improve extension officer to farmer ratio. Components & Scope of Works

Review of Village Extension Worker Model and other relevant policies and alignment to National policies;

Coordination and Implementation of VEW model; and Monitoring, Evaluation and Reporting.

Progress and Achievements Attempts to obtain reports from FPDA for this project were unsuccessful and therefore no progressive report will be provided at this time. 2014 level of funding and expenditure Year 2013 2014 Original


Actual Exp


Issues and Risks Reporting needs to be improved by the Agency Recommendations

Funding was received late and implementation was slow and therefore DNPM needs to follow up on

the report.



554 COFFEE INDUSTRY CORPORATION

AGENCY SUMMARY

Mission Statement To increase productivity, production and market access for female and male PNG coffee farmers and others along the value chain with motivated, competent and continuously learning staff and other actors. Scope of the Public Investment Programs The five projects that received funding support are:

The Freight Surety Program which is a service oriented program aimed at enabling market access for coffee farmers in the rural areas by subsidizing air freight of transportation to the third level airline companies who provide this service;

District Coffee Rehabilitation Program aimed at empowering the farmer by providing the appropriate skills and knowledge as well as the farmer support in terms of planting material and tools required for the rehabilitation of the coffee industry at the farmer level.

Lae Export Office is basically requesting support for the rehabilitation of the Coffee Export Control Office in Lae, in terms of infrastructure development and quality assurance equipment and capacity building.

Strategic defence of PNG Coffee Industry against Coffee Berry Borer requires immediate and urgent attention in response to the discovery of Coffee Berry Borer in Telefomin. This requires a national strategy to prepare for countering the pest should it be rediscovered.

Coffee Price Subsidy which was approved by the NEC to support coffee price should it fall below threshold levels.

Key Issues

CIC has not reported all the projects implemented in 2014. PSC needs to be immediately established for all the projects to ensure effective implementation

and effective implementation. 2014 Funding: (K’000)


Revised Budget

GoPNG Appr.

Donor Total Funding

Freight Assurance Subsidy Scheme 7,000.0 7,000.0 7,000.0 0.0 7,000.0

Coffee Rehabilitation & Develop.Phase II

7,000.0 7,000.0 7,000.0 0.0 7,000.0

Lae Export Office Rehabilitation 2,200.0 2,200.0 2,200.0 0.0 2,200.0

Strategic Defence – Coffee Berry Borer

2,000.0 2,000.0 2,000.0 0.0 2,000.0

Coffee Price Subsidy 11,000.0 11,000.0 11,000.0 0.0 11,000.0

Total 29,200.0 29,200.0 29,200.0 0.0 29,200.0

Recommendation A total of K29.2 was released to the agency and therefore DNPM needs to undertake a monitoring visit. DNPM also needs to urgently follow up on the reports from CIC.



Agency Coffee Industry Corporation

Project Name Freight Assurance Subsidy Program

Status Ongoing

Objective To facilitate market access for coffee growers from the remote areas by assisting in transporting coffee to the nearest marketing depots, facilitating processing and marketing. Components and Scope of Works

Facilitating a survey for effective continuation of the program through identification of all possible airstrips in the rural areas and MOUs signed with freight providers;

Enabling the Growers into organised groups to effectively conduct their business through the assistance of CIC and other service providers; and

Undertake maintenance to the rundown airstrips in the remote districts.

Progress and Achievements In 2014, 693kg of Parchment coffee (671 bags gbe) were freighted from 6 province only at a cost of K 1.2 million. The total revenue to the farmers in the remote areas was K4.2 million at a cost of K 1.4 million. The net benefit to farmers is K 2.8 million. The farmers in the remote areas are no longer burning coffee and have increased investments in managing their coffee trees. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


Issues and Risks CIC submitted its Workplan and Cashflows at end of April and hence received funding late in June due to Cashflow problems faced by the Waigani Public Accounts. However expenditure shows full spending. Recommendations This project is an important project that has been implemented over a long period. CIC needs to report on the rate of return for this project and also provide a CBA for to justify for increased funding.




Project Name Coffee Rehabilitation & Development Phase II

Status Ongoing

Objective The objective of the program is to undertake an intensive Coffee rehabilitation and development process through appropriate training, extension, and appropriate support systems. CIC incepted and implement the pilot District by District (DxD) village coffee rehabilitation program in 2009 with funding support from NADP and the technical assistance form ACIAR PRAP program. Nurseries were established in EHP, Simbu and the WHP. The main aim of the program was to rejuvenate the mainly smallholder coffee blocks that are currently partially or completely rundown. The program will provide extension, training, and incentives to enable the farmer to return to the coffee blocks and undertake rehabilitation. Components & Scope of Works

Continue Work on the 53 established nurseries and propagation of quality seedling for smallholder garden rehabilitation in all Districts of Highlands Provinces;

Establish additional new central nurseries in the 65 district; Rehabilitation process for 1,863 hectare of smallholder coffee; Conduct awareness, mobilise and train and rehabilitate additional 590,000 farmer coffee plots;

and Conduct and provide extension and personal viability training involving farmers, service

providers and development partners. Progress and Achievements Reports for 2014 were not provided but over the last three years the program has managed to achieve the following: 8669 farmers trained, 1639.53 ha rehabilitated, 36 nurseries built containing 1,687,000 million seedlings and 2,615 shade tree seedlings; and184 members of 29 cooperative societies trained in Specialty market training. The project has expanded and now covers the 65 districts in the 14 coffee growing provinces and implemented through organized grower groups. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 7,000.0 7,000.0 7,000.0 7,000.0

Issues and Risks

CIC submitted its Workplan and Cashflows at end of April and hence received funding late in June due to Cashflow problems faced by the Waigani Public Accounts.

PIP funding for this program was diverted to support other activities outside of the scope of the program and hence this needs to be verified through a through investigation

Recommendations There is evidence of CIC supporting activities outside of the scope of the project and therefore DNPM needs to do a full audit of the program before any support is provided.




Project Name Lae Export Office Rehabilitation

Status Ongoing

Objective The objective of the program is to facilitate increased financial returns to coffee producers in PNG and safeguard PNGs quality niche market by renovating the CIC Coffee Export Office Complex (Coffee Clearance Hauls) and acquiring appropriate testing equipment. Coffee is largely produced by over 297,000 smallholder coffee farmers. To ensure the coffee exports are of premium quality, CIC operates an Export Office in Lae, Morobe Province. The CIC Export office in Lae, Morobe Province contains a Chemical Analysis Laboratory The laboratory houses coffee quality test equipment – a Gas Chromatograph that is used to conduct Quality Assurance Check. The machine has outlived its usefulness and needs to be replaced. The building itself is very old, requiring substantial renovation for in critical areas of roofing, walls and security measures. The project hopes to rehabilitate the Export office and acquire appropriate coffee testing and grading equipment for the in-house laboratory. Components & Scope of Works

Renovation of the building; Acquisition of the Equipment from Overseas (Europe and Asia); and Training and upgrading of skills of Export Office Staff.

Progress and Achievements The full funding has been expended and unfortunately there is no reporting from CIC 2014 level of funding and expenditure


Revised Appro.

Actual Exp


Issues and Risks

The building was gutted by fire last year and is need of urgent rehabilitation; and This project very critical in terms of sampling and grading coffee to maintain high export

standards for global demand. Recommendations DNPM needs to undertake a trip to Lae to see the progress on this very crucial State asset.




Project Name Strategic Defence of PNG Coffee Industry against Coffee

Status Ongoing

Objective The overall objective is to ensure a rapid detection, containment and eradication of the Coffee Berry Borer, when and where there is an incursion. The project is design to establish total protection of the PNG Coffee Industry from the Coffee pest known as the Coffee Berry Borer (CBB) found in Sandaun along the PNG Indonesian border. Components & Scope of Works

Understand the CBB pest and local relatives; Validate the current CBB Emergency Response Plan; Develop CIC capacity for CBB Defence & Eradication; and Conduct CBB Surveillance and Monitoring.


Funds for 2014 released late according to CIC the two activities conducted were Maintenance of surveillance and trap equipment along PNG – Indonesian Border; and Expert in CBB from Australia visited Aiyura and conducted training on CBB.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 2,000.0 2,000.0 2,000.0 2,000.0

Issues and Risks

CIC inability to provide proper reports for the project. CIC indicated that the funds for this project were fully expended

Recommendations DNPM to follow up on the reports from CIC as funds for these projects were fully expended in 2014.




Project Name Coffee Price Subsidy

Status Ongoing

Objective The objective is to subsidize the coffee price for rural coffee farmers to increase production and assist farmers during the commodity prices downfall. Components & Scope of Works

Establish MOAs with the interested established coffee buyers and exporters for price subsidy participation; and

Subsidisation of Coffee price when price fall below threshold levels. Progress and Achievements There is no report on the project 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

4,000.0 11,000.0 11,000.0 11,000.0 11,000.0

Issues and Risks

This is an NEC approve project and hence CIC needs to meet with KIK to assist it with concepts involved in the roll out of a price subsidy program.

The project indicates a full expenditure and therefore DNPM needs to follow up and verify the project implementation.

Recommendations A full report is required and that DNPM will need to follow up on this project and assess the progress.



558 TOURISM PROMOTION AUTHORITY

AGENCY SUMMARY

Mission Statement PNGTPA will enhance the development, marketing and sustainability of PNG Tourism in partnership with the industry, government and community. Scope of the Public Investment Programs The Tourism Mid Term Master Plan Implementation is the only project support with appropriation of K3.0 million in 2014. Key Issues Delays in the release of funding from Treasury; 2014 Funding: (K’000)


Revised Budget

GoPNG Appr.

Donor (World Bank)

Total Funding

Tourism Mid Term

Master Plan

Implementation

3,000.0 3,000.0 3,000.0 0.0 3,000.0

Total 3,000.0 3,000.0 3,000.0 0.0 3,000.0

Recommendation TPA needs to be adequately funded if the Government is expecting growth in the Tourism industry.



Agency Tourism Promotion Authority

Project Name Tourism Mid Term Master Plan Implementation

Status Ongoing

Objective (s):

To increase the overall economic value of tourism to the nation by doubling the numbers of tourist on holiday in PNG every five (5) years and maximising sustainable tourism growth for the social and environmental benefit for all Papua New Guineans.

To identify characteristics upon which unique and appealing tourism experiences can be built ad to identify the policies, programs, infrastructure development, investment strategies and marketing positions needed to bring the potential of the country to reality; and

To identify opportunities to improve the competitiveness of the sector and provide an integrated framework for the industry development in the next ten years.

Components & Scope of Works Componets include:

TMP Policy and Planning Projects; and TMP Product Development Projects.

The scope includes

Awareness and Publications – Tourism Issues Paper and Guidebook; Model Provinces – Central Province; Technical Assistance Support including regional cooperation assistance; Tracking Developments – Kokoda Track, Black Cat and Mt Wilhelm; and New Developments in Cruising, Surfing, Game fishing

Progress and Achievements Though TPA attended the review and was able to provide a rundown on its intentions in relation to implementation of the program, no proper report was provided for the benefit of this report. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


Issues and Risks TPA shows that the funding was fully expended and therefore it needs to provide a full report on the project. Recommendations DNPM will need to meet with TPA to discuss how to adequately support the industry.



559 OIL PALM INDUSTRY CORPORATIONS (OPIC)

AGENCY SUMMARY Mission Statement

To increase the productivity, production, profitability and sustainability of oil palm products of male and female smallholders and other out-growers. Scope of the Public Investment Programs The Smallholder Agriculture Development Project (SADP) is a road infrastructure rehabilitation program targeted at rehabilitating and improving the rural access roads in the oil palm growing provinces to assist improve the accessibility and promote the productivity of the smallholders and other out-growers. OPIC has submitted in 2013 our requirements for PIP funding in 2014 for all incomplete roads leading to all smallholder oil palm blocks to be completed and for on-going maintenance to be done on existing roads. The submission for K70.3 million was approved in principle and later discarded as there was no funding. The problem continues to persist today with heavy rainfall in the Oro and West New Britain Provinces. These two provinces contribute over 130,000 hectares of oil palms grown and contributed over K1.2 billion to the PNG economy. The project was appropriated K2.0 million in 2014. Key Issues Funding is inappropriate to undertake major roadworks 2014 Funding: (K’000)


Revised Budget

GoPNG Appr.

Donor (World Bank)

Total Funding

Smallholder Agriculture Development Project

2,000.0 2,000.0 2,000.0 0 2,000.0

Total 2,000.0 2,000.0 2,000.0 0 2,000.0

Recommendation World Bank review report will need to be provided to the Department to support any further decisions on support for the Oil Palm industry projects related to the SADP.



Agency Oil Palm Industry Corporation

Project Name Smallholder Agriculture Development Project

Status Ongoing

Objective To provide extension services for the oil palm industry as well as to assist in the expansion of the smallholder industry. The project is aimed at improving infrastructure which benefits the smallholder and out-growers sector such including road infrastructure and service delivery mechanisms. Components and Scope of Works The major components:

Rehabilitation of the worst sections of the smallholder oil palm road network; Procure road maintenance equipment; and Establish sustainable road maintenance arrangements.

The scope of works in 2014 included:

Oro incomplete roads - 100 kms On-going maintenance on existing roads in Oro and West New Britain. Up-grade of OPIC's IT infrastructure and implementation of a wide area network (WAN).


Upgrade of the IT infrastructure and implementation of a wide area network (WAN) has commenced

while no roads have been supported due to limited funding.



Revised Appro.

Actual Exp


Issues and Constraints

Currently, two bridges in the West New Britain province have been washed away and almost all the smallholder blocks in Oro are inaccessible by road, hence harvested fruits (FFB) cannot be picked up and are left to rot by the road side. FFB production in 2015 to 2017 will be adversely affected if nothing is done within this year.

This is a road infrastructure project. Recommendations DNPM will need to meet with the agency to discuss the implementation before any further support can be provided.



563 NATIONAL AGRICULTURE QUARANTINE AND INSPECTION AUTHORITY (NAQIA)

AGENCY SUMMARY

Mission Statement To provide quarantine services in order to prevent and minimize the risk of entry and spread of pests and diseases whilst allowing free trade between PNG and its trading partners and to ensure the animals and plant materials brought into the country for the development of our agriculture, pastoral and forestry sectors are diseased free. Scope of the Public Investment Programs NAQIA submitted proposals focusing on the both intrusion and the evolution of exotic pests and diseases in PNG that pose a threat to the Agriculture sector. The PIPs are targeted at improving our response to such threats and developing countermeasures. This is crucial in light of increased cross border interactions and the development of the LNG project. The project is Monitoring and Surveillance of Invasive Agricultural Pests and Diseases. This program focuses on identifying possible pests and diseases which have evolved as a result of climate change and others that may have migrated into the country through cross border engagements. Other activities include monitoring of existing exotic pests and diseases. The program was appropriated K2.5 million in 2014. Key Issues Delays in the release of funding from Treasury though Cashflow was submitted in February; NAQIA has used its own sources of funding to undertake critical activities of the project; and PSC needs to be established. 2014 level of funding and expenditure


Revised Budget

GoPNG Appr.

Donor

Total Funding

Monitoring and Surveillance of

Invasive Agricultural Pests and

Diseases.

2,500.0 2,500.0 2,500.0 0.0 2,500.0

Total 2,500.0 2,500.0 2,500.0 0.0 2,500.0

Recommendation This is crucial agency and funding must be continued with the establishment of a project steering committee.



Agency National Agriculture Quarantine and Inspection Authority

Project Name Monitoring and Surveillance of Invasive Agricultural Pests and Diseases

Status Ongoing

Objective

Undertake surveillance, identify, demarcate the new exotic pests, weeds, diseases and other invasive alien species which threaten PNG’s agriculture, forestry, environment, the economy and livelihoods;

Develop an online database information retrieval and risk assessment system that will serve as an early warning system for incursion of exotic plant and animal pests, diseases and weeds; and

Enhance PNG’s opportunities for market access for its agricultural, forestry and marine products on the international market by making available pest and disease status information available to trading partners as stipulated in the WTO rules for removing barriers for trade.


Monitoring and Surveillance of high risk areas done on a quarterly basis. Observe and inspect plant and animal, collect samples for identification and diagnosis and

results reported to stakeholders; Collect primary authenticate pest and disease data of plants and animals and also established

data from the commodity boards through the Development of a Database of Endemic Pest and Diseases.

Development of Internal Control Measures to address incursions of invasive alien/exotic pests, weeds and diseases and Development of Early warning systems for threats from targeted pests and diseases.

Identification of pest and disease status of plants and animals in survey area, draft movement control protocols, Gazettal of Plant and Stock Inspectors with appropriate training provided;and

Identify threats and develop target lists of pests and diseases, Determine pathways and collaborate with Government agencies and Agriculture institutions with the review and updating of Emergency response plans;

Progress & Achievements The focus for 2014 was at the Newcastle Disease in Sandaun and the Bogia Coconut Syndrome; however there is ack of reporting by NAQIA to highlight any achievements. 2014 level of funding and expenditure



Issues & Risks

To protect our agriculture industry, a lot of caution is exercised in awareness exercise so as not to cause panic that can negatively impact our export markets;

PSC needs to be established: and K400,000.0 for the project funds was not released

Recommendations

DNPM will continue the collaborations with the NAQIA to ensure report is provided before any funding can be released.



566 PNG COCOA BOARD

AGENCY SUMMARY

Mission Statement To ensure that PNG exports quality organic cocoa beans to the global market and is ensuring that Cocoa farmers are maximizing from appropriate management practices. Scope of the Public Investment Programs The PNGCB’s focus is on regulating the production chain and ensuring the quality of Cocoa beans produced by the rural farmers is of high value satisfying international demand. Two (2) programs are targeting preserving the premium cocoa quality by monitoring the post harvest and Fermentary processes and addressing the traces of chemicals in the cocoa beans. Cocoa Freight Support and the Nursery Program are targeted at providing rural farmers market access and access to nurseries providing high yielding CPB tolerant clones. The agency received total appropriation of K16.8 million in 2014. Key Issues

Funding for CB has been fully released; Cocoa Board was the only agency able to conduct its own midyear review in June at Vanimo and

PSC Meeting; and Cocoa Board submitted its 2014 report.

2014 Funding: (K’000)


Revised Budget

GoPNG Appr.

Donor

Total Funding

Remote Areas Cocoa Freight Subsidy Scheme

5,800.0 5,800.0 5,800.0 0 5,800.0

Post Harvest& Cocoa Quality Program 2,000.0 2,000.0 2,000.0 0 2,000.0

Cocoa Quality Assurance and Market Promotion

2,000.0 2,000.0 2,000.0 0 2,000.0

Establish Provincial Cocoa Nurseries Project

7,000.0 7,000.0 7,000.0 0 7,000.0

Total 16,800.0 16,800.0 16,800.0 0 16,800.0

Recommendation Cocoa Board performed exceptionally well in 2014 and such agencies must be supported to realise Government aspireation for our rural farmers. A project site visit was undertaken to Vanimo coinciding with the PSC Meeting. Agency needs to be supported adequately.



Agency Cocoa Board

Project Name Remote Area Cocoa Freight Subsidy Program

Status Ongoing

Objective The overall objective of the project is to promote the cocoa activity as the premier and sustainable income earning opportunity for remote farmers. Components and Scope of Works

The major components of the project are:

Identification of ports and airstrips and companies operating this services; Formation of Partnerships with this organisations including subsector operators; Grower groups are established; and Linkages to Micro finance institutions and other banking services.

The scope of works includes:

Signing of MOA for program participation with Districts; Mobilisation of Farmers ; Purchase of Support vehicles and outboard motors; and Roll out of the program itself.

Progress and Achievements The program has been implemented extremely well with high level of participation by interest Districts. Currently a total of ten provinces have signed MOAs with CB and five are fully participating.A total of 34,904 bags have been freighted through the program, totalling 2,269 tonnes earning an estimated farmer net income of K16.2 million. Currently the program is rolled out to ENBP, NIP, Madang, WNBP and Simbu and MOAs have been signed between AROB, Morobe, Oro, Sandaun and Manus. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 5,800.0 5,800.0 5,800.0 5,800.0

Issues and Risks

Simbu Province is also participating through the Karamui District Cocoa Roll out Program. A presentation was provided during the Midterm review; and Any shortfall in funding will adversely affect the program.

Recommendations DNPM needs to undertake site visits especially to Simbu to appreciate the Cocoa projects supported in the Karamui area.



Agency Cocoa Board

Project Name Post Harvest & Cocoa Quality Program

Status Ongoing

Objective The overall objective of the Communal Processing Facility Project is to minimize cocoa quality issues that are currently being experienced with the presence of CPB. Components and Scope of Works The major components of the project are:

Consultations and awareness on the Communal processing facilities; Establishment of communal processing facilities in the worst CBP affected areas; Post Harvest Training Program; and Follow-ups and site inspections

The scope of Works for 2014 includes

Fermentary Inspections and Registration; Communal Drier follow up and monitoring; Regional Office Establishments; Post Harvest Trainings; and Database production

Progress and Achievements The outputs for 2014 are include; the inspection of 8,614 / 13,277 fermentaries, registration of 15,290 / 19,567 fermentaries and 2,070 Dry Bean dealers, distribution of 8/26 Communal driers including one for Rigo for the first time, establishment of Offices for Morobe and Oro Provincial (Oro for the first time) and 24 Trainings in Gulf, Manus and Central in Rigo and Abau. The Database is 50% completed. 2014 level of funding and expenditure


Revised Appro.

Actual Exp


0.0 2,000.0 2,000.0 2,000.0 2,000.0

Issues and Risks Staff capacity is a challenge and hence private sector partnerships are crucial. Recommendations Staff capcity issue must address inorder to expand on this project. DNPM also needs to undertake site visits to capture physical progress reports on this project.



Agency Cocoa Board

Project Name Cocoa Quality Assurance and Market Promotion

Status Ongoing

Objective The objective is two-fold:

Enhance rural livelihoods and contribute to national well-being through the sale of consistently high quality and internationally certified cocoa beans in the value chain; and

To bring PNG Cocoa quality to a standard acceptable by international trade or with high food safety standards.

The project is design to monitor the occurrences of all forms of contaminants for the purpose of assuring cocoa buyers that cocoa products and derivatives from PNG are certified to be within permissible limit set out for all known physical, chemical and biological substances regulated under international trade. Components and Scope of Works

Cocoa Quality Assurance; Awareness to farmers and cocoa stakeholders of the new international market requirement on

certification which is expected to be made compulsory by 2020; Monitor pesticide residues, heavy metal content, smoke taint in relation to poly aromatic hydro-

carbon chemicals as well as other substances harmful human; Maintain our competiveness in the internal markets by maintaining and / or increasing our fine

flavour status from 90 to 100% by reducing and even removing smoke taint. Cocoa Market Promotion Facilitate and participate in the quality promotion shows locally and internationally through

Cocoa of Excellence Competition; Build up and maintain our reputation with overseas buyers by assuring them of the high quality

standard we maintain through trade promotion. Progress & Achievements The project has performed well under capacity pressure. A service provider has been engaged to undertake lab assessment and TOR has been formulation for lab assessments, 80 Exporter Sheds and 46 major ports including 34 minor ports were inspected in AROB, Madang, Morobe, ESP and WSP. 15/34 Dry bean dealers were inspected and most of the Dry bean sheds at intended project sites were close due to CPB so this activity was not undertaken. 7/10 export license were issued and 10 Compliance meetings were held with exporters in Madang, AROB, NIP and Oro. 2014 level of funding and expenditure


Revised Appro. Actual Exp


Issues and Risks The project is critical in maintaining our 90% fine flavour status for PNG cocoa. Recommendations Site visit is recommended to see the actual physical implementation of this project.



Agency Cocoa Board

Project Name Establish Provincial Cocoa Nurseries Project

Status Ongoing

Objective To establish strategic cocoa nurseries and budwood gardens in each cocoa producing proving with the aim to distribute high yielding CPB tolerant planting material to the public. Components and Scope of Works


Establishment of MOA Partnerships with Provinces and Districts for the establishment of the nurseries;

Establishment of actual nurseries; and Appropriate technical training and extension on impacted communities.

The scope in 2014 includes:

Signing of MOAs with Provinces and Districts; Establishment of Nurseries; and Distribution of Planting Material.

Progress and Achievements The activities pertaining to the above scope of works are being implemented with 8/9 MOAs signings with Kokopo, Maprik, Yangoru Sausia, Gazelle, Madang, Middle Ramu, Markham, North Bougainville and AitapeLumi.3/9 central nurseries established in Kokopo, Gazelle and North Bougainville and Aitape and a total of 573,760 CPB tolerant clones distributed seedlings planted in the above mentioned districts. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 7,000.0 7,000.0 7,000.0 963.0

Issues and Risks A presentation was provided during the 2014 Midterm review; and a report was provided to the Department. Recommendations

Site visit is recommended to see the actual physical implementation of this project.



568 LIVESTOCK DEVELOPMENT CORPORATION (LDC)

AGENCY SUMMARY Mission Statement To revitalize and expand the livestock, apiculture and aquaculture industries to improve the welfare and livelihood of rural communities and to contribute to the overall economy of the country. Scope of the Public Investment Programs

The LDC has only one ongoing project which is the Livestock Rehabilitation and Restocking Program. The program is targeted at rehabilitating all government own ranches including farmlands, stockyards, abattoirs and housing compounds.

A total of K8.0 million was appropriated for the program in 2014. Key Issues

Management crisis resulting in the termination of the MD and the entire board; Developing a Strategic Development Paper aligned to the MTDP and the overall Sector Plan that

captures agriculture development auspices to arrive at the desired result of 4 million metric tonnes by 2030;

LDC to collaborate with NARI to provide a small ruminants (sheep & goats) program; and Landownership issue where a substantial DAL land owned by LDC has been signed over to

private developers resulting in court injunctions by LDC. 2014 level of funding and expenditure


Revised Budget

GoPNG Appr.

Donor

Total Funding

Livestock Development Project. 8,000.0 8,000.0 8,000.0 0 8,000.0

Total 8,000.0 8,000.0 8,000.0 0 8,000.0

Recommendation No more funding should be allocated to this project which has received substantial funding over its project duration.



Agency Livestock Industry Corporation

Project Name Livestock Development Project

Status Ongoing

Objective

The project is aimed at rehabilitating and developing the livestock industry in PNG through the

rehabilitation of existing facilities including ranches, piggery and cattle abattoirs; and cattle breeding

including promotion of smallholder livestock production.

Components & Scope of Works The major components of the program are:

Abattoir maintenance and upgrade Cattle production and distribution; Apiculture Development Program; PNG Sustainable Alliance (with Queensland DPI); Proposed Livestock Development Authority; Erap Station Rehabilitation – LDA Office relocation; Public Private Partnerships; and Program Management.

The scope of works for 2014 included:

Restock the rehabilitated government cattle stations in, Segalau, Zurugu and Erap Station. Cattle increased through partnerships and Joint Venture Smallholder Companies, Redevelopment of the smallholder cattle farms; Development of Goat breeding and distribution centres; Rehabilitation and major renovation of abattoirs, ranches and homestead; and Capacity building; and Administration and logistic support.

Progress and Achievements K366,000.0 was release in the first quarter. However there is no report produced by the agency to explain implementation since suspension of previous management. Most of the funding was also used on recurrent activitie. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000.0 8,000.0 8,000.0 8,000.0 366.0

Issues and Risks After the management change PIP funds were used on recurrent bills and hence balance of the funds were not released. Recommendations

It is recommended to note the issue mentioned above and a dialogue needs to be convene between DNPM and LDP to address this issue before any further development funding is allocated towards this agency.



Agency Livestock Industry Corporation

Project Name Livestock Development Project

Status Ongoing

Objective

The project is aimed at rehabilitating and developing the livestock industry in PNG through the

rehabilitation of existing facilities including ranches, piggery and cattle abattoirs; and cattle breeding

including promotion of smallholder livestock production.

Components & Scope of Works The major components of the program are:

• Abattoir maintenance and upgrade • Cattle production and distribution; • Apiculture Development Program; • PNG Sustainable Alliance (with Queensland DPI); • Proposed Livestock Development Authority; • Erap Station Rehabilitation – LDA Office relocation; • Public Private Partnerships; and • Program Management.

The scope of works for 2014 included:

• Restock the rehabilitated government cattle stations in, Segalau, Zurugu and Erap Station. • Cattle increased through partnerships and Joint Venture Smallholder Companies, • Redevelopment of the smallholder cattle farms; • Development of Goat breeding and distribution centres; • Rehabilitation and major renovation of abattoirs, ranches and homestead; and • Capacity building; and Administration and logistic support.

Progress and Achievements K366, 000.0 was release in the first quarter. However there is no report produced by the agency to explain implementation since suspension of previous management. Most of the funding was also used on recurrent activitie. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000.0 8,000.0 8,000.0 8,000.0 366.0

Issues and Risks After the management change PIP funds were used on recurrent bills and hence balance of the funds were not released. Recommendations

It is recommended to note the issue mentioned above and a dialogue needs to be convene between DNPM and LDP to address this issue before any further development funding is allocated towards this agency.



INFRASTRUCTURE SECTOR



Description No of PIPs

2014

Approriations (K’millions)

Code INFRASTRUCTURE SECTOR AGENCIES

258 Department of Communication & Information

2 6,500

259 Department of Transport

2 6,000

264 Department of Works

54 930,600

523 PNG Accidence Investigation Commission

1 0.6

524 Independent Public Business Corporation

5 335,000

526 National Maritime Safety Authority

1 3,000

537 National Aiports Corporation

5 68,750,

538 PNG Air Services Limited

1 9,300

546 PNG Power Limited

2 22,000

TOTAL 38

1,381,750



I. SECTOR SUMMARY Infrastructure development is mostly engaged and implemented through Transport and Utilities Sector. With the 2014 national budget, more emphasis was put on infrastructure sector to yield positive results for the years to come. Immediate intervention had been focused on road, sea and air infrastructure development. High impact road projects in Port Moresby and Lae have been of high priority. Electricity and ICT infrastructure are also major impact projects funded in 2014.

II. 2014 SECTOR APPROPRIATION

(a) GoPNG Direct Financing

The 2014 Total Budget Appropriation was K15.0 billion (both capital & operational expenditures) that

reflects the Government’s ongoing and new commitments based on the 7 key enablers focused on key

investments on sustainable growth for the country. Out from the K15.0 billion budget, Transport &

Utility (ies) Infrastructure was initially appropriated a total budget of K1,672,000,000 in which

Transport sector was allocated K1,615,500,000 whilst Utility sector was allocated K 56,500,000.0. With

the revised budget, the land transport was appropriated K930, 600,000.0, Aviation and Maritime Sector

was K 354,653,000 and Utilities Sector had K93, 500,000.

The total infrastructure revised budget appropriation in 2014 was K1, 381,750,000.0. Against the total

revised budget appropriation, the aggregate expenture for the sector was K1, 365,841,802.71. This is

about 99% of the total revised infrastructure budget appropriation.

(a) External Financing (Donor Support)

In the 2014 Development Budget the State source

Development Finance through Loans and Grants,

Infrastructure Sector funding through Loans was K 351,

019577 million + Grants (K198, 419,799) million = Total

549,439,356 million.

Grants funding for 2014 under infrastructure illustrates NZ

Aid and AusAid the main grant funding nation. China, World

Bank and ADB are the major donor partners through loans

as shown in Figures 13.0 and 14.0.

Specific analysis will be made on the Land Transport,

Aviation and Maritime and Utilities Infrastructures.

III. ANALYSIS OF THE 2014 SUB-SECTOR

APPROPRIATION

(a) Land Transport

The Department of Works development budget was utilised for improving 4,844km roads and 109

cross drainage structures comprising 69 bridges and 40 culverts. Under the DFAT Australian AID

Transport Sector Support Programme (TSSP) and phase II of World Bank Road Maintenance and

Rehabilitation, 1, 721 km and 140 km of roads were also maintained respectively.

In the 2014 development budget appropriation the priority roads reconstruction, upgrading and

rehabilitation maintenance is 34.5%, 19% for the development of city town roads, other roads is

14.35% and missing link is about 2.75% of the total budget. The bridges construction, rehabilitation

and maintenance is about 6.3%. The donors’ component in the budget is 20.13 % and the remaining

balances are for design and survey and other projects (2.97%).

7%

84%

9% WorldBank

ADB

Figure 13.0 External Funding by Loans

94%

6%

Figure 14.0 External Funding by Grants

AusAid

NZ Aid



The graph below shows the distribution of the K1, 199,600 000 (original appropriations) in accordance

with the DOW’s work plans and budget.

(b) Aviation & Maritime Total revised budget appropriation for Aviation and Maritime Sector was K 354,653,000. Independent Business Investment Corporation (IPBC) had the largest potion of 77% totalling K270, ooo, ooo allocated for completion of the Lae Port Tidal Basin Project. The CADIP and Jackson’s International Airport Upgrade under National Airport Corporation (NAC)

received its full apropriated funding for 2014

respectively accumulating to 19% of the Sector

budget. These two programs cover high impact

priority projects.

PNG Air Servies Limited (PNG ASL) from its

appropriation of K14.3 million, was revised to K9.3

million, however, K3.3 million was released.

National Maritime Safety Authority (NMSA) was

allocated K3 million for the year. Figure 16.0 shows

the break up of 2014 revised appropriation.

(c) Utilities

Total revised appropriation for Utilities sector is K93, 500, 000. Expenditure appropriation issued for

the year is K 85,382,316 which indicates 9 % of unissued warrant for the year for this sector.

The Utilities Sector in the 2014 development budget captures the following Agencies and their respective Programs/projects for implementation:

1. Independent Public Business Company (IPBC) Lae Tidal Basin & Wharf Extension Port Moresby Sewerage Project National Broadband Network

2. PNG Power Limited (PPL) PNG Towns Electrification Investment Program (TEIP) Port Moresby Town Grid

3. Department of Information & Communication (DIC); Government Information System (IGIS) Rural Telecommunication.

BridgesMissing

LinkOtherRoad

Priorityroad

Cityroads

Donors

SpecialProjects/Design

& Survey

Wharf

Approriation 103,000, 45,000,0 259,000, 561,349, 310,000, 304,040, 37,876,0 14,000,0

Warrant 78,933,3 50,000,0 93,492,4 434,400, 245,000, 56,166,6 15,717,3 14,000,0

Expenditure 71,862,0 13,920,0 147,373, 459,784, 284,363, 56,097,7 22,907,5 14,000,0

0.00

100,000,000.00

200,000,000.00

300,000,000.00

400,000,000.00

500,000,000.00

600,000,000.00

Ap

pro

pri

atio

ns

(K'M

illio

n)

Fig. 15.0 Expenditure Report for the Land Transport Projects

IPBC 77%

NAC 19%

PNG ASL 3%

NMSA 1%

Figure 16.0 2014 Revised Appropriation



IPBC appropriation accounts to 69%, PNG Power Limited (PPL) 24% and Department of

Communication & Information (DCI) 7 % repectively.

Apart from the funding allocated for 2014, there are concerned number of projects under utilities

backdating to 2012 and 2013 which the recipient agencies are not able to report on yet.

Figure 17 below, specifies the revised funding share as allocated by year per agency.

IV. 2014 WARRANT & EXPENDITURE ANALYSIS

In 2014 about 95% of the total warrants were released to infrastructure sector for PIP projects against

the revised Budget. Actual expenditure was a slight increased of 0.02 % increased from the warrant

issued.

Table 6.0 Warrants and Expenditure Reports

Agency Original Budget Revised Budget Cashflow YTD Warrants YTD Actual Spend

DCI 6,5000,000 6,5000,000 6,5000,000 6,5000,000 5,5000,000

DOW 1,199,600,00 930,600,000 1,064,362,332 861,456,454 935,409,487

PNG AIC 600,000 600,000 600,000 600,000 6,000,000

IPBC 345,000,000 335,000,000 335,000,000 335,000,000 335,000,000

NMSA 0 3,000,000 3,000,000 3,000,000 3,000,000

NAC 76,000,000 68,750,000 72,650,000 68,750,000 68,750,000

PNG ASL

14,300,000 9,300,000 3,300,000 3,300,000 3,300,000

PPL 30,000,000 22,000,000 22,000,000 22,000,000 14,882,316

1,672,000,000 1,375,750,000 1,507,412,332 1,300,606,454 1,366,441,803


Excessive funding was released in the first & second quarter for the High Impact Projects. From the

review reports obtained almost 90% of the 2014 new projects have been procured and are pending

approval due to CSTB process. In general all ongoing projects are performing at a satisfactory rate

whilst others are slowly picking up with implementation due to delays in procurement.

VI. ISSUES AND CHALLENGES

The most common issue delaying the project implementation is the procurement process especially in

awarding of contracts. CSTB procurement process is quite lengthy and time consuming as a result

69%

7%

24%

Figure 17.0 Utilities Revised Appropriation Distribution

IPBC

DCI

PPL



actual implementation for most projects commenced towards the end of 2014 fiscal year. These are for

projects funded in 2014. Another common issue would be on the contractor’s capacity to implement. A

Hand full of the minor contractors / sub-contractor is in experience and does not have the qualified

expertise qualified to take on the job.

Generally, projects that are not performing are highly due to these factors: Substandard, poor quality

work; Lack of co-operation; Provision of poor quality, or out dated information; Supply and installation

of poor quality, un-specified, and un-approve equipment; Substandard supervision; Poor performance

from contractors, semi or unskilled.

VII. RECOMMENDATION

Due to inability of many agencies to meet for intime PIP funded reports, Projects Steering

Committee (PSC) involvement by Senior Officers and DNMP management is critical. PSC needs to be established within each agency implementing PIP for infrastructure.

A critical Monitoring and Evaluation Program is needed to endure, audit, investigate and

account for outstanding 2011, 2012, 2013 and 2014 PIP reports.

Insufficient or Lack of Go PNG counterpart funding has been a hinderance to timely infrastructure development that needs to be addressed.

Capacity issue of implementing agency or contractors needs to be assessed carefully before funding is released for implementation.



264 DEAPARTMENT OF WORKS

AGENCY SUMMARY Mission Statement

To provide and maintain an adequate and safe priority road network in an accountable, transparent

and environmentally sustainable manner in consultation with stakeholders to facilitate national

development and embrace the standard of living as embodied in the Constitution of PNG.

To access the road network through professional approach in delivering the service to benefit the

people of Papua New Guinea in partnership with the stakeholders and the community.

Scope of the Public Investment Programs:

A total of 54 projects are included in the 2014 Development Budget for Department of Works. These

projects can be summarized according to the programs below;

1. National roads and bridges program 2. Provincial roads and bridges program 3. City roads – Port Moresby and Lae 4. Provincial town roads 5. Emergency funds (revised appropriation)

The above programs have been funded through Government and international development assistance

through loans and grants. Key development assistance projects are the following;

1. ADB Loan programs for roads in the Highlands Region 2. ADB Loan program for bridges 3. World Bank Loan for national road maintenance 4. AusAID grant through Transport Sector Support 5. World Bank Disaster and Climate Resilient Transport Sector 6. JICA PTD Workshops Rehabilitation

Key Issues

1. Tedious procurement process in awarding of contracts by NEC and CSTB has resulted in the delay in awarding of DOW road contracts thus the delay or no implementation of road projects. The result is the massive unused Government funds.

2. The capacity of road contractors to fully implement the road projects is a major challenge as the road contractor industry in PNG is small. There is shortage of plant and equipment and appropriate technology to fully sustain road works.

3. Cost variation and cost escalation to the original tendered amount has also put strain on the available Government funding appropriations.

4. There is no proper monitoring and evaluation of road projects hence the reporting mechanisms are poor. This is a huge challenge for road maintenance planning and sustainability.

5. The LNG project has resulted in the increase in cost for road construction.



2014 Level of Funding Project Original

Budget

Revised

Budget

World Bank Road Maintenance Project (Six Provinces) 5,000,000 5,000,000

Transport Sector Support Program 10,000,000 10,000,000

Highlands Region Roads Improvement Investment Programme 50,000,000 50,000,000

Buluminsky Highway 10,000,000 10,000,000

ADB 5 Highlands Provinces Roads Maintenance- Supp Loan 25,000,000 25,000,000

21412000 - ADB Bridge Replacement & Improve Rural Access Project 20,000,000 20,000,000

Rehabilitation of PTD Workshops -Tools & Equipment 10,000,000 5,000,000

Rehabilitation of Koroba Kopiago Highway 10,000,000 10,000,000

Highlands HighWay 150,000,000 143,000,000

POM City Roads 170,000,000 170,000,000

Lae City Roads 100,000,000 100,000,000

Minjung Bridge 8,000,000 5,500,000

Kulupuga Road 5,600,000 5,600,000

Bubuleta to Agaun 5,000,000 1,500,000

Wasa Bridge 35,000,000 15,600,000

East-New Britain Highway 15,000,000 15,000,000

Alotau - East Road 5,000,000 2,500,000

Highlands Region Roads Improvement Investment Program -II 22,000,000 22,000,000

National Bridges Rehabilitation & Reconstruction 50,000,000 50,000,000

National Roads Rehabilitation & Maintenance 100,000,000 94,000,000

2013 Joint Understanding: Design & Scope for Madang - Ramu 15,000,000 12,000,000

Talasea Ring Road 5,000,000 0

Missing Links ( Baiyer-Madang) 10,000,000 0

Wapanamanda Road 10,000,000 0

AITAPE DISTRICT WHARF RECONSTRUCTION 14,000,000 14,000,000

Pangu Laigam (Stage3) 30,000,000 0

Waseta Kendaka Road 5,000,000 0

KIKORI - GULF 10,000,000 500,000

Kupiano Town Road Sealing 5,000,000 0

Bena to Ramu Road 10,000,000 0

Kirriwinna Ring Road 6,000,000 0

Telefomin Road 10,000,000 10,000,000

Nipa Kutubu Road 10,000,000 10,000,000



Hiri Lai Road 10,000,000 9,000,000

Finschafen Road Work 10,000,000 10,000,000

Nawae Road 5,000,000 0

Kimil - Tabibuga Road 10,000,000 0

Rouna - Sirinumu Road 30,000,000 20,000,000

Lumusa - Baiyer Road 10,000,000 10,000,000

Mt Hagen City Roads 40,000,000 0

Sepik Highway - Wewak to Vanimo 15,000,000 15,000,000

Gulf - Southern Highlands 10,000,000 0

Fisika (Missing Link) 10,000,000 10,000,000

Kandrian - Kimbe (Missing Link) 10,000,000 0

Esa'ala Road 6,000,000 2,000,000

Kisenapoi - Kagua 15,000,000 12,000,000

Karamui Bridge 10,000,000 8,000,000

Goilala - Mona Road 5,000,000 0

Northern Highway (Pongani - Afore) 10,000,000 1,000,000

ADB Roads Shortfall (6 Roads) 26,000,000 24,000,000

Kompiam Road 5,000,000 0

Tokua Airport to Kokopo Town 4 Lane Road Design 5,000,000 2,000,000

Mendi - Mongol - Tambul Road 2,000,000 1,400,000

Porgera - Tari Road Construction ( Porgera MoA) 10,000,000 0

Total for Dept of Works 1,199,600,000 930,600,000

Recommendation The Department of Works do encounters a number of problems and challenges in carrying its mandate of implementating road, bridges and maintenance works. These challenges includes, Landowners relates issues, Capacity of local contractors, and DOW’s capacity to implement. Serious reviews are needed to contempelate on these issues.



DONOR FUNDED PROJECTS

Agency Name Department of Works

Project Name World Bank RMRP II

Status Ongoing, commenced in 2011

Objective

To assist the GoPNG in promoting an efficient, safe and reliable road transport system in the

participating provinces through: (i) the improvement of selected road segment, (ii) Strengthening

strategic planning and management of the road sector and (iii) strengthening the institutional

arrangements for road maintenance, including the private sector participation.


The Second phase of the World Bank financed Road Maintenance and rehabilitation Project has two

major components:

1. Upgrading and/or maintenance of roads and bridges; three major contracts on Hiritano Highway; and

2. Technical assistance for project management, design, supervision and capacity development.

2014 Progress & Achievements

Project Description Current Status

Upgrade to seal Hiritano Highway between

Inawabui and Bereina in Central Province

(17km)

Contract Started 3 June 2013. 100 % completed by

November 2014 under DLP

Upgrade to seal Hiritano Highway between

Malalaua and Epo in Gulf Province (56km)

Contract commenced on 28 August 2013. Completion date

27 February 2014, with work actually completed on 21

January 2014

Routine maintenance of Hiritano Highway on

the gravel section between Malalaua and

Kerema in Gulf Province (67km)

Contract commenced on 28 August 2013. Completion date

27 February 2014, with work actually completed on 21

January 2014

Total: 140 km



Revised Appro.

Actual Exp

Funding Level (GoPNG) 0.0 5,000,000 5,000,000 5,000,000 5,000,000

Donor Assistance 22,900,000

Issues and Risks

Procurement delays due to the CSTB process. Lack of qualified bridge specialist contractors and DOW engineers to fully implement bridge

programs. Procurement delays were a major obstacle to fully implement phase 1 and 2 of the program.

Recommendation GoPNG to be committed in honouring its loan counterpart funding and release funding on time to

allow drawdown on loan component




Project Name Transport Sector Support Program (TSSP)


Objective

The PNG transport Support Program (TSSP) is a long term (15-20 years) committed by the Australian

Government through AusAid to support GoPNG achieve a well maintained transport infrastructure

network under the oversight and strategic direction of GoPNG. The objective is to upgrade and

maintain the existing roads. The implementation work required is routine, periodic and specific

maintenance.


Supervision & project management of the projects Procurement & construction Specific & Routine road Maintenance Upgrading to sealing Vegetation control/minor works

TSSP has been implemented in 11 Provinces (Milne Bay, Central, Morobe, WNB, ENB, New Ireland,

Madang, East Sepik, West Sepik, Eastern Highlands ABG and Oro.


Works are currently ongoing in all provinces on the work plan projection and scope of maintaining

1,721km of roads. Of that, 106km is for rehabilitation and roads improvements and 1,260 km for

maintenance.

Province Activities/Status

Milne Bay The planned activities of rehabilitation and maintenance covered 56 km on the East Cape road and the Magi Highway. Total of 99 km for 2014 for maintenance. To date the actual km maintained to good condition is 75.9 km

Central Magi Highway, Hiritano Highway

( 4 x minor works contract) 2 x awaiting CSTB to forward conformed contract and 2 x Bid close awaiting CSTB approval

Morobe Wau/Bulolo Minor contracts

3 x minor works contract for repairing potholes, Drainage works, road widening. 1 x contract approval on the Ramu Highway, 1x contract in along Wau has been retendered and 1 x going through pre tender committee for contract to be awarded

Work carried out on Ramu Highway (31km) and 5.5km of Wau highway has been upgraded.

West New

Britain NB Highway

3 x minor works contracts – 2 x work in progress satisfactorily and 1 x awaiting CSTB approval

East New

Britain Activities concentrated within 35.4 km of the New Britain Highway. Rehabilitation of 14.8 km have commenced on September 2014.

12 x minor works contract approved, 11 completed , 1 x second cycle and 2 x new contracts to be approved

New Ireland The Buluminski Highway and West coast were covered by TSSP of which 119 km out of 344km of the Buluminsky highway comes under the National Roads authority.

5 x minor works contracts have s 32 approval completed, 3 completed, 2 in progress with 1 being preferred for tender.



Madang Works in Madang were concentrated on the Coastal Highway and Ramu highways covering aprox. 450 km of which 18.9 km were rehabilitated. 1 x contract along Ramu Highway work in progress and is 90% completed. Work done is generally minor works, and 1 x contract to be tendered. Coastal Highway : 2 x minor work contract are in working progress

East Sepik 140.2 km long maintenance plan for 2014.

All minor and major works contract are delayed due to contractors capacity West Sepik 6.5 km of Sepik Highway is on rehabilitation and another 14.7 km is on maintenance.

2 x contracts along Coastal Sepik Highway are in working progress at 36% physical work completed and 1 x contract along Sepik Highway awaiting CSTB approval

Eastern

Highlands

Works in EHP covers 185.5 km of the highlands highway. Various specific maintenance was

carried out concentrating on slip repairs and culvert construction at specific locations of the

highlands highway.

42 work orders issues, 14 have been completed, 28 are outstanding, Work done are generally, road widening, clearing slips, line drains and pothole repairs. Covec is undertaking slip works and while Loma contractors doing the minor works. Progress to date is 40% completed.



Revised Appro.

Actual Exp


Donor Assistance 0.0 79,400,000

Issues and Risks

Procurement delay Contractor capacity to implement minor day works contract

Recommendation

It is recommended that DoW supervise all the contracts undertaken by contractors to ensure standards

and specifications are met.




Project Name ADB HRRIIP II


Objective

The Project is a Multi Financing Facility for the Highlands Roads Network to be implemented consistent

to the current National Transport Strategy. There is a need to translate initiatives in the NTS into

workable systems by (i) strengthening NRA's capacity to plan and manage road maintenance works,

(ii) seek more financing for the road fund by rationalizing road user charges, and (iii) awarding long-

term performance-based road maintenance contracts. The MFF will help to enable implementation of

the NTS and to ensure a sustainable road system in the Highlands region.


The overall scope of the program includes upgrading and improving of 1,400 km of highlands core road

network and transferring to NRA for long term performance-based maintenance.


Road Physical Completion Financial Completion

Medi-Kandep (50km) 84% 80%

Laiagam-Pogera (60km) 83% 78%

Major improvement works are underway on these two roads totalling 100km under the first Tranche

of ADB’s HRRIIP



Revised Appro.

Actual Exp

Funding Level (GoPNG) 30,000,000 50,000,000 50,000,000 50,000,000 0.0

Donor Assistance(ADB)

30,000,000 79,400,000

Issues and Risks

Delays in obtaining NEC approval for contracts over K10 million. Land compensation demands. Cost escalation due to delay of counterpart funding and foreign exchange fluctuations. Government to honour counterpart funding obligations.

Recommendation

It is recommended that all these projects under this loan program is on schedule and are completed on

time to avoid delay and cost escalations. Site visit must be under taken to verify the work done so far.




Project Name ADB Bridge Replacement for Improved Rural Access Sector


Objective

To replace the single lane deteriorated Bailey bridges along the 16 main highways with permanent concrete/composite bridges and construct new bridges along the provincial and district road network using the removed bridges, ultimately to improve market access for the rural population


Bridge replacement 27Baily Bridges with two lane permanent structures and Improving rural access

i) Civil Works ii) Consulting services for design and supervision iii) Resettlement Capacity development of DOW’s BAMS Road safety awareness in rural areas Project administration

Highway Name Province Bridge Name (length M) Ramu Madang 1.Gusap (40)

2. Bora (40) 3. Dry Wara (40) 4. Miya (134)

5.Wasigo (40) 6. Tapo Ford(40)

Magi Central 1.Dogona10 2. Sivitatana22 3. Kokebagu16 Hiritano Central 1. Laloki, 75 2. Brown75 3.

Angabanga,140 Sepik East Sepik 1. Pasik30 2.Ogama30 3. Potohu20 New Britain West New Britain 1.Ulamona6

2. Ibana40 3. Pika40 4. Korori30

5. Soi24 6. Koloi 40 7. Lobu30 8. Kiava24

9. Aleeu9 10. Otutabu36 11. Marapu6

12. Ubai16 Total 1,000


To date six bridges on Magi and Hiritano Highways in the Central province have been awarded to China Habour Engineering in December 2014. Another 12 bridges on New Britain Highway in West New Britain have also been tendered as package 2 and awarded to Wildcat Construction in December 2014. Overall, eighteen (18) of the 27 bridges along five priority corridors has been tendered.



Revised Appro.

Actual Exp


3,000,000 20,000,000 20,000,000 20,000,000 0.0

Donor Assistance (ADB)

0.0 47,200,000



Issues and Risks

Delay in awarding of contracts Land owners compensation – this is the real issue faced currently and requires Government

Stakeholders collective input in providing assistance towards addressing this matter, Lack of funding for the Land Compensation claims to DoW.Provincial Administrator and ward

councillors involvement in taking leader ship in addressing the land owner compensation issues,

Lack of awareness to the local communities informing them of the project in order to avoid unnecessary local issues,and

Recommendation

GoPNG to be committed in honouring it’s loan counterpart funding and release funding on time to allow

drawdown on loan component.




Project Name Rehabilitation of PTD –Tools & Equipment

Status Ongoing

Objective

To provide an effective maintenance and monitoring system of construction Plant and Machinery and

enable rapid yet economical mobilization of machinery to work sites. Further to facilitate and enable

rapid yet economical mobilization of machinery to road and bridges construction sites; hence the

implementation of the national governments Capital Works &maintenance.


1. Freight Charges for shipping machinery equipment’s to the four sites 2. Logistic cost 3. The types and quantity of the Necessary Equipment are:

Bulldozer x 4 Excavator x 4 Motor Grader x 8 Wheel Loader x 4 Vibration Roller x 4 Water Tanker x 4 Dump Truck x 16 Mobile workshop x4 Spare Parts full set

4. Mobilising 48 construction fleet in Provinces 5. Training/Capacity building 6. New road construction and road maintenance

Scope of Work in 2014:

1. Disposal of the machinery equipments at the four pilot sites Kimbe - New Guniea Irelands Lae – Momase Region HT- Hagen – Highlands Region Central – southern Region

2. Revitalizing of the Plant A& B class machines. 3. Undertaking Pilot road construction under PTB fleet.


Arrival of the 48 Construction fleet from JICA Plant and Transport Division officially received the 48 construction fleet from JICA early

2014. Official delivery of the 48 Construction Fleet on 12th March, 2014 in Lae, Morobe Province

by JICA to PNG. Procurement and logistic arrangement completed and delivered by JICA . Completed launching of Twelve (12) construction fleet to each of the 4 pilot provinces. 08th July, 2014 Officially launched Situm-Bukauwa Road for construction under PTD fleet,

17th September, 2014 launching of the Kiru Road for construction under the PTD fleet.





Revised Appro.

Actual Exp

Funding Level (GoPNG) 0.0 10,000,000 10,000,000 10,000,000 9,268,816.0

Donor Assistance (JICA) 0.0 22,500,000

Issues and Risks

More operators to be trained to operate the construction fleet.

Recommendation

PTD construction fleet is used to take on the maintenance of the national road network and construct new roads linking the National Highways.

A lot of capacity issues faced currently by DoW will be solved if the PTD is revitalised. This will help save cost in hiring of construction fleet from other sub-contractors.

Funding is consistent to this program to revitalise the PTD to take on road maintenance and improve road conditions.



HIGH IMPACT ROADS

Agency Name National Capital District

Project Name POM City Roads

Status Ongoing

Objective

The objective is to construct alternative roads to provide reliable transport system through the

provision of good road linking major suburbs in NCD and provide alternative routes to cater for the

current city expansion plans.


Design and construction Road sections as per NEC Decision No: 123/2013

No: Road Section Specification/ length Amount

1 Gerehu- Hanuabada (Poreporena

Highway) Design – 4 lane road 14.4 km

196,001,077.0

2 Gerehu – 9 mile Arterial Road Design – 4 lane road 8.7 km 122,081,012.0

3 Gordons Industrial Roads Design – 2 lane 3.74 km 85,705,400.0

4 Hubert Murray Highway (Erima – 9 Mile) DC – 4 lane 2.2 km inc 8 Mile Bridge

77,842,881.0

5 Kookaburra Fly over DC – 2.5 km 4/6 lane, 600m fly over

160,368,474.0

6 MoreaTobo Roads (6 Mile – 7 mile) Dc – 1.2 km 4 lane , 4.7 km 2 lane 63,341,164.0

Total Contract value 757,992,403.0


Item Description Activity Status

1 Gordon Industrial Road Construct 2 Lane Road,

Asphalt Sealing , Street light

and Pipe drainage

60% completed

2 Construction of Gerehu – 9 Mile

Road and Gerehu to Poreporena

Highway

Construct 4 lane road, asphalt

sealing, street light and Pipe

Drainage

10% completed

3 Design & Construction of

Kookaburra Road and the Fly

over at the Erima Junction

D & C 4 lane Road , Asphalt

sealing , street lighting and

Pipe drainage and the fly over

at the Erima Junction

40% completed

4 Design & Construction of Hubert

Murray Highway ( Erima to 9

Mile)

Design and construct 4 lane

road, Asphalt , sealing , street

light and piped drainage

4 lane Bridge redesign and

construction

50% completed

5 Design & Construction of

MoreaTobo and associated roads

D & C 4 lane Road, Asphalt

sealing , street and piped

40% completed



from 6 mile to 7 mile. drainage

6 Gerehu – Hanuabada (back road) D & C 4 lane Road, Asphalt

sealing, street light and Piped

drainage, look out points and

sea wall.etc

10% completed



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 170,000,000 170,000,000 170,000,000 170,000,000

Issues and Risks

Trust Account for POM Roads held by Department of Finance – NCDC wants funds to be transferred directly to the projects Trust Account.

Delay on Loan negotiations and effectiveness to secure Loan funding from Chinese Exim bank for 2 road sections to be implemented in 2014.

Recommendation

It is recommended for the remaining balance of K25.0 million from the 2014 appropriation be released for smooth flow of road construction.

Fast track negotiations from the Exim bank loan for the two major roads under construction



Agency Name DoW

Project Name LAE City Roads

Status Ongoing

Objective (s)

To Rehabilitate and upgrade selected road sections and improving on existing road pavement and construction of reinforced concrete pavement / sealing with 40 mm asphalt, together with associated drainage, road kerbs and footpath.

To upgrade the deteriorating Lae City Roads.

Scope and Component

Component incudes:

• Improve on Premature Failures on concrete design • Construction (upgrading town roads to concrete pavement)

Scope of Works:

• Improvement of the existing road pavement & construction of reinforced pavement , associated drainage, road Kerbs and footpaths under ongoing commitments (stage2),

• Pavement recycling, stabilizing and asphak surfacing drainage, road kerbs, and footpaths under stage 3,

• Improvement of existing road pavement and construction of 40 Mpa reinforced concrete pavement with associated drainage , road kerbs and footpaths under stage 3,

• Repair and maintenance of poorly designed & constructed concrete road pavements stages 1 & 2.


Appropriate design and technical specification being finalized since 2013 Structural repairs in progress for stage 3 Majority of the contracts valued at K96.8 million are completed, whilst Bumbu Road is expected

to be completed before the end 2014. Six (6) additional contracts under stage 3 totalling K268.5 million has been tendered and

awarded in January 2014 and progressing on track. The total length of the awarded contracts is 26.74km.

Work is progressing satisfactory for all projects under stage 3

Status of Stage: 2 Contracts for 2013 Road Section Length(k

m)

Start Completion Progress Contract

Value(K)

Bumbu Road (Stage2) 1.4 Jan-12 Dec-13 Completed 17,216,401.0

Bus Stops (Stage2) 1.3 Jan-12 Dec-13 Completed 9,832,713.0

Sandpiper Road (Stage2) 1.6 Jan-12 Dec-13 Completed 11,758,916.0

Coronation Drive (Stage 2) 1.5 Jan-12 Aug-12 Completed 18,117,123.0

Markham Road (Stage2) 2.2 Jan-12 Dec-13 Completed 16,250,228.0

Total 8 73,175,381.0



Status of Stage: 3 Contracts for 2014

Road Section Length Start Completion Progress Contract Value(K)

Kwila Road (stage3) 3.7 Sep-13 July-14 100% 9,821,861.0

Aircorps (Stage 3) 3.8 May-14 Nov-14 100% 31,566,989.0

Butibam, Milford Haven (stg 3)

2.1 Jan-14 Oct-14 100% 24,512,582.0

Mongola, Malaita, Jawani, Boundary, &Baimo Rd

6.55 Jan-14 Mar-15 88% in progress 73,770,589.0

Telikom, Igam, Orion &Rigel Rd

5.71 Jan-14 Jul -15 89% on track 67,260,743.0

Busu Road 4.88 Jan-14 May-15 59% on track 61,624,084.0

Total 26.74 268,556,848.0




Issues and Risks

Poor scoping, design and documentation, and over-commitment by previous management consultant under stage 2 of the Project.

Actual appropriation of the Project was K50 million under Stage 2 of the Project but commitments on contracts and variations with unusually high rates has increased the value of the works by more than 100% causing severe cash flow problems and delay in the completion of the works.

Poor management by contractors. Although advance payments have been made, some contractors have not started work and delayed the overall progress of the Project.

No design and technical specifications, or quality control and traffic management plans were incorporated into all the contract documentation in Stage 2 by previous contractor which Dow was not consulted. DOW managed to correct that.

Funding not released on time due to central agencies faced with cash flow problems.

Recommendation

It is recommended that:

The balance of the funding for 2014 is released on to avoid unnecessary delays that may incur cost variations by the contractor.

DoW continues to seal the remaining town road sections with concrete base pavement.



Agency Name DoW

Project Name Gulf – Southern Highland Highway

Status Ongoing

Objective

To develop feasibility and geotechnical studies for the Highlands Highway and Gulf-SHP Highway.


Road new - construction Geotechnical survey and design Design and procurement on the following road section:

Angura to Kiburu Mendi to Koroba Lialibu to Erave - Simberi Kagua to Simberi

The scope includes

Geotechnical survey and design Design and procurement Mobilisation & construction


Geotechnical survey and design - Angura to Kiburu at documentation stage completed. Geological assessment for Ialibu – Erave – Simberi section completed. Procurement for design – Kisenapoi to Angura approved. K5.0 million was paid to the

contractor for mobilisation. Contractor mobilised and Works completed at a cost of K5.0 million.



Revised Appro.

Actual Exp

Funding Level

(GoPNG) 0.0 10,000,000 10,000,000 10,000,000 0.0

Issues and Risks

Delay in geotechnical studies, scoping, design in 2013 that delayed the actual construction.

Recommendation

It is recommended that all design works must be completed by 2014 and construction must commence

on the first section of the road that links the Gulf and Southern Highlands Province.



NATIONAL HIGHWAY

Agency Name DoW

Project Name Magi Highway

Status Ongoing

Objective

To maintain and upgrade road condition to good condition between Gabone and Hula and resealing

works between 6 mile and Gereka turnoff.


Routine maintenance Specific maintenance Roadside maintenance


Upgrading works between Gabone and Hula, 36km along under procurement stage for K5 million. 6.2km resealing works between 6 mile and Gereka turnoff is 100% complete



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000.0

Issues and Risks

Contractors slow performance. Lack of proper supervision.

Recommendation

It is recommended that a monitoring visit must be undertaken to the various road sections that funding

was expended on to carry out road works. As some road sections along the Magi Highway is still in bad

condition.




Project Name Highlands Highway

Status Ongoing

Objective

To fully rehabilitate and restore the Highlands Highway to good condition and especially on critical

road sections.

Components & Scope of Works:

Nebilyer to Puo Bridge – Western Highlands – (6.5 km) - Insitu pavement recycling, stabilizing and bituminous surfacing

Pup Bridge to Kagul Bridge – Western Highlands (11km) - Insitu pavement recycling, stabilizing and bituminous surfacing

Poroma to Werin – Southern Highlands (10km) - Upgrading and bituminous surfacing

Werin to Semin Primary School – Southern Highlands (10km) - Upgrading and bituminous surfacing

These involves Major repair and reconstruction works.


Road Activity/Status

Poroma –Werin

(10km)

Contract awarded in Sept 2014, construction progressing:20% physical & 30%

financial

Werin-Semin APC issued on 17 June 2014 – Contract awarded, construction

progressing;30% physical & 40% financial

Nebilya – Pup Construction progressing; 65% physical & 75% financial

Pup – Kagul Contract award to Lorma, work in progress; 10% financial & 20% financial



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 150,000,000 150,000,000 150,000,000 139,690,003

Issues and Risks

1. Delay in awarding of contract over K10.0 million by NEC. 2. Lack of proper reporting and monitoring. 3. Land owners demanding compensation on the emergency slips

Recommendation

An independent evaluation needs to be carried out on this program against the funds appropriated in the recent years under the Development budget.

Monitoring visit must be undertaken on the sections along the highlands Highway funded under the Highlands Highway Maintenance Program.




Project Name East/West New Britain Highway

Status Ongoing

Objective

Main objective is to construct the New Britain Highway from Gaulim to Powel Habour Open Bay,

connecting to the East New Britain Highway. This will intend connect the two Missing Links.


New construction works:

Survey/Design/Scoping and Documentation Tendering and Evaluation of Tender Bids Awarding of the Contract Establishment/Mobilization

The scope includes

Procurement and tendering Major earth Works (Clearing and grabbing ) Widening the track road approaching from West New side and as well as New Britain side

towards the Missing Link. Total length 101.6km (64.8km – new construction) and (36.8km – minor works)


New construction of 4 sections of East/West New Britain link totalling 54.8 km and total value of

contracts is about K25 million. Another 10 km section of Bew Britain Highway is to bherecontructed

using PTD with a contract value of K7 million. Two minor works, totalling 36.8 km in ENB (22.8 km)

and WNB (14 km) using 2013 budget and other funds. All contracts are ongoing. All contracts in ENBP

completed and a retention amount yet to be paid is K1, 0000,441.14 for ENBP One contract in WNBP

side is still ongoing.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 15,000,000 15,000,000 15,000,000 14,994,324

Issues and Risks

Geography – the road will run through the rough terrain of the Baining Rangers which should be a

technical challenge to Engineers during construction.

Bad Weather – the Baining Range is known for its high rainfall which has greatly affected past

attempts of road construction in these areas.

Recommendation

It is recommended that the full funding must be expended on the road construction and a monitoring visit to verify the progress to date on the missing link connecting the two East and West New Britain provinces.




Project Name Buluminsky Highway

Status Ongoing

Objective

To seal the remaining 18.0 km unseal condition still in coronas and in gravel and maintain the

Buluminski Highway to a trafficable condition.



1. Sealing of the remaining 18 km unseal 2. Routine Maintenance 3. Substantial and Specific Maintenance 4. Emergency Road Maintenance 5. Supervision

Scope of Works for 2014:

Widening the road Sealing of the remaining 18 km unseal Routine Maintenance


Out from the total length of the road, 280km is sealed and in fair and good condition while 58km is unsealed still in coronas that need maintenance and re-gravelling to be done. The unsealed road to Namatanai is 10km that also needs to be sealed. This highway was initially constructed by TSSP under AusAid.

2014 Progress: Rehabilitation of two sections: 1. Kanapit – Pire (13km), 2. Pir-Bipore (4.5km), Contract value of both road sections is K15.9 million. Physical completion 55%, financial 25%.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 7,822,816

Issues and Risks

As gazette, NRA must take control of the 50% of the highway for routine maintenance as gazetted

under NRA’s Act.

Recommendation

It is recommended that DoW continues sealing the remaining unsealed sections and NRA to take on the

routine maintenance on the sealed sections.




Project Name Vanimo Highway

Status Ongoing

Objective

To seal the remaining unseal condition still in gravel and maintain the Highway to a trafficable

condition (18km).



Re-gravelling and sealing of the 18km along the Vanimo Highway Drainage Work

Scope of Works for 2013 & 2014:

Re-gravelling and sealing Drainage Work Substantial and Specific Maintenance Emergency Road Maintenance Supervision


Funding appropriated under 2013 Development Budget. Contract awarded and contractor mobilised on site and have commenced construction Work is in progress 46% completed.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000.0 15,000,000 15,000,000 15,000,000 4,874,281

Issues and Risks

Lack of road contractors is a major concern for Sandaun and this would continue due to lack of funding

and the volume of work.

Recommendation

It is recommended that funds must be fully expended to continue the road works and a monitoring visit

be undertaken to verify the physical status on the ground.



PROVINCIAL BRIDGES


Programme Name Construction and Renovation of Provincial Bridges

Status Ongoing

Objective

The primary objective is to improve condition through substantial and specific maintenance and

maintain accessibility through maintenance work by and that is to maintain cross drainage structures

classified as good, fair and poor within two to three cycles of annual routine maintenance.


The components include: 1. Minjung Bridge, 2. Yawar Bridge, 3.Wasa Bridge Scope of Works for 2014:

Re-gravelling and sealing Drainage Work Substantial and Specific Maintenance Emergency Road Maintenance


No: Project

Name

Road Length

(km)/Bridge

2013

Approp:

2014 Approp: Scope and Status

1 Yowar

Bridge

1 4,000,000.0 0.0 The funding is transferred to the

district treasury. Contract is awarded

and piling foundation work is in

progress.

2 Minjung

Bridge

1 8,000,000.0 8,000,000.0 The funding is transferred to the

district treasury. Engineering design

has been completed. Construction is

yet to start.

3 Wasa Bridge

5,000,000.0 15,600,000.0 The funding is transferred to the

district treasury. Geotechnical

investigation only.Survey and design

is in progress.



Funding Level (GoPNG) 17,000.0 21,100,000 21,100,000 21,100,000 21,100,000

Issues and Risks

Contractors slow performance

Recommendation

It is recommended that the balance of funding for Minjung and Wasa Bridge be fully expended and a

monitoring visit be undertaken to the various bridges to verify the physical progress to date before the

balance of 2014 funding is released.



PROVINCIAL ROADS


Programme Name Construction & Rehabilitation of Provincial Roads

Status Ongoing

Objective

To upgrade and rehabilitate the deteriorated Provincial Road section that are along the National

Highways giving access to people and improve linkages for market access and for the rural people in

the Provinces.


1. Road reconstruction 2. Bridge works 3. Design and supervision 4. Land acquisition

Scope of Works for 2013& 2014:

Design & Scoping Procurement Construction ( Major earth works & upgrading to sealing)

2013/2014 Progress & Achievements

No: Project Name Road Length

(km)

2013 Approp: 2014 Approp: Scope and Status

1 Kikori – Kerema

(Design)

100km 10,000,000.0 5,000,000 Pilot track done under the PTD

commercial concept up to

11.4km with this funding.

Procurement in progress.

2 Future Stages of

Highlands

Highway Design

112km 30,000,000.0 0.0 Three consultancy contracts for

survey and design awarded. A

112 km design.

3 Goroka Town

Road

Maintenance &

Rehab

7km 10,000,000.0 0.0 Work underway. 50 % physical

progress achieved.

4 Hagen Kudjib&

Hagen Toguba

Road

(56km design)

15km (maint)

10,000,000.0 0.0 Design of 4-lane highway is in

progress and 80% work has

been completed. Maintenance

has been done 15km.

5 Malalaua to

Kotidanga

32km 10,000,000.0 0.0 1. Contract awarded to Kana

Construction for constructing

pilot tract. K5.million was

expended. Physical completion

30%.

2. K5.0 million expended.

Contract awarded to Westfield

Rivers Ltd for Geotech and DTM

Survey and aerial survey. Work



in progress to identify possible

route. Physical Completion

25%.

6 Kulupuga Road 35km 10,000,000.0 5,600,000 Provincial Road. Contract for

K10.0m As per review report

work is in progress. However,

this report is not accurate. A

site visit needs to be

undertaken to verify the

physical status.

7 Bubuleta–Agaun

Road

26km 5,000,000.0 1,500,000 The funding is transferred to

the district treasury for

rehabilitation of road. The work

done is upgrading to sealing.

Physical Completion 26%.

8 Nuku-Arkusame

Road

17km 5,000,000.0 0.0 The funding is transferred to

the district treasury.

Rehabilitation works is in

progress.

9 Buluminsky

Highway

17.5km 10,000,000.0 10,000,000.0 Rehabilitation of 2 sections. 1.

Kanapit-Pire 13km and Pir-

Bipore4.5km. Contract value of

both K15.9 million.55%

completed.

10 Hiritano

Highway

Mainteance

7km

(design)3km(c

onstruction)

10,000,000.0 7km (design)

3km(constructi

on)

Work in Progress is on

Pavement recycling,

Stabilization and Bituminous

Resurfacing of the road from

9mile market to Laloki

Bridge.100% complete

11 Koroba-lake

Kopiago Road

36km(upgradi

ng)6km

(sealing)

10,000,000.0 Contract of K10.0 million to

upgrade 35km section of this

provincial road is ongoing and

5% progress have been

achieved to date

Total 1.275km

(design)

2.391km(impr

ove &

maintenance)

120,000,000.

0

22,100,000

No: Project Name 2014 Appro: Warrant Un-used warrant Scope and Status

1 WasetaKendak

a

5,000,000.0 0.0 0.0 Scoping and design

completed. Preparation for

tendering.

2 Kikori Gulf

Road

10,000,000.0 0.0 0.0 Project is undertaken

through the commercial

concept

3 Kulupuga Road 5,600,000.0 5,600,000.0 5,600,000.0 Awaiting award under PSTB



4 Bubuletta-

Agaun

5,000,000.0 1,500,000.0 1,500,000.0 Transferred to District

Treasury

5 Minjung-Bridge 8,000,000.0 4,933,334.0 4,929,295.0 Funding transferred to

District Treasury.

Engineering design

completed. Construction yet

to start.

6 Wasa Bridge 15,600,000.0 15,500,001.0 15,500,001.0 Survey and design in

progress near completion.

7 Karamui

Bridge

10,000,000.0 8,000,000.0 5,000,000.0 Funding to be utilized on

emergency bridge purchase.

Procurement stage

8 Alotau East

Cape Road

5,000,000.0 2,499,999.0 2,499,999.0 Work on that section is

currently untaken by World

Bank. Funding to be

transferred to WB as

counterpart to the loan

program implementing this

section of the road.

9 2013 Joint

Understanding

:design &scope

for

MadangRamu

15,000,000.0 7,384,000.0 7,384,000.0 Counterpart for the DFAT

TSSP design and

investigation of the Ramu

Highway section

10 Missing Link-

(Baiyer-

Madang)

10,000,000.0 5,000,000.0 2,000,000.0 -Baiyer approach to Madnag

K7.0 m

-Madang approach to Baiyer

K3.0 m

-Documentation in progress

11 Pogera –Tari

Road

Construction(P

ogera MOA)

10,000,000.0 0.0 0.0 Awaiting Funds

12 PanguLaigam

Road stage 3

30,000,000.0 10,000,000.0 10,000,000.0 Tendering stage

13 Kupiano Town

Road sealing

5,000,000.0 3,500,000.0 3,500,000.0 Tendering and evaluation

completed. Forwarded to

PSTB to award

14 Bena – Ramu

Road

10,000,000.0 0.0 0.0 Feasibility Study in progress

for pilot track

15 Kirriwina Ring

Road

6,000,000.0 0.0 0.0 Procured through PSBT

16 Teleformin

Road

10,000,000.0 5,125,000.0 5,125,000.0 Contractor mobilized (14km

section)

17 Nipa – Kutubu

Road

10,000,000.0 10,000,000.0 10,000,000.0 Scoping and tendering in

progress

18 Hiri Lai Road 10,000,000.0 10,000,000.0 10,000,000.0 Construction in progress.

Funding will be used to

continue the current work in



progress.

19 Finschafen

Road Works

10,000,000.0 10,000,000 10,000,000 Procurement Stage

20 Nawae Road 5,000,000.0 0.0 0.0 Nil warrant issued for 2014

21 Kimil-Tabibuga

road

10,000,000.0 10,000,000.0 10,000,00.0 Procurement Stage

22 Rouna and

Sirinumu Road

30,000,000.0 0.0 0.0 Currently 3x contract

tendered and now on

evaluation stage for

upgrading

23 LumusaBaiyer

Road

10,000,000.0 0.0 0.0 Procurement stage –

tendering

24 Mt-Hagen City

Road

40,000,000.0 40,000,000.0 0.0 Funds Transferred to

Provincial Government

25 Talasea Ring

Road

5,000,000.0 2,000,000.0 2,000,000.0 Completed scoping and

design. Documentation

Completed. Ready for

procurement.

26 Sepik H/W -

Wewak to

Vanimo

15,000,000.0 3,440,000.0 3,440,000.0 Tender evaluation stage

27 Gulf-Southern

Highlands

10,000,000.0 0.0 0.0 Under scoping , report yet ot

be submitted on the possible

route by RAMS

28 Fisika road-

Kabwun

-Sialum-

Nawae

10,000,000.0 10,000,000 10,000,000

29 Kandrian-

Kimbe (Missing

Link)

10,000,000.0 10,000,000.0 10,000,000.0 Completed scoping and

design. Documentation

Completed. Project will be

undertaken by DoW /PTD-

construction fleet. PTD pilot

project in WNBP.

30 Esa’aala Road 6,000,000.0 2,000,000.0 0.0 Funds transferred to District

Treasury

31 Kisenapoi-

Kagua

15,000,000.0 10,500,000.0 4,615,252.0 No Report

32 Goilala-Mona

Road

5,000,000.0 0.0 0.0 Procurement in process to

be tendered through PSTB

33 Northern

Highway

(Pongia-Afore)

10,000,000.0 927,455.0 50,448.0 First Minor Work Contract

commenced for the value of

K4,279,334.0

Second MWC to be procured

through PSTB. Document

ready for tender.



34 Kombiam Road 5,000,000.0 5,000,000.0 0.0 Full funding to be utilized to

pay for outstanding work in

2013

35 Tokua Airport-

Kokopo Town

(4 Lane Road

design)

5,000,000.0 1,333,334.0 1,195,219.0 Only K1.33 million was

received by the Province and

used for resealing of existing

alignment. Negative CFC’s

being released for remaining

funds.

36 Mendi –Mongol

&

Tambul Road

2,000,000.0 1,399,999.0 0.0 Work under progress from

both Tambul and Mendi

ends

37 Buluminsky

Highway

10,000,000.0 9,333,332.0 9,247,535 Under construction; 45%

physical & 25% financial

Total 393,200,000.00 204,976,454 133,586,749.00



Funding Level (GoPNG) 0.0 204,976,454 204,976,454 204,976,454 133,586,749.00

Issues and Risks

Delay in procurement PSTB & CSTB thus slowing progress in implementation. Warrants not released on time, delays work progress. Few number of project funds were transferred to District treasury for District to implement, thus

DoW does not administer and supervise those projects as such no report provided. Districts do not have the capacity to implement, lack of capacity to undertake scoping & design

and in preparing bid documents for tendering. Road project funds transferred to Districts are not closely monitored; projects are not procured

using proper PSTB process. Funds transferred to Districts are not expended on the activities budgeted for as per the cash

flow and work plan. DoW is faced with additional capacity issues especially to implement projects that DoW did not

submit for and are not of their priorities. Thus putting pressure on the agency to implement. District Projects funded outside of DoW’s priorities are not fully scoped and designed and no

documentation in place by Districts to prepare for procurement and construction. Un-qualified contractors in Districts that does not meet DoW road construction standards and

specification, thus results in poor performance.

Recommendation

It is recommended that,

1. DoW provide progressive status reports on the projects that funds were drawn down on , 2. A monitoring visit be undertaken to verify the physical status and road condition of these

following road projects: i. Kulupuga Road – No actual construction taken place.

ii. Mt-Hagen City Roads – Hagen roads are in dire needs of repair & where did this development funds go?

iii. Northern Highway- (Pongia – Afore) iv. Esa’ ala Road v. Hiri Lai Road

vi. East West New Britain Highway



vii. Goroka Town Road viii. Wasa Bridge

ix. Lae to Nadzab (4lane road)- Not progressing. 3. All scoping and design of the new projects be completed in 2014. 4. Funding should not be appropriated to un-scope projects that are not of DoW’s priorities. 5. It is recommended that an audit be done on the Lae-Nadzab road project as the progress of

implementation is at very slow phase. 6. Funding for those projects that warrants have not been release to date should not be issued as

DOW is not prepared to implement, due to capacity issues. Funding can be utilised in other priority areas identified.



537 NATIONAL AIRPORT CORPORATION (NAC)

AGENCY SUMMARY

Mission Statement

National Airports Corporation (NAC) is responsible for the certification of airports and the maintenance of safety and security standards across the National Airports in the country.

It is also operates and manages all the aerodromes areas and thus recognizes the importance in upgrading and restoring the airports infrastructure and services to facilitate access to the to the air transport network in the PNG.

The Agency is responsible for the implementation and delivery of the Civil Aviation Development Investment Program (CADIP) which is an initiative jointly funded by the Asian Development Bank and the GoPNG.

Scope of the Public Investment Program

NAC was allocated funding for five projects in 2014. A Multi Tranch Project (MFF) and a High Impact

project:

CADIP (MFF) Port Moresby International Airport Upgrade (High Impact) Kokopo Airport Upgrade New Ireland provincial Airport Upgrade Alternate Landing Strip – Tokua Airport

The NAC was allocated a total of K76 million in GoPNG counterpart funding appropriations for projects

in 2014. This includes K26 million as counterpart funding for Civil Aviation Development Investment

Program (CADIP) and the balance of K50 million going to NAC projects including the Port Moresby

International Airport Upgrade-Stage I project, the Tokua Airport Upgrade, Kavieng Airport upgrade and

Tavilo alternate airstrip project.

The revised budget by end of the 4th quarter to the NAC is K68.75 million which was wholly expended

in 2014.

Key Issues

Oustanding contractual payments for contracts under tranch 1 Additional cost of K4.2 million for Mt Hagen Terminal under CADIP Much of counterpart funding for CADIP under 2014 budget was expanded on Tax & escalation

2014 Level of Funding and Expenditure

Project Appropriation Warrant Expenditure Donor

CADIP 26,000,000 26,000,000 26,000,000 95,000,000

Jacksons Airport Upgrade & Rehabilitation - PMIA ITB Stage 1 30,000,000 30,000,000 30,000,000

0

Tokua Airport Upgrade 3,500,000 3,500,000 3,500,000 0

Kavieng Airport Upgrade 10,000,000 7,750,000 7,750,000 0

Tavilo- Alternate to Tokua Airport 6,500,000 1,500,000 1,500,000 0

Total 76,000,000 68,750,000 68,750,000 95,000,000

Recommendation

It is imperative for a meeting to convene between DNPM, Treasury, Department of Tranport, IRC and

NAC to discuss the key issues highlighted before draw-down of fundings.



Agency Name National Airport Corporation

Programme Name CADIP

Status Ongoing

Objective

To rehabilitate and upgrade the aging 22 national airports and airway infrastructure to meet

compliance with the Civil Aviation Rules and ICAO safety and security standards


Major project components under the Batch 1 are as follows:

Component A: Procurement

1. Port Moresby 3 No Fire Tenders Component B: Civil Works

2. Port Moresby Domestic Apron Extension 3. Mount Hagen Terminal Building Construction & Associate Works 4. Hoskins Airport Pavement Upgrading & Associate Works 5. Hoskins, Wewak, Gurney, Goroka Airport security Fence (Packaged) 6. Kavieng Airport Security Fence

Component C: Program Support / Capacity Development

7. Design and Supervision Consultants (DSC) 8. Financial Management 9. Operational & Facility Enhancement Program


Component Progress 2013 Progress 2014

Goods

Port Moresby No 3

Fire Tenders Delivery and commissioning of the new

fire tenders in March 2013. Project Completed

Civil Works

Port Moresby

Domestic Apron

Extension

Construction in progress. Overall physical progress is 98% whilst overall Financial progress is 95

Project Completed

Mt Hagen Terminal

Building

Construction &

Associated Works-

Contract Sign Advance payment made by GoPNG and

ADB Contractor already mobilized to site Groundbreaking ceremony undertaken

by PM Work was commenced

Construction of new terminal in progress, temporary Terminal building completed and currently in use. 72% physical & 60% financial

Hoskins Airport

Pavement Upgrading

& Associated Works

Contract signed Advance payment made by GoPNG and

ADB Contractor Mobilized to site Ground breaking ceremony undertaken

Construction in progress, Runway extension works

at SE ends completed. 60% physical & 46% financial



Commencement of Works Hoskins, Wewak,

Gurney, Goroka

Airport Security

Fence (package)

20% works completed in Goroka and Hoskins

10% works completed in Wewak Works to commence fro Gurney

Project completed, closed

Kavieng Airport

Securityfence Project successfully completed and

handed over to the NAC Successful Completion of

project

Program support /Capacity Development

Design and

Supervision

Consultants (DSC)

Most of Batch 2 preparation works is completed

Commencement of recruitment process of Batch 2 DSC

Design and documentation works for Tranche 2 projects completed

Preparation works for Tranche 3 sub projects

Financial

Management Commencement of new Project

Accountant. 2012 Annual Financial Statement

audited by the Autditor General’s Office.

CADIP PIU reverted to ANZ DiskPay payroll system in conjunction with Able payroll system

Change of Signatories to CADIP GoPNG Operating Trust Account to reflect changes in the Finance Department

Review of CADIP financial management and accountinf system

Commencement of new financial management specialist

CADIP 2013 Audit of Annual Financial Statements Undertaken

Operational &

Facility

Enhancement

Program

Training submissions for NAC, PNGASL and CASA PNG being funded

CADIP Training & Capacity Building Plan implemented



Funding Level (GoPNG) 16,000.0 26,000,000 26,000,000 26,000,000 26,000,000

Donor Assistance (ADB) 95,000,000

Issues and Risks

Oustanding contractual payments under Tranch 1 will compel NAC to subsidise through Tranch 2 funding.

Recommendation

It is imperative for a meeting to convene between DNPM, Treasury, Department of Tranpsort and NAC

to discuss the key issues highlited before draw-down of fundings.




Programme Name Jackson’s Airport Upgrade & Rehabilitation Stage 1& 2

Status Ongoing

Objective

Upgrade of Port Moresby International Airport’s International Terminal Building to cater for the 2015

South Pacific Games, 2018 APEC summit and forecasted medium term demand in passenger, aircraft

and freight movement. It is also the first stage to the overall redevelopment of the airport.


The components of the project include:

1. Extension of the domestic and international apron 2. Construct new Stub Taxi-way connecting the new extended Apron to the existing Parallel

Taxiway. 3. Constructed sealed shoulders to both the new apron and new Stub Tax- way 4. Construct new aircraft pavements 5. Construct concrete encased duct bank under Stub Taxiway 6. Construct new Apron access road as an extension to the exiting 7. Construct flank earthworks/topsoil/grassing to the new apron and stub taxiway 8. Construct storm-water Drainage 9. Construct open drain lining 10. Supply and install Apron flood lighting to the extended apron 11. Paint new pavement marking to aircraft pavements 12. Improvement of airport transfer facilities


1. Design and Construct Contract – in progress 2. Completion – in progress 3. Construction - 65% Physical progress



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues and Risks

Commercial loan agreement without GoPNG’s direction indirectly affects the government to pre-

commit for repayment.

Recommendation

It is recommended that NAC witheld loan assistance from commercial banks pending further consultation woth concern government departments.




Programme Name Tokua (Kokopo) Airport Upgrade

Status Ongoing

Objective

Upgrade of the airport facilities to meet international standards and process international tourist

arrivals.


Components include:

International terminal, baggage security screening upgrade, security and safety improvements at the

airport including the upgrade of the Aviation Security Services (Avsec) and Airport Rescue & Fire

Fighting (ARFF) services and facilities, training of Avsec and ARFF personnel, improvements to the

ARFF mock up training facility, NAC airport staff housing, airport power house upgrade and

relocation of aviation fuel facility – site preparation


Tender Bid Evaluation Contract Award


Due to funding availability, project tender cancelled Rebids in Q1 2015



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 3,500,000 3,500,000 3,500,000 3,500,000

Issues and Risks

Insufficient or lack of funding may constrain the project Development partner funding may be needed to successfully implement the project Contractor capacity and performance during project implementation may impede project Landowner issues associated with acquisition of land for runway extension may delay project

Recommendation

The NAC requires Government development funding in the short term to successfully implement this

project.




Programme Name Tavilo – Alternate to Tokua Airport

Status Ongoing

Objective

To Construct Tavilo airstrip to serve as an alternate landing strip to Tokua Airport to cater for

emergency needs.


The Scope of Work includes, Site inspection,Preliminary Documentation & Tender


First Site inspection conducted All documentation completed

Contract put out for tender for phase I preliminary clearing, grubbing, tree cutting, works/activities



Revised Appro.

Actual Exp


0.0 1,500,000 1,500,000 1,500,000 1,500,000

Issues and Risks

Slow disbursements or revised under funding from Government to meet scheduled work plan Commercial loan agreement without GoPNG’s direction which indirectly affects the government

to pre-commit for repayment

Lack of funding assistance from project partners, e.g. province Land acquisition

Recommendation

The NAC requires Government development funding in the short term to successfully implement this

project.



538 PNG AIR SERVICES LIMITED

AGENCY SUMMARY

Mission Statement

To provide quality aviation services to PNG Air Services Limited’s domestic and international customers at a reasonable cost.

To modernise and update PNG’s air traffic management system and surveillance technology

Scope of Current Public Investment Program

A contract valued at K133 million was awarded to COMSOFT Gmbh of Karlsruel of Germany to improve the level of safety across PNG skies. Components include:

1. Complete Air Traffic Managment (ATM) automation, full Air Traffic Control (ATC) and 3D tower control simulators;

2. Implementation of COMSOFT’s complet ATM system at Port Moresby to enable its status as an international ATM hub;

3. Enable domestic airports to Madang, Mt Hagen, Goroka, Nadzab and Tokua to contribute to the country’s overall coverage and precise surveillance within PNG’s vast Flight Information Region (FIR); and

4. Delivery of multilateration (MLAT), a widely used navigation and surveillance technique to the capital’s main terminal areas.

Key Issues

The core ATM and surveillance systems were co-funded by the DFAT TSSP (K12.2 million) and the

2013 GoPNG appropriation (K14.3 million). From the revised appropriated GoPNG funding of K9.3

million in 2014, K3.3 million was actually warranted and spent.

2014 Funding: (K’000)

Project Original Budget Revised Budget

Air Traffic Management & Surveillance 14,300.00 9,300.00

Total 14,300.0 9,300.00

Recommendations

It is recommended that GoPNG be consistent with the funding appropriations to meet the total cost of

the project to fully realize the project. It is very critical that air navigation systems and equipments

meet the required civil aviation world standard. This is critical to provide safety for the travelling

public.



Agency Name PNG AIR SERVICES Ltd

Programme Name PNG Air Traffic Management and Surveillance

Status Ongoing

Objective

Modernise Air Traffic Management System and associated surveillance systems, thereby improving

safety and enhancing efficiency to airlines operating within PNG airspace


Introduction of Automatic Dependant Surveillance, ADS-B for upper airspace and MLAT for the Port

Moresby terminal area (TMA). The MLAT option for the Port Moresby terminal area is taken as a

backup to and replacement for the Radar (SSR).

The scope was extended to include replacing the aging semi automated procedural air traffic

management system with a modern fully automated ATM system in the Port Moresby ATCC. The

surveillance systems and ATM modernization is expected to be completed by 4Q 2015.


Pre Mobilisation, transition planning & site visit planning all achieved The project has been tendered using World Bank ICB procurement guidelines. Award of contract, equipment assembled software adaptation systems tested/installed &

trainings done.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

14,300,000 9,300,000 9,300,000 9,300,000 3,300,000

Issues and Risks

Cash flow submission was specified under goods & services totalling K16.3 million. Specification of appropriated K14.3 million was unclear which require clarification through Project Steering committee.

With the contract sign with the main contractor PNG ASL will require funds to meet the agreed payment schedule as stipulated in the contract agreement.

Recommendation

Outstanding Funding for last year is released to meet cash flow schedule and contract Payment

Schedule.



523 PNG AIR INVESTIGATION COMMISSION

AGENCY SUMMARY

Mission Statement

The accident investigation Commission (AIC) has the responsibility to develop policies, programs,

standards, systems, and procedures for the Human Resources Development of air safety investigation

of the AIC to ensure investigation and technology currently, meet AIC requirements, and to comply

with AIC obligation to meet the standards set and legislative requirements in PNG Civil Aviation Act 2000.

Scope of Current PIP of Agency

Air Investigation Commission has allocated funding its Capital Formation in 2014. These include

Laboratory facilities and proper database and the system.

Key Issues

AIC has staff capacity issues that need to be addressed immediately to assist in the implementation of current funded PIP project.

The issue over the building occupancy is a legal matter currently; hence, they need to resolve this issue to avoid delay in project implementation.

2014 Funding: (K’000)

Project Original Budget Revised Budget

AIC Capital Formation 600,000 600,000

Total 600,000 600,000

Recommendation:

It is recommended that the above two issues be addressed immediately in order for the project

implementation to happen smoothly.



Agency Name PNG Accident Investigation Commission

Programme Name AIC Capital Formation

Status Ongoing

Objective

This project is to set up the entire AIC property that would include the procurement and installation of

electrical machineries and to replace the old air-conditioning system of the AIC building and

warehouses.



Procurement & installation of Gen-set Procurement & Installation of New Air conditioning Units for the building and two Warehouses

at the 7 mile property Routine maintenance


Pre Mobilisation, transition planning & site visit planning all achieved The project has been tendered using World Bank ICB procurement guidelines Award of contract, equipment assembled software adaptation systems tested/installed &

trainings done.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 600,000 600,000 600,000 600,000

Issues and Risks

Awaiting Supreme Court’s deliberation on the property ownership dispute between AIC and National Airport Corporation in which AIC is currently using.

Recommendation

It is recommended for management to note that funding allocated to AIC in 2012, 2013 and against

Capital Formation project is yet to be expanded pending legal ownership over the office.



526 NATIONAL MARITIME SAFETY AUTHORITY (NMSA)

AGENCY SUMMARY

Mission Statement

To provide safety and efficiency of water transport services through improved regulations and monitoring of shipping traffic throughout the country’s territorial waters. It also carries out search and rescue operations at sea, collects data relevant to maritime safety, marine pollution and prevention and acts on behalf of the state in relation to any domestic and international agreements relating to the above areas of responsibilities. The proposed Small Craft Bill 2010 which is currently before the Legislative Council is anticipated to empower NMSA to provide for improved safety operations of small crafts.

Scope of Public Investment Program Components include:

Replacement. Installation and maintenance of navigational aids Improving safety information infrastructure and practice The project components includes: supplying, installing, testing and commissioning navigational

aids equipment specifically: Installation of navigational aids, Installation of all corrosion protection system, Installation of site checking with GPS coordination, Replacing eroded under water pipes for lighting systems and Installation of the flashing lights for all sites in Momase Region, New Guinea Islands and

Southern Region.

Key Issues

NMSA is to be self financing. It also needs to strengthen its internal project implementation of this project to see how the provinces are implementing and carrying out their operations of the program at provincial Maritime Provinces. As there has been many small crafts missing off shores and the navigational systems are not that equipped to do searches out on the seas.

K3 million funding allocated to NMSA was drawn-down from PNG Power’s Town Electrification Investment Program (TEIP) funding in 2014.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 3,000,000 12,000,000 0.0 3,000,000

Recommendation

The government needs to honor its loan component to implement fully this project since this project is

being co-funded through ADB loan.



Agency Name National Maritime Safety Authority (NMSA)

Programme Name Maritime Waterways & Safety

Status Ongoing

Objective

The objective is to provide an effective and efficient communications systems of the National Maritime Safety Authority through the upgrading of its navigational aids and other infrastructures.


Consultation & Site Survey Design & Prepare Prebid documentation for:

• navaids procurement and installation • tide gauge procurement & Installation

Administration & Operational cost


Pre Mobilisation, transition planning & site visit planning all achieved The project has been tendered using World Bank ICB procurement guidelines. Award of contract, equipment assembled software adaptation systems tested/installed &

trainings done.



Revised Appro.

Actual Exp


0.0 3,000,000 3,000,000 3,000,000 3,000,000

Issues and Risks

The initial project implementation period is for five years and was suppose to commence in 2013. This project is funded from the proceeds of ADB loan (K41.5 million) signed on the 29th of January 2013, with counterpart funding to come from government of K21.4 million. However, government counterpart funding was not facilitated in 2013 and less in 2014.

Recommendation

The project will greatly benefit the 14 Maritime Provinces, the travelling public. It will increase the

safety of shipping activities in remote and isolated coastal areas. Therefore the government needs to

honor its loan component to implement fully this project.



524 INDEPENDENT PUBLIC BUSINESS COORPORATION

AGENCY SUMMARY

Mission Statement: Its mission is to institute stronger governance, best practice and commercial accountabilities structures in IPBC to maximize the value of its assets and investments for the benefit of the State and the people of Papua New Guinea.

Scope of Public Investment Programs:

Under the 2014 Development Budget, IPBC was allocated funding for three (3) projects. These projects

are:

1. Lae Port Tidal Basin 2 2. Port Moresby Sewerage Project 3. National Broad Band Network

Key Issues/ Constraints:

IPBC is seeking NEC approval to implement Phase II of the Lae Port Tidal Basin which will cost K727 million and to be funded by commercial arrangements.

National Broadband Network is a commercial Arrangment between GoPNG and Exim Bank Port Moresby Sewerage is not funded through PIP in 2015

2014 Funding:

Project Original


Lae Port Development Tidal Basin 2 270,000.0 270,000.0

Port Moresby Sewerage 20,000.0 20,000.0

National Broadband Network 55,000.0 45,000.0

Total 90,000.0 90,000.0

Recommendation:

It is recommended for DNPM to note the key issues outlined.



Agency Name IPBC

Programme Name Lae Port Tidal Basin 2

Status Ongoing

Objective

The objective of the Lae phase 2 is to develop the Lae port facilities to capture the vision of a

transhipment hub port of the Asia Pacific region and to meet the increasing future demand for cargo

throughput of 450 TEU/year. The phase2 shall enhance and improve the capacity to effectively and

efficiently maintain the supply chain to support the economic activities throughout PNG and the Pacific

region.


These phase II of the project comprises an extension of 200 meters of Tidal Basin dredging to make a

total of 900 meters, extension of 460 meters on current 240 meters to make the total wharf berthing

facility of 700 metres, and a further five (5) hectares on 13 hectares to make a total container terminal

area of 18 hectares, and some revetment/slope protection works on the extended tidal basin banks.


The Lae Port Development is being implemented in two phases. Phase 1 was completed in December 2014 and commissioned with handover-takeover to PNG Ports Corporation. Phase 2 commences immediately upon completion of phase 1 and is expected in 2015.

NEC approval and CSTB approval in 2015 for Phase 2



Funding Level (GoPNG) 20,000,000 270,000,000 270,000,000 270,000,000 270,000,000

Issues and Risks

Cost variation in phase 1 was due to social cost and kina fluctuation and funded through additional

loan.

Recommendation

IPBC will be initiating dialogue with commercial banks to fund phase 2. Proper dialogue must convene

with GoPNG responsible government agency before commercial arrangements are made.



Agency Name IPBC

Programme Name Port Moresby Sewerage

Status Ongoing

Objective To develop sewerage systems in Port Moresby in order to provide sewerage services in the city and prevent environmental pollutions into coastal areas, thus contributing to improving sanitation conditions and prevention of marine ecology and activating regional industries in the city. Componenst and Scope of Works

Redesign of the sewerage system Civil Works Land Acquisition The scope of works for 2014:

Final design for STP Upgrade Construction of Stage 2 – Extending Plant Capacity to year 2042 Connection of Southern Villages to POM SSUP – Survey and Redesign


This is an ongoing project and generally all components of this project are all progressing very well and

within the timeframe despite issues arising from the redesigning of the STP and land compensation.

Project status is 15 % completed. Procurement phase has been completed to a large extent with

construction phase now imminent to start.

Land compensation for the KilaKila/Vabukori sewerage Treatment Plant Site-valuation report is completed and awaiting purchase/sale documents to complete compensation payment.

An overseas designer has been engaged to redesign the STP to optimize the plant for the site constrains and increase the capacity. Hence, redesign of STP for construction (1staugmentation evaluation and concept design) completed plus redesign of reticulation system for construction (1ststage Hydraulic Model) completed.

IPBC is commissioning through NCDC a designer for the Poreporena (Baruni) Freeway design issues and designer for the upgrade of the POMSSUP pipe work in relation to insufficient capacity for the final design horizon (year 2042).



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

15,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks

The Sewer Treatment Plant (STP) as proposed by the Japanese Consultant is not fit for purpose. As far as the loan agreement is concern, the inadequate design life of the STP and the related problems were discussed in the last PSC meeting with participation of JICA representatives. An alternative design solution was presented by AWT consultants that will double the capacity of the plant and remain within the existing footprint and budget. However JICA disagrees with the proposed design as based on the GoJapan ODA loan rule, any design changes are excluded once the final design was accepted. However IPBC is firm on the redesign issue and will seek directives from the Government hierarchy to progress the project despite the terms and conditions as agreed prior to the execution of the Loan Agreement.



IPBC is not in a position to provide evidence to DEC that the STP is designed for a 25 years lifespan

Consequently, at present DEC is unable to issue the Environmental Permit. Redesign of the Poreporena Freeway underground pipe work. The NCDC currently undertaking

a major road upgrade network throughout the city and this has presented serious design clashes with the POMSSUP design along the Gerehu to Hanuabada upgrade road project. Hence, a redesign has been initiated and the two parties will address this matter.

Recommendation

It is recommended for independent Audit/evaluation to be conducted and loan negotiation for a design to meet 40 year life span of the project so that environmental permit can be issued.



Agency Name IPBC

Programme Name National Broad Band Network

Status Ongoing

Objective

To extend and upgrade the Mobile telephony market.


Major components include:

Phase 1: Core network modernization, fixed broad band rollout and 3rd& 4th Generation Mobile Networks to cover 121sites in Port Moresby and Lae.

Phase 2: Expansion of 3G and LTE Mobile network to a 300 strong footprint along with a convergent Billing Solution.


Telikom PNG and Huawei has begun rolling out the NBN starting in NCD with the installation of new

Multi-service Access Nodes (MSANs) to deliver high-speed broadband to resdential and small business

customers and will over the next six (6) months see the retirement of five (5) aging digital telephone exchanges and the full-scale deployment of Next Generation Network Soft Switches which work with

the new MSANs to provide the fastest broadband in the market.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 55,000,000 55,000,000 45,000,000 45,000,000

Issues and Risks

The state and the China Exim Bank has entered into a commercial Agreement with certain terms and

conditions outlined in the NBN commercial Contract to be adhered to by both parties. Most of the

Conditions Precedent has been met by the State with only 15 % of the first payment of which State

must meet to trigger the disbursement of the loan. NEC #199/2013, approval of US$203.8 Million Exim

Bank Loan (@85%) and GoPNG (@15%).

Recommendation

It is recommended that before the loan draw down to be effected in 2015, Telikom PNG and IPBC need

to provide a completed report on the 2014 PIP funding of K45 million as allocated.



DEPARTMENT OF INFORMATION & COMMUNICATION (DIC)

Agency Name DIC

Programme Name Integrated Government Information System (IGIS)

Status Ongoing

Objective

1. To Centralize Government Information in a secured government owned portal system that enabling all Departments and Agencies to work together in a coordinated and secured environment.

2. To develop ICT infrastructure to capture life events such as births, deaths, marriages, change of name and adoptions for National Civil registry & including national ID and e-passport.

3. Improve capacity of Department of Communications & Information to provide management and planning to support the objective of IGIS projects.

Scope & Major Components

The major components of the project include: 1. GIS Shared Services-Record Management Centre/Data Centre 2. IGIS District Management System 3. IGIS Executive Information System- Department of National Planning and Monitoring 4. IGIS Civil registration and National ID System

Scope of works: IGIS Network linking Government Departments and Agencies at National, Provincial and

District level Establishment of IGIS Civil registration and National ID System Establishment of National Data Centre

2014 Progress & Achievements The project commenced implementation in 2011 and is now complete with the IGIS net infrastructure

linking up 47 government department office and 6 pilot Provinces (EHP, Central, ESP, Sandaun, ENB &

WNB), and Central data System.The project was launched by Prime Minister on the 11th of July 2014.



Revised Appro.

Actual Exp


Donor (China – Concessional)

41,500,000

Issues and Risks

47 Departments can’t excess internet and call person of offices outside the IGIS network because TPNG wouldn’t provide service for DCI before the service agreement is signed. The most value for IGIS phase 1 is depreciated.

The IGIS network is not fully understood by all government Department/Agencies; hence their desires to participate with the IGIs network are not clear and strong.

The IGIS network policy and regulatory framework and service charges are not finalised yet. Lack of local ICT talent within the government bureaucracy system.



Recommendation

1. Adequate funding be sourced to maintain the data centre; and 2. Design and scoping of Phase 1 be commenced.



Agency Name DIC

Project Name Rural Telecommunication

Status Ongoing

Objective

The objective is to provide infrastructure for improve and sustainable telecommunication services in

rural & remote areas to meet the expected social and economic development objective of PNG.


These are the components to this project:

1. To strengthen the capacity of Depart. Of Communication & Information and NICTA, 2. Develop the processes, procedures & systems to manage Universal access scheme to sustain the

overall ICT sector 3. Establishment of communication infrastructure in rural remote areas of PNG to access

communications voice services.


40% of work carried out for Communications infrastructure achieved, consultant engaged and PMU

establish within NICTA/DCI.





Donor (China – Concessional)

8,831,346

Issues and Risks

This project upon restructure approval by both the World Bank and GoPNG in September 2014, the

project was effectively tranfered in whole from department of Communication and Information to the

Ntional Information and communications technology Authority (NICTA).

Loan funding from World Bank , K45 million became effective in 2011, however, lengthy procurement process was delaying implementation until 2014 with full rollout of voice services to 22 provinces and engagement of consultant for the project. Recommendation

In effecting the above issue the counterpart funding be tranfered directly to the Project Account and

not through the Department of communication and Information.



546 PNG POWER LIMITED

AGENCY SUMMARY

Mission Statement: Ensure that ownership of energy resources is vested with the resource owners and that their

development must be accessible, reliable, affordable, efficient and environmentally friendly for the

benefit to communities, industries and trade, and other development activities.

Scope of Public Investment Program:

Under the 2013 Development Budget, PNG Power is implementing the (3) projects as part of its Public

Investment Program. These projects are as follows:

1. PNG Towns Electricity Investment Project 2. Rural Electrification Program 3. Port Moresby Grid Development Project

These three projects are PPLs current public investment programs ongoing projects in the 2013

Development Budget. The Town Electrification Investment Program is a nationwide impact project

which will benefit the many towns in the country. This program is co-funded by the Government of

PNG and Asia Development Bank.

Key Issues:

The poor development of the provincial power systems is due to factors such as difficult geographical conditions resulting in isolated load centers with relatively low demands, operational issues related to maintenance, high initial investment costs for hydropower resulting in reliance on diesel generation which has low upfront investment costs but substantially higher life cycle costs and investment disincentive from the single national tariff structure for the corporatized PPL to invest in high cost provincial centers. 2013 Funding: (K’000)


Revised Budget

PNG Towns Electricity Investment Project 26,000.0 18,000.0

Port Moresby Grid Development Project 4,000.0 4,000.0

Total 22,000.0 22,000.0

Recommendation: It is recommended that PNG Power provides full report for 2014 implementation under these two projects.



PNG POWER LIMITED (PPL)

Agency Name PPL

Programme Name Town Electrification Investment Programme (TEIP)

Status Ongoing

Objective

To improve the power supply in provincial urban centers through replacement of high cost diesel

power generation with sustainable renewable energy generation.


This program is supported by a Multi-Tranch Financing Facility consisting of two Tranches for duration

of six years.

1. Design and documentation 2. Land acquisition 3. Civil works


Tranche One - Scope as 0f 2013 including construction of three hydro power stations;

1. Divune Hydro Power Plant, Oro province 2. Lark Hargy Hydro /BiallaKimbe Transmission Lines, WNB province 3. Ramazon Hydro Power Plant, Bougainville


Divune:

Six of seven ILG for Divune has been completed and only one is pending completion. Valuation report for the value of land is pending from the Valuer. Generals bidding documents for the HPP and the DL documentation completed

Technical designs and electromechanical drawings are both 80% and 70% complete and geotechnical investigations have been conducted last month July.

Draft Environmental Management plans have been completed.

Ramazon:

One ILG application form has been lodge and awaiting advice from DLPP and valuation report has been received from the Valuer General Office. A meeting with the Lease Title Holder BIGL is been arranged and needs confirming by ABG.

Bidding documents compeleted. Geotechnical investigations have been conducted in July and Civil designs and drawings are 60%

complete and electromechanical drawings and designs are in progress and 50% complete. Draft EMP are completed and inserted in the bidding document.

Bialla to Kimbe Interconnection Transmission Line:

Awareness on Land Access Agreement has been completed and will be an ongoing exercise. NBPOL palm oil trees will be compensated based on current market value.

Bidding document for Transmission Line document completed. Line equipment and material specifications are in progress and 85% complete, while line survey

amendments with regards to relocations are in progress and specification drawing are 90% complete.

Draft EMP are completed and inserted in the bidding document.





Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 18,000,000 18,000,000 18,000,000 18,000,000

Issues and Risks Although work progress is going well for the Bialla and Ramazon in terms of Land owner issues, the Divune has been of major issue. The main issue being who to get the most benefit in the compensation. A meeting needs to be arranged for the Divune Landowners to resolve this issue.

Recommendation

It is recommended that PNG Power in consultation with respective government agency resolve this

issue above inorder to commence and complete project implementation.



Agency Name PPL

Programme Name Port Moresby Grid Development

Status Ongoing

Objective

The main objective of this project is basically to resolve the unshared power generation potential

renewable energy generated from hydro electrical schemes. This will be undertaken through

rehabilitation of current Rouna 1 hydro power station facilities to 6MW and Sirinimu Toe of Dam

generation to 1.5 MW capacity.


1. Feasibility Studies 2. Design and Documentation 3. Civil Works


The Port Moresby Grid Development (POMGD) project will involve rehabilitation of the hydro plants in

Rouna , reinforce transmission lines throughout the capital city, connect 3000 households along the

transmission lines from Rouna, 40 MW Kilakila Power Plant 11 kV Mesh loop Distribution Network &

substation


Rouna 1 hydro Power station’s Standard Bidding Document completed



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 4,000,000 4,000,000 4,000,000 4,000,000

Issues and Risks

Land acquisition pending due to delay in Land owner ILG certification

Recommendation

It is recommended that PNG Power resolves the Land aqusition issue as soon to progress

implementation.



SOCIAL SECTOR



No of PIPs

2014


Code SOCIAL SECTOR AGENCIES

235 Department of Education 5 16,060,000

236 Office of Higher education 6 44,100,000

240 Department of Health 2 25,000,000

241 Hospital Management Services 13 106,000,000

242 Department of Community Development 1 2,500,000

512 University of Papua New Guinea 2 20,000,000

513 University of Technology 2 10,000,000

515 University of Environment & Natural Resources 1 10,000,000

516 PNG Sports Commission 2 7,241,000

519 National Aids Council Secretariat 1 3,000,000

520 Institute of Medical Research 1 3,000,000

521 Nationa Youth Commission 1 5,000,000

539 National Museum & Art Gallery 1 5,000,000

542 National Cultural Commission 1 700,000

TOTAL 39 257,601,000



I. SECTOR SUMMARY

The Social Sector comprises the following departments and agencies: Department of Education,

Department of Higher Education, Department of Health, Department of Community

Development, Universities, Sports Commission, National Aids Council, Institute of Medical &

Research and Youth Commission.


The 2014 total Revised Budget Approriation for the Social Sector was K257.60 million. Against

the total Revised Appropriation, the total expenditure incurred was K246.48 million.

This is about 95% of the expenditure against the total revised budget. The spread of the

Social Sector budget by key sub-sectors are as follows:

Health –K137 million Education – K100.16 million and

Other Social social sub-sectors – K20.44

million.

The Health Sector received the highest funding

under the Hospital Management Services to the

tune of K106 million.

Figure 18.0 shows the the social sector revised

funding distribution in the 2014 Development

Budget.

III. ANALYSIS OF THE 2014 SUB SECTOR APPROPRIATIONS

(a) Health Sector

The health sector development programs and projects received the highest level of funding (64%) in the 2014 budget compared to other sub-sectors. The high level of funding was aimed to address the current health sector reforms to improve service delivery, strengthen the primary health care systems at all levels by getting “back to basics” right, improve health system’s preparedness for disease outbreaks and emerging population health threats. This also includes other major sector programs such as;

1. Roll-out of the Provincial Health Authorities; 2. Major redevelopment of Provincial Hospitals; 3. Major Referral Hospitals; 4. Rural Hospitals to District Hospitals; 5. Aid Post and Community Health Post Roll Out; 6. Provincial Transmit Medical Stores; 7. Medical Equipment and Static Plants; and, 8. Support to Training Institutions.

There were 23 projects funded in the 2013, of which 12 were funded by Government of Papua New Guinea (GoPNG) while 10 were funded by development partners (DPs) and 1 (Rural Primary Health Services Delivery Project) was cofinanced by the ADB (loan), GoPNG and AusAID and is co-financed with other development partners and GoPNG. In the 2013 Development Budget, GoPNG has allocated K126.0 million under the Public Investment Program (PIP) for NDOH for major infrastructure work in the Health Sector through the National Department of Health (NDOH). The key impact projects such as the Provincial General Hospital Rehabilitation, Port Moresby General Hospital, Medical Equipment Replacement Program and Training Institutions Infrastructure and Support were significantly funded.

23%

51%

16%

10%

Figure 18.0 Revised Expenditure

Education

Health

Universities

Other Sub Sectors



The NDOH received a total funding of K278.946 million in 2013. From this total funding, K126.0 million was direct GoPNG financing and K152.946 million as grants from various donors and K9.035 million as loan financing from ADB and various DPs in which GoPNG contributed K2.0 million for the Rural Primary Health Services Delivery Project. NDOH is required to transfer funds to the Provincial Hospitals and implementing stakeholders to implement the project activities as planned and within the timeframe and budget and strengthening the coordination aspects of the procurement processes.Major Hospitals have had their funds transferred by way of a MOU with NDOH Headquarter to ensure that all programs and projects are implemented effectively and on time. The GoPNG funds are kept in the Health Trust Account known as the “Health Sector Improvement Program Trust Account” (HSIPTA) and funds are carried over when projects roll over into the following fiscal year.Funding for some of the hospitals has been transferred under MOUs to Hospitals so they are managed while some hospitals still remain with NDOH due to lack of capacity and also lack accountability and transparency in the Hospital Management.

(b) Education Sector

The Education Sector was appropriated an aggregate sector budget of K100.17 million in the 2014 Development Budget. The sector budget distribution are as follows: Department of Education – K16.06 million, Department of Higher Education – K44.1 million, UPNG – K20.0 million, University of Technology (Unitech) – K10.0 million, University Of Environment & Natural Resources (UNRE). The Higher Education received highest funding allocation of 44% comapared to the Education Department and Universities. See fig 18.0.

The 44% (K44.1 million) of the funding was spread to finance the following programs and projects;

Trade Skills Scholars TVET Sector Projects Infrastructure, Rehabilitatio & Recapiatlization National Open University Science Research Council Western Pacific University. 2013 Joint Agreement (UPNG Rhabilitation

The Department of Education got the second highest funding of 16% (K16, 06million) to finance the following projects:

Inspectors Housing and Transportation TVET Sector Projects Qualifications Upgrading Skills Development

Enhancing Quality in Teaching through TV Education Training & HRD Program (Edf9)

Education (Primary & Secondary)

16%

Higher Education

(OHE) 44%

UPNG 20%

Unitech 10%

UNRE 10%

UOG 0%

Fig 19.0 2014 Education Sector Budget Distribution



Grant Original Revised AppropriationWarrants Expenditure Unissued Unused

Project AppropriationAppropriationYTD YTD Warrants Warrants

240 Dept. of Health

Training Instutions Rehibilitation & suport GoPNG 10,000.00 5,000.00 5,000.00 55,000.00 -50,000.00

Rebuilding the Angau Hospital GoPNG 20,000.00 20,000.00 20,000.00 0.00 20,000.00

Total for Depart of Health 30,000.00 25,000.00 25,000.00 55,000.00 -30,000.00

241 Hosp Man Servs

Kerema Hospital Redevelopment GoPNG 5,000.00 4,000.00 4,000.00 5,000.00 -1,000.00

Popendetta Hospital Redevelopment GoPNG 5,000.00 5,000.00 5,000.00 5,000.00 0.00 0.00

New Nonga Hospital Development GoPNG 20,000.00 10,000.00 10,000.00 0.00 10,000.00

Mendi Hospital Redevelopment GoPNG 5,000.00 4,000.00 4,000.00 5,000.00 -1,000.00

Mt.Hagen Redevelopment GoPNG 20,000.00 13,000.00 13,000.00 20,000.00 -7,000.00

Modilon General Hospital Redevelopment GoPNG 5,000.00 4,000.00 4,000.00 5,000.00 -1,000.00

Vanimo General Hospital Redevelopment GoPNG 5,000.00 4,000.00 4,000.00 5,000.00 -1,000.00

Kundiawa General Hospital Rehabilitation GoPNG 5,000.00 5,000.00 5,000.00 5,000.00 0.00

Port Moresby General Hospital GoPNG 30,000.00 30,000.00 30,000.00 30,000.00 0.00

Goroka General Hospital Rehibilitation GoPNG 10,000.00 5,000.00 5,000.00 5,000.00 0.00

Boram General Hospital rehabilitation GoPNG 20,000.00 15,000.00 15,000.00 15,000.00

Lorengau general Hospital Rehibilitation GoPNG 5,000.00 2,000.00 2,000.00 5,000.00 -3,000.00

Daru Hospital Rehibilitation GoPNG 5,000.00 5,000.00 5,000.00 5,000.00 0.00

Total for Hosp Man Servs 140,000.00 106,000.00 106,000.00 95,000.00 11,000.00

Total For 240 & 241 170,000.00 131,000.00 131,000.00 150,000.00 -19,000.00

IV. 2014 WARRANT AND EXPENDITURE ANALYSIS

(a) Health Sector In 2014 Development Budget, the Government of Papua New Guinea, (GoPNG) funded 15 projects under Department of Health and the Hospital Management Services. A total of K131.0 million was allocated from the original appropriation of K170.0 million.Against the total appropriation for the health sector, about K150.0 million was actually spent with while the expenditure reports has indicated that there was over expenditure of K19.0 million. Out of the total warrants released, K31.0 million was recorded as un-used warrants.

(b) Higher Education & Other Social Sectors

The UPNG received 20% of the total sector budget while Unitech and UNRE received 10% each out of the total appropropriation. The University of Goroka was not given any direct funding in the 2014 Development Budget. Others social sectors were appropriated amounting to K26.44 million, with 95 % of this funding actual expenditure.

Project

Grant Original Approp

(K’000)

Revised Approp (K’000)

Warrants Expenditure

Unused

YTD (K’000)

YTD (K’000)

Warrants (K’000)

242 - Dept Com Dev

Social Protection Program GoPNG 5000 2500 2500 999482 1500518

Total Dept. Comm Dev 5000 2500 2500 999482 1500518

512 – UPNG

UPNG Law School Building GoPNG 15000 12000 12000 9000 3000

UPNG Science IV Building GoPNG 10000 8000 8000 6000 2000

Total UPNG 25000 20000 20000 15000 5000



513 – Unitech

Petroleum & Petro - chemical Engineering Sch

GoPNG 10000 5000 5000 5000

Meeting Accredition Requirements GoPNG 10000 5000 5000 5000

Total Unitech 20000 10000 10000 10000

515- Univ of Eiv & Nat Research

Uinversity of Vudal Library GoPNG 10000 10000 10000 10000 0

Total for Evi & Nat Research GoPNG 10000 10000 10000 10000 0

516 - Sports Commission

PNG Sports GoPNG 0 0 0 0 26577

Sports Enhancement Program for Districts & Pro

GoPNG 10000 7241 7240398 0

Total for Sports Commission 10000 7241 7240398 26577

519 – NACS

National Strategic Plan on HIV/AIDS Implememt

GoPNG 3000 3000 3000 3000 0

Total for NACS 3000 3000 3000 3000

520 – IMR

Malaria Research Infrastracture Project GoPNG 4000 3000 3000 2600 400

Total IMR 4000 3000 3000 2600 400

521 - National Youth Commission

Youth Friendly Centre GoPNG 5000 5000 5000 5000 0

Total for Youth Commisn 5000 5000 5000 5000

539 - Nat Museum

International Conference Centre GoPNG 5000 5000 5000 1000 4000

Total for Nat Museum 5000 5000 5000 1000 4000

542 - Nat Cult Comm

National film Institute Support GoPNG 700 700 700 700

Total Nat Comm 700 700 700 700

Total for other social Sectors 87700 2500 59300 8277080 20927095



(c) Education Sector Against the total Revised Appropriation of K60.16 million, the total expenditure incurred was KK50.36 million. This reflects about 84% of the total revised appropriation. The un-used warrants or a fund not expended is about K5.75 million. This is assumed to be recalled back to the Consolidated Revenue.

(d) Overall 2014 Sector Warrant & Expenditure The table 7 below shows the 2014 warrants and expenditure of the social sector agencies

0

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

140,000,000

160,000,000

180,000,000

Education Health Universities Other SubSectors

Original Budget 79,060,000 170,000,000 55,000,000 32,700,000

Revised Budget 60,160,000 131,000,000 40,000,000 26,441,000

Warrants YTD 59,717,700 137,000,000 40,000,000 20,440,398

Actual Spend 50,969,121 155,600,000 25,000,000 14,913,302

Ap

pro

riat

ion

s (K

'mill

lon

s)

Table 7: Warrant & Expenditure

Grant Original Revised AppropriationWarrants ExpenditureUnissued Unused

Project AppropriationAppropriationYTD YTD Warrants Warrants

235 Dept of Educn

Enhancing Quality in Teaching through Television GoPNG 1,000.00 1,000.00 1,000.00 759,944 240,056

Inspectorss Housing and Transportation GoPNG 11,060.00 11,060.00 11,060.00 956,067 10,103,933

Qualifications Upgrading Skills Development GoPNG 0 0 0 0 0

Reading Education Project GoPNG 2,000.00 2,000.00 2,000.00 0.00 2,000.00

Flexible, Open & Distance Education Project GoPNG 2,000.00 2,000.00 1,600.00 600.00 1,000.00

Total for Education 16,060.00 16,060.00 15,660.00 1,716,611 10,346,989

236 Dept of Higher Education

Trade Skills Scholarship GoPNG 15,000.00 14,000.00 13,973.00 14,831,614 -858,614

TVET Sector Projects GoPNG 10,000.00 3,400.00 3,400.00 7,801,623 -4,401,623

Infrastracture & Rehibilitation & Recapitalisation GoPNG 10,000.00 10,000.00 10,000.00 9,937,964 62,036

West Pacific University GoPNG 17,000.00 10,000.00 10,000.00 9,231,161 768,839

Science Research Council GoPNG 6,000.00 3,700.00 3,684,700 3,850,815 -166,115

National Open University GoPNG 5,000.00 3,000.00 3,000.00 2,999,933 67

Total for Dept of Education 63,000.00 44,100.00 3,725,073.00 48,653,110 -4,595,410

Total for 235 & 236 79,060.00 60,160.00 3,740,733.00 50,369,721 5,751,579



V. IMPLEMENTATION STATUS Overall implementation of projects is progressing well. Most of the Programs/Projects are ongoing and in some provinces are progressing well whilst some are lagging behind. Efforts are focused to redevelop the provincial hospitals and regional referral hospitals in the country in the next five years. These hospitals include:

Angau Referral Hospital; Mt. Hagen Referral Hospital; New Nonga Referral Hospital; and, Port Moresby General Referral Hospital;

Similarly, the immediate priority is also placed on the upgrading of the district hospitals and Community Health Posts to improve the prevailing rural health infrastructures with the aim of supporting the strategy of achieving universal access to primary health care.

VI. ISSUES AND CHALLENGES Some of the key issues affecting the smooth implementation of the national health development programs:

Staff capacity issue faced by NDOH and the need to recruit graduate Architects and Engineers to design and implement health infrastructure development projects. A lot of the qualified graduates are absorbed into the private sector as a result of the construction boom flow-on effect from the LNG project;

Lack of capacity in the areas of technical support and financial capacity of hospitals and health centers have delayed implementation of programs/projects;

Delay and the lengthy procurement process of goods and services by Central Supply and Tenders Board (CSTB) have affected the project implementation as planned.

Slow disbursements of funds and delays in approvals and processing of funds has affected execution of projects between the implementing agencies and the contractors as well as the suppliers;

Variations in costs of goods and services have further delayed the implementation of planned project activities.

Lack of pro-activeness and innovation from the agency responsible had resulted in most of the development funds kept in the trust accounts without expending it. There were carried overs from the previous years – 2011 to 2012.

VII. RECOMMENDATION It is recommended that:

NDOH is required to advance the signing of MOU for the remaining hospitals so that funds can be transferred to implement its planned activities;

Disbursement of funds/payments must be done on a timely basis to expedite implementation of planned activtities.

Prompt and appropriate action should be taken on fast tracking of all tendering process – delays in approvals, processing and funds disbursements;

Planning and information gathering should happen well ahead before funds are secured to avoid delay in expending funds received in one financial year;

Implementing agencies should improve on their reporting mechanism to provide quarterly reports to DNPM and should also release funding for the major capital works under expenditure items 223 for project preparatory activities;

A meeting must be facilitated by NDOH with CSTB so that importance of health infrastructure is re-emphasized and to fast track health infrastructure developments.

NDOE be proactive and improve in the implementation, monitoring and reporting of both the

donor and Go-PNG funded projects;



Warrants to be release on timely bases as per cash flow and work plan submission;

Compliance issues to be observed by the donor agencies in relation to project reporting; and, Project Steering Committee is established

Half of the appropriation under the health programs must be released in the third quarter of

each fiscal year. While the balanace of the funds must be released when all contracts are signed with all the relevant contractors and the project is ready to ne delivered.

DRAFT

155 2014 Annual Public Investment Program Implementaiton Report


240 DEPARTMENT OF HEALTH

Agency Name Department of Health

Project Name Training Institution Rehabilitation and Support

Status On going

Objective

To rehabilitate the current training institutions; and to expand the capacity of training institutions to

meet the Workforce Development Plan for future staffing need. This project will focus on rehabilitating

and strengthening the current infrastructure for training institutions to increase the annual output for

qualified and accredited health workers to meet the needs of the growing population


1. Rehabilitation and upgrading of 12 x community health workers training schools; 2. Rehabilitation and upgrading of 8 x Nursing Training Schools; and, 3. Rehabilitation and upgrading of 4 x midwifery nursing training schools and universities.


The project commenced in 2012 and has been appropriated a total of K22 million (2012 – K6m, 2013 –

K6 m, 2014 – K10m ), which was distributed evenly throughout the nine (9) school of nursing and

twelve community health workers training schools in the country. NDOH has MOU signed with 6

nursing schools for K4.1 million and 11 CHW training schools for K1.413 million namely:

1. Lae Nursing School for K500,000.0 for a Male and female dormitories and construction is in

progress

2. Mendi school for K500,000.0 for refurbishment of male dormitories and extension to

administration block of which construction is 80% completed

3. Goroka Nursing school for K 500,000.0 for maintenance of students dormitory of which work

is 80% in progress

4. St.Marys Vunapope Nursing School for K500,000.0 and scope of works for rehabilitation is

been done

5. Enga School of Nursing for K500,000.0 and awaiting completion of the scope of works

6. UPNG school of Medicine for K100,000.0 for scope of works for the whole rehabilitation

7. Kapunafor K250,000.0 for scope of works for the whole rehabilitation

8. St Margarets , Tinsley, Rumginae Kumin, Braun, Gaubin, Raihu, Lemakot for K83,000.0 for

scoping works

9. Kugumanda for K250,000.0

10. Madang Lutheran school of Nursing, Nazarene school of nursing, Pacific Adventist University are allocated K125, 000.0 each however have yet to have the MOU signed.

The total warrant released at this point in time is being put in trust HISP accounts with no plans

DRAFT





Revised Appro.

Actual Exp

Funding Level

(GoPNG)

6,000,000 10,000,000 10,000,000 10,000,00 5,000,000

Issues and Risks

The project has been appropriated a total of K 22 million of which warrants of K17million has

been released to date, however working report provided has only being for K5.513 million

with K11.487 unaccounted for.

There is no project steering committee for the project despite being implemented nationwide

The project progress is quite slow

Lack of technical personals on project sites in each school to progress work

NDOH has decided for the remaining funds to be used as co-financing with DFAT, progress on

project is being halted

Lack of detailed work plan and costing for each institution’s upgrade.

Recommendation

1. The project should be engaging a project management consultant to progress project forward

2. Training programs on project management for project site officers should be conducted to

build their capacity to manage projects at their level

3. The decision to use 2014 GoPNG appropriation to counterpart DFAT funding should be

confirmed by DNPM as change of project scope

4. A project steering committee meeting be held

DRAFT



Agency Name Department of Health

Project Name Rural Primary Health Service Delivery Project

Status On going

Objective

Is to strengthen the rural health system in sixteen (16) selected Districts of Papua New Guinea by

increasing the coverage and quality of primary health care in partnership with both state and non-

state service providers delivering health services in those Districts and by supporting the Government

of PNG to implement the National Health Plan 2011 – 2020 (NHP) as it relates to general health

generally.


1. Support to National Department of Health – Community level health promotion and awareness 2. Strengthening of Local Health System 3. Human Resource Development 4. Upgrading of Community Health Facilities for the pilot provinces 5. Health Promotion and Capacity Development in Local Communities.


The Community Health Post Policy and Implementation Guideline have been published and e formal launch was made by the Deputy Secretary for Health on 9th July 2013.

Project consultant provided input into the following policies launched at the National Health Conference on the 18th June 2014:

i. National Health Sector Partnership Policy ii. National Family Planning Policy 2014

iii. National Sexual Reproductive Policy 2014 iv. Health Gender Policy 2014

The HR Consultant is assisting the National Department of Health’s Human Resource Taskforce charged with developing and implementing strategies to mitigate the impending health workforce shortage.

Partnership Committee have now now been established in each of the eight Project Provinces and all are meeting as required by their Terms of Reference

Health Mentors and Project Consultants continue to work with each of the Provinces to identify specific training needs of rural health staff of the participating District.

The project also supported “Training of Trainers” during May 2014 in Kimbe for the Integrated Management of Childhood illness.

Project Officer are advocating in local communities for local students to apply for Australia Awards Scholarship to undertake community health worker, nursing or midwifery studies.

Community and landowner consultation and engagement activities are proceeding and 27 of 32 communities where new CHP are to be established have been visited.

Agreement has been reached with customary landowners of the eighteen (18) of the site for transfer of title for the required land to the state.

2014 level of funding and expenditure Year 2013 2014 Original

Appro.

Revised

Appro.

Actual Exp


2,000,000

DRAFT



Issues and Risks

The implication of the fluctuating exchange rate for the kina versus USD and escalating building cost.

No counterpart funding

Recommendation

1. Ensure that counterpart funding must be considered for this project annually in the Development Budget as this project will bringing health to our people in the rural areas.

2. DNPM to be member to Project Steering Committee

DRAFT



241 HOSPITAL MANAGEMENT SERVICES

Agency Name Hospital Management Services

Project Name New Enga Hospital

Status On going

Objective

The main objective of this project is to address the ailing and at times non existing primary and

curative health care in the province by building a new 300 bed provincial hospital for the 400,000

people of Enga and to replace the current 67 bed provincial hospital that was built in the pre-colonial

era as a district hospital.


1. Construction 2. Project Administration and consultancy 3. Furnishing/ Equipments /IT/ Owner System


The project is implemented and managed by Provincial Hospital Board and Management in collaboration with Provincial Administration and in partnership with Public and Private Healthcare Partners from United States of America. The NDOH with its technical officers will coordinate and oversee the project for compliance of medical standard and health infrastructure standards. 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000.000 30,000.0 30,000.0 30,000.0 30,000.0

Issues and Risks

The new Hospital Development site has major land purchase problem on the new proposed site and going through the National Court to sort it out. Land title is yet to be purchased as well;

Recommendation

Ensure that land issues and land title must are sorted out before going ahead with the implementation

activities to avoid unforeseen challenges for impediments of project implementation.

DRAFT




Project Name New Nonga Hospital

Status On going

Objective

To construct a new regional referral hospital for the New Guinea Island region


Conduct feasibility studies for the new hospital 2014 Progress & Achievements

The project has been appropriated a total of K35million up to 2014 ENB Provincial Administration has completely purchased the land (Wairiki) recently (2014)

for K3.25 million and work on the land grubbing has began K4million of the 2011 warrants has been directed to the existing Nonga hospital as directed by

the Hospital Relocation committee to do emergency works so as to keep the service going on. These works included; Renovation of the medical CD ward, service Unit and Medical CD ablution, mortuary building, sisters quarters, Bala house and amenity, 2 staff houses, paediatric ablution block and the ward, RMO residence, existing nursing building, ,biomedical workshop, matanoni staff houses, accidents and emergency& out patient, gynaecology and labour ward surgical unit and theatre and the Family planning unit buildings.

K1 million has also being given to improve emergency works also for Vunapope hospital. No

report at this stage.

All warrants released are kept in the HSIP trust account. Warrants release are yet to be used as actual full project and scope of works is yet to be planned out todetermine the actual requirements in the project.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 10,000.0 10,000.0 10,000.0 10,000.0

Issues and Risks

The project has no progress in the last three years despite appropriation being made for.

There is a misunderstanding of the expected output of the project between all stakeholders to the project of which the NDOH and the ENBPA has been the forefront. This has led to the prolong search for land and such the accumulation of the appropriations in to the HSIP trust account and lack of good working relationship.

Recommendation

1. DNPM, as an independent stake holder to conduct fact finding on the project status and make appropriaterecommendation on the future of the project as soon as possible.

2. Establishment of Project Steering Committee.

DRAFT




Project Name Popondetta Hospital

Status On going

Objective

To redevelop Popondetta Hospital into a Provincial Hospital to provide improved, better, affordable

and accessible curative health services to the majority of the rural population in Oro Province.


1. Redevelopment plan of the hospital 2. Implementation of the redevelopment Plan 3. Tendering for construction of the operating theatre 4. Design and construction of new staff houses 5. Construction of new hospital building 6. Rehabilitation of existing infrastructure


A total appropriation of K25 million to date allocated to this project

Master Plan for the redevelopment has been completed Land has been purchased for the construction of the staff houses and other new development

of which earth works have begun at a cost of K2.5 million. Contract for construction has being awarded to Pavilion construction and logistics.

The construction of the operating theatre has started end of last year.



Revised Appro.

Actual Exp


Issues and Risks

Expenditure and Implementation are not been submitted on timely basis. Project Steering Committee meeting to be conducted on regular basis.

Recommendation

1. Strengthened sector coordination and consultation through Project Steering Committee or Project.

2. Stakeholder Meetings to ascertain the level of project implementation for the PIP funded projects.

DRAFT




Project Name Mendi Hospital Redevelopment

Status On going

Objective

To redevelop the Mendi Hospital into a Provincial Hospital to provide improved, better, affordable and accessible curative health services to the majority of the rural population in Southern Highlands Province.


Schematic Design and Tender Documentation for Water and Sewerage System. Upgrading of water and sewerage Rehabilitation and refurbishment of run down hospital facilities including wards Hospital redevelopment Construction of new Medical Lab Building and Dental Unit Construction of staff house – two storey building Construction of x-ray room rehabilitation


Consultancy services for master planning schematic design and costing and documentation has been awarded to Planpac Architects as per CSTB contract No… with the final schematic design nearing completion for K9.2 million

Renovation works for the mortuary and administration office completed Planning for rehabilitation works for x-ray and laboratory currently underway for works to

begin in September Design and costing for the Re development plan currently in progress for the submission of

second phase PIP funding to begin in 2015 Warrants release are yet to be used as costing and design for the rehabilitation works are yet to

be completed A master plan for the redevelopment of the hospital has been completed by the Plan pack

consultants including all the schematic designs and the detailed costing of the hospitals plan. The Plan has been approved by NDOH and Southern Highlands PG. The project documentation has been developed and submitted to NDOH

All rehabilitation works for the outpatient ward and mortuary is completed.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks The hospital Redevelopment is in its phase 2, which is the schematic design and detail design stage, these may have been completed, NDOH yet to report. The 3rd phase is the construction and the 1st stage will cost K183.7 and it will start in 2015. The funding may not be sufficient for the construction and implementation may not progress well.

Recommendation

The Government to consider and increase PIP funding in the next budget and

Project Steering Committee meeting to be conducted.

DRAFT




Project Name Kerema Hospital

Status On going

Objective

To redevelop Kerema Hospital into a Provincial Hospital to provide an improved, better, affordable

and accessible curative health services to the majority of the rural population in Gulf Province through

efficient utilization of available resources and effectively responding to the changes within the

country’s health systems.


1. Construction of remaining of part 1A & 1B, hospital building 2. Construction of Phase 1 & 2 (stage 1) redevelopment which includes building of a new

outpatient and administration block,1x Nurses Quarters (10x2 bedroom ) and 33 bedroom nurses dormitory

3. General staff houses (3 bedroom duplex 3x3 bedroom duplex) 4. 2x Executive Duplex for Specialists &Lagatoi house (x3)

Contract awarding of the construction of sewerage plant, kitchen and mess and medical doctors houses was done on 12th May 2014 2014 Progress & Achievements

Consultancy services for master planning schematic design and costing and documentation was awarded to Laki Manoka Architects as per CSTB contract No: with all related works completed for K7.5 million.

Construction of nursing dormitory completed and opened in 2013. The construction of the Out Patient Department and Administration Building Complex is near

completion, the contractor is currently doing the final touches. The construction of six (6) staff houses (lagatois in design) is near completion. Tendering and contract awarding was done by NDOH at the CSTB for the sewerage plant and

staff houses and awarded to Pacific Rim and House Built Construction respectively of which the latter has been rejected by the Hospital Board based on the hospital’s current experience. Hence the contract for the construction of 2x Executive Duplex for Specialists and the upgrade of the hospital’s kitchen and mess has been awarded to the Pacific Rim Construction through the provincial Tenders board.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks

Land for extension of the hospital as per the redevelopment plan l is under negotiation for the establishment of the treatment plant for the hospital

The issues of rejection of the contracts by the Hospital should be discussed further with the NDOH to avoid any legal issues.

DRAFT



Recommendation

1. Project steering committee meeting to be conducted and a site visit be conducted to ascertain the major constructions works currently going on.

2. Contract awarding conflicts be solves between the NDOH and the hospital board as soon as possible.

DRAFT




Project Name MT Hagen Hospital

Status On going

Objective

To redevelop the existing Mt. Hagen Hospital into a trauma Specialist Referral Regional Hospital for

the Highlands Region


1. Feasibility study for development of the master plan, renovation and construction of Hagen Hospital to be a Highlands Regional Referral Hospital

2. Contract Documentation 3. Complete Hospital Redevelopment

Scope of works for 2014 Develop master plan to upgrade to a Specialist Regional hospital and the Construction and renovation

of;

Hospital fencing, Nurses accommodation Female toilets in medical ward Physiotherapy and disable clients toilets Maintenance of intermediate ward Waiting areas and ventilation at the Tininga (HIV/AIDS) clinic Renovation of A&E section Repairing of operating theatre


No reports on the implementation stage



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks

Lack of reporting by the hospital and NDOH on the progress to date.

Recommendation

1. DNPM to conduct a site visit on the progress to date 2. Project steering committee to be established.

DRAFT




Project Name Modilon Hospital

Status On going

Objective

To redevelop Modilon Hospital into a Provincial Hospital to provide improved, better, affordable and accessible curative health services to the majority of the rural population in Madang Province through efficient utilization of available resources and effectively responding to the changes within the country’s health system. Components and Scope of Works

1. Conduct feasibility studies for infrastructure improvement for the hospital 2. Construction of operating theatre facilities 3. Upgrading of staff houses


The construction of the operating theatre is in progress, the concrete flooring is completed, the

building structure are erected and the roofing complete. The actual project is progressing well.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

3,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks

Bad weather has slowed the grounds work much and causing inconvenience such as the flooding of

drain water into the ground level wards.

Recommendation

A comprehensive financial report needs to be provided by HMS on this current scope of works and

physical report through site visit is required.

DRAFT




Project Name Vanimo Hospital

Status On going

Objective

To redevelop Vanimo Hospital into a Provincial Hospital to provide high level of clinical

responsiveness to critical care and intermediate client and provide a central coordination, monitoring

and reporting of health service delivery in the Sandaun Province


1. Construction of a 2 level building for Critical Care Unit, Intermediate Services, Maternity ward, office space and consultation rooms for doctors.

2. Complete Hospital Redevelopment Scope of works for 2014

Construction of ICU and Intermediate Ward Upgrading of sewerage system


Construction of the critical care and the intermediate ward has began at a cost of K4.790 million Design and scoping of the new 2 storey building for PHA and adolescents ward (20 – 40 beds) is completed and submitted to NDOH standards section of which has been endorsed and contracts awarded to Peoples Construction Company with all foundation completed at this point in time The projects that have been completed include; new operating theatre department, new Family Health Service Building, Staff Houses, Paediatric Ward, construction of Medical and surgical wards completed and construction of 12 men 2 bedroom units completed



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks

Lack of land to expand The province also lacks other physical plans of which could guide the new hospital

developments

Recommendation

1. DNPM to conduct a site visit on the progress to date. 2. Project Steering Committee to be established.

DRAFT




Project Name Kundiawa Hospital

Status On going

Objective

To redevelop Kundiawa Hospital into a Provincial Hospital to provide improved, better, affordable and accessible curative health services to the majority of the rural population in Simbu Province through efficient utilization of available resources and effectively responding to the changes within the country’s health systems. Components and Scope of Works

1. Rehabilitation and upgrading of existing hospital facilities and wards 2. Rehabilitation of number of staff houses 3. Construction of Nurse’s quarters 4. Major renovation of the operating theatre


In 2014, K5million was released to the hospital. The following components under the vote have been

earmarked for implementation in 2014, some were approved by Hospital Board in 2013 but has yet to

be implemented and these are; Extension of Physio therapy and Gym; Construction of 2x single

doctors unit; Construction of Administration Staff Quarters; 2nd phase of operating theatre extension;

Rehabilitation and Improvement of Hospital wards and Construction and Extension of Administration

Complex.

The projects on progress are;

The construction of six houses for doctors – 3 completed Construction of new TB ward- completed Construction of new storage /warehouse- near completion Installation of new water plant for the hospital – well drilled and awaiting plumbing works Construction of new duplex for nurses – near completion New fencing of the hospital – almost complete Construction of new transit duplex for new staff, on call and shift staff – work in progress Improvement of access road



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks

Progressive and expenditure reports are not submitted on timely basis

Recommendation

1. Project site visit to be conducted 2. Establishment of Project Steering Committee.

DRAFT




Project Name Port Moresby General Hospital

Status On going

Objective

To redevelop Port Moresby General Hospital into a National Specialist Referral Hospital for non-communicable disease with international standard to provide improved, better, affordable and accessible curative health services Components and Scope of Works

1. Maintenance Costs Water leak, children’s outpatient, doctor’s flats, ward 4-A,B,C & ward 3 A, B, C, ward 2A&B, Ward

2C&D, CSSD, Lift 1&2, biomedical office, medical records, sister’s quarters, admin building, and

assets registry

2. Development Projects Construction of the 2 storey building for women and children ward Relocation and construction of the sister’s quarters Renovation and upgrading of all the hospital facilities Construction of the administrative block Minor Building Works to Clinical Services (as per Clinical Implementation Plan 2010-2020) Major Buildings Works to Clinical Services (as per Clinical Implementation Plan 2010-202


Previous works completed are: rehabilitation on the maternity and nursery ward, mortuary facilities upgrade, redevelopment of the accidents and emergency wards and general outpatient ward. Water reservoir has been up graded and new administration block been constructed. Current Refurbishment works ongoing for:

Ward 4C , wards 4D , ward4A , ward 4B for K 7,048,772.65 by ZONE (png) LTD Wards 2 & 3 levels 1 & 2 and ground level for K3,768,837.90by ZONE (png) LTD Ditto Ward for 2,413,922.40by ZONE (png) LTD Laloki nurse training college and staff houses for K5,540,971.00 by Digara contractors Service maintenance to Morgue reefer freezers containers, electrical up grade (power lights

ceiling fan , smoke detectors, fire hydrant &system & air-condition ) for the wards and admin office, maintenance upgrade to MSB panel board by the laundry room, cable and main switch board upgrade by ELTECH Engineering services for K2,435,603.20

Major , renovation, maintenance and refurbishment of 18 rooms (nurses accommodation), 28 rooms (admin building), ward male & female toilets for 3B, 06, 3A, the warden house and laundry shed and the doctors accommodation of unit 56, 59, 62, 63 and 60 for K1, 945, 132.16

Other maintenance works include maintenance works to the old laboratory, the disable toilets, cancer and STD wards for K227, 129.81.

Design of the Master plan for the whole hospital upgrade and redevelopment is also under way

by the Thompson Adsett for K 328,947.37(1st payment) Extension of the car park and sealing and fencing by Hebou construction for K257, 131.00

DRAFT



Purchase and installation of back genset, office furniture 0ffice, 320 lockers ,angle shelving and racking system, oxygen gas, incinerator shed and supply and the upgrade of the lift for K4,001,139.74

Other demolition and earth works are also going on to prepare new construction by the Red Sea Housing Services for K235,501.42 and the mechanical works for the new administration building for K246,646.30

The total contract sum for the above current ongoing works is about K28, 799,951.77 No work was done in 2014 due to slow release of funds



Revised Appro.

Actual Exp


50,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues and Risks

The hospital has not been providing progressive and expenditure reports on a timely basis. No Project Steering Committee meeting held for the last 2 years

Recommendation

Project Steering Committee to be established DNPM to conduct project site visit.

DRAFT




Project Name Angau Memorial Hospital

Status On going

Objective

To rebuild the Angau Hospital to support the Health Sector to improve delivery of health services to

the people of Morobe and the country.


1. Construction of a new kitchen building 2. Construction of maternity ward 3. Construction of 5x L40 type house.


K20 million appropriated as part of the Joint Understanding between Australian Government and GoPNG

No reports submitted to date



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks

No consultation meeting with Hospital management. No report submitted to date.

Recommendation

1. Project Steering Committee to be established 2. DNPM to conduct a project site visit.

DRAFT




Project Name Goroka Hospital

Status On going

Objective

To rehabilitate and upgrade Goroka Provincial Hospital to enable accessibility to basic Preventative

and Curative Health care at the hospital, which will also reduce the morbidity and mortality rates and

also address issues related to public health such as HIV/AIDS, Malaria and other emerging treats


1. Renovation of maternity ward 2. Renovation of operating theatre 2. Construction of 5xl40 type houses 2. Construction of 40 room nurses accommodation building


The project was appropriated K10 million and is yet to submit report.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks There has been lack of reporting on the project implementation. DNPM needs to step on monitoring & evaluation to ensure that project is smoothly implemented.

Recommendation

The Gorokoa Hospital Management needs to establishof Project Steering Committee for this project.

DNPM to conduct a project site visit.

DRAFT




Project Name Boram Hospital

Status On going

Objective

Is to relocate the hospital and develop modern hospital facilities which will provide quality health

services and be the referral hospital for the province and the people of East Sepik Province.


1. Invitation for consultancy services for the Master Plan design of the hospital

2. Undertake tender for design consultancy services

3. Upgrading and maintenance of existing hospital facilities and staff houses

4. Construction of new hospital facilities.

2014 Progress & Achievements The new site for the hospital relocation has finally been identified; the new site is at Wirui, Wewak. The documentation for the land acquisition is in progress. Refurbishment work to the existing facilities and staff houses are still continuing at the current Boram hospital, for continuity of health services to the people.

The total appropriation is K30.0 million



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 15,000,000 15,000,000 15,000,000 0.0

Issues and Risks

Progress of the project has been very slow due to poor communication between Hospital Management/Board and the Provincial Government.

No reports submitted on regular basis No Project Steering Committee established

Recommendation

Establishment of Project Steering Committee Consultation meeting with the hospital management

DRAFT




Project Name Manus Hospital

Status On going

Objective

To rehabilitate Manus Provincial General Hospital to be able to meet the increasing demand of health care needs for the people of Manus and the country as whole.


1. Feasibility Studies and project design

2. Consultancy phase including mobilization, construction, commissioning and demobilization

3. Major renovation of Accident and Emergency Department & Administration Block.


No report submitted to date The hospital was allocated K1.5 million from the K20million appropriated in 2013 Development Budget under the Provincial Hospital Rehabilitation Program



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks

No report submitted to date

Recommendation

Establish Project Steering Committee Consultation meeting with Hospital Management and conduct site visit.

DRAFT




Project Name Daru Hospital

Status On going

Objective

To rehabilitate and redevelop the Daru Hospital to be able to meet the increasing demand of basic Primary and Preventative Health Care and provide a modern and clinically safe and improved health services for the people at the Provincial Hospital.


1. Feasibility studies and project preparation 2. Master Planning 2. Consultancy services and Detail Design Documentation 3. Tendering and Awarding of Contract 4. Redevelopment of Daru Hospital.


No report submitted to date



Revised Appro.

Actual Exp


0.0 5,000,000 5,000,000 5,000,000 5,000,000

Issues and Risks

No report submitted to date No Project Steering Committee established

Recommendation

Establishment of Project Steering Committee Consultation meeting with Hospital Management and conduct project site visit.

DRAFT



247 DEPARTMENT FOR COMMUNITY DEVELOPMENT

AGENCY SUMMARY

Objective & Mission Statement:

Objective: To promote integrated human development with an emphasis on specific social needs of individuals, families, and groups. The Department for Community Development (DCFD) aims to take a lead in mobilizing local communities and marginalized groupings in order to enhance productive living and community development. Mission: Through the implementation of the Integrated Community Development Policy (ICDP), successful and productive families and communities will be promoted by creating opportunities for learning and development for all.

Scope of the Public Investment Program:

The community and social development programs are within the gender, youth and vulnerable sector strategies of the Medium Term Development Plan (2011 -2015) and the Integrated Community Development Policy of which intends to empower and strengthen the informal sector through community learning.

The current annual appropriation is K80, 259, 000.00 and funds a total of nine (9) projects. Of these, eight (8) are donor funded through grant financing whilst only one (1) is funded by Go-PNG for K1million. These programs/projects are:

1. Furthering Human Rights; 2. Non State Actors Support Program; 3. Strongim Pipol Strongim Nesen; 4. Care Integrated Community Development; 5. PNG Church Partnership Program; 6. Violence Against Women; 7. Gender Equality and Women’s’ Empowerment; 8. Gender Equality/Gender Based Violence; and, 9. Child Protection.

Key Issues:

The level of input on the annual project work plans and overall development planning needs to

be improved to match the current scope of the project. (Completion of the Social Protection

Policy) as highlighted in the 2014 budget books.

The project steering committee is yet to be established

The 95% of the 2014 appropriation are donor fund and hence are implemented outside the

DFCD structures and such lacked reporting on progress to date.

2013 AGENCY SUMMARY (K’000):

Project

Grant Domestic

Original Approp

Revised Approp

Warrants YTD

Expendur YTD

Unused Warrants

Projects Funded under Vote 242 Furthering Human Rights Dom 1,000 1,000 1,000 1,000

Non State Actors Support Program Donor/Grant 818 818 0 0 0 Strongim Pipol Strongim

Nesen Donor/Grant

44,188 44,188 0 0 0 Care Integrated Community Development

Donor/Grant 3,233 3,233 0 0 0

DRAFT



Project

Grant Domestic

Original Approp

Revised Approp

Warrants YTD

Expendur YTD

Unused Warrants

Projects Funded under Vote 242 PNG Church Partnership Program

Donor/Grant 17,244 17,244 0 0 0

Violence Against Women Donor/Grant

724 724 0 0 0 Gender Equality and Women’s’ Empowerment

Donor/Grant 3,897 3,897 0 0 0

Gender Equality/Gender Based Violence (A

Donor/Grant 3,233 3,233 0 0 0

Child Protection Donor/Grant

5,940 5,940 0 0 0 Grand Total K(‘000’) 80, 277 80, 277 1,000 1,000 0

2014 Agency Summary

Project

Funds

Source

Original

Approp

Revised

Approp

Warrants

YTD

Expenditure

YTD

Unused

Warrants

242 - Dept

Com Dev

Social

Protection

Program GoPNG 5,000.00 2,500.00 2,500.00 999,482 1,500,518

Total Dept.

Comm Dev 5,000.00 2,500.00 2,500.00 999,482 1,500,518

DRAFT



Agency Name Department of Community Development

Project Name Social Protection Program

Status On going

Objective

1. To promote a integrated program of building a progressive, productive, inclusive, safe and sustainable ples laip haua maurina through improvement in quality of life and enable an ongoing process of human development with emphasis on the needs of individual, families and communities

2. To promote and advocate for the development and establishment of social protection programs in PNG


1. Research, compile reports and development of the PNG Social Protection Policy 3. Integration of National E-ID process and the National Civil Registration through the National

Civil Registry Office. 4. Empowerment and capacity building and lives skills program through literacy, socio-economic

support program and district focal point support program. 5. Protection and promotion of human rights education and support program for all vulnerable

groups including pension programs for people living with disability and elderly and 6. Restoration and protection of PNG indigenous social and cultural value.


No report



Revised Appro.

Actual Exp


0.0 2,500,000 2,500,000 2,500,000 2,500,000

Issues and Risks

No report

Recommendation

Consultation meeting to get up to date information on the progress of the program

DRAFT



203 PNG NATIONAL SPORTS COMMISSION

AGENCY SUMMARY Mission Statement & Objectives

The agency’s mission is to lead and coordinate the delivery of quality sport and physical activity into the lives of all people and to create opportunities for sporting excellence in PNG The strategic objectives are:

1. To develop its organizational capacity and increase support to PNGSFactivities;

2. To increase access and participation in sports and physical activities; 3. To identify and develop talent; 4. To provide qualification courses; 5. To promote development benefits of sports and to use sports fordevelopment; and 6. To ensure provision of adequate sporting facilities and resources.

The overall goal of the projects is to develop, strengthen and promote sporting programs at the

districts and provinces through development of sport development programs and infrastructure

development.

Scope of Public Investment Program:

PNGSF was allocated K7, 241,000.0 for one ongoing project in 2014.

• Sports Enhancement Program for district and provincial sporting bodies -GoPNG

2013 Appropriation & Expenditure Summary (K’000)

Fund Source Original Revised Warrants Exp

Unused

Projects Funded under Vote 203

Australian Sports Outreach Program AusAID 1,950 1,950 0 0 0

Sports Enhancement Prog. for Districts & Provinces Dom 5,000 5,000 5,000 5,000

Grand Total 6,950 6,950 5,000 5,000

2014 Appreciation & Expenditures Summary (K’000)

Fund Source Original Revised Warrants Exp Unused

516 - Sports Commission

PNG Sports GoPNG 0 0 0 0 26,577

Sports Enhancement Prog. for Districts & Pro GoPNG 10,000.00 7,241.00 7,240.3 0

Total for Sports Commission 10,000.00 7,241.00 7,240.3 26,577

Key Issues:

The Go-PNG funded project has experience political interference from the minister concerned hence, the planned activities not implemented as per the project documentation and also the current implementation progress is a duplication of the current programs of talent identification and development by the 2015 South Pacific Games Project.

DRAFT



PNGSF is still implementing also its other ongoing major project components with its previous funding.

The Australian aid funded project is yet to fully begin as the project is fully managed by the donor office.

Recommendations

1. The Go-PNG funded project continues to be funded in the next quarters of 2013, pending the

review of projects’ current implementation structure and components as some components of

both projects are similar implemented outside of the planned scope.

2. Reporting and monitoring of other past major projects to continue.

DRAFT



Agency Name PNG Sports Commission

Project Name Sports Enhancement Program for Districts and Provinces

Status On going

Objective

To assist in preparation of sports men and women and communities and promote bottom up sports

development


1. Games Enhancement Program and 2. Sports Infrastructure Development Program


No report



Revised Appro.

Actual Exp


5,000,000 10,000,000 10,000,000 10,000,000 7,240,398

Issues and Risks

No reports

Recommendation

DNPN to have consultation meeting with the agency.

DRAFT



519 NATIONAL AIDS COUNCIL SECRETARIAT

Agency Name National AIDS Council Secretariat

Project Name National Strategic Plan On HIV/AIDS Implementation

Status On going

Objective

To strengthen and expand HIV/AIDS PREVENTION, CAREW and TREATMENT by focusing on

comprehensive health services delivery mechanism at both the National and Provincial levels.


1. National Coordination of Strategic Implementation Plan 2. Coordination of Provincial and District Activities 3. Grants to Provincial AIDS Council Secretariat to fund minimum priority activities.


No progressive report provided on 2014 achievements



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues and Risks


Recommendation DNPN to have consultation meeting with the agency.

DRAFT



520 INSTITUTE OF MEDICAL RESEARCH

Agency Name Institute of Medical Research

Project Name Malaria Research Infrastructure Project

Status On going

Objective

To build a modern laboratory, office complex and staff accommodation for the vector borne disease

unit based in Madang Province


1. Construction of the modern laboratory 2. Office Complex 3. Staff houses 4. Procurement of laboratory equipment.


No report submitted


Year 2013 2014 Original

Appro.

Revised

Appro.

Actual Exp

Funding Level

(GoPNG)

3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues and Risks


Recommendation

1. DNPN to have consultation meeting with the agency

2. Conduct project site visit.

DRAFT



Agency Name Department of Education

Project Name Inspectors Housing and Transportation

Status On going

Objective

To improve the role of school inspectors in the country by:

Building 44xH65 type houses in 22 provincial centers for the Standard Officers Renovate 10x existing Standards and Guidance Division houses in NIP, Manus, SHP, Simbu,

East Sepik, Western and Central Province.


Construction of 44 x H65 houses for Standards Officers at K2888, 244.00 across 22 provinces. (4 x houses for each province excluding those provinces that the houses were built

Renovation of 10 existing houses at K100, 000.00 = K1, 000,000.00


Completed draft housing and transport policy was reviewed and negotiations with provincial lands divisions have been going through the Senior Standards Officers to identify land to build 24 new houses for EHP x1, Jiwaka x2, Manus x2, WNBP x2, AROB x2, NIP x2, NCD x1, Gulf x2, MBP x2 and Oro x2 at the end of 2013.

Purchased 16 new vehicle for Jiwaka x2, ESP x1, Hela x2, WSP x1, WNBP x1, Manus x1, AROB x1, NIP x1, Central x1, Gulf x1, Western x1, MBP x1, Oro x1 and Head Quarter x1.

Purchased 3 new out boat motors for Morobe x1, Madang x1 and NCD x1.



Funding Level

(GoPNG)

10,000,000 11,060,000.00 11,060,000.00 11,060,000.00 11,060,000.00

Issues and Risks

There is still the outstanding contract works to be implemented by Boetha Construction Company despite the upfront payment for more than two years ago.

2013 appropriation of K7 million has not been used for the projects works by the NDOE management as reported by the project implementation team, hence has halted the CSTB procurement process for the Island region of which is still outstanding to date

Unavailability of state land in some provinces to build houses and hence the prolong process to securing state land

The travel ban on the department has affected the implementation of any project activity for 2014

DRAFT



Recommendation

Physical monitoring to be carried out on the houses and vehicles purchased and regular project monitoring to ensure project is fairly distributed nationwide in an effective and efficient manner.

The diversion in the projects total appropriation by the NDOE be investigated and audit be conducted accordingly as required by the Public Financial Management Act

The project’s implementation must be fast tracked as quality assurance at this level of education is crucial. A project steering committee must be established for this project for improved project management.

DRAFT




Project Name TVET Sector Project

Status On going

Objective

To provide formal education, training and assessment for skills acquisition with proficiency testing for

employment, sustained livelihood and responsible citizenship.


1. Renovation and maintenance of all existing buildings in Technical and Business Colleges nationwide: The buildings range from staff houses, dormitories, ablution blocks, workshops, classrooms

and computer labs in all the colleges and security fence.

2. New Expansion and development for each technical/business college; and New infrastructure expansion and development for the existing colleges.

Scope of works for 2014 Renovation and maintenance of all existing buildings in Technical and Business Colleges

nationwide: The buildings range from staff houses, dormitories, ablution blocks, workshops, classrooms

and computer labs in all the colleges and security fence.

New Expansion and development for each technical/business college; and New infrastructure expansion and development for the existing colleges

Construction, Renovation and Improvement of all existing building for;

1. Madang Technical College (Double Storey Classroom x 2, 10 x H65 staff houses and 2 x double

bed room

duplex and College Administration Complex 2. Port Moresby Business College( 2 Level Auditorium, 1x Transit Units, 3 Level Admin building

and Storage Warehouse; 10 x H65 Type Staff Houses; and 2x3 Storey Classrooms and 1 x

Computer Laboratory

3. Kokopo Business College (10 Staff Houses and 8 dormitories, 1 Mess/Kitchen, 6 Classrooms

and 4 laboratories)

4. Lae college ( 4 duplex classrooms, a engineering laboratory facilities & engineering workshop

)

5. Goroka College(10 staff houses and of new admin block )


The project has been funding in the previous years however no progress has been noted due to a lack of reporting.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

DRAFT



Issues and Risks

The project has been noted for the very slow implementation phase despite being an ongoing project for three years hence a real progress is yet to be established for this project; hence a real progress is yet to be noted for the project

The Lack of corporation between the various stakeholders on the project namely the namely Lae Poly technical colleges, Goroka Business College, Rabaul business, Port Moresby technical college and Business colleges and Hagen Technical College and the national department . .

This has lead to the accumulation of the previous and current project funds in the project trust accounts

Lack of monitoring by DNPM on the project progress The travel ban on the department has affected the implementation of any project activity for

2014 Recommendation

DNPM to conduct a review on the project scope to establish the actual status of its implementation.

A Project Steering Committee must be established as soon as possible with DNPM as a member A project status report be provide by NDOE to DNPM NDOE has to be proactive in progressing the projects.

DRAFT




Project Name Reading Education Project

Status On going

Objective

1. To improve reading skills of elementary and primary school students in PNG; and

2. To develop policy, monitoring and evaluation capacity of CDAC, improve the efficiency of the

school subsidy system and increase capacity for financial management & procurement in

NDOE.


1. Improving Reading in Elementary & Primary Schools 2. Early Grade Reading Assessment (EGRA) 3. Strengthening Systems and Capacity for School Subsidies 4. Support for Procurement & Financial Management 5. Project Management & Evaluation

Scope of works for 2014 a. Improving Reading in Elementary & Primary Schools

Increasing supply of books & other reading materials and Furniture Providing professional development to teachers for reading instructions and support on

how to use tothe classroom libraries andcreate localized materials b. Early Grade Reading Assessment (EGRA)

Coordination and development of EGRA within NDOE, PNG Education Institute, NationalLibrary, University of PNG, National Research Institute and the Summer Institute of Linguistics.

Strengthening Systems and Capacity for School Subsidies. This component complements AusAID’s program of co-financing GoPNG school subsidies anddisbursement program.

Support for Procurement & Financial Management Provision of trainings and technical assistance in procurement and financial management.

c. Project Management & Evaluation

2014 Progress & Achievements No report submitted



Revised Appro.

Actual Exp


2,000,000 2,000,000 2,000,000 2,000,000

Issues and Risks

Lack of timely and adequate reporting by the project unit Lack of monitoring by DNPM.

DRAFT



Recommendation

1. DNPM to conduct a site visit on the site and consult accordingly to establish the project status and review the project components as to establish the total projects cost and the demarcation of the funding roles by the two funding agencies.

2. Donor to comply with the PIP reporting requirements.

DRAFT




Project Name Flexible, Open & Distance Education Project

Status On going

Objective

To provide a second chance for out of school youths to complete secondary education and tertiary

diploma/certificate equivalency programs to further their learning and career.


1. Updating and distribution of Curriculum and Instructional Materials 2. Improving the Quality of Service Delivery 3. Expansion of Grades 11-12 Matriculation Program 4. Improving Information Technology, Monitoring and Evaluation, and Management Capacity 5. Expanding FODE Office and Classroom space in order to house new staff, consultants and

equipments


Completed upgrading and redevelopment works at the FODE HQ, all the teachers’ houses at Gerehu

Printing of learning and teaching materials completed and distributed to 20 secondary schools, TVET and teachers colleges as per the VPN rollout plan.

No report submitted



Revised Appro.

Actual Exp


2,000,000 2,000,000 2,000,000 1,600,000

Issues and Risks

The current activities funded are recurrent in nature Current status report has not being provided and lacks monitoring by DNPM Lack of reporting on project progess by the donor

Recommendation

1. The project should be continued in 2015 in phases because it is an important project to address school drop outs and offering alternative life in education a promised hope.

2. DNPM to conduct site visits.

DRAFT




Project Name Enhancing Quality in Teaching Through Television Program

Status On going

Objective

The objective is to improve the quality of classroom teaching and delivery of distance education

through the use of television programs.


1. Production of model lessons and teacher/student support materials; 2. In-service workshops and awareness and monitoring visits; 3. Printing and distribution of guidelines and other support materials for model lessons.

Scope of works for 2014 1. Development of teaching materials and provision of education supplies 2. Production of television program 3. Printing and distribution of student textbooks 4. Capacity building for teachers through workshops and in service trainings

Progress & Achievements

25 new schools received TV equipment (Enga, Madang, Manus, and Oro & Western). Curriculum resource materials have been developed, printed & ready for distribution.

(Teacher and student resource books resources). These include: i. Mathematics – Gr. 7 & 8

ii. Science – Gr. 6, 7 & 8 iii. Personal development- Gr. 6 iv. Making a Living- Gr.7 v. Social science – Gr. 8

120 TV screens and DVD Players have been purchased and distributed to 12 provinces in the country

A national EQUITV trainers training was conducted including a research/study in to how EQUITV can be introduced in to the Teachers training college curriculum

No work has progress on the project in 2014 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

1,000,000 1,000,000 1,000,000 1,000,000

DRAFT



Issues and Risks

Lack of adequate reporting on the project progress Lack of project information on the funding components by each funded and the exact cost to be

incurred by each in the projects total life span Recommendation

1. DNPM to conduct a site visit on the site and consult accordingly to establish the project status and review the project components as to establish the total projects cost and the demarcation of the funding roles by the two funding agencies

2. Donor to comply with the PIP reporting requirements.

DRAFT



236 DEPARTMENT OF HIGHER EDUCATION, SCIENCE, RESEARCH AND TECHNOLOGY

Agency Name Department of Higher Education, Science, Research and Technology

Project Name Trade Skills Scholarship

Status On going

Objective

To sponsor Papua New Guinean school leavers and non-school leavers who meet the scholarship

requirements to study trade courses in Queensland TAFE Colleges to acquire trade skills necessary(

skills deficiency and required competency level) for the development of the country.


1. Admissions and scholarship for 2000 students to undertake trade skills training at Queensland

TAFE Colleges in Australia.

2. Project Management and Evaluation

3. Stake holders input and apprenticeships

Scope of works for 2014 1. Scholarship Administration

Advertisement, Selection and project administration through the coordinating mechanism within OHE

Contingencies and Emergencies 2. Sponsorship/Scholarship for sending 2000 PNG students to TAFE Queensland-Australia


The project has sought partnership with the 8 provincial education divisions in the mobilization of the applicants for 2014.

916 applicants received of which 460 have being short listed for interview and other checkups of which 180 have passed and being awarded the scholarship

Work has progressed for processing the second 28 students’ whist the first 24 are already doing their training in Queensland

A total of 561 students have graduated for the program in 11 trade skills courses to date. 254 graduates are being engaged with various companies for on the job training, permanent employment and apprenticeship

The training programs offered are; certificate 11 level in civil construction, construction automotive mechanics, engineering fabrication, mechanical engineering, electro technology air conditioning and split systems , drainage and plumbing , hospitability and sustainable Energy.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

20,000,000 15,000,000 15,000,000 15,000,000 15,000,000

Issues and Risks

Lack of effective working relationship between other stake holder agencies i.e. civil registry office, office of Immigration and Citizen Ship and Australian certified panel doctors in process each study cohort

DRAFT



Effective communication with applicants and for information dissemination to interested candidates has being a challenge for the project team

The need to advertise more to local companies the availability of training students to be placed on the job training programs

The program does not allow for the work placement to also be done in Australian so as to compliment the training received by each student

Recommendation

The project is to be reviewed and possibly be planned to institute this training in PNG.

DRAFT




Project Name Infrastructure Rehabilitation & Recapitalization

Status On going

Objective

To maintain, rehabilitate and recapitalize the physical infrastructure of the universities to enable them

to achieve the vision 2050, PNGDSP 2030 and the MTDP targets and the international standards


1. Infrastructure rehabilitation and maintenance

2. Recapitalisation of laboratory and information technologies for the 4 state universities

UPNG – Staff houses, lecture rooms & studios for the creative Arts Faculty Unitech – Agriculture Science Department Upgrading, Library and Computer lab UOG – Staff housing, science lab maintenance, equipments UNRE – Infrastructure maintenance for Popondetta and Central Sepik campus, Ocean

going learning, training and research vessel an IT broad band and access Scope of works for 2014

1. Assessment of the project proposal by the universities and project approval

2. Monitoring of the project progress


2 meeting conducted with the 6 universities for confirmation of project priority listings of which payments have began however through the normal tendering processes

No work has progress 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 10,000,000 10,000,000 10,000,000 10,000,000

Issues and Risks

The original project scopes listing for funding have been changed Lack detail listing and cost of the proposed projects by the 6 universities

Recommendation

Detail scoping and costing of all the university’s needs be developed to guide the project scope The project’s implementation must be fast tracked as quality assurance at this level of education

is crucial. A project steering committee must be established for this project for improved project management.

DNPM to carry out physical monitoring on the current projects funded at the universities to be

carried out.

DRAFT




Project Name West Pacific University

Status New

Objective

To build a new university to carter for the increasing demand for tertiary education in the Pacific. It is also to fulfill and achieve the Vision 2050, PNGDSP 2030 and MTDP targets set in these plans.

To establish a university to be called the Western Pacific University to offer an alternative opportunity to pacific people who are unable to enter higher education institutions due to lack of space and opportunities in their country.


Design, Construct and establish all infrastructures required for a university. Design and Develop all required academic and administrative programs for a university

Scope of works for 2014 • Project scoping and documentation

• Site preparation as in earth works such as grubbing and building of foundations


Land payments have began by the Department of the Prime Minister Feasibility studies such as the Topography and boundary survey are currently under way



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 9,231,161

Issues and Risks

Prolong lands negotiations and delay in the payment of the proposed land site by the Department of Prime Minister and NEC

The project has two source of funding, i.e. Department of Prime Minister & NEC and the OHE as such the funding demarcation is no clear at this point in time.

Lack of staff to work on the project.

Recommendation

1. The land negotiation to be completed as soon as possible 2. The project design on the full establishment of the university be designed so total project cost

be established 3. The remaining project warrants for 2014 be released 4. Project implementation unit be established.

DRAFT




Project Name Science Research Council

Status New

Objective

To enhance the research capacities of the universities , research and Post Graduate Centers as centers

of Learning, technology transfer , knowledge creation/ discovery and innovation as well increasing

number of post graduate students.


1. Agriculture and fisheries research 2. Biological Research 3. Environment and climate change 4. Education and training 5. Adoption of Appropriate Technology 7. Manufacturing and downstream processing 8. Tourism 9. Research on sociology of development and modernisation

Scope of works for 2014: 1. Formulation of the PNG Science &Technology Council and Secretariat

2. Formulation of the National Research Policy /Science & Technology Strategic plan

3. National Capacity Assessment ,Research and Development Survey


The Council has established a secretariat and is in the process of preparing for a recruitment exercise to get on board employees. Likewise, appointment of the council members has also began

The national Research Code of Conduct and Ethics Policy and the national Research Agenda are currently being drafted.

A survey tool is also under formulation of which will be used to undertake a nationwide survey to establish the type and size of research currently undertaken in the country.

No work has progressed



Revised Appro.

Actual Exp


Issues and Risks

The late release of funds has also delayed the full establishment of the secretariat.. Recommendation

The research focus is on the economic with emphasis on downstream possibilities for the future.

DRAFT




Project Name National Open University

Status New

Objective

To establish an open university to be called the Papua New Guinea to offer an alternative opportunity to people who are unable to enter the higher education institutions due to lack of space..


1. Construction and establishment of all infrastructure development from a university 2. Design and development of teaching programs and material 3. Establishment of the information technology and communications system

Scope of works for 2014 Design of the academic programs and Open University model


A technical working has been established comprising of representative from all 6 local universities who recommended to NEC the Resource Coordinating Open University model as appropriate to PNG of which was endorsed by NEC.

The team has began study tours to Malaysia to develop details of the above model The Open University Bill has been developed but is in draft at this point in time.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

3,000,000 5,000,000 3,000,000 2,999,933

Issues and Risks

The project has incurred cost outside the project scope due to payment made based on ministerial direction. Recommendation

A project design be developed containing the full cost of the establishment

DRAFT



512 UNIVERSITY OF PAPUA NEW GUINEA

AGENCY SUMMARY

Objective and Mission

The University of Papua New Guinea’s Mission is to deliver excellent education and research results

for national building and global advancement towards an innovative and empowered society.

Scope of Public Investment Program

There were only two projects that were funded in 2013 of which 1 was wholly GoPNG Funded and the other was funded by EU at a total value of K818, 000.

In 2014 a total of K20, 000. Was appropriated for the two building to carry on with the

construction s part of ongoing program. Key Outcome or Output The warrant was not released due to lack of actual works progress on the ground for the Science IV Building from the previous funding.

Issues and Risks

UPNG are very slow to implement the Science IV Building Project. There are not even showing up for

2nd Quarterly Budget reviews.

Recommendation


1. The funds must not be released unless they don’t report. DNPM will write a demand letter to explain why such administrative failures are existent which has the potential to destroy the good name and image of the nation’s premier institution.

2. UPNG must improve on their reporting on timely basis and collaborate and encourage having close dialogue with DNPM, Treasury and Donors to tackle the pressing development issues faced by the University, especially its infrastructure and the demand for placing at the institution, which is denying potential students their future.

DRAFT



Agency Name University of Papua New Guinea

Project Name UPNG School of Law Building

Status Ongoing

Objective

To construct a new Law school building equipped with the required facilities and equipment to

support and enhance learning at UPNG law Faculty.


1. law school building and lecture rooms

2. law school administration and staff room

3. a state of the art lecture theatre

4. A library in the building and

5. Installation of all multimedia equipment in the Lecture theatre

Scope of works for 2014 is to complete the fill out of the new law building 2014 Progress & Achievements

No work has progress due to late release and also low level of warrants released to date hence could not implement the planned activities of filling out the completed building 2014 level of funding and expenditure


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

12,000,000 15,000,000 12,000,000 9,000,000

Issues and Risks

Late release of warrants.

Recommendation

The construction to begin as soon as possible.

DRAFT



Agency Name University of Papua New Guinea

Project Name UPNG Science 1V Building

Status Ongoing

Objective

To construct a new Science IV Building equipped with the required facilities and equipments


1. Construction of a New Science IV Building,

2. Procurement, installation and commissioning of up-to-date equipment and facilities for science

teaching, research and outreach operations.

Scope of works for 2014

1. Commence construction of the building

2. Purchase and install the building fittings accordingly 2014 Progress & Achievements

Total appropriation for the project is K55 million The building contract was awarded to Morobe Builders through CSTB The company has demobilized form the current site and moved to new site due to an

underground water pipe could not be enrouted as per the original design as this will incur more expenses than estimated.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 8,000,000 10,000,000 8,000,000 6,000,0000

Issues and Risks

The moving to a new site has incurred a variation cost to almost K500, 000.0 and also delay in the project cost

The late release of warrants including the low level of warrants released to date has slowed the project progress as the fund available is insufficient to do work.

Recommendation

The University’s Project Management Unit needs to be proactive in dealing with the projects and also

have regular consultation with DNPM.

DRAFT



513 UNIVERSITY OF TECHNOLOGY

AGENCY SUMMARY

Objective and Mission Statement

To develop an offer teaching, research and community service of high standard: engendering critical evaluation and application of science and technology for Papua New Guinea and South Pacific. Scope of the Public Investment Program

There were two (2) projects that were funded in 2013. These projects are wholly GoPNG Funded at a total value of K5 million. In 2014 Development Budget Appropriation, K10.000 was appropriated to complete the two buildings which are on going programs. 2014 Progress & Achievements

Key activities have started and implemented smoothly. The Construction of fully furnished laboratory,

staff houses and steel fencing, 1.48 Persons’ Female Dormitory and establishment of Petrochemical

Engineering School under in construction.

Issues and Risks

No report made on the funds allocated.

Recommendations

1. Higher Education infrastructure such as the two projects at Unitech is important. However, accountability of such public funds is important. And to encourage and support such to prevail, the PSCs must be revived and all key stakeholders both at the national agency levels must be well represented to effectively manage these projects.

2. The remaining funds must not be released until issues on the ground are identified and ironed out and implementation begins smoothly.

DRAFT



Agency Name University of Technology

Project Name Petroleum and Petro- Chemical Engineering School

Status Ongoing

Objective

To train and provide skilled manpower in the mining and petroleum sector of the economy


Physical Infrastructure

1. Two fully furnished laboratory 2. Two dormitories (1 male/1 female) 3. Staff housing 4. Equipments and white goods 5. Steel fencing


Construction of the staff housing and dormitories Progress and achievements

23 academic staff houses have been constructed by the PNG Forest Products and filled with white goods

One new male dormitory constructed for 2014 No work plan and cash flow has been submitted hence the non release of warrants Construction has been completed for 23 academic staff houses and one male dormitories for K10 million.

2014 level of funding and expenditure (K’000)


Funding Level (GoPNG) 10,000,000 5,000,000 10,000,000 5,000,0000 0.0

Issues and Risks

There is less market demand for petrochemical engineers in the country as established by the research conducted by the University and such there is no need for this academic stream of study to be established. A new program on the same is developed but at the post graduate level.

The management crisis at the University has slowed the progress of the projects Warrant for the project is yet to released due to non-submission of work plan and cash flow

Recommendation

The project Management Unit must have regular consultation meeting with DNPM, to ensure correct information is communicated at all time.

DRAFT



Agency Name University of Technology

Project Name Meeting Accreditation Requirement

Status New

Objective

To create an engineering educational framework that can be accredited to international standards as prescribed by Washington , Sydney and Dublin International Engineering Accords to enable PNG engineering graduates being recognized and accepted internationally Components and Scope of Works

1. Upgrading of infrastructures, soft ware development and suitable linkages to other international universities and develop databases for information storage.

2. Design of academic programs Scope of works for 2014

No work plan and cash flow has been submitted hence Curriculum review for the engineering stream of study has been completed and submitted to the University Academic Board

An inventory has been conducted on existing infrastructure development and on the required infrastructure that would be needed.


Curriculum review for the engineering stream of study has been completed and submitted to the University Academic Board

An inventory has been conducted on existing infrastructure development and on the required infrastructure that would be needed.



Revised Appro.

Actual Exp

Funding Level (GoPNG) 5,000,000 10,000,000 5,000,000 0.0

Issues and Risks

Due to management crisis there was no submission of work plan and cash flow and such the cash warrants are yet to be released

No work plan Recommendation

Due to management crisis there was no submission of work plan and cash flow and such the cash warrants are yet to be released

DRAFT



Agency Name University of Goroka

Project Name UOG Dormitory

Status Ongoing

Objective

1. To construct new student accommodation stages 2, 3 and 4 in the Goroka campus, in order to alleviate the current acute accommodation problems experienced by the university.

2. To build up and strengthen institutional capacity to train sufficient numbers of qualified Secondary Teachers and other pre- educators to meet the national human development needs, and

3. To provide sufficient bed space to carter for the increased student numbers.


Construction of a five (5) multi- level student hall of residents and major components include the actual construction and development of the first level of dormitory facilities (Stage 1) and to reach 2000 bed spaces. The GoPNG will take up stage 1 and 5 and the Chinese loan component will carter for stage 2-4. 2014 Progress & Achievements

The project is full completed in November 2014 and officially opened in December by the Deputy Prime Minister Hon Leo Dion with the Chinese Ambassador.

The five six storey dormitories are fully furnished, each floor has units with 4 bedrooms and 1 bedroom is shared by 2 students, it also has toilet and shower, a living room and kitchen sink and bench.

The Government of PNG has fully funded the counterpart requirement of the loan project as per the contractual agreement for stages 2 and 4.


Year 2013 2014 Original Appro. Revised Appro.

Actual Exp

Funding Level (GoPNG) 7,000,000 0.0 0.0 0.0 0.0

Issues and Risks

None at this time Recommendation

The University will have to increase the number of teaching staff as there will be an increase number

of new intakes. This will enable the provision of quality educational requirements for students.

DRAFT



515 UNIVERSITY OF ENVIROMENT AND NATURAL RESOURCES

Agency Name University of Environment and Natural Resources

Project Name Vudal Library

Status Ongoing

Objective

To improve and modernize library information services for the students and community users.


1. Relocation of the library

2. Site clearance, and

3. Construction of the actual library building.


1. Design, survey and engineering completed.

2. Tendering and engagement of contractor have been done

3. The construction of the actual library building started in 2013 and is in progress



Funding Level (GoPNG) 2,000,000 10,000,000 10,000,000 10,000,000

Issues and Risks

No progress report submitted to date

Recommendation

Project Steering Committee to be established DNPM to conduct a site visit.

DRAFT



DRAFT

208 2014 Annual Public Investment Program Implementat1on Report


LAW & JUSTICE SECTOR

DRAFT



DESCRIPTION No of PIPs

2014


Code LAW AND JUSTICE SECTOR AGENCIES

223 Judiciary 1 40,000,000

225 Attorney General

2 7,000,000

234 Dept of Defence

2 3,000,000

522 Law Reform

1 1,000,000

TOTAL 39 257,601,000

DRAFT



I. SECTOR SUMMARY The Law & Justice Sector Departments and Agencies that got funded in 2014 are; (1) Judiciary, (2) Attorney General, (3) Defence and (4) Law Reform Commission. The scope of Public Investment Program includes the following ongoing programs and projects;

Court House Design & Maintenance; PNG – Aust L& J Partnership Rural Lock up; Police Housing Program; Maritime Surveillance Program Review & Amendment of 150 Existing Legislation, and; The Police Modernization Program.

II. 2014 SECTOR APPRORIATION Development Budget Appropriation for 2013 and 2014, the sector had a Revised Budget Appropriation of K51, 000,000.00 from the original Budget Appropriation of K27, 300,000.00. From the revised appropriation of K51, 000,000.00, a cash flow of K50, 400,000 was reported as expanded. For the 2013 appropriation is assumed that the funds have been expended. However, the output of the work compared to millions allocated is too shallow. III. ANALYSIS OF THE 2014 SUB SECTOR-SECTOR BUDGET DISTRIBUTION From the K51 million revised appropriated for Law & Justice Sector, the Judiciary received a largest potion of about 78% of funding to implement the Court House Design and Maintenance Program. Attorney General received 14%. Department of Defence 2% and Law Reform Commission 2%. Figure 20.0 below shows the agency distribution of the Law & Justice Sector Budget.

Judiciary 78%

Attorney Gen 14%

Dept of Defenc 6%

Law Reform 2%

Figure 20.0: Agency Distribution of the Law Justice Sector Budget

DRAFT




In 2014, about 98 % total warrants of revised budget were drawn for Law and Justice Sector. Actual

expenditure equates to 92% of revised budget.

Agency Original

Budget

Revised

Budget

Cash Flow

YTD

Warrants Actual

Spending

Unspent

Warrent

Judiciary 10,000,000 40,000,000 40,000,000 40,000,000 40,000,000 0

Attorney

General

8,300,000 7,000,000 6,400,000 6,400,000 6,400,000 142,250

Department

of Defence

8,000,000 3,000,000 8,000,000

3,000,000

0

3,000,000

Law Reform

1,000,000

1,000,000

1,000,000

1,000,000

1,000,000

0

The Figure 21.0 below shows the expenditure report for the Law & Justice Sector in 2014.


The Waigani National Court House is progressing well through the design and documentation phases of the project. The main Courts Building (Contract 2) is approximately 60% complete. The progress on the Police Housing Project is unsatisfactory as well as the Police Modernization Program. The Correctional Services for the Rural Lockup program is a failed program. The only one that is successfully implemented is the one in East Sepik Province.

0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

40,000,000

Judiciary Attorney Gen Dept of Defenc Law Reform

Original Budget 10,000,000 8,300,000 8,000,000 1,000,000

Revised Budget 40,000,000 7,000,000 3,000,000 1,000,000

Warrants YTD 40,000,000 6,400,000 3,000,000 1,000,000

Actual Spend 40,000,000 6,257,750 0 1,000,000

Ap

pro

riat

ion

s (k

'Mill

ion

s)

Graph 21.0: Expenditure Report by Agency

DRAFT



The Department of Defence Forces has couple of ongoing programs. These include; Madang – Baiyer Road which is almost complete and Air Capacity Program which was never implemented despite an appropriation of K3 million which was allocated in the 2014 Development Budget for training of civilian pilots and purchase of light aircrafts. The Law Reform Commission are doing well in caring out awareness and amendments to Existing Laws.


The Defence Force has its own in house differences between the staff of Department of Defence (DOD) and this has implication on the financial management. For example, the procurement process was not followed in purchasing the equipment for Madang – Baiyer Road program. Furthermore, the air capacity program was never implemented despite funds were released to the project. With the new Chief of Defence (Commander) we hope we see some changes in infrastructure development within the Defence Institutions. The Police Housing Program and the Modernization Program have failed to meet the targets of the government despite millions of kina were allocated for these programs. There have been serious issues of reporting by the Department of Police. As a result of that, it is really unclear as to whether there have been some progress made on these programs which have costed the stae millions of kina. VI. RECOMMENDATION

The Police should provide quarterly full report to DNPM for the Police Housing and the Police Modernization programs which millions of Development Funds have been are allocated.

Quarterly meetings must be held for all Law & Justice Sector to establish progress of project and the drawdown of the Development Funds.

Defence Force should operate a separate Development funding Accounts. At the moment development and recurrent are operating under one account and as such, there are chances of misuse of development funds

DRAFT



223 JUDICIARY SERVICES

Agency Name 223 Judiciary Services

Project Name Court House Design & Maintenance

Status Ongoing

Objective

To construct a new court house complex for the National and Supreme Court in Waigani, NCD.


The Waigani Court House Complex project for funding under the PIP and this will accommodate the

High Courts only - Supreme, Courts of Appeal and National Courts. This is an ongoing project

undertaken by the Judiciary and Government with funding starting in 2012. The project is fully GoPNG

funded and so far a total of K26, 000.0 was appropriated for years (2014 – K10.0 million, 2013 – K10.0

million, and 2012 – K6, 000.0 million) and this year (2015) the project received K190, 000.0 million for

the project.

1. Surveys of the site and the existing Supreme and National Court undertaken; geotechnical,

survey, laser scan, and compliance undertaken,

2. Draft master plan for the new court complex developed, with associated cost estimate

completed for client review and budget approval.

3. Preliminary approval on revised budget received, more detailed project master planning

developed and costs further analysed.

4. Finalise master plan and concept design for entire WNCC site incorporating client feedback

and input into design.

5. Commence scheme design phase of early works packages – scope to be determined.

6. Finalise execution of consul

2014 Progress & Achievement

1. Feasibility studies being carried out 2. Schematic designs and tendering, evaluation, and contracting of project done.



Revised Appro.

Actual Exp


Issues & Risks

Report for 2014 has been submitted to DNPM but the content of the report is too shallow compared to the level of Development Fundingappropriated over the last three years totalling K26.0 million Recommendation

DNPM needs to followup ont reports and also fastrack the establishment of the PSC so that issues

impeding implementation can be addressed.

DRAFT



225 DEPARTMENT OF ATTORNEY GENERAL Agency Name 225 Dept. Attorney General

Project Name PNG – Aust L&J Partnership

Status Ongoing

Objective

To support the implementation of the Law and Justice Sector Policy and Plan of Action and strengthen

the efficiency and effectiveness of the formal Justice system to administer services and to achieved

measureable progress against its sector goals.


The major component of the project funded by GoPNG &

1. Support to L&J sector Secretariat;

2. DJAC infrastructure development;

3. Support state & Legal Services;

4. Office of the Public Curators ;

5. Support to Magisterial Services in District Court Houses;

6. Rehabilitation of Bomana Police College;

7. Feasibility study for Regional training college in Lae;


The program is so far successful as is evident in infrastructure developments pertaining to the

program take shape. However, AG needs to report to DNPM to appreciate the achievements.



Revised Appro.

Actual Exp


Issues & Risks

Reporting remains weak for the agency.

Recommendation

Quarterly reports be submitted to DNPM purposely as to know the progress of the programs.

DRAFT



234 PNG DEFENCE FORCE Agency Name 234 Defence Force

Project Name Mad – Baiyer Road & Air Capacity Prog

Status Ongoing

Objective

Defence Force has a mission to defend the country from external and internal threats and assist the

Government in emergency situations threatening the citizens and its infrastructures in the country

and assist in Civic Action Program to fulfil the Government’s long term Development Plans.


1. Construction of missing Link – Madang – Baiyer Road.

2. Air Capacity program - purchase of light aircraft and training of civilian pilots.


All the funds are draw down and there is no report to DNPM on the progress of the project.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

16,000,000 3,000,0000 8,000,0000 3,000,000 0.0

Issues & Risks

Reporting remains weak for the agency The Development Funds are kept under the Recurrent Account and this can lead to abuse and

misapplication of funding

Recommendation

It is strongly recommended that:

1. The Agency establishes a trust account for Development Funds. 2. DNPM to meet with Defence and discuss the project 3. Defence to provide reports on the progress of the project over the last three years.

DRAFT



522 CONSTITUTIONAL LAW REFORM COMMISSION

Agency Name 522 Constitutional Law Reform Commission

Project Name Review of Existing Laws

Status Ongoing

Objective

To review and amend 150 existing legislations in light of the recent past and current political, socio-

economic, judicial and legislative situations faced in PNG.


1. Conduct number of awareness seminars and workshops in regional areas. 2. Engagement of specialist Consultants. 3. Purchase number of equipment and laptops. 4. Conduct capacity building training in areas of research and legal.


The Constitutional Review Commission had done awareness informing people of Papua New Guinea of the proposed changes in the existing Laws in the country.

At this stage, DNPM has not been informed of the progress of the amendments to the existing laws.



Revised Appro.

Actual Exp


Issues & Risks

Reporting remains weak

Recommendation

The Constitutional Review Commission should report to DNPM on the progress of the amendments to

current laws and its expenditures.

DRAFT



DRAFT



ADMINISTRATION SECTOR

DRAFT



Description No of PIPs

2014


Code Administration Sector Agencies

203 Prime Minister & NEC

2 59,200,000

204 National Statistic Office

0 0

206 Department of Finance

1 11,700,000

208 Department of Treasury

4 216,000,000

211 Customs

3 15,000,000

213 Fire Services

1 4,000,000

216 Internal Revenue Commission

3 10,500,000

217 Foreign Affs 4 58,123,500

229 Department of National Planning & Monitoring 11 157,870,000

262 Industrial Relations Office 1 6,100,000

267

Department of Implement & Rural Development

23

58,000,000

509 Border Development Authority

1 5,000,000

539 National Museum

1 5,000,000

TOTAL 55 606,493,500

DRAFT



(50,000,000)

0

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

PM&

NEC

NSO DoF DOT Custm

Fire S IRC DFA DNPM

IndRel

DIRD BDA

Original Budget 59,200 0 10,000 172,0018,000 5,000, 18,500 60,000145,50 10,00055,500 5,000,

Revised Budget 59,200 0 11,700 216,0015,000 4,000, 10,500 58,123157,87 6,100, 58,000 5,000,

Warrants YTD 59,200 0 11,700 216,0015,000 4,000, 9,500, 58,123157,87 6,100, 58,000 5,000,

Actual Spend 59,200 (5,274 11,787 215,5514,646 4,987, 9,656, 58,111157,86 2,737, 57,642 5,000,

Ap

pro

pri

atio

ns

(k'm

illio

n)

Figure 22.0: Warrants & Expenditure

I. SECTOR SUMMARY

The sector was responsible for coordinating some of the major programs and projects targeting

improved governance and administration;knowledge and skills enhancement and capacity

building;strengthening of disaster preparedness and management capacity;rural economic

development; microfinance schemes to empower the small to medium enterprises;improved financial

accounting and management; institutional strengthening and infrastructure

development;enhancement of state-church partnership; high impact projects under the Umbrella

Benefit Sharing Agreement (UBSA) between the state and the resource areas; and the MTDP Review.


A total of fifty-five (55) projects were implemented withtwenty-seven (27) fully Go-PNG direct

financed, whilst twenty two (22) were grant financing, four (4) as loan projects with three (3) projects

being co-funded respectively. This was an increase by six (6) programs/projects from 2013

Development Budget programs/projects.

The grants and loans funding are coordinated by the respective donor agencies either through a

managing contractor or through their own accounting and monitoring systems hence; report on the

same is unavailable and not reported.

The 2014 Development Budget Appropriation for the Administrative Sector was at K1, 273,839.0

which is inclusive of both the GoPNG and donor funded programs and projects. The GoPNG direct

funding was at K607.778million, the donor grant financing at K306.435 million and K215.704 million

as loan. The revised appropriations show an increase on the Go-PNG funding by K206. 657 million

resulting in the overall revised appropriation of both GoPNG and donor funded programs and projects

at K1, 480,056.00 million. Figure 22.0 illustrates below.

DRAFT



III. ANALYSIS OF THE 2014 SUB SECTOR BUDGET DISTRIBUTION

The Department of Treasury (DOT) received the highest sector funding of 36% followed by the

Department of National Planning & Monitoring (DNPM). The reasons for the highest appropriation to

DOT reflects number of programs such as Infrastructure Development Grants and other projects

parked under Treasury’s 207 Miscellanous votes. DNPM also received highest funding because of the

some important programs such as Church –State Partners Programs. Rest of the appropriation to the

sector has been spread across different sector agencies as shown in the Figure 23.0 below.


About 99% of the Warrant from the revised budget was drawn towards Administration Sector

Agencies in 2014 with 98% of the funding being the actual expenditure. Un-issued warrant amounts to

K7.3 million.

Agency Original

Budget

Revise

Budget

Cashflow

YTD

Warrants

YTD

Actual YTD Actual

Spending

PM & NEC 59,200,000 59,200,000

59,200,000

59,200,000

59,200,000

59,200,000

Stat Office 0 0 0 0 0 (5,274)

Dept.

Finance

10,000,000

11,700,000

11,700,000

11,700,000

11,700,000

11,787,326

Treasury 172,000,000

216,000,000

216,000,000

216,000,000

215,555,556

215,555,556

Customs 18,000,000

15,000,000

18,000,000

15,000,000

14,646,987

14,646,987

PM & NEC 10%

Stat Office 0%

Dept of Fin 2%

Treasury Dept 36%

Customs 2%

Fire Services 1% Int Rev Comm

2% Foreign Affs

9%

DNPM 26%

Ind Relations 1%

Dpt of Implement & R

9% Border Dev Auth

1% National Museum

1%

National Cultural Commission

0%

Figure 23.0: Agency Distribution of the Administration Sector

DRAFT



Fire

Services

5,000,000

4,000,000

5,000,000

4,000,000

4,987,577

4,987,577

IRC 18,500,000

10,500,000

18,500,000

9,500,000

9,656,950

9,656,950

Foreign

Affairs

60,000,000

58,123,500

61,123,500

58,123,500

58,111,076

58,111,076

DNPM 145,500,000

157,870,000

159,470,000

157,870,000

157,865,845

157,865,845

Industrial

Relations

10,000,000

6,100,000

6,100,000

6,100,000

2,737,282

2,737,282

DIRD 55,500,000

58,000,000

58,000,000

58,000,000

57,642,357

57,642,357

BDA 5,000,000

5,000,000

5,000,000

5,000,000

5,000,000

5,000,000

National

Museum

5,000,000

5,000,000

5,000,000

5,000,000

1,000,000

1,000,000

TOTAL 563,700,000

606,493,500

623,093,500

605,493,500

598,185,680

598,185,680


a. Reporting

The major issue across the implementing agencies is the lack of compliance to providing timely,

quarterly and annual reports. Most of the donor funded projects that is some Central & Line

Agencies programmes/projects have not provided reports. Hence, there are four major

implications:

1. There is under-reporting of donor funded programs/projects that are successful and have

direct impacts on the development of the country;

2. There are non-high impact donor funded program/projects that are currently ongoing. These

need to be identified and reviewed so that funds can be reallocated to priority areas of

development;

3. Some Central & Line (Implementing) Agencies don’t have the capacity & the know how to

implement the programmes being funded for Development Budget year which affects the

actual implementation of the programme/project during the Development Budget year which

leads to DNPM regarding them as Non-Performing programmes/projects that leads to their

remaining appropriations being diverted to Performing programmes/projects or PM’s

Outstanding Commitments come year end annually; and

4. Demarcation of Roles and Responsibilities of the two (2) Divisions under the Public

Investment Programme (PIP) Wing should be adhered to accordingly at all times by the

DRAFT



respective First Assistant Secretary (and his/her officers) for Planning & Programming and

Development Monitoring & Evaluation Divisions so that each Division should comply

accordingly and implement the programmes/projects successfully annually.

b. Roles & Responsibilities of each Division:

1. Planning & Programming Division should deal accordingly with all the creation of New

programmes/projects ; whilst

2. Development Monitoring & Evaluation Division should deal accordingly with all the New &

On-going programmes/projects in regard to the Monitoring aspect and the actual successful

implementation of the programmes/projects under Public Investment Programme (PIP)

Wing.

c. Work plans and Cash flows

Agencies still have a problem submitting their work plans and cash flows within the timeframe

indicated in the Budget Circular 2014 and therefore delaying the processing and release of

warrants to them in 2014. This has resulted in lack of implementation or delay in the

implementation of these projects and even non-release of warrants.Consequently, quarterly or

annual reports have not been submitted.

d. Establishment of Project Steering Committees (PSC)

Not all the implementing agencies have established PSCs to provide oversight and guidance to

the effective implementation of all development programs/projects funded through the PIP.

For some agencies though they are formed they are not being utilised.

(eg. PMNEC, DPM, Finance & Treasury)

e. Project Management Skills

There is lack of Project management and implementation skills in some agencies to effectively implement projects.

f. Frontloading of Development funds This has implications on the absorptive capacity of agencies.

g. Government Procurement and clearance processes Lengthy Procurement process and CSTB approved supplier (contractor) instead of the agency recommended supplier resulting in contractual mishaps and delays in implementation phases of projects. For example: the PNG Customs CEF project & the PNG Fire Service Re-construction of 14 Fire Service Stations (especially the Madang & Lae Stations)

h. Agency Senior Management/Administrative Issues This is one of the major issues contributing to the non-performance of the programs/projects in the implementing agencies hierarchy. The funding are not released to certain programs due to agency administrative issues, eg: PNG Fire Service.

i. Poorly Designed and Scoped programs/projects Lack of proper project planning has resulted to poorly designed and scoped projects. For example, NEC approved projects figures without proper scope and designs.

j. Lack of reporting by government agencies Funds to be withheld and released only upon the submission of the quarterly and annual reports and plus the actual establishment of Project Steering Committees.

DRAFT



VII. RECOMMENDATIONS

It is recommended that the Administrative Sector:

1. Facilitate the PIP process and requirements workshops for agencies who are not complying

due to high turnover of staff, lack of knowledge on the PIP process or just plain ignorance;

2. Ensure that the agencies without a PSCs need to establish their PSCs to provide project

oversight; and

3. Establish dialogue and engage more with the central and line agencies of Government and the

development partners for more effective coordination and implementation of development

programs and projects in the sector with mutual understanding and accountability for

improved performance and service delivery.

4. Review some of the donor funded program especially on Governance and Capacity Building to

assess their impacts on the Public Sector to determine their continuity especially the AusAID

and UN funded programs.

5. The NEC approved project figures should be accompanied by project scopes, timelines and cost

schedules so to give insight to officers when designing the programmes/projects.

6. Agencies submitting project proposals should be investigated for Management/Administrative

disharmony and project management capacity and denied funding until they get their houses

in order and appoint qualified project managers.

7. Stop the frontloading strategy and release funds based on performance of projects.

8. Appoint competent officers to the CSTB to fast track the process since the funds are normally

appropriated for a calendar year implementation and slack officers to show cause for non-

performance and unnecessary delaying the procurement process and terminated.

9. Implementing Agencies should comply strictly with their Cash flows and Work plans which

they usually submit to DNPM by end of every second week of January annually so that they can

be held accountable in implementing the programmes/projects either successfully or

unsuccessfully as per the Cash flows and Work plans rather than deviating from the actual plan

instituted by all Concerned Agencies Senior Managements.

10. Funds will be released in regard to actual achievements of the Monthly or Quarterly Reports as

per the Cash flows & Work plans received by DNPM provided by the responsible implementing

agencies.

DRAFT



202 OFFICE OF THE GOVERNOR

Agency 202: Office of the Governor

Project Name Construction & Rehab of Main Admin Office Building

Status Ongoing

Objective

To construct and rehabilitate the main administration building so that all staff could be housed in one building for better coordination and team work.


The major component of the project is the Rehabilitation & Construction of the Main Admin Building.


Actual construction of the building structures is complete including the roof, ceiling and walls. Funding constraint has delayed the completion of this project in 2013 and now the project has been completed successfully in August 2014.

2014 Level Of Funding And Expenditure: (K’000)


Appro.

Revised

Appro.

Actual Exp

Funding Level

(GoPNG)

0.0 1,000,000 0.0 1,000,000 1,000,000

Issues & Risks

The implementing agency has the relevant experience and expertise to successfully implement the project in consultation with the relevant stakeholders.

Recommendation

It is recommended that the GG’s Office submit a progressive report on the successful completion of the project.

DRAFT



203 DEPARTMENT OF PRIME MINISTERS & NATIONAL EXECUTIVE COUNCIL (PM & NEC)

Agency Department of Prime Ministers & National Executive Council(PM & NEC)

Project Name PEACE BUILDING

Status Ongoing

Objective

1. To support national efforts to strengthen culturally appropriate mechanisms which can

reduce the risks of civil conflicts and sensitise communities to vulnerability of children and

women affected by conflicts;

2. To strengthen disaster preparedness and management capacity at the community, provincial

and national levels in the event of natural disaster; and

3. To support and promote gender equality and opportunities for women.

Components & Scope of Works


1. Developing and implementing a nation building strategy to enable government to address

issues of crisis prevention; and

2. Identifying selected communities that are able to effectively apply mediation and arbitration to

reduce the level of crisis and violence in their communities and are linked to national and

regional networks.


There are no quarterly and annual reports provided by the PM&NEC to indicate both the expenditure

and physical status of the project. This is a grant project fully funded by the United Nations.

Level of Funding and Expenditure (K’000) Year 2013 2014 Original


Actual Exp

UN 6,418,000 6,418,000 6,418,000 6,418,000

Issues & Risks

There are no quarterly or annual reports submitted to DNPM by PM&NEC as they are also not

aware of the reports provided by the UN that is coordinating this project.

There is also lack of internal coordination and dialogue between the responsible sectors in the

PIP Wing and the Foreign Aid Division who coordinate with the respective donors.

Establish dialogue with the UN and PM&NEC on this project and work closely with them. Lack

of consultation has resulted in non-reporting of the project status.

DNPM needs to actively participate in the existing Project Steering Committee meetings (PSC)

to provide the technical advice and guidance to successfully implement the project.

Recommendation

It is recommended that the project is coordinated well with all stakeholders and that quarterly and

annual reports are provided to DNPM so that the key outputs and impacts of this project can be noted

as contributions towards the development outcomes of the country.

DRAFT



Agency 203: Department of Prime Ministers & National Executive Council (PM & NEC)

Project Name Australia PNG Incentive Fund

Fund Source AusAID

Status Ongoing

Objective

To strengthen and reward performing Papua New Guinean organizations capable of delivering and

maintaining high impact development activities that benefit men, women and children.


The program has two (2) major components:

1. Program Component – Project like investments

2. Policy Component – Provincial Performance Improvement Initiative (PPII) and Sub National

Strategy (SNS).


The Australia PNG Incentive Fund (APNGIF) program was established in 2000 and has been

implemented from 2000 to 2009. The program was further extended from 2010 to 2014. It is

coordinated by AusAID through a managing contractor that has the capacity to implement the

program.

The APNGIF has funded 39 projects across 15 provinces at a total of K220 million from 2000-

2009. Churches, government, community-based organizations, NGOs and private sector

organizations have accessed direct funding support to increase their contribution to the

national development of PNG.

Level of Funding and Expenditure (K’000): Year 2013 2014 Original


Actual Exp


Issues & Risks

Annual reporting by AusAID on the APNGIF is not forthcoming to the government through

DNPM so the government is made aware of its status.

The modality in which the APNGIF is delivered and monitored is one of the most successful,

robust and a transparent mechanism that is effectively working that can be used as a best

practice model in PNG.

Recommendation


1. The program be reviewed and extended as it has successfully stimulated development by

funding those organizations that are able to effectively contribute to PNG’s development

outcomes with good track record of program and financial management.

2. The APNGIF Annual Report is submitted to DNPM

DRAFT




Project Name Community College

Fund Source GoPNG & Peoples Republic of China

Status Ongoing

Objective:

1. To provide access to skills trade trainings aimed at promoting job creation, skilled based

employment, self-sustainability, and community interdependence for all; and

2. To empower the disadvantaged and underprivileged sections of the population, mainly

focusing on youths to have access to complementary system of education.


The project has three (3) main components:

Survey, design, documentation and procurement of materials and equipment

Establishment of Community College Pilot Projects (Marienberg, Milne Bay, Enga & East New

Britain Provinces)

Program Coordination and Management

2014 Progress & Achievements:

Since the commencement of the project, the following activities have taken place;

Badili Vocational Centre:

Concept commenced on 22nd February 2010 with 115 students and 85 in 2011 respectively.

Courses offered are Basic Fisheries Technology, IT, Seamanship, Small engine technology, sheet

metal and life skills;

Fatima Vocational Centre:

Concept commenced in March 2011 with 120 students taking tourism, hospitality and life

skills;

Kepi Vocational Centre:

Recorded no enrolment for 2010, computer lab set up and not in use until 2011 they enrolled

30 students;

Kundiawa Vocational Centre:

Recorded no enrolment yet as infrastructure yet to be established;

Kwikila Vocational Centre:

Commenced enrolment in March 2010 with 65 students and 85 students in 2011. Courses

offered are motor mechanic, welding, carpentry, agriculture, plumbing, tourism and hospitality

and life skills;

Limana Vocational Centre:

The concept commenced in March 2010 with 65 students and 85 in 2011. Courses offered are

Hospitality Management. Computer soft and hardware, tourism and travel and life skills. The

first lot of students graduated on 30th August 2011;

Manus Vocational Centre:

The Community College concept was not understood well in Manus and its implementation

hasn’t started as anticipated in 2010;

Maria Hilf Vocational Centre commenced in March 2011 with 80 students taking office

management, IT and life skills;

DRAFT



St Andrews Vocational Centre:

Commenced enrolling 110 students in 2010 and increased its intake to 325 students in 2011.

Course offered are tourism and hospitality, agriculture, IT and life skills;

Karkar Vocational Centre:

Commenced enrolment of 206 students in 2010, however in the following year (2011) only

106 students were enrolled. The drop in the number of students enrolled are due to the

appalling conditions of existing college facilities. The courses offered though are motor

mechanic, carpentry, computing, nursing assistant, welding, tourism and hospitality and life

skills;

Other Community College centres are under construction including Marienberg, Finchaffen, Kupiano,

Kwato, Pangia, Tari and Wabag.

A total of 93 teachers and administrators from selected TVET colleges have been trained on

Community College Education Concept in Chennai, India since 2008. The last batch of 10 teachers and

an inspector was sent in June 2011.

Unfortunately, the implementation report for 2014 is yet to be submitted by the Secretariat under

PM&NEC on the progressive report.

Level of Funding and Expenditure (K’000):


Revised Appro.

Actual Exp


Issues and Risks

This is a loan project which is coordinated by a Secretariat that is supposed to be

administratively operating under the Department of Education however, it has been operating

independently through an ITE Trust Board. Hence, they have not been complying with the PIP

processes and requirements.

The project needs to be moved back to the Department of Education where it can be rightly

placed to deliver its intended project outputs.

Recommendation

It is recommended that this loan project be reviewed and terminated as it is operating independently

from the PIP processes without any clear directions.

DRAFT




Project Name South Pacific Games 2015

Fund Source GoPNG

Status Ongoing

Objective:

To prepare the country sporting facilities to host the 2015 South Pacific Games



1. Venue Infrastructure & Equipment 2. Project Organising Committee, and 3. Grass Roots to Gold Awareness & Training Scope:

Refurbishment/reconstruction of existing facilities in the provinces Awareness programmes being implemented to prepare the athletes and the people in country

to prepare for the games in 2015.


The Games Authority Secretariat and its various committees are established.

Some of the construction phases were delayed due to CSTB prolonged awarding of contracts to successful bidders whilst contract price variations increased for the contractors who have already been awarded contracts which consequently impacted on the appropriated funds of K59.2 million under the 2014 Development Budget thereby additional funds being sought to the amount of K250.0 million under the 2014 Supplementary Budget. Games Village;

• Enabling and Piling Contract: 100% complete.

Accommodation Blocks: CRCE

• Overall delay to programme 8 weeks.

• All 10 Buildings are erected

• Painting in progress to blocks 6,5,4,3,2,1.

• Roof structure, roofing and canopy is complete at to all blocks. Ridge cap, gutter, flashing and down pipe underway to block 7-9.

• Aluminium window frame installation continues at block 7-9

• Doors, crimsafe mesh installation in progress at block 3,2 &1. Perry Grate installation underway at block 8-10

• Plumbing works continues both internal and external work.

• External services, Road & Drainage in progress. Water reserve tank in placed.

Generator in placed.

• Finishing Works and defects works underway at Blocks 6, 5 & 4

• Built in drawers, tables, closets installation continues at Block 4-5

• Totem Poles construction continues

• Landscaping works continues including walkways

DRAFT



Dining Hall and Kitchen - CRCG

• Precast Wall erected ,installed and completed

• Kitchen roofing works completed

• Structural Steel erection completed

• Dining hall area roofing works completed

• Mechanical duck works & plumbing works continues at the kitchen Area

• Electrical wiring works commenced

Drill Hall & Sports Field: CHINA JIANGSU

Revised for construction drawings been issued

Foundation works commenced

Re painting & making good toilet ablution commenced

Concreting of footing completed

Backfilling of suitable materials and slab preparation underway.

TAURAMA AQUATIC & INDOOR COMPLEX: Enabling Works: Practical Completion Certificate issued.

Main Complex -FMC

• Central block is currently 3 weeks behind programme. Arena is currently 9 weeks behind programme. Overall Programme impact is 3 weeks.

• Studio ground floor ceiling joist continues. Upper level partition wall continues

• Central Block Level 1 partition wall continue. Ground level & upper level fire sprinkler piping underway. Ceiling studs underway at ground level & level1 continues. Soffit works continues at the Central block pool viewing area. Polished floor finished continues at level 1 central block.

• Roof sheeting at Studio and Arena Interface is 100%.. Installation of Rodeca Sky light translucent panel in progress at the Arena. Installation of Rodeca translucent external wall panel at the Arena continues and Studio is 100%. Decotec wall lining commenced at the indoor arena wall.

• 25mtr Pool construction works all done.

Piping works underway.

• 50mtr pool slab & precast panel walls installation completed. Electrical & Mechanical works continues.

• Plumbing works in progress at central block. Sanitary fittings underway

• Toilet wall Lining continues at the GF Central Block

Structural Steelwork -FERRUM

• Interface steelwork completed.

• Ferrum works on site are complete

50 meter pool stainless perimeter up stand commenced. Wall lining installation underway.

Sir John Guise;

SJG Indoor Stadium -PHOENIX

• Kingspan roof & acoustic insulation is 100% at the Arena

• Diamond Roofing works continues at the admin area

• Mechanical duct works & plumbing works in progress at arena. AC Outdoor unit installed

• Rodeca Wall Panel System installation to external face of the building continues

• Decorative ceiling installation continues at the Arena.

• Light fittings installation continues at the Arena

Structural Steelwork -FERRUM

• Interface steelwork completed.

• Ferrum works on site are complete

Swimming pool: MYRTA

• 25 meter pool stainless wall lining installation continues. Piping works and pumps installation underway

Swimming pool: MYRTA

• 25 meter pool stainless wall lining installation continues. Piping works and pumps installation underway

DRAFT



Outdoor Demolition-Practically completed

Pre-Cast Bleachers- DIGARA

• Casting of precast bleachers completed

SJG Outdoor Stadium -FMC

Grandstand - Kingspan roof continue installation. Precast bleachers installation completed. Plumbing works to all levels underway. Bulkhead lining & plastering to level 1 continues. G & A continue installation to Level 3. External painting underway

Northwest Stand –Precast bleachers installation is 100%. Roof Structure completed. Precast stair installation completed.

East Stand - Pre cast bleacher 3 tier bleachers installation completed. Stairs to vomitories 100%.

Hockey – Surface preparation underway (wet turf). Roofing works 100%.

Southwest stand - Structural steel erection on progress. Bleachers underway

North Stand – 3 tier bleacher support completed .Earth works continues

South Stand – 3 tier bleacher installations is 100%. Earth works preparation continues

Site works - Drainage in progress. Score board structural frame work is 100%.

Lighting Tower erection completed.

Practice track works have commenced

Rita Flynn;

RITA FLYNN NETBALL COURTS – China Jiangsu Perimeter Fence in progress.

Pavilion plumbing works in progress

Site civil works underway

Structural Steel column erection is 100%. Beams & wall braces structure completed.GF Slab concreting underway.

Upper level mezzanine floor slab preparation underway

Schools Programme; Scoping for 16 selected Schools completed in June 2014.

All Venue User Agreements (VUA) signed off by respective schools.

IEA has signed off Venue User Agreement for all five (5) of its schools on 16-Jan-15

Received Draft TEC Report for SSTB

0017,0021,0024,0025 on 3-Dec-14. Draft

SSTB Board Resolution received on 29-Jan15

7 Contracts been awarded

Received Draft TEC Report for SSTB 0020, 0023, 0018, 0011 on 19-Dec-14.Draft SSTB board resolution received on 4-Feb-15

Last 2 schools still pending TEC Report

Bisini Sports Ground Complex

BISINI SPORTS GROUNDS

• Master Plan presented on 29-Jun-14.

• Demo Package – Practically Completed

DRAFT



Main Contract - Site works & drainage continues. Excavation and backfilling underway. Fencing

underway. Toilet ablution and changing room foundation works underway. Block wall underway.

Softball building profile & form setting underway. Top soil filling underway to rugby & soccer area

JUNE VALLEY SHOOTING COMPLEX:

New Air Pistol shed is 100%.

Outdoor Pistol range is 100%. Defect lists fixing underway.



Actual Exp


Issues and Risks

GAMES VILLAGE CONCERN:

▪ Unlikely that all buildings will be completed, For Games mode 6 blocks to be completed

TAURAMA AQUATIC & INDOOR COMPLEX CONCERN:

▪ Minor finishing works at Central Block and external works. Seats to middle arena will not be completed.

SIR JOHN GUISE INDOOR CONCERN:

▪ Offices areas are not expected to be completed.

SIR JOHN GUISE OUTDOOR CONCERN:

▪ Main Stadium, some finishing works to various level and external works will not be completed.

RITA FLYNN NETBALL COURTS CONCERN:

▪ Project is not expected to be completed before the Games

BISINI SPORTS GROUND CONCERN:

▪ Irrigation and grassing

The project being moved from agency to agency causing confusion and slow implementation of the various components.

Tender internationally for projects of such magnitude to avoid unnecessary delays.

Recommendation

1. The Sports Authority (PNG Games Authority) and the Department of PM&NEC to provide 2014

annual report on the implementation status report inclusive of detailed expenditure on the

funds and detailed quarterly reports

2. DNPM through SAD & DMED are copied the Minutes/Records of PMU/PSC for verification and

well-informed decisions to be made regarding especially the disbursement of funds.

DRAFT



206 DEPARTMENT OF FINANCE

Agency 206: Department of Finance

Project Name Financial Management Improvement Program (FMIP)

Fund Source GoPNG

Status Ongoing

Objective

1. To strengthen expenditure control, develop sound financial systems, and build capacity of

Finance staff in the Government; and

2. To improve and integrate financial management system to enhance fiscal control, improve

targeting of programs, increase transparency, reduce wastage and improve efficiency through

all levels of government in the long term.


The project has five (5) main components:

1. Develop Roll Out Plan for the Departments

2. Establish a Roll Out Design for each Departments

3. Change Management to each Departments

4. Progressively Roll Out IFMS; and

5. Plan for a Pilot Roll Out to Provinces


IFMS went live in 2012 especially the Key Pilot agencies which are Finance, Treasury & National Planning & Monitoring and other statutory authorities that have been using the system to do their transactions especially the self-accounting agencies. A major milestone achieved was the use of the IFMS to design and program both the 2012, 2013 & 2014 Development & Recurrent Budgets using the IFMS program and is now in use since 2012 in the central agencies and rolling out to other national agencies and then rolled to the provinces in which Milne Bay have been piloted to carry out IFMS program budgeting. The IFMS team from Department of Finance have been up to date with their progressive reports for the quarters and the project has been slow but achieved milestones from the end of last year (2013) and early this year by rolling out to the Line Agencies to input raw data into the IFMS programme. Currently no progressive reports received from the department of Finance for the 2nd quarter 2014 despite mile stone being achieved by DoF.



Actual Exp

Funding Level

(GoPNG)

11,769,700 11,700,000 10,000,000 11,700,000 11,700,000

DRAFT



Issues & Risks

This is a huge project for the government that started implementation since 2001 and has

gradually developed and is now used to prepare the National Budgets as of 2012. The

Department of Finance however, has not been consistent in providing the quarterly and annual

reports over the years. Finance department has also not fully utilised some project funds that

were appropriated annually over these years of implementation according to the IFMS

financial report dated 31 October 2013.

Large amount of GoPNG funding spent on the project and to date yet the Department of Finance are very slow in providing progressive reports for the 1st and 2nd Quarters of 2014.

The IFMS is capable of delivering and ensuring prudent financial management system of the

government as proven by the production of the 2013 National Budget.

Recommendation

It is recommended that the project is funded until its complete roll out to the provinces in the next five

years.

DRAFT



Agency Code 206: Department of Finance

Project Name ESPG TWINNING SCHEME

Fund Source AusAID

Status Ongoing

Objective

The main objective is to improve and build the technical and management skills of middle managers in

the public service.


The EPSG has two main components;

1. Strengthening of middle level management of GoPNG agencies by partnering with their

equivalent Australian Commonwealth Government Departments, this are: Australian Treasury

with PNG Treasury; Australian Department of Finance and Deregulation with PNG Department

of Finance; the Australian National Audit Office with the PNG Auditor-General’s Office; and

Australian Customs Service and the Australian Tax Office with their respective counterparts in

the PNG Customs Service and Internal Revenue Commission.

2. Conducting overseas training for national staff in line agencies by their counterparts in

Australian Government Departments or placing requests by GoPNG line agencies to the SGP for

an advisor to assist with management capacity building.


There has not been any progressive report provided by the Department of Finance on the

status and impact of the project.

AusAID who is providing the grant financing has not provided any reports as well.

2014 level of funding and expenditure (K’000):


Revised Appro.

Actual Exp

Funding Level (Aust Aid) 6,337,000 6,337,000 6,337,000 6,337,000

Donor (Grant/Loan) 2,444,000

Issues & Risks

Department of Finance and AusAID have not provided timely reports on the implementation of

this project.

This is a good scheme to build both the technical and management capacities of middle

managers in selected public service agencies to be more effective and efficient in performing

their duties using best work place practices..

Recommendation

It is recommended that the Department of Finance and AusAID provide progressive reports for the

project so other government agencies can be made aware of its progress and benefit and participate in

it as well.

DRAFT



Objective

To support legislative institutions to draft, debate and pass legislations which will promote MDGs and nation building.


Main component is the development of capacity within the Office of Legislative Council (OLC) on drafting of legislations.

Scope of Work: Capacity building in the policy, governance and financial management framework aspects in

regard to implementing the legislation accordingly. 2014 Progress & Achievements

Lack of reporting on the part of DoF and the donor agency has contributed to the progress and

achievements of the project not known.



Revised Appro.

Actual Exp

Funding Level (AUS AID) 8,110,000 8,110,000 8,110,000 0.0

Donor (Loan/Grant) 5,231,000 7,000,000

Issues & Risks

Department of Finance and AusAID have not been providing timely and quarterly report to

DNPM on the progress of this donor funded project programmed for 2014.

There is no Monitoring and coordination between the concerned agencies involved in implementing this project. Large amounts of GoPNG funding have been spent on the project and to date there is no progressive reports received from Dept. of Finance for the 1st& 2nd Quarters of 2014.

DNPM needs to establish dialogue with DoF and be more proactive on the providing relevant

technical advice and ensure that the PIP processes and requirements are met, particularly on

reporting.

Recommendation

It is recommended that the AusAID through the Department of Finance provide timely reports to

DNPM so the government of PNG through National Planning & Monitoring can know of the progress of

this project and especially the activities of the donor agencies operating in country in sensitive areas.

Agency 206: Department of Finance

Project Name UN Assistance to Governance

Fund Source AusAID

Status Ongoing

DRAFT



208 DEPARTMENT OF TREASURY

Agency 208: Department of Treasury

Project Name Infrastructure Development Grant (IDG)

Fund Source GoPNG

Status Ongoing

Objective:

To undertake the National Government's infrastructure commitments made in the Umbrella Benefit

Sharing Agreement (UBSA) as part of the government's liaison and public affairs programs with the

landowners and private sector stakeholders essentially to ensure the smooth operations of the LNG

Project.


Components include Grants for infrastructure developments in the area where the LNG activities are

happening.


The Department of Treasury that is responsible for the rollout of this project has not provided the

2013 and 2014 Annual Report, although DNPM has made several attempts to get some feedback. This

could basically be due to the fact that the UBSA provinces have not used the funds on the purposes

intended for therefore are not keen on reporting on this program.




Funding Level

(GoPNG)

120,000,000 120,000,000 120,000,000 120,000,000 120,000,000

Issues & Risks:

The Economic sector responsible for the administration of the project within DNPM has not

been providing report for this project due to the fact that the UBSA provinces have not used

the funds on the purposes intended for.

There has not been any monitoring done on the usage of these funds appropriated since 2011

totalling K360.0million as there is nothing to monitor since then.

The Economic Sector to be more proactive in coordinating the implementation of this project.

The economic sector has produced some “administrative guidelines” on the procedures to

implement this initiative.

Recommendation

The funds released so far to UBSA provinces are audited to authenticate the use of these funds

and refer the project that has failed to relevant authorities for investigations and possible

prosecution.

DRAFT



Agency Code 208: Department of Treasury

Project Name High Impact Projects

Fund Source GoPNG

Status Ongoing

Objective

To determine the costs including the scope and design of the projects identified in the Umbrella

Benefit Sharing Agreement (UBSA) as High Impact Infrastructure Projects for the Southern Highlands

Province. These projects are part of the benefit package to the landowners of the PNG Liquefied

Natural Gas (LNG) Project.


The major component will include grants for infrastructure developments as identified under the

UBSA.


The Department of Treasury that is responsible for the rollout of this project has not provided the

2013 and 2014 Annual Report, although DNPM has made several attempts to get some feedback. This

could basically be due to the fact that the UBSA provinces have not used the funds on the purposes

intended for therefore are not keen on reporting on this program.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

50,000,000 50,000,000 50,000,000 50,000,000 50,000,000

Issues & Risks

The Economic sector responsible for the project within DNPM has not been providing report

for this project.

There has not been any monitoring done on the rollout of the program.

The Economic Sector to be more proactive in coordinating the implementation of this project.

Recommendation


1. The project funding be continued to ensure that the Government meets its commitment to the

UBSA with the Landowners.

2. A monitoring trip is undertaken by Admin & Economic Sector officers to verify outputs on the

ground as per the scope of the UBSA commitments.

DRAFT




Project Name Micro-Finance Expansion Project

Fund Source GoPNG & ADB

Status Ongoing

Objective

To support and develop the microfinance sector in PNG, that is to provide sustainable micro finance

services to viable enterprises & savings services to the population at large.


The major components of the extension phase include:

1. Strengthening of the capacity of the microfinance industry to provide financial services to a

broader cross-section of the community and strengthen the capacity of its clients to utilize

these services.

2. Providing of appropriate regulation and supervision of microfinanceinstitutions.

3. Increase lending to micro and small enterprises (MSE) to increase rural income generation.

4. Provide efficient and effective project management service.


The project has being successfully implemented since 2001 – 2011 and has built a solid base for the

microfinance sector and had developed microfinance as a suitable tool for rural development in PNG.



Revised Appro.

Actual Exp

Funding Level

ADB & GoPNG 3,088,000 2,000,000 21,552,000 50,000,000 2,000,000

GoPNG 1,000,000 1,000,000

Issues & Risks

There are issues with regard to accessibility of the micro finance services in rural areas where

the interest is high.

A lot of awareness needs to be raised on the micro finance services as there are many rural

clients who would like to engage in small to medium enterprises but are not aware of this

service to help them realize their business plans and aspirations.

This project should continue to be co-funded by the GoPNG to support business-minded Papua

New Guineans to build their businesses and in the process build their capacity in managing

funds of different magnitude.

Recommendation

This is an ADB loan financed project and it is recommended that the project is counter-funded for the

duration of the project to support more Papua New Guineans to enter into business activities and build

their businesses.

DRAFT




Project Name PNG Microfinance Expansion Project

Fund Source AusAID

Status Ongoing

Objective

The main objective is to develop the microfinance sector in PNG through development of small

medium enterprises.


The major components of the project are unclear at this stage as it is similar to the ADB funded

microfinance project.


AusAID through Treasury has not provided the 2014 and 2013 and even the 2012 annual report to

DNPM on the progress of the project. Hence, there is no clear project objective, components and

achievements to date.



Revised Appro.

Actual Exp

Funding Level (AUS

AID)

4,000,000 3,9343,000 3,9343,000 3,9343,000

Issues & Risks

The project has not provided any quarterly or annual reports to identify issues involved with

the project.

A lot of awareness needs to be raised on the micro finance services as there are many rural

clients who would like to engage in small to medium enterprises but are not aware of this

service.

Recommendation

This is an AusAID grant financed project and it is recommended that;

1. The project is coordinated together with the ADB funded Micro finance project to avoid

confusion and duplication of resources.

2. The project is coordinated and monitored by DNPM so AusAID is not making money out of the

DB processes.

DRAFT



211 PAPUA NEW GUINEA CUSTOMS SERVICE

Agency 211: Papua New Guinea Customs Service

Project Name Institutional Housing

Fund Source GoPNG

Status Ongoing

Objective

To provide better housing facilities and a conducive working environment for customs officers both at

headquarter and the provincial centres. This will intend create improved and effective performance.


The major components of this project are;

Consultation, Land Acquisition and Design

Construction and Development (Outright Purchases)

Commissioning and Awarding of Tenancy


PNG Customs have purchased various properties as listed below:

1x Stand along house for the Madang Port worth K300, 000.

6x2 bedroom units for Port Moresby Officers worth K2million

4x2 bedroom units for Port Moresby Officers worth K2.5million

Purchase of a duplex for our Kokopo Officers worth K630,000

Other properties yet to be identified and purchased include:

4x2 bedroom flats for the Lae office worth K2.0 million

One standalone house to be built for Popondetta Office to the value of K300, 000.00.



Revised Appro.

Actual Exp


Issues & Risks

There are still issues of land acquisition and purchasing of properties in some of the locations

which can delay the implementation of the project.

DNPM needs to assist PNGCS through the Project Steering Committee to provide the relevant

technical guidance and advice.

Recommendation

It is recommended that the project is adequately funded to provide better housing facilities and a

competitive working environment for customs officers at the Headquarter and the provincial centres

for improved and effective performance to protect PNG borders and our economy.

DRAFT



Agency 211: Papua New Guinea Customs Service

Project Name ASYCUDA

Status New

Objective

To upgrade the current limited Automated System for Customs Data (ASYCUDA) to ASYCUDA World version to meet International Customs Standards.


The major components of the projects are; 1. Procurement and installation of the ASYCUDA World by the UNCTAD 2. Specialist Training, and 3. Project Management 4.

Electronic funds transfer and revenue collection in terms of turn-around time by reducing receipting and hinders misuse of funds (improves accountability).


Implemention is slow due to late release of funding and a report is yet to be provided by the

orgranisation.



Revised Appro.

Actual Exp


Issues & Risks

DNPM needs to assist PNGCS through the Project Steering Committee to provide the relevant technical

guidance and advice.

Recommendation


1. The project is adequately funded to provide better housing facilities and a competitive working

environment for customs officers at the Headquarter and the provincial centres for improved

and effective performance.

2. DNPM step up its interactions with the organisation to address issues impeding the project.

DRAFT



213 PNG FIRE SERVICE

Agency 213: PNG Fire Service

Project Name Construction, Rehabilitation And Upgrading Of 14 Fire Stations And Fire Equipment Program

Status Ongoing

Objective

To construct a responsive PNG Fire Service with technically and professionally trained fire fighters;

appropriate and well maintained equipment; and well located stations to protect property,

investments and life from fire, disasters and related emergencies.


The project has three (3) major components:

1. Fire facilities and equipment upgrade in 4 selected stations

2. Infrastructure Rehabilitation and Reconstruction in 14 identified Stations

3. Capacity Development


Some of the achievements to date include:

Consultation and Design of Madang Fire Station including other similar Level Standard Stations

have been completed and ready for construction to begin in 2013 and be completed by end of

2014.

PNGFS Management with the IT Team undertook a familiarization trip to Australia and met

with the potential supplier(s) of the Call Aided Dispatch (CAD) System. PNGFS is currently in

the process of purchasing and procuring the CAD System to be installed in PNG.

2014 implemenation is yet to be reported on.



Revised Appro.

Actual Exp


Issues & Risks There has been delay in awarding of the contracts through the Central Supply & Tenders Board

(CSTB) for preparation, construction and rehabilitation of the infrastructures at the 14 sites

and to the supplier to supply the CAD System equipment.

DNPM to continue to work closely with the PNGFS to provide the relevant technical advice to

build their capacity on the PIP processes and requirements.

Recommendation

It is recommended that the project is adequately funded to ensure that all the essential facilities and

equipment’s are purchased and installed in the new and rehabilitated Fire Stations in the selected

locations to adequately equip them to respond to any disaster especially structural.

DRAFT



216 INTERNAL REVENUE COMMISSION

Agency 216: Internal Revenue Commission

Project Name Revenue Accounting System II (RASII) - Enhancement

Status Ongoing

Objective:

1. To enable IRC to improve its revenue collection capacity by ensuring that the current tax

collection system is upgraded and efficient; and

2. To ensure that all financial institutions and companies are linked to the system for effective tax

collection and management.



1. Payment Agreements & Collection

2. Tax Audits & Objections

3. Report Management & the Interfaces Development of IPA, CUSTOMS ASYCUDA and the Banks.

2014 2014 Progress & Achievements:


Consultations and Design preparations were carried out in the provinces to be linked up with

the Main Frame System Server at the headquarters in Port Moresby by the Contractors.

Construction and maintenance have been completed in early 2012.

Revenue Accounting System II has been installed and it is up and running at the Headquarters.

It is expected to be rolled out to the provinces in the next phase.



Revised Appro.

Actual Exp


Issues & Risks

The roll out of the RASII system to the provinces has been delayed due to some technical

issues. It is expected to be resolved and implemented as soon as possible.

It is an important project that is vital to enhance the capacity of the IRC to collect and manage

taxes when the country is experiencing economic boom in the mineral and petroleum sectors.

Recommendation


1. The project is continued funding to completion to fully equip and resource IRC for effective

collection of tax revenues.

2. DNPM step up its interactions with the organisation to address issues impeding the project.

DRAFT




Project Name Institutional Housing

Status Ongoing

Objective

To create a competitive working environment by providing housing to ensure the welfare of the

provincial staff is taken care of, hence improvements in their work performance.

Scope & Components

The major components of this project are;

Consultation, Land Acquisition and Design

Construction and Development (Outright Purchases)

Commissioning and Awarding of Tenancy


Some progress to date include:

1x Stand along house for the Madang Port worth K250,000.00

2x2 bedroom units for Kimbe Officers worth K370,000.00

2x2 bedroom units for Alotau Officers worth K3600,000.00

Purchase of a duplex for Sohano Island (Small Buka) Officers worth K500,000.00

Documents for these properties are currently being vetted and exchanged for successful handing over

to the new landlord (IRC) by mid August. PNG IRC now owns these properties for its officers.

Other properties yet to be identified and purchased include;

4x2 bedroom flats for our Lae office worth K2million



Revised Appro.

Actual Exp


Issues & Risks

Housing for some locations are still outstanding due to issues with land acquisition and

insufficient funds to purchase the properties.

Recommendation

It is recommended that the project is continued funding until completion to create a competitive and

stable environment for provincial staff to effectively perform their duties in all matters concerning

revenue collection.

DRAFT




Project Name Raising Revenue Initiatives

Status Ongoing

Objective

To ensure there are sufficient resources available to allow IRC to meet the growing demands of tax payers and enforce voluntary compliance in a booming economy and translate that into increased revenue collections for the Government.


The major components are Revenue Raising Initiatives with these sub-components; 1. Conduct of Audits on large business and non-compliance sectors. 2. Establishment of a Case Selection and Intelligence (CSI) System for audit and enforcement

activities to include e-lodgment and e-registration and the procurement and installation of the Scanning and Optical Character Recognition (OCR) System.

3. Construction of a data Warehouse in preparation for the completion of project RAS II 4. Engagement of legal support (experts) to review the Income Tax Act.

Scope oF Work: SIGTAS system to be rolled out to the provinces nationwide.


No progressive reports have been provided by the implementing agency on the status of the project for the quarters in 2014, resulting in funds being diverted to cater for other performing projects/programmes to cater for in the 2014 Supplementary Budget. 2014 level of funding and expenditure (K’000):


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

3,000,000 2,000,000 3,500,000 2,000,000 2,000,000

Issues & Risks

No liaison, monitoring and coordination with implementing agencies (especially the project management team) on how much they’ve progressed with the specific project concern.

Recommendation

It is recommended that the project is continued funding until completion to create a competitive environment for provincial staff to effectively perform their duties in all matters concerning revenue collection.

DRAFT



217 DEPARTMENT OF FOREIGN AFFAIRS (DFAT)

Agency 217: Department of Foreign Affairs (DFAT) Project Name Re-Opening & Re-Construction of PNG High Commission in Honiara,

Solomon Islands and Fiji Chancery Status Ongoing

Objective:

1. To re-open and re-construct the Honiara, Solomon Island Chancery, New Zealand Chancery, Fiji,

Cairns and Singapore Chanceries to consolidate PNG’s bilateral relations; and

2. To reinforce PNG’s bid for full membership in ASEAN to play a critical role in strengthening

PNG’s multilateral relations through the various international and multilateral organizations in

the region.


The major components of the programme are as follows: 1. Reconstruction of the PNG High Commission Project in Honiara, Solomon Islands and Fiji;

2. Feasibility studies and preparations to construct a Fiji Chancery at Suva.



Refurbishment of the New Zealand High Commission and Re-opening and refurbishment of the

Singapore Mission.

Honiara Chancery Site possession :

Surveyed existing works and benchmarks 100% completed, Clean and Demolition of existing frameworks 100% completed;

Main Building: Demolition 100% completed; Structure refurbished up to 85% works done and roofing almost 100% competed;

Services Roughing: Lift works are currently work in progress at 65% complete; Doors and Windows are 85% completed but work is still in progress. Light weight Wall frame and Interior Finishes are also 65% complete at the moment.

Services Fit Off: Joinery, Fixtures and Fittings, Exterior Finishes and External Screens and Metal work are 75 % completed and work in progress.

External Areas and Buildings, Generators and Car-park 79% completed at the moment for now. Commissioning and Handover will be done in later October when all is completed for the

Solomon Island building. Fiji Chancery:

Bag filling 100% completed of the swampy land by the City Council – Fiji for the land for the PNG Chancery to be built on

feasibility and scoping have already being done and the designs of the building to be similar like the Honiara Chancery and

Costings hopefully to be constructed by Lamana Construction Limited (LCL) due to its influence in the Pacific Islands.

DRAFT



2014 Level of Funding and Expenditure (K’000): Year 2013 2014 Original


Actual Exp

Funding Level

(GoPNG)

25,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues & Risks

DFAT has not been providing timely reports and these projects have not been monitored.

PNG’s foreign missions are required to provide their full requirements from design, scoping,

and procurement to DFAT to ensure appropriate levels of funding are secured to implement

the projects successfully.

Lack of coordination between DNPM, Treasury and DFAT has resulted in the delay in

implementing the Honiara Chancery Project on time.

DNPM to have more interaction with DFAT on these project implemenation to ensure the

projects are completed on time and save PNG embarrassment in the international arena.

Recommendation

It is recommended that the project is adequately funded and completed on schedule to strengthen

PNG’s multilateral relations in the Asia Pacific region and to save PNG from international

embarrassment.

DRAFT



Agency 217: Department of Foreign Affairs (DFAT)

Project Name Regional Development Grant to Solomon Islands

tatus New

Objective To honour the commitment made by the former Prime Minister Grand Chief Michael Thomas Somare who pledge of K100 million to the Solomon Islands in 2011 as a bilateral assistance to the Government of Solomon Island for a period of the five (5) years. Components & Scope of Works for 2014 This is a new programme. The cheque of K20 million was presented by the Prime Minister O’Neil to Prime Minister Gordon Darcy Lilo in May 2013 as first payment for a five year period with an outstanding of K80 million. Progress and Achievements

the second payment has already being disbursed to the the Government of Solomon Islands in 2014

Monitoring and evaluation of the funds be done in the 3rd quarter and 4th quarter of 2014. No progressive reports have been provided by the implementing agency (DFAT) on the status

of the project for the quarters in 2014. Level of Funding and Expenditure (K’000)


Appro.

Revised

Appro.

Actual Exp

Funding Level

(GoPNG)

21,124,000 20,000,000 21,124,000 21,124,000

Issues &Risks Liaison, monitoring and coordination with implementing agencies (especially the project management team) needs to be improved Recommendation It is recommended that in future commitments made by the Prime Minister must be given preference and priority.

DRAFT



Agency Code 217: Department of Foreign Affairs (DFAT)

Project Name Republic of Fiji General Elections

Status New

Objective To maintain and enhance bilateral relations within the Pacific Region and to assist the people of Fiji to exercise their democratic rights without fear or favour when voting in the true Spirit of Democracy and to honour the pledge of K50 million made by Prime Minister Peter O’Neil to the Prime Minister of Fiji in Port Moresby in April 2013. Components & Scope of Works for 2014 The project has one major component which is the Election Grant for the Fiji General Elections. 2014 Progress and Achievements

This is a one-off grant to the Republic of Fiji Government in 2014.The Fiji elections haave been conducted successfully in 2014 in which Fiji has thanked the government of PNG for its assistance.

No progressive reports have been provided by the implementing agency (DFAT) on the status of the project for the quarters in 2014.

2014 Level of Funding and Expenditure (K’000):


Revised Appro.

Actual Exp


25,000,000 25,000,000 25,000,000 10,000,000

Issues &Risks No liaison, monitoring and coordination with implementing agencies (especially the project management team) on how much they’ve progressed with the specific project concern. Recommendation It is recommended that future project such as this scale due to its importance in the GoPNG commitments made by the Prime Minister should be given preference and priority.

DRAFT



Agency 217: Department of Foreign Affairs (DFAT)

Project Name Regional Development Assistance to the Pacific Islands Countries

Status New (One-Off)

Objective The main objective is to maintain and enhance bilateral relations within the Pacific Region. Components & Scope of Works for 2014 The project involves Grant;

1. Tuvalu Budgetary Support 2. Tonga Democratic Reforms 3. Pacific ACP Secretaries Establishment 4. Republic of Marshall Islands Drought/Climate Change Awareness.

2014 Progress and Achievements

This is a new and one-off grant to the Pacific Island Nations as per PM’s commitment to strengthen our bilateral relationships with other Island Nations.

No progressive reports received from DFAT for the Quarters in 2014 for these programme. 2014 Level of Funding and Expenditure(K’000)


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 10,000,000

Issues &Risks No liaison, monitoring and coordination with implementing agencies (especially the project management team) to follow up and validate progress of the project. Recommendation It is recommended that future project such as this scale due to its importance in the GoPNG commitments made by the Prime Minister should be given preference and priority.

DRAFT



220: DEPARTMENT OF PERSONNEL MANAGEMENT

Agency 220: Department of Personnel Management

Project Name Strongim gavman program (SGP)

Fund Source AusAID

Status Ongoing

Objective

Under the PNG-Australia bilateral arrangements, the Australian Government agencies provide a

whole-of-government engagement assistance:

1. To build capacity development and provide advice in advisory positions only within key

GoPNG agencies.

2. To provide advice on strategic advice as advisors on public service policy, capacity

development, administrative, leadership and management support.


1. Strengthening of capacity assessments of the different sectors;

2. Development of a SGP Capacity Development Strategy and Monitoring and Evaluation

Framework; and

3. SGP Assessment of Positions and Placements of Advisors subject to performance in key GoPNG

agencies.


AusAID through DPM have not provided any reports on this program although there are

unknown numbers of advisors currently attached to some key government agencies.



Actual Exp

Funding Level (AUS_AID)

61,626,000 61,626,000 61,626,000 61,626,000

Donor (Loan/Grant) 59,189,000

Issues & Risks This is a grant project which AusAID coordinates and detailed program reports where not

provided to DPM or DNPM.

DNPM through the AusAID branch needs to work closely with AusAID on this program to

ensure there is knowledge and skill transfer from Advisors to national staff. From past

experience, transfer of knowledge and skills from technical advisors to national staff was

lacking.

Recommendation

This is an AusAID grant financed project and it is recommended that the project be reviewed to

assess its impact to determine its continuity.

DRAFT




Project Name Economic and public sector program

Fund Source AusAID

Status Ongoing

Objective

To provide an effective facility that supports and encourages the efforts of both private and public

sector organizations in PNG to participate in, and contribute to, national development in accordance

with the development policies and priorities of the Government.

Scope & Components

The program has two (2) major components:

1. Program Component – Project like investments

2. Policy Component – was in abeyance until late (2004); GoPNG-Provincial Performance

Improvement Initiative (PPII) and Sub National Strategy (SNS).


AusAID through DPM have not provided any reports on this program although the program has

assisted a number of central agencies with their respective capacity diagnostic exercises among other

technical assistances.



Actual Exp

Funding Level (AUS AID)

45,265,000 29,917,000 29,917,000 29,917,000

Issues & Risks

This is a grant project which AusAID coordinates and detailed program reports were not

provided to DPM or DNPM.

DNPM AusAID branch and the PIP Wing need to work closely with AusAID on this program to

ensure that the impact of this program is reported in the overall development budget

implementation report annually.

Recommendation

This is an AusAID grant financed project and it is recommended that the project provides annual

reports to DNPM for planning and reporting purposes.

DRAFT



Agency Code 220: Department of Personnel Management

Project Name PNG Property

Fund Source AusAID

Status Ongoing

Objective:

To cater for the rental, assets and other administrative associated costs for the AusAID program

personnel in PNG


The main component of this program includes Payment of rentals and assets cost of the AusAID

Program in PNG.


This is an ongoing program which has incepted in 2013. No reports received from the Agency

concerned.



Revised Appro.

Actual Exp


5,749,000 6,411,000 6,411,000 6,411,000

Issues & Risks

No report on the program.

Recommendation

The implementing agency should provide relevant updates & progressive reports to the DNPM so that outputs can be noted and appreciated and further assist DNPM on future funding support for organization.

DRAFT




Project Name PNG COUNTRY PROGRAM

Fund Source AusAID

Status Ongoing

Objective

To support the operational costs of AusAID Program in PNG


The main component of this program includes Support to administrative and operational costs of the

AusAID Program in PNG.


This is an ongoing program which is continuing from 2013. No progressive reports have been

provided by the implementing agency (DFAT) on the status of the project for the 1st& 2nd quarters in

2014.



Actual Exp


1,078,000 1,639,000 1,639,000 1,639,000

Issues and Risks

No progressive reports.

Recommendation


DRAFT




Project Name Australian Awards Programme

Fund Source AusAID

Status Ongoing (but transferred to DPM)

Objective

To contribute to economic growth and poverty reduction in PNG by the development of highly skilled

men and women who are able to apply their professional and technical expertise, experience and

leadership skills in the workplace and the society.


The main component of this program includes:

1. PNG Australian Development Scholarships (ADS).

2. Australian Leadership Awards Scholarship (ALAS)

3. Short Course Awards

4. Health Awards Development Scholarship (HADS)

5. Strengthening PNG’s Professional Associations and the PNG-Australian Alumni Association;

and

6. Ongoing Support to Scholarship Awardees


This is an ongoing program which has incepted in 2013.

Total of 152 Australian Awards Scholarships awarded under PNG ADS and ALAS For the Australian Awardees, year-on-year awardees mostly from NCD (62% in 2013 and 65%

in 2014) Under HADS, there were 510 awardees to commence study in 2014. Over 75% are women awardees 88% of awardees comes from other provinces There is no strong quantitative evidence of the program impact (outcome) in addressing the

urgent skills knowledge gaps in PNG’s Private and Public sector Level of Funding and Expenditure (K’000) Year 2013 2014 Original


Actual Exp

Funding Level (AUS AID) 50,262,000 50,262,000 50,262,000

Issues & Risks

No report on the program.

Recommendation


DRAFT



229: DEPARTMENT OF NATIONAL PLANNING & MONITORING

Agency 229: Department of National Planning & Monitoring

Project Name Special Intervention Program

Fund Source GoPNG

Status Ongoing

Objective Thye main objective is to intervene where necessary on policy and programming matters for all development policy plans from sectors including lower levels of government are aligned to minimize mismatches but to act in unison to reach higher national objectives and goals. Components & Scope of Works Regional policy forums to identify mismatches for amendments and alignment. 2014 Progress and Achievements Preliminary consultation workshops have been completed however the results do not seem promising and there is a lot more need to be done. 2014 Level of Funding and Expenditure (K’000):

Year 2013 2014 Original Appro. Revised Appro.

Actual Exp


10,000,000 12,970,000 0.0 12,970,000 12,970,000

Issues & Risks Allocation of adequate funding is a major challenge which threatens the successful implementation of the project. Recommendation

1. Responsible sector desk officers within DNPM to provide progressive report on implementation of program.

2. Department continues to fund this project to see ultimate objective of reaching unified planning and management system developed.

DRAFT




Project Name Consultative Implementation Monitoring Council (CIMC) Support

Fund Source GoPNG

Status Ongoing

Objective The main objective of this project is to give technical and operational support to the Consultative Implementation Monitoring Council (CIMC). Components & Scope of Works The major project activity is to support to the Operations of the Consultative Implementation and Monitoring Committee to deliver on their core business. Progress and Achievments

No progressive report of the project has been submitted by the implementing sector under (DNPM-PBSD) to GoPNG.

The statuses of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM policy division.



Revised Appro.

Actual Exp


1,500,000 1,500,000 1,500,000 1,500,000

Issues & Risks

Need to establish Project Steering Committee to implement & sustain the project activities. Non-compliance of progressive reporting by the respective sector under DNPM (PBSD). No coordination and Liaison with the Desk Officers (Admin Sector) responsible for the actual

programmes. Never was present at the Mid-Term Review presentations which did not show a good

impression of taking ownership, leadership and compliance of the policies and procedures of Public Financial Management Act (PFMA).

Recommendation Responsible sector desk officers within DNPM to provide progress report on implementation of the program.

DRAFT




Project Name Tax Credit Scheme

Fund Source GoPNG

Status Ongoing

Objective:

1. To extend by way of capital works and maintenance of Government’s infrastructure on the national development priority sectors, the beneficial impacts of mining, petroleum and primary industry developments to the population of the host province and other parts of PNG.

2. To assist where possible in developing a planning and implementation capacity at either the Provincial, District, Local Government or Ward levels.

Components & Scope of Works: All major Infrastructure projects in the provinces which are categorized into six areas as follows; (1) Transport, (2) District Administration complexes, (3) Health, (4) Education, (5) Primary Industry and (6) Law Justice & Other infrastructures. The scope of works includes the construction of infrastructure facilities for health, education, primary industry, district administration, law and justice, transport and others considered on a case by case basis. Progress and Achievements: The Tax Credit Scheme program forecasted allocation was K130.0 million in the 2014 Development Budget. K70.0 million was for the Highlands Highway and K60.0 million was for other infrastructure projects. Of the total appropriated for the highway, K20.76 million was approved for the highlands highway administration budget and two projects while 64 projects worth K160.36 million was approved for normal TCS projects. National Infrastructure Tax Credits was introduced in August 2014 with the approval of the Marea Haus and the administration budget at a cost of K94.35 million. The projects approved include education, police, roads and health infrastructures in Western, Southern Highlands, Enga, West New Britain, Madang, Central, Chimbu, Oro, New Ireland Provinces and the National Capital District. These projects will be or are been implemented by Oil Search Limited, Hargy Oil Palm Ltd, Porgera Joint Venture, Ok Tedi Mining Ltd, Ramu Agri Industries Ltd, Kula Ltd and Lihir Gold Ltd respectively.

1. Fourteen high school infrastructure projects in New Ireland approved in 2012 for LGL to

implement have all commenced implementation. Of the 14 projects, 3 projects including the

rehabilitation of Namatanai, Mongop and Utu High Schools were completed while the others are

progressing well.

2. Eighteen projects approved in the 2011, 2012 and 2013 were being implemented by PJV. Of this

total, five projects including the Construction of Wabag Eye Clinic Extension, Laiagam Police

Barracks, Paiam Police Barracks, Paiam Town Water Supply Emergency Works and the Design of

Hela University have been completed. All other projects are progressing.

3. Seventeen projects approved in 2010, 2011, 2012 and 2013 were being implemented by OSL. Of

these total 4 projects (Kutubu Access Road upgrade, Construction of 2xStaff Houses at Juni Clinic,

Feasibility Studies at Kupiano District Health Centre and Tari-Pai Police Mobile Squad Barracks

Electrical Power supply upgrading) were completed while others are progressing well.

DRAFT



4. Eleven projects were being implemented by OTML while one project, Redevelopment of the

Balimo District Hospital was opened and handed over to the Fly River District Administration. Two

projects are under construction while works on the other nine projects are yet to resume after

terminating the contractors for non-performance.

5. Hargy Oil Palm Ltd completed the Upgrade of Barema Mill Access Road. Other 2 projects are

currently undergoing construction.

Funding Level (K’000):

*NB: Please note that the balances are brought forward from the previous years (2011-2014).

Issues Risks

Sustainability of projects implemented under the program is an issue.The concerned Districts and Provincial Administrations fail to maintain completed projects in most cases after developers have handed over the completed projects.

Need to establish Project Steering Committee to implement & sustain the project activities current there’s non at the moment.

Recommendation It is recommended that the program continues as it is effective in delivering the desired infrastructure in the most remote regions of PNG.


Revised Appro.

Actual Exp


DRAFT




Project Name Coastal Vessels Program

Fund Source GoPNG

Status Ongoing

Objective The main objective is to provide marine transportation services to coastal and river side local communities, government establishments and business houses at an affordable cost. Components & Scope of Works for 2014 The project has only one (1) major component and that is Procurement of vessels and boats within the country & overseas. Progress and Achievements The project was implemented some years back but was ceased due to poor implementation and mismanagement of project funding. However, NEC made a decision to revive this program/project which commenced implementation in 2013. A total of K10.0 million was appropriated for the program/project. Normally, the funds are allocated upon request from MPs whose constituencies are from coastal and river side communities. Several MPs have bought vessels for their respective coastal and riverside communities. Level of Funding and Expenditure (K’000): Year 2013 2014 Original


Actual Exp


20,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks

Guidelines need to be developed to ensure due process and procedural requirements are followed before funds are released for the purchase of vessels.

This is a good program and if managed well it should deliver the government desired outcomes

in enhancing sea transport in the Maritime Provinces.

Recommendation It is recommended that some information is provided on the program to Administrative sector and DMED technical officers on the progress of this program.

DRAFT



Agency Code 229: Department of National Planning & Monitoring

Project Name PNG Church State Partnership Program

Fund Source GoPNG

Status Ongoing

Objective To financially assist the churches (Faith-based organizations) in terms of their implementation of education and health services to the communities. Components & Scope of Works Major components are:

1. Establish Framework for improving Church-Government Development Partnership. 2. Rehabilitate and Maintain Church-run health and Education Institution around the country.

The other major component of this program is to establish a policy framework for improving Church-Government Development Partnership and Rehabilitate and maintain church-run health and education institutions around the country. Progress and Achievements The Status of PNGCSP Program as at 12th of October 2014 (K10 million) reflects the following;

12 Projects Funded totaling up to K 5,970, 400.00; YWAM Ship was paid K4 million; Remaining balance is currently K 29,600.00; Completed the Social Development Program report; Three (3) NEC Submissions produced and submitted to NEC to endorse SDP Report and

establish the Church Development Council; MOU drafted and signed between YWAM and DNPM on behalf of GoPNG for the procurement

of the Medical Ship; Received 155 projects at a value of K1.5 billion and screening, elimination and appraisal

continues; TOR for the Secretariat is being endorsed by NEC; NEC has endorsed the formulation of Church Development Council that will have its first

meeting on the 18th February 2014 to deliberate of the recommended submissions to be funded in 2014;

Establishment of Technical Project Appraisal Committee; and Establishment of DNPM Project Steering Committee (PSC) for PNG SCP.

Level of Funding and Expenditure (K’000)


Revised Appro.

Actual Exp


Issues and Risks

Non-compliance by the implementing agencies and respective sectors in DNPM on the progressive reporting on the projects.

There must be better working relationship established between the State and partner churches to see better results.

DRAFT



This is a good program and if managed well it should deliver the government desired outcomes

through the churches in PNG.

Recommendation It is recommended that the respective sector under DNPM provide respective the progressive reports on promptly.

DRAFT




Project Name One UN Fund for PNG

Fund Source Ausaid

Status Ongoing

Objectives To establish a One UN Fund, a single funding mechanism supporting the PNG Country Program 2012-2016 Components & Scope of Works A technical assistance is required to set up a single funding mechanism in PNG where funds are better coordinated and disbursed not only in one sector but spread evenly as possible. Progress and Achievements The policy formulation process seems to be very slow and is yet to be seen to commence in a big way. 2014 Level of Funding and Expenditure (K’000):


Revised Appro.

Actual Exp

Funding Level (AUS

AID)

6,466,000 6,556,000 6,556,000 6,556,000

Issues & Risk

There is an urgent need to progress implementation of this project. No reporting & coordination between the donor and GoPNG (DNPM-FAD) in regard to funding

perspectives.

Recommendation

It is recommended that GoPNG should sustain the projects upon completion and that the implementing agencies (Donor & GoPNG) to provide progressive reports to Administration Sector (DMED) Branch.

For 2014 UN committed K6.6 million for the exercise and it is committing another sum of K5.0

million for the same. The Government must fully support this exercise to see positive results.

DRAFT



Agency Department of National Planning & Monitoring

Project Name EDF Nao Institutional Capacity BUILDING Project

Fund Source GoPNG/EU

Status Ongoing

Objective To enhance capacity of NAOs to achieve an efficient and timely use of NIP, SABEX and SAP funds. This project is important as it aims to build the capacity levels of knowledge and skills of responsible officers who normally deal with projects funded by EU and further more EU has committed a final allocation of K9.0 million in 2015 Budget. It is recommended that the Department must support this project for some time because there is high turnover rate of officers who do not last longer than expected. Components & Scope of Works for 2014 The project has two major components which are: capacity building in terms of training and coordination between NAO officers. Progress and Achievements No progressive report of the project has been submitted by the Donor agency and the implementing sector under (NAOSU) to GoPNG. Level of Funding and Expenditure (K’000):


Revised Appro.

Actual Exp

Funding Level (GoPNG) 300,000 300,000 300,000 300,000 300,000

Donor (Grant/Loan) 8,177,000 8,689,000 8,689,000 8,689,000

Issues & Risks

No reporting & coordination between the donor and GoPNG (DNPM- NAOSU) in regard to funding perspectives.

Recommendation It is recommended that GoPNG should sustain these projects upon completion and that implementing agencies (Donor & GoPNG) to provide progressive reports to the Administration Sector (DMED) Branch.

DRAFT




Project Name Institutional capacity building

Fund Source GoPNG

Status Ongoing

Objective To support and strengthen the functioning of the Department of National Planning and Monitoring through institutional and human resources capacity building in order for the Department to effectively deliver on its responsibilities. Components & Scope of Works The seven (7) main components of the project are:

1. Human Resource Capacity Building 2. Institutional Capacity Building 3. Institutional Housing 4. Planning Workshops, 5. Review of Project Cycle Process, 6. Sector Development Plan Coordination 7. National Planning Act


In terms of Human Resource and Institutional Capacity Building, a training plan for the next five (5) years have been prepared to train and equip the Senior Management as well as the Officers with the relevant skills and qualifications to perform their duties accordingly.

As for Housing, a policy is already in place and the commercial bank (BSP) has also agreed on it with talks also established with NCDC and Department of Lands to secure land.

Training Plan completed for human resource capacity building for the next 5 years. Housing policy in place after talks with relevant stakeholders Allotments have been allocated at Dogura – Gerega Suburb for 200 officers.

Level of Funding and Expenditure for 2014 (K’000):


Revised Appro.

Actual Exp


Issues & Risks

The major issue regarding this project will be the unavailability of land for Institutional Housing but the responsible Committee is working to locate a vacant land as soon as possible and also reporting aspect is the only factor that has affected the progress of the project for the quarter, failure by the implementing agencies (specific DNPM sector) to liaise with DNPM Desk Officers. Warrants totaling K3.0 million released but no progressive report received yet for the quarters, 2014.

Need to establish Project Steering Committee to implement & sustain the project activities. Recommendation

The implementing agency should provide relevant updates & progressive reports to the Desk Officers from Administration Branch (SAD & DMED – PIP Wing) for accurate reporting and presentations in regard to the appropriations released for the quarter.

DRAFT




Project Name Rural Economic Development Phase I

Fund Source EU

Status Ongoing

Objective To pave the way towards a second phase of the programme which will be focused at improved livelihood and income opportunities of the rural population in PNG. Components & Scope of Works Major Component;

1. Feasibility study of the RED Phase II 2. Rural Infrastructure Improvement ; and 3. Access to Financial Services


This is an ongoing programme which includes the feasibility study of the RED II programme to be extended under the EU contractual arrangements from the end date of Nov4ember 2012 to July 2013. The purpose of the extension is for the Consultant to carry out an efficient and coordinated M & E systems for DNPM, NARI & DPLLGA.

No progressive report of the project has been submitted by the Donor agency and the implementing sector under (DNPM-FAD) to GoPNG.



Revised Appro.

Actual Exp

Funding Level (Donor- EU) 6,260,000 6,260,000 6,260,000

Issues & Risks No reporting & coordination between the donor and GoPNG (DNPM-FAD) in regard to funding perspectives.

Recommendation The donor agency plus the implementing agency (DNPM)-FAD should provide progressive reports to DNPM Administration Sector (DMED) Officers for ongoing projects so DNPM cannote the programmes achievements and status.

DRAFT




Project Name Rural Economic Development Phase II

Fund Source EU

Status New

Objective To pave the way towards a second phase of the programme which will be focused at improved livelihood and income opportunities of the rural population in PNG. Components & Scope of Works The project consists of three (3) components:

1. Rural Infrastructures are to improve the Highlands Region (Contribution Agreement with ADB).

2. Access to financial services for agriculture value chain financing is further developed in the Highlands Region (Contribution Agreement with ADB).

3. Value Chain Development Support Services and service delivery capacities of government structures as well as non-state actors are strengthened in the Highlands Region.(Contribution Agreement with ADB).

Progress and Achievements No progressive report of the project has been submitted by the implementing sector under (DNPM-PBSD) to GoPNG. The statuses of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM policy division. Level of Funding and Expenditure (K’000) Year 2013 2014 Original


Actual Exp

Funding Level (Donor EU)

15,649,000 15,649,000 15,649,000

Issues &Risks

Need to establish Project Steering Committee to implement & sustain the project activities. Non-compliance of progressive reporting by the respective sector under DNPM (PBSD). Lack of coordination and Liaison with the Desk Officers (Admin Sector) responsible for the

actual programmes. Recommendation The donor agency plus the implementing agency (DNPM)-FAD should provide progressive reports to DNPM Administration Sector (DMED) Officers for ongoing projects to update the programmes achievements and status.

DRAFT




Project Name Identity card (with biometrics)

Fund Source GoPNG

Status Ongoing

Objective To develop a national identity card system that is unique and applicable to Papua New Guinean situation managing and identifying national population census, electoral rolls, and immigration passports and for other planning purposes. Components & Scope of Works Infrastructure and ICT networks Progress and Achievements No progressive report of the project has been submitted by the implementing agency (NSO) to DNPM and hence status is unknown. Level of Funding and Expenditure (K’000) Year 2013 2014 Original Appro. Revised Appro. Actual Exp


30,000,000 30,000,000 167,000,000 30,000,000 10,000,000

Issues &Risks

The implementing agency should provide relevant updates & progressive reports to the Desk Officers from Administration Branch (SAD & DMED – PIP Wing) for accurate reporting and presentations in regard to the appropriations released for the quarter.

Reporting aspect is the only factor that has affected the progress of the project for the quarter, failure by the implementing agencies (specific DNPM sector & NSO) to liaise with DNPM Desk Officers. Need to establish Project Steering Committee to implement & sustain the project activities.

Recommendation The implementing agency should provide relevant updates & progressive reports to the Desk Officers from Administration Branch (DMED – PIP Wing) for accurate reporting and presentations in regard to the appropriations released for the quarter.

DRAFT




Project Name JICA Training

Fund Source JICA

Status Ongoing

Objective Enhance the human resource development and knowledge creation. Components & Scope of Works Four components are;

1. Leadership Training, 2. Trainers Training, 3. Solution Creation and International Dialogue.

Progress and Achievements No progressive report of the project has been submitted by the Donor agency and the implementing sector under (DNPM-FAD) to DNPM and hence status of the project is unknown. Level of Funding and Expenditure (K’000):


Revised Appro.

Actual Exp

Funding Level (Donor - JICA)

1,397,000 1,397,000 1,397,000 1,397,000

Issues &Risks No reporting & coordination between the donor and GoPNG (DNPM-FAD) in regard to funding perspectives. Recommendation The donor agency plus the implementing agency (DNPM)-FAD must provide progressive reports to

DNPM Administration Sector (DMED)

DRAFT




Project Name JICA volunteer

Fund Source JICA

Status Ongoing

Objective Enhance the Human resource development and knowledge creation. Components & Scope of Works Consist of four components:

1. Leadership training, 2. Trainers Training, 3. Solution Creation and 4. International Dialogue.


Train and produce skilful human resource Progress and Achievements No progressive report of the project has been submitted by the Donor agency and the implementing sector under (DNPM-FAD) to DNPM and hence status of the project is unknown.



Actual Exp

Funding Level Donor (JICA)

1,397,000 7,056,000 7,056,000 7,056,000

Issues & Risks

No coordination and Liaison with the Desk Officers (Admin Sector) responsible for the actual programmes.

Never was present at the Mid-Term Review presentations which did not show a good impression of taking ownership, leadership and compliance of the policies and procedures of Public Financial Management Act (PFMA).

Recommendation The donor and the implementing agency (DNPM)-FAD should provide progressive reports to DNPM Administration Sector (DMED) Officers for ongoing projects to status and achievements.

DRAFT




Project Name Sustainable Development Programme

Fund Source GoPNG

Status New

Objective To decrease the population growth with a fertility rate of 4.3 to 2.1 children per woman in order to decrease the demand and dependency to unsustainably exploit the natural resources whereby contradicting the guiding principles of the constitution on equity and responsible use of the environment. Components & Scope of Works Major Component: Sustainable Development Agenda:

1. Bio-Fuel Development in PNG – To pilot bio-fuel as an alternate to diesel fuel in line with promoting clean energy. The pilot project will be done in two districts. Sumakar in Madang and Alotau in Milne Bay Provinces.

2. Setting up opportunity costs Funds – To set up a special fund with clear administrative guidelines and legislation to mobilise funding from international funding organisation. This is partnership with the private sector especially in the major cash crop areas of copra and cocoa to regenerate the interest of the majority of families in the rural areas who depend on these cash crops for a living.

Progress and Achievements The statuses of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM policy division.



Actual Exp


Issues & Risks


programmes. Recommendation DNPM needs to step up on reporting on projects parked within the Department

DRAFT




Project Name HOUSING AND LAND DEVELOPMENT PROGRAM

Fund Source GoPNG

Status New

Objective To promote nationalism in ensuring that all Papua New Guineans are able to afford and own a house and can live a healthy, wealthy and securable life as enshrined in the whole of government’s goal “Vision 2050, PNG DSP & MTDP”. Components & Scope of Works The programme consists of eight (8) major components that have involved a number of agencies in implementing:

1. Preliminary Works – NHC 2. Nationwide Housing Audits – NHC 3. Establish Secretariat - DNPM 4. Affordable Home Ownership Scheme Policy – DNPM 5. Pilot Project – JTWG/NHC 6. Land Development Programme – Lands Department 7. Land Acquisition Programme – Lands 8. Contingencies for Legal Challenges - DNPM



The statuses of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM - Infrastructure & Economic Division.



Revised Appro.

Actual Exp


Issues & Risks


programmes. Recommendation DNPM needs to step up on reporting on projects parked within the Department

DRAFT




Project Name EU Grants Reimbursement

Fund Source GoPNG

Status New

Objective To reimburse the European Union for non-compliance with the set EDF procedures and processes of projects implemented under the 8th and 9th European Development Fund (EDF). Components & Scope of Works The major component of the project is to ensure GoPNG comply with the EDF processes and procedures in order to satisfy the Cotonou Partnership Agreement. Progress and Achievements


The statuses of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM - Foreign Aid and Policy Division.



Actual Exp


Issues & Risks


programmes. Recommendation The respective sector under DNPM & EU Programm section under (FAD) should provide respective progressive reports on timely manner and provide accurate reporting to the Administrative Branch (DMED) Officers in regard to the implementation of the project quarterly and annually.

DRAFT




Project Name Kokopo City Infrastructure Development (Water and Sewerage)

Fund Source GoPNG

Status New

Objective

1. To rehabilitate and construct essential infrastructure and public utilities such as electricity, water and sanitation, telecommunication and banking systems.

2. To integrate the MDG’s the Population Policy, and to be more gender responsive in planning and to promote Results Based Monitoring.

Components & Scope of Works The project has one major component which includes Detail Design & Project Costing @ a cost of K20 million. Progress and Achievements No progressive report of the project has been submitted by the implementing sector under (DNPM-PBSD) to GoPNG. The status of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM policy division.



Revised Appro.

Actual Exp


20,000,000 20,000,000 20,000,000 20,000,000

Issues & Risks

Need to establish Project Steering Committee. Non-compliance of progressive reporting by the respective sector under DNPM (PBSD). No coordination and Liaison with the Desk Officers (Admin Sector) responsible for the actual

programmes. .

Recommendation The respective sector under DNPM - Infrastructure Planning & Programming section under (IED) should provide respective progressive reports on timely manner plus also provide accurate reporting to the Administrative Branch (DMED) Officers in regard to the implementation of the project quarterly and annually.

DRAFT




Project Name Development Planning Advisor

Fund Source GoPNG

Status New

Objective The maing objective is to enhance the capacity of DNPM in the area of Aid Coordination and Project Monitoring and Evaluation. It is also expected to support policy issues. Components & Scope of Works for 2014 The project has three (3) components which include:

1. Aid Coordination 2. Project Cycle Management especially in the area of Project Monitoring and Evaluation. 3. Support to Policy Issues requested by DNPM.

Progress and Achievements No progressive report of the project has been submitted by the implementing sector under (DNPM-PBSD) to GoPNG. The statuses of various projects funded under the program are unknown at this stage as quarterly status reports are yet to be received from the relevant implementing sector under DNPM policy division.



Revised Appro.

Actual Exp

Funding Level (GoPNG) 470,000 470,000 470,000 0.0

Issues & Risks


programmes. Recommendation The respective sector under DNPM - PBSD section under Policy Division should provide respective progressive reports on timely manner plus also provide accurate reporting to the Administrative Branch (DMED) Officers in regard to the implementation of the project quarterly and annually.

DRAFT



230: ELECTORAL COMMISSION Agency 230: Electoral Commission

Project Name Electoral Support Project Phase II

Fund Source Ausaid

Status Ongoing

Objective

1. To support reform and improvement of the electoral system in PNG. 2. The Electoral Support Program Phase 2 (ESP2) supports the PNG Electoral Commission in its

role to plan, execute and monitor elections in PNG as well as support reforms to improve the electoral process.


1. Preparation & Conduct of the 2012 National Elections; 2. Capacity building to strengthen institutional capacity (purpose of extension to 2015 after 2012

elections) Progress and Achievements Technical capacity of PNGEC to plan for elections has improved; however, there are still areas to address in the actual conduct of elections in which AusAID is assisting to provide actual activities under this program to improve the PNGEC staff competency and effectiveness in delivering their tasks and responsibilities.



Actual Exp

Funding Level (AUS

AID)

10,927,000 10,927,000 10,927,000

Issues & Risks

Reporting aspect is the only factor that has affected the progress of the project for the quarter, failure by the implementing agencies plus the AusAID to liaise with DNPM Desk Officers.

Recommendation The respective sector under DNPM & AusAID section (FAD) & the implementing agency should provide respective progressive reports on timely manner plus also provide accurate reporting to the Administrative Branch (DMED) Officers in regard to the implementation of the project quarterly and annually.

DRAFT



232 DEPARTMENT OF PROVINCIAL & LOCAL LEVEL GOVERNMENT AFFAIRS (DPLLGA)

Agency 232: Department of Provincial & Local Level Government Affairs (DPLLGA)

Project Name Sub-National Strategy (SNS)

Fund Source AusAID

Status Ongoing

Objective

To improve service delivery for men, women and children in PNG through improved public

administration and governance processes; improved performance in provinces; and

alignment of ongoing programs to be more responsive to service delivery challenges at the

sub-national level.


The project has six (6) major components:

1. Strengthening the National Government Support to the sub-national levels of Government

2. Capacity Building exercises in sub-national levels of government to meet their service delivery

mandates

3. Constructive engagement with non-state institutions and champions for change to ensure

continuation of some core services where appropriate

4. Improve effectiveness of the government aid program through increased engagement with all

levels of government

5. Improve effectiveness of the AusAID Program through increased coordination between sector

programs; and

6. Effective engagement between civil society and government.


AusAID through DPLLG has never provided quarterly and annual reports to DNPM to

report on some of the successful programs/projects that are been implemented through this

program.



Revised Appro.

Actual Exp


53,887,000 48,925,000 48,925,000 48,925,000

Issues & Risks

The program has received counterpart funding in 2012, however, DPLLGA failed to submit

their annual work plan and cash flow. In addition, they failed to provide the quarterly and

annual reports.

DNPM needs to work closely with DPLLGA and AusAID to facilitate the PIP processes and

requirements so that responsible officers in DPLLGA comply accordingly.

Recommendation

This is one of the major AusAID grant financed program and it is recommended that the grant

assistance continues and GoPNG provides the counterpart funding for the duration of the program to

improve public administration, governance processes and service delivery challenges at the sub-

national level.

DRAFT




Project Name PNG DISASTER RISK MANAGEMENT SUPPORT PROGRAM

Fund Source AusAID

Status Ongoing

Objective

To improve disaster risk management and to strengthen and enhance turn-around response time of

provincial disaster response centres in all provinces.



1. Manage disaster risks

2. Early identification and categorization of disaster risks against risks codes; and

3. Strengthen and improve rate of return on response time to emerging and changing disaster

risks.


AusAID through DPLLG has never provided quarterly and annual reports to DNPM to report on some

of the successful programs/projects that are been implemented through this program.



Revised Appro.

Actual Exp

Funding Level (AUSAID) 5,057,000 3,715,000 3,715,000 3,715,000

Issues & Risks

DPLLGA have failed to submit their annual work plan and cash flow. In addition, they also

failed to provide the quarterly and annual reports.



Recommendation

This is an AusAID grant financed project and it is recommended that the grant assistance continues

and that the project provide timely reports to DNPM.

DRAFT




Project Name Rural Services Delivery and Local Government Project

Fund Source World Bank

Status New

Objective

To pilot a successful Community Driven Development (CDD) platform in PNG that would be scaled up

and eventually adopted by the government as a way to improve the access, quality and management of

basic public services delivered in rural areas.



1. Systems & Financing of Community Service Delivery Grants – Provision of grants to LLG’s to

finance community identified sub projects

2. Capacity Building of national & Sub-National Entities – Strengthening of capacities of national

& sub-national government (and non- governmental) entities to manage and implement the

project and to improve local governance.

3. Project management – Support of a Project Management Unit at the National Level and

Provincial Project Offices in the targeted Provincial Administration.


There are no reports at this stage



Revised Appro.

Actual Exp


7,001,000 7,001,000 7,001,000

Issues & Risks

DPLLGA have failed to submit their annual work plan and cash flow. In addition, they also

failed to provide the quarterly and annual reports.



Recommendation

This is a World Bank financed project and it is recommended that the implementing agency provides

timely reports to DNPM.

DRAFT



261: DEPARTMENT OF LABOUR & INDUSTRIAL RELATIONS

Agency 261: Department of Labour & Industrial Relations

Project Name Capacity Building Programme

Fund Source GoPNG

Status Ongoing

Objective To strengthen the capacity and capability of the Department of the need and importance of having labour offices located in all Provinces, nationwide plus the various stages of development on the Capacity Building Programme which includes institutional staff housing projects, staff training and upgrading the resources that are available for each province and at the headquarter level.. Components & Scope of Works

Renovation, Upgrading and Construction of all Provincial labour Offices nationwide including six (6) new offices in Daru, Vanimo, Manus, Buka, Hela and Jiwaka.

DLIR Office Complex to house all statutory and programme offices in one building and Institutional Housing development.

Resourcing all offices nationwide and training of department staffs also (one-off activity). Establishment of the National Skills Development Authority purposely to; Align training standards to Papua New Guinea Qualification Framework Improve flexibility and smooth transition between training institutions Labour Administration services in delivering services in the field nationwide. Re-organisation of the Department to meet the demands nationwide, especially in the latest

major developments eg. LNG Project and Ramu Nickle Mining, just to name a few (one-off activity).


Feasibility studies in the 1st& 2nd Quarters of 2014 Minor works (refurbishments & ground breaking ceremonies for actual construction to take

place) to certain key provinces for the actual roll-over of the programme to be fully operational next year 2015.

Launching of the Oro Provincial Labour Office @ end of July, 2014. Level of Funding and Expenditure (K’000):


Revised Appro.

Actual Exp


Issues & Risks

Slow in implementing the project/programme and especially the awarding of the contract to the contractors in which CSTB procurement processes are responsible for.

Recommendation

1. The implementing agency should provide the progressive reports accordingly or measures will be taken against them for the remaining quarters.

DRAFT



2. The implementing agency should provide relevant updates & progressive reports to the Desk

Officers from Administration Branch (DMED – PIP Wing) for accurate reporting and presentations in regard to the appropriations released for the quarter.

3. It is recommended that the project should be continued funding in 2015 due to its importance

to do the Department and country.

DRAFT



509: BORDER DEVELOPMENT AUTHORITY

Agency 509: Border Development Authority

Project Name Pilot Border Development Trade & Investment Project

Fund Source GoPNG & ADB

Status Ongoing

Objective

To improve the business environment in Sandaun Province by reducing the business transaction costs

associated with infrastructure and compliance with the Government rules and regulations.



1. Construction of border facilities at Wutung

2. Capacity Development

3. Social Development Program.


The staff housing project is almost complete with 13 new H65 houses, 4 duplexes and 10

existing houses maintained awaiting supply and installation of white goods.

The main border administration complex project has commenced laying foundations works on

site. The design was reviewed to include minor changes with the design layout and traffic flow

that may meet the operational requirements of the respective agencies that will be working at

the border.

One of the major outcomes of the project is to improve the investment environment to capture

trade opportunities at the border post.

Level of Funding and Expenditure (K’000) Year 2013 2014 Original


Actual Exp

Funding Level (ADB Loan) 7,422,000 7,422,000 7,422,000 7,422,000

GoPNG 10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks

The initial design was reviewed to include minor changes that have been overlooked at the

design stage. This incurred variations on GoPNG counter-part funding.

DNPM needs to continue to work closely with BDA to provide the relevant technical guidance

to implement the project.

Recommendation

This is an ADB loan financed project and it is recommended that the project is effectively implemented

with full GoPNG counterpart funding over the loan agreement period to address border issues at

Wutung Border Post at the northern part of the land border with Indonesia.

DRAFT



DRAFT



PROVINCES

DRAFT



Description

No of PIPs

2014


Code PROVINCES

571 Fly River 6 75,000,000

572 Gulf 6 42,800,000

573 Central 4 67,200,000

574 NCD 3 50,500,000

575 Milne Bay 3 68,000,000

576 Oro Province 3 34,500,000

577 Southern Highlands 7 137,160,000

578 Enga Province 7 124,300,000

579 Western Highlands 4 104,500,000

580 Simbu 5 115,000,000

581 Eastern Highlands 7 146,000,000

582 Morobe 5 155,900,000

583 Madang 4 102,500,000

584 East Sepik 3 103,000,000

585 Sandaun 3 68,500,000

586 Manus 3 21,000,000

587 New Ireland 8 54,700,000

588 East New Britain 4 89,000,000

589 West New Britain 5 43,500,000

590 Bouganiville 7 160,000,000

591 Hela 98,000,000

592 Jiwaka 5 71,000,000

TOTAL 1,932,060,000

DRAFT



I. PROVINCIAL SUMMARY

The provinces remain one of the biggest sectors in terms of funding appropriation. The Government’s focus on the provinces has increased with number of key interventions to improve service delivery in the 22 provinces. The District Services Improvement Programs (DSIP) and the Provincial Services Improvement Programs (PSIP) are flagship programs that demonstrate National Government’s commitment to sub-national levels of government. Other development projects and programs are also funded under respective provinces to improve their capacity to effectively deliver services. The public funds allocated to Provinces and Districts are used to address wide ranging issues of economic and social nature. The state of development in many provinces in the past reflects lack of funding commitments which had contributed to rapid deterioration of key infrastructures to unmanageable operational standards. Thus, these conditions have prompted the National Government to focus more on the sub-national levels in terms of increased funding as well as decentralization of certain national functions to the provinces and districts.

II. FUNDING ALLOCATIONS TO REGIONS & PROVINCES

Table 1: 2014 Development Budget Appropriations for the four (4) regions of the country.

Region Appropriations (Revised)

(K’000)

Actual

Expenditure (K’000)

Sum of Un-spent WA (K’000)

GoPNG Donors

Southern 338,000.0 Nil 337,500.0 500.0

Highlands 795,960.0 Nil 784,467.0 11,493

MOMASE 429,900 Nil 427,500.0 2,400.0

NGI 368,200.0 Nil 363,450.0 4,750.0

TOTAL 1,932,060.0 Nil 1,912,917 19,143.0

The pie chart below shows the percentage of the budget distributions by region.

In 2014

Development Budget, the Provinces Sector received a total Revised Budget Appropriation of K1.93 billion as direct funding towards their specific and

service improvement programs and projects. Out of this appropriation a total of K1.91 billion was recorded as expenditure whilst K19.14 million as un-spent warrants. There are other programs and projects that are funded by donors which are also implemented in the provinces. However, their funding and expenditure reports are not entailed in this report. This is an area that needs to be improved in the future.

NGI, 368,200,000, 19%

Southern, 338,000,000, 18%

Momase, 429,900,000, 22%

Highlands, 795,960,000, 41%

Figure 24.0: Provincial Budget Distribution by Region

DRAFT



As reflected in the graph above, the Highlands region received the biggest slice of the budget at the total sum of K795.96 million (41%) and the actual expenditure is K784.75 million which is about 99% expenditure at the total revised level. The MOMASE region was allocated a total revised budget of K429.90 million which is the second largest share of the budget and the expenditure against appropriation is K427.50 million. This is about 99.5% of the total appropriation. New Guinea Islands region got the third largest allocation of K368.20 million and expenditure incurred against the appropriation was K363.45 million. Southern region received the lowest compared to other regions with total allocation of K338.0 million. The expenditure incurred against the total appropriation was K337.5 million

III. FUNDING ALLOCATION TO PROGRAMS (Figures in millions of Kina (‘000’) Program/Projects Funding Sources Expenditure

GoPNG Donors (

Combine Total)

DSIP 890,000 Nil 849,380

PSIP 445,000 Nil 445,000

SSGs 54,120 Nil 51,020

IDGs/SIGs 20,000 Nil 20,000

SPAs 26,680 Nil 26,680

Support to LLGs 157,000 Nil 129,700,600

Projects (Combined) 322,520 Nil 217,181,718

Total 1,915,320,000 Nil 1,738,962,318

The pie chart below shows the percentage distribution of programs and projects funding in the Provinces.

The District Services Improvement Program (DSIP) receives about 47% of the total budget appropriation going to the provinces. This is important in terms of delivering services in the districts.

DSIP 44%

PSIP 22%

SSGs 3%

IDGs/SIGs 6%

SPAs 1%

Support to LLGs 8%

Projects (Combined) 16%

Figure 25.0: Percentage Distribution of the Specific Programs/Projects

DRAFT



The Provincial Service Improvement Program (PSIP) received 23% of the total provincial appropriation followed by projects (17%), Support to LLG (8%), IDGs (6%),SSGs (3%) and SPAs (1%). The graph beow shows the expenditure performances of the Provinces.

IV. ISSUES AND CHALLENGES The implementation of programs/projects in the provinces arenot clear at this point in time despite increased funding to provinces. There are number of factors affecting effective program/project implementation. However, the most common causes are:

The infrastructure that supports communication systems for government business is mostly none existent in districts and LLGs. In provinces. There is lack of communication between the headquarters and the provinces.

It is very expensive exercise to conduct field monitoring of projects right across the nation and available resources for such an exercise is not there. There is lack of regular field monitoring to enforce compliance to standard practices of good project management accountability and reporting.

DSIP, PSIP, Support to LLGs and other handpicked projects are politically driven programs/projects. Such programs are not properly designed, scoped and costed. Consequently, when funds are allocated; they are spent at the wish of the political authorities or politicians, which n most cases do more harm to development outcomes than good.

Although provinces have indicated that they have in-place Project Steering Committees (PSC) and internal Project Management Units (PMU), the results in terms of better practice of project management and progressive status of projects reporting is almost absent. There is no systematic coordination of successful implementation of programs/projects to achieve planned results.

V. RECOMMENDATIONS Base on the above issues and discussions, the following recommendations should be noted:

0

20000000

40000000

60000000

80000000

100000000

120000000

140000000

160000000

FlyRiver

Gulf

Central NC

D

MilneBay

Oro SHP Enga

WHP

Simbu

EHP Morobe

Madan

g

ESP Sandau

n

Manus

New

Ireland

ENB

WNB

ABG

Hela

Jiwaka

Original Budget 1

Revised Budget 75,0 42,8 67,2 50,5 68,0 34,5 142, 144, 104, 105, 146, 157, 102, 103, 68,5 21,0 54,7 89,0 43,5 160, 100, 81,0

Warrants YTD 75,0 42,8 67,2 50,5 68,0 34,5 137, 124, 104, 115, 146, 155, 102, 103, 68,5 21,0 54,7 89,0 43,5 160, 98,0 71,0

Actual Spend 75,0 42,8 67,2 50,5 68,0 34,5 137, 124, 104, 115, 146, 155, 102, 103, 68,5 21,0 54,7 89,0 43,5 160, 98,0 71,0

Ap

pro

riat

ion

s (K

'mill

ion

s)

Figure 26.0 Expenditure Report by Province

DRAFT



To ensure effective communication between Waigani and the Districts, the National Government must assess the current telecommunication infrastructure in the provinces and districts, the cost of up-grading the infrastructures and having connections all the way down to districts and LLGs. The current Rural Communication Project and Broad Band Network Project should focus more on the districst and LLGs to improve communication for development.

To enforce compliance to standard practice of good project management, acoountability and

transparency, the National Government must make available adequate resources and funding support for project monitoring and reporting to all respective departments, particularly the Department of National Planning & Monitoring.

DSIP, PSIP, Support to LLGs and politically motivated projects must comply with the standard

procedures of proper project documentation and appraisals before development funds are allocated to these projects.

To provide successful oversight to project implementation, the Project Steering Committees

(PSCs) and Internal Project Management Units (PMUs) must be established in all provinces.

DRAFT



SOUTHERN REGION

The Southern Region comprises six (6) provinces as shown in the table below. The development challenges facing these provinces are similar to what many other provinces are experiencing throughout the country. However, the PIP scope for 2014 varies in each of the provinces. And the six Southern Provinces’ 2014 PIP funded projects are listed below. However, the Tax Credit Funded

projects have not been reported due to difficulty in compilation of appropriate data and information.This is a challenge that DNPM needs to improve on in order to have on record the total development funds meant for the concerned resource provinces.

Table below shows 2014 Expenditure Summary by Provinces (K’000)

Development Funding

per Province

Original Budget

Revised

Budget

Warrants Year to

Date

Expenditure

to Date

Unused WA

Un-Issued

WA

Western Province 70, 000 70,000 70,000 68,600 1,400 0

Gulf Province 58,800 58,800 52,100 50,100 2,000 6,700

Central Province 67,200 67,200 64,000 58,040 5,960 3,200

National Capital District 47,500 47,500 47,500 47,400 100 0

Milne Bay Province 70,000 70,000 70,000 68,400 1,600 0

Oro Province 44,500 44,500 44,500 43,600 900 0

Total 358,000 358,000 348,100 336,140 11,960 9,900

20%

16%

19% 13%

20%

12%

Figure 27.0: Budget Distribution by Province (Southern)

Western Provinces Gulf Province Central Province

National Capital District Milne Bay Province Oro Provinces

DRAFT



WESTERN PROVINCIAL ADMINSTRATION

Agency 571 : Western Provincial Administration

Project Name Fly River Provincial Government SSG

Fund Source GoPNG

Status Ongoing

Objectives:

To support implement various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to, in the OK Tedi (MOA) relating to Ok Tedi Mine.


The components of this program is to support all the projects that are identified within the Provicial and District Development Plans as well as projects within the MOA


Reporting of the SSG projects implementation has not been effective from the Western Provincial Administration.

Level of Funding & Expenditure (K’000’)


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

14,400,000 14,400,000 14,400,000 14,400,000

Issues & Risks

SSG is a fixed commitment from the National Government and it is extremely important that the funds are spent well on projects to achieve tangible developments.

Recommendations

DNPM should work closely with Western Provincial Administration to ensure that the SSG reports are provided regularly to to all stakeholders.

DRAFT



Agency Western Provincial Administration

Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objectives

To assist the 3 districts of Western Province to address development needs on each of the sectors according to their priority areas captured within their Fiver- Year Development Plans and priorities.


To support and improve basic sevice delivery in the districts based on key development priorities in the District Development Plans.


Department of Implementation and Rural Development is yet to provide a report to DNPM regarding the implementation of the DSIP.

Level of Funding and Expenditure (K’000’)


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues andRisks

At this stage it is difficult to report on the issues and risks as we do not have the DSIP reports.

Recommendations

DNPM needs to collaborate with DIRD to ensure that the DSIP reports are provided regularly indicating status of the DSIP implementation.

DRAFT



Agency Code Western Provincial Administration

Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective

To empower the14 LLGs and assist them effectively to deliver the needs of the people at the LLG lelve


1. To support improve the LLG institutional capacity to effectively deliver basic services to the rural people

2. To fund development projects identified within LLG development plans. 2014 Progress & Achievements:

DIRD is yet to provide a report to DNPM regarding the implementation of the LLG SIP.



Revised Appro.

Actual Exp


Issues and Risks

At this stage it is difficult to report on the issues and risks as we do not have the LLGSIP reports.

Recommendations

DNPM needs to collaborate with DIRD to ensure that the LLGSIP reports are provided regularly to report on the Government achievements a the LLG level

DRAFT




Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support the province implement key development priorities identified in the Provincial Development Plansin consistent with the overarching national development plans and policies.


The project component comprises projects and programs identified under the each of the Sectors within the Provincial Development Plans.


Department of Implementation and Rural Development is yet to provide a report to DNPM regarding the implementation of the PSIP.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

15,000,000 15,000,000 15,000,000 15,000,000

Issues and Risks

At this stage it is difficult to report on the issues and risks as we do not have the PSIP reports.

Recommendations

DNPM needs to collaborate with DIRD to ensure that the PSIP reports are provided regularly indicating status of the DSIP implementation.

DRAFT




Project Name Special Support Grants-Ok Tedi NFDA

Fund Source GoPNG

Status Ongoing

Objective

To support the communities specifically affected by the Ok Tedi mine. Components & Scope of Works:

The project components comprise projects agreed in the MOA that will specifically assist and enhance the commounties affect by the mine. 2014 Progress & Achievements:

The status of the project is unknown due to lack of reports from the WPG.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

3,600,000 3,600,000 3,600,000 3,600,000

Issues and Risks

Reporting for this project remains a challenge for the Provincial Administration.

Recommendations

DNPM will need to liaise with WPG for these reports.

DRAFT



GULF PROVINCIAL ADMINSTRATION

Agency Code Gulf Provincial Administration

Project Name Gulf Provincial Government SSG

Fund Source GoPNG

Status Ongoing

Objective

To support implement various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to, in the Gulf – Southern Highlands Memorundum of Agreements (MOA) relating to Kutubu Oil Project.




Reporting of the SSG projects implementation has not been effective from the Gulf Provincial Administration.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

4,800,000 4,800,000 4,800,000 3,700,000

Issues & Risks


Recommendations

DNPM should work closely with Gulf Provincial Administration to ensure that the SSG reports are provided regularly to to all stakeholders.

DRAFT



Agency Name Gulf Provincial Administration

Project Name Gulf Provincial Administration Office Complex

Fund Source GoPNG

Status Ongoing

Objective To improve, restore and increase Public Servants productivity and confidence and strengthing the administrative capacity.

Components & Scope of Works: The components are:

1. Tender documentation and project tendering and awarding of project 2. Construction of the office complex and its associated costs.


The design and scoping of the building is ready for tendering awarding of contract for construction. Total cost for the building is K 20,000,000.00. K4 million given in 2012 development budget was released and held at the provincial treasury for the project.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

4,000,000 4,000,000 4,000,000 4,000,000

Issues and risks The Leadership, Management and Governance issue in the province has always been a problem for the province. To see effective implementation of these projects, a steering and management committee will be established to oversee the implementation and assist the Provincial Administration to provide effective leadership and management in the areas required on the project. Although total amount for this year allocation has been fully used, the Gulf Provincial Administration is yet to provide a year-end project performance report. Recommendation It is recommended that a monitoring visit must be conducted to ascertain the proper use of funds as per the project plans and activities.

DRAFT




Project Name Kerema Town Roads

Fund Source GoPNG

Status Ongoing

Objectives

To improve the road condition of the Kerema Town roads


Upgrade and Maintenance of the Kerema Town roads


The status of the project is unknown at this stage



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

5,000,000 5,000,000 5,000,000

Recommendations

It is recommended that Gulf Provincial Administration must provide a report on the project

DRAFT





Fund Source GoPNG

Status Ongoing

Objectives

To assist the 2 districts of Gulf Province to address development needs on each of the sectors according to their priority areas captured within their Fiver- Year Development plans and priorities.



2014 Progress & Achievements::




Revised Appro.

Actual Exp

Funding Level

(GoPNG)

20,000,000 20,000,000 20,000,000 18,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 572 Gulf Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To support the province implement key development priorities identified in the Provincial Development Plans in consistent with the overarching national development plans and policies.


The project components comprise projects and programs identified under the each of the Sectors within the Provincial Development Plans.





Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 10,000,000

Issues and Risks


Recommendations


DRAFT




Project Name Development Assistance Grant

Fund Source GoPNG

Status Ongoing

Objective

To assist Gulf Provincial Administration to fund development projects to create business environment for investors as well as its people to access goods and services that have been lacking for many years.


The components comprises projects identified in the Provincial Development Plan 2014 Progress & Achievements:

Gulf Provinical Administration is yet to provide a report to DNPM regarding the implementation of the project.



Revised Appro.

Actual Exp


Issues & Risks

There is no report for the project at this stage

Recommendations

DNPM to liaise with GPA to proress the report on this project.

DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To empower the LLGs and assist them effectively to deliver the needs of the people at the LLG level







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

500,000 500,000 500,000 440,000

Issues and Risks


Recommendations


DRAFT



CENTRAL PROVINCIAL ADMINSTRATION

Agency Code 573 Central Provincial Administration

Project Name Central Provincial Government SSG

Fund Source GoPNG

Status Ongoing

Objective

To support implement various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to as part of the LNG project development.




Reporting of the SSG projects implementation has not been effective from the Central Provincial Administration.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

700,000 700,000 700,000

Issues & Risks


Recommendations

DNPM must work closely with Central Provincial Administration to ensure that the SSG reports are provided regularly to to all stakeholders.

DRAFT




Project Name District Services Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist the 4 districts in Central Provinces to address development needs on each of the sectors according to their Fiver Year Development Plans and priorities.





Level of Funding and Expenditure (k’000’)


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

40,000,000 40,000,000 40,000,000 34,000,000

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective



The project components comprises projects and programs identified under the each of the Sectors within the Provincial Development Plans.


Department of Implementation and Rural Development is yet to provide a report to DNPM regarding the implementation



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

20,000.000 20,000.000 20,000.000 20,000.000

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To empower the 15 LLGs and assist them effectively to deliver the needs of the people at the LLG level.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

6,500,000 6,500,000 4,000,000 4,000,000

Issues and Risks


Recommendations


DRAFT



NATIONAL CAPITAL DISTRICT COMMISSION

Agency Code 574 National Capital District Commission

Project Name Urban Youth Development

Fund Source GoPNG & UN

Status Ongoing

Objective

To provide socially and economically disadvantaged youth short term employment opportunities utilizing labour-intensive methods, and to strengthen and expand programs that provides the knowledge and skills for employment. Components & Scope of Works: There are three components to this project:

1. Employment skills training; 2. Employment schemes; and 3. Socialisation and Capacity building


It’s been an on-going project since 2010 - 2015; there is a limited absorption of the formal employment sector this creates a need to provide opportunities for entry into the informal sector through entrepreneurship training for selected participants. Inclusive is the considerable higher participant costs and limited absorption capacity of the private sector to support such a programme. Level of Funding and Expenditure (K’000’)


Revised Appro.

Actual Exp

Funding Level

(GoPNG)

1,000,000 1,000,000 1,000,000 1,000,000

Issues & Risks

Unemployment of youths continue to be a challenge

Recommendations

It has achieved some of its objectives and goals. The project needs to be reviewed to see the good results and how best this same program can be implemented in other centres of the country.

DRAFT




Project Name NCD Solid Waste Management

Fund Source GoPNG & JICA

Status Ongoing

Objective

To develop and improve solid waste management in the National Capital District and PNG.


Three major components are:

1. Improvement of Baruni Dump Site

2. Improvement of waste collection in NCD

3. Development of Waste Management Plan for NCD 2014 Progress & Achievements:

The project started implementation in 2011 with JICA and NCDC funding. In 2011 the NCDC Solid Waste Management project was submitted for funding under the 2012 PIP. A NCDC Solid Waste Management Plan was developed this year. The actual construction phase of the project is scheduled to commence by the end of 2013.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

1,000,000 0.0 0.0

Issues & Risks

No issues of concern at the time of reporting but as the project progress on some issues may rise.

Recommendation

Although the project is progressing so well with physical developments taking place, unfortunately, the Donor contribution is not reflected in monetary terms which do not paint a good picture for JICA’s contribution. This must be done at the Project Management Level and any other issues arising should be addressed as well.

DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To assist the three electorates within NCD to address development needs on each of the sectors according to their Fiver Year Development Plans and priorities.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues and Risks


Recommendations


DRAFT




Project Name Provincial Support Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To support the province implement key development priorities identified in the National Capital District Commision Plan in consistent with the overarching national development plans and policies.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

15,000,000 15,000,000 15,000,000 15,000,000 15,000,000

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To empower the LLGs and assist them effectively to deliver the needs of the people at the LLG level.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

500,000 500,000 500,000 500,000 400,000

Issues and Risks


Recommendations


DRAFT



MILNE BAY PROVICIAL ADMINISTRATION

Agency Code 575 Milne Bay Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To assist and empower the 4 Distirics to address development needs on each of the sectors according to their Fiver Year Development Plans and priorities.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

40,000,000 40,000,000 40,000,000 40,000,000 40,000,000

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To support the province implement key development priorities identified in the Provincial Plan in consistent with the overarching national development plans and policies.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks


Recommendations

DNPM needs to collaborate with DIRD to ensure that the PSIP reports are provided regularly indicating status of the PSIP implementation.

DRAFT



Agency Code 575 Milne Bay Province


Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp

Funding Level

(GoPNG)

8,000,00 8,000,00 8,000,00 8,000,00 6,400,00

Issues and Risks


Recommendations


DRAFT




Project Name Land Mobilisation-MBay

Fund Source GoPNG

Status Ongoing

Objective

To improve land administration in Milne Bay Province so that land in the province is mobilised and development for economic benefits.


Feasibility studies and Land Mobilization for the Provincial Government. 2014 Progress & Achievements:

There could be some achievements but cannot be reported due to a lack of reporting by the Provincial Government.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

2,000,000 2,000,000 2,000,000 2,000,000 2,000,000

Issues & Risks

At this stage it is difficult to report on the issues and risks as we do not have the necessary reports.

Recommendations

DNPM needs to collaborate with the Provincial Government to ensure that the report on this project is provided.

DRAFT



ORO PROVINCIAL ADMINISTRATION DEVELOPMENT PROJECTS 2013

Agency 576 Oro Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To assist and empower the 2 Distirics to address development needs on each of the sectors according to their Fiver Year Development Plans and priorities.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 576 Oro Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 576 : Oro Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


Issues and Risks


Recommendations


DRAFT



Agency Code 576:Oro Provincial Administration Project Name Special Infrastructure Grant Oro

Fund Source GoPNG

Status Ongoing

Objective

To assist the Province Administration rehabilitate all major infrastructure in the Province


The components include: Up-grading and rehabilitating of all high priority infrastructure.


Although funds have been used the status of the project cannot be determined due to the lack of reporting by the Provincial Government



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks

The funds are earmarked for infrastructure of which most where destroyed by the natural disasters in the Province and hence need to be used for the purpose intended.

Recommendations

DNPM needs to follow up on the reports from the Provincial Government as well and undertake a monitoring visit to verity fhe progress of the projects.

DRAFT



HIGHLANDS REGION

The Highlands Region has seven (7) provinces and the funding distribution to the Provinces are shown in the graph below. The scope of Provincial Funding under the Public Investment Program differs from province to another. This programs include DSIP, PSIP, DSG and SSGs. The lists of projects funded by Provinces are also indicated in the table below.

The graph bellows shows the distributiobn of funding to the seven (7) Highlands Provinces in the 2014 Development Budget.

Number of projects funded in each of the Provinces are listed below. Southern Highlands Province

(i) Special Support Grant- Kutubu SPA

(ii) Southern Highlands Provincial Government SSG

(iii) District Support Improvement Program (DSIP)

(iv) Provincial Support Improvement Program (PSIP)

(v) Support to LLGs

Hela Province (i) Hela Special Purpose Authority (ii) Hela Provincial Headquarters (iii) District Support Improvement Program (DSIP) (iv) Provincial Support Improvement Program (PSIP) (v) Support to LLGs (vi) Tari to Ambua Road

Enga Province (i) Special Support Grants (SSG) Pogera SPA (ii) Enga Provincial Government SSG (iii) New Provincial Hospital (Wabag) (iv) Enga Teachers College (v) Wabag Road

Eastern Highlands Province (i) Ungai Bena District Office (ii) Goroka Market Redevelopment (iii) District Support Improvement Program (DSIP) (iv) Provincial Support Improvement

Southern Highlands Province

15%

Enga Province 14%

Western Highlands Province

16% Simbu Province

15%

Eastern HIghlands Province

18%

Hela Province 12%

Jiwaka Province 10%

Funding Distribution to Highlands Provinces

DRAFT



(vi) Wabag Kompiam Road (vii) Yampu to Londol Road (viii) District Support Improvement Program (DSIP) Enga Province cont… Provincial Support Improvement Program (PSIP) (x) Support to LLGs (xi) Wapenamanda Airport Fence

Program (PSIP) (v) Support to LLGs

Western Highlands Province (i) Mt Hagen City Roads (ii) District Support Improvement Program (DSIP) (iii) Provincial Support Improvement Program (PSIP) (iv) Support to LLGs (v) Kapal Haus (Administration Building)

Jiwaka Province (i) Jiwaka Provincial Office Maintenance (ii) District Support Improvement Program (DSIP) (iii) Provincial Support Improvement Program (PSIP) (iv) Support to LLGs

Simbu Province (i) Dumun Salt Nomane Road

2013 HighlandsExpenditure Report by Provinces (K’000)

Development Funding

per Province

Original

Budget

Revised

Budget

Warrants

Year to

Date

Expenditure

to Date

Unused

WA

Southern Highlands

Province 113,800 113,800 113,800 111,800 2,000

Enga Province 112,300 112,300 112,300 111,400 900

Western Highlands

Province 124,500 124,500 124,500 124,500 0

Simbu Province 115,000 115,000 115,000 112,060 2,940

Eastern HIghlands

Province 138,000 138,000 138,000 138,000 0

Hela Province 89,900 89,900 89,900 87,300 2,600

Jiwaka Province 78,000 78,000 78,000 77,962,318 37,682.00

Total 771 ,500 771,500 771,500 763,022,318 46,122,00

Key Issues These are some of the key issues experienced by the Provinces in project implementation.

There is lack of will and political direction in most of the provinces; It is noted that there is unnecessary bureaucratic processes delays in the timely release of

warrants and slow expending of funds which has resulted in either funds being rolled over to the new year or are being forfeited back to the Consolidated Revenue.

DRAFT



Central Supplies and Tenders Board (CSTB) has a chronic problem of slowing contract approvals or facilitating contracts effectively, which have slowed down implementation of many projects on the ground.

Lack of reporting compliance and other compliance issues have been observable in most of the provinces, particularly reporting to key stakeholders and financiers on the use of public funds.

Recommendations

Based on the analysis and the issues discussed above, the following recommendations have been made to improve on the current performances.

1. In future, Project Steering Committees (PSCs) must be re-activated or established for all programs and projects with DNPM taking proactive leadership

2. In every first quarter of any fiscal year, two thirds of the development budget appropriation for individual programs and projects must be released. The balance of the funds should be released after the first quarter based on the project performance. Projects that are performing well with clear outputs and reporting should get full funding. Those projects that have failed to perform without any substantive reasons should be penalized by way of funds being withheld or funds being transferred to projects that are performing and needs additional funding.

3. Lack of late release of warrants against agencies work plans and cash-flows has caused many

activities to be delayed DNPM should closely coordinate with Department of Treasury to ensure funds are released on time and based on the cash-flows and work plans

4. The Provinces should expend on the funds that are being released to them. They should not keep

funds accumulated as they are taking significant risks in that the funds may be recalled back by Treasury to the Consolidated Revenue if not expended towards the end of the year.

5. Political and administrative setbacks are not always and honestly reported by the Provinces. These

actions are detrimental to the implementation of the projects and may further jeopardise future funding. It is important that the Provinces exposes political and administrative risks to DOT and DNPM during the budget consultations or during the quarterly reviews. Remedial actions can be taken to address these problems

6. PSIP, DSIP, LLGSIP funds expenditure must be guided by the guidelines and through the Ministry of

National Planning and Rural Development, a directive must be sent by way of letter to all Provincial Governors and Electoral Members of Parliament to develop specific work plans and cash flows to spend this funds as per their priorities as per individual Provincial five-Year Developments Plans and District Five-Year Development Plans, including Local Level Governments as well. This is critical to track performance of each province, District and LLGs in the country.

DRAFT



SOUTHERN HIGHLANDS PROVINCE

Agency Code 577 : Southern Highlands Provincial Administration

Project Name Special Infrastructure Grant –Kutubu SPA

Fund Source GoPNG

Status Ongoing

Objective

To assist and develop appropriate infrastructure agreed to in the Kutubu MOA to enhance service delivery in the province


Upgrading of existing and construction of new infrastructure in communities impacted by the Oil and Gas projects in the Province.


There may be some achievements but this cannot be reported at this stage due to the unavailability of reports fromt he Provincial Government.



Revised Appro.

Actual Exp

Funding Level

(GoPNG)

8,640,000 8,640,000 8,640,000 8,640,000 8,640,000

Issues & Risks

The funds are earmarked for infrastructure in the impacted areas and hence need to be used for the purpose intended.

Recommendations


DRAFT




Project Name Southern Highlands Provincial Government SSG

Fund Source GoPNG

Status Ongoing

Objective

To support implement of various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to in the various Oil and Gas development Agreements (UBSA and LBBSA).




Reporting of the SSG projects implementation has not been effective from the Southern Highlands Provincial Administration.



Funding Level

(GoPNG)

20,160,000 20,160,000 20,160,000 20,160,000 20,160,000

Issues & Risks


Recommendations

DNPM must work closely with Southern Highlands Provincial Administration to ensure that the SSG reports are provided regularly to to all stakeholders.

DRAFT



Agency Code 577: Southern Highlands Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To assist and empower the Districts to address development needs on each of the sectors according to their Fiver Year Development Plans and priorities.







Revised Appro.

Actual Exp

Funding Level

(GoPNG)

50,000,000 50,000,000 50,000,000 35,000,000

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp

Funding Level

(GoPNG)

25,000,000 25,000,000 25,000,000 25,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 577 : Southern Highland Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To empower the LLGs and assist them effectively to deliver to the needs of the people at the LLG level.







Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 8,000,000

Issues and Risks


Recommendations


DRAFT



ENGA PROVINCE

Agency Code 578 : Enga Provincial Administration

Project Name Special Support Grant- Pogera SPA

Fund Source GoPNG

Status Ongoing

Objective

To assist and develop appropriate infrastructure agreed to in the Pogera MOA to enhance service delivery in the province especially in the impacted areas.


Upgrading of existing and construction of new infrastructure in communities impacted by the Pogera Mine.





Revised Appro.

Actual Exp


4,400,000 4,400,000 4,400,000 4,400,000 4,400,000

Issues & Risks

The funds are earmarked for infrastructure in the impacted areas and hence need to be used for the purpose intended.

Recommendations


DRAFT




Project Name Enga Provincial Government SSG

Fund Source GoPNG

Status Ongoing

Objective

To support implement of various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to in the Pogera MOA.




Reporting of the SSG projects implementation has not been effective from the Enga Provincial Administration.



Revised Appro.

Actual Exp


4,400,000 4,400,000 4,400,000 4,400,000 4,400,000

Issues & Risks


Recommendations

DNPM must work closely with Enga Provincial Administration to ensure that the SSG reports are provided regularly to to all stakeholders.

DRAFT




Project Name New Provincial Hospital Wabag

Fund Source GoPNG

Status Ongoing

Objective

The objective is to establish a fully serviced Level 3 modern Provincial Hospital to provide quality health care for the people of Enga Province.


The components included:

1. Construction of Main Access Road to project site, 1 kilometre. 2. 30m Bridge Construction. 3. Site clearing and grubbing. 4. 1 Perimeter fencing for 3000 meters. 5. Water Supply connection for 1000 meters 6. Main Power line Connection for 1000 meters. 7. Survey and Geotech work.


The conceptualization and commencement set in 2008 with initial funding K0.6million from Enga

Provincial Government (EPG). Further K2million was given by Enga for Concept Plan Development in

2010. Another K3million was for detailed design of the hospital in 2011. In 2012, EPG committed

K1million for new main access road construction which is half through to completion while K9million

appropriated under 2012 Development Budget is for detailed Land Survey and land payment.

It is hope that full pledge project should commence by 2014 after preliminary work is completed with counter funding coming from a major donor in China.



Revised Appro.

Actual Exp


5,000,000 5,000,000 5,000,000 5,000,000

Issues & Risks

Tribal fights are concern and such events may lead to destruction of the hospital.

Recommendations


DRAFT




Project Name Enga Teachers College

Fund Source GoPNG

Status Ongoing

Objectives

To increase the capacity of the college to train more teachers to meet the current demand for teachers in the Province.


The components include the establishment of classrooms, teachers housing, student dormitories and utilities etc.


The program has been supported over the last three years. There may be some achievements but this cannot be reported at this stage due to the unavailability of reports fromt he Provincial Government.



Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT




Project Name Wabag Roads

Fund Source GoPNG

Status Ongoing

Objectives

To rehabilitate the Wabag Town Roads.


Rehabiiltation of the Wabag Roads





Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT




Project Name Wabag Kompiam Road

Fund Source GoPNG

Status Ongoing

Objectives

To upgrade the Wabag Kompium Road


Rehabiiltation of the Wabag Kompium Road





Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT




Project Name Yampu to Londoi Road

Fund Source GoPNG

Status Ongoing

Objectives

To upgrade the Yampu to Londoi Road


Rehabiiltation of the Yampu Londoi Road





Revised Appro.

Actual Exp


2,000,000 2,000,000 2,000,000 2,000,000

Issues & Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To support districts in Enga Province to achieve their sector goals by supporting priority projects identified in their District Plans.







Revised Appro.

Actual Exp


50,000,000 50,000,000 50,000,000 50,000,000 49,900,00

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective

To assist Enga Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


25,000,000 25,000,000 25,000,000 25,000,000

Issues and Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


Issues and Risks


Recommendations


DRAFT




Project Name Wapenamanda Airport Fencing

Fund Source GoPNG

Status Ongoing

Objectives

To improve the security and safety of travelling public, aircrafts and assets within the airport.


Designing and construction of the fence around the parameters of the entire airport.


There may be some achievements but this cannot be reported at this stage due to the unavailability of reports fromt the Provincial Government.



Revised Appro.

Actual Exp


5,000,000 5,000,000 5,000,000 5,000,000

Issues & Risks


Recommendations


DRAFT



579: WESTERN HIGHLAND PROVINCE

Agency Code 579: Western Highlands Provincial Administration

Project Name Mt Hagen City Roads

Fund Source GoPNG

Status Ongoing

Objective

To upgrade all roads within the Mt Hagen City.


Reconstruction and up-grading of all major roads within Mt. Hagen city



2014 level of funding and expenditure (K’000’)


Revised Appro.

Actual Exp


10,000,000 40,000,000 40,000,000 40,000,000 40,000,000

Issues & Risks

Reporting for this project remains a challenge for the Provincial Administration

Recommendations


DRAFT



Agency Code 579 : Western Highlands Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To support districts in Western Highlands Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


40,000,000 40,000,000 40,000,000 40,000,000 40,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 579 :Western Highlands Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To assist Western Highlands Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code Western Highlands Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


4,500,000 4,500,000 4,500,000 4,500,000 4,500,000

Issues and Risks


Recommendations


1.

DRAFT



Agency Code 579 : Western Highlands Provincial Administration

Project Name Kapal Haus (Administration Building)

Fund Source GoPNG

Status Ongoing

Objective

Establishment of the Western Highlands Provicial Adminstration Building


Construction of the Kapal Haus 2014 Progress & Achievements:




Revised Appro.

Actual Exp


50,000,000 50,000,000 50,000,000 50,000,000 50,000,000

Issues & Risks


Recommendations


DRAFT



SIMBU PROVINCE DEVELOPMENT Agency Code 580 : Simbu Provincial Administration Project Name Dumun Salt Nomane Road

Fund Source GoPNG

Status Ongoing

Objective

To enable road acess from Dumun to Salt Nomane


Designing and construction of the Dumun Salt Nomane Road





Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name Kundiawa Town Roads Phase 2

Fund Source GoPNG

Status Ongoing

Objective

To continue phase II and upgrade all roads within the Kundiawa Town.


Reconstruction and up-grading of all major roads within Kundiawa Town





Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name Kerowagi Bogo Road

Fund Source GoPNG

Status Ongoing

Objective

To enable road acess from Kerowagi to Bogo


Designing and construction of the Dumun Salt Nomane Road





Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name Kundiawa Airport

Fund Source GoPNG

Status Ongoing

Objective

To upgrade the Kundiawa Airport


Designing and upgrading of the Kundiawa Airport





Revised Appro.

Actual Exp


5,000,000 5,000,000 5,000,000 5,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name Rural Housing Scheme

Fund Source GoPNG

Status Ongoing

Objective

To provide affordable housing for Public Servants as a form of motivation to remain in rural areas and deliver required goods and services to the rural people.


Designing and construction of the rural houses





Revised Appro.

Actual Exp


1,000,000 1,000,000 1,000,000 1,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Simbu Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


60,000,000 60,000,000 60,000,000 60,000,000 60,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist Simbu Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 580 : Simbu Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks


Recommendations


DRAFT



581: EASTERN HIGHLAND PROVINCE

Agency Code 581 : Eastern Highlands Provincial Administration Project Name Ungai Bena District Office

Fund Source GoPNG

Status Ongoing

Objective

To establish the District Administration Office Buliding in Ungai Bena District


Designing and construction of the Building





Revised Appro.

Actual Exp


4,000,000 4,000,000 4,000,000 4,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 581 : Eastern Highlands Provincial Administration Project Name Goroka Market Redevelopment

Fund Source GoPNG

Status Ongoing

Objective

To completely rehabilitate the Goroka Town Market


Designing, construction and up-grading of the Goroka Town Market


The project has been provided funding for some time but actual work is yet to commence.



Revised Appro.

Actual Exp


2,000,000 2,000,000 2,000,000 2,000,000

Issues & Risks

There is currently a standoff between the Governor and the Goroka MP regariding the implementation o the project and hence the project has not progressed.

Recommendations


DRAFT



Agency Code 581 : Eastern Highlands Provincial Administration Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Eastern Highlands Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


80,000,000 80,000,000 80,000,000 80,000,000 80,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 581: Eastern Highlands Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist Eastern Highlands Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


40,000,000 40,000,000 40,000,000 40,000,000 40,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 581 : Eastern Highlands Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


12,000,000 12,000,000 12,000,000 12,000,000 12,000,000

Issues & Risks


Recommendations


DRAFT



591: HELA PROVINCE DEVELOPMENT PROJECTS DETAILS

Agency Code 591 : Hela Provincial Administration Project Name Hides Special Purpose Authority

Fund Source GoPNG

Status Ongoing

Objective

To empower the Hides Special Purpose Authority to effectively deliver the projects agreed to in the various LNG development agreements (UBSA and LBBSA)


To componens comprise the projects identified in the agreements 2014 Progress & Achievements:




Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT



Agency Code 591 : Hela Provincial Administration Project Name Hela Provincial Headquarters

Fund Source GoPNG

Status Ongoing

Objective

Establishment of the Hela Provincial Administration Office


Construction of the Provincial Office 2014 Progress & Achievements:





12,000,000 15,000,000 12,000,000 9,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 591 : Hela Provincial Administration Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Hela Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 591 : Hela Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist Hela Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


15,000,000 15,000,000 15,000,000 15,000,000 15,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 591 : Hela Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


6,000,000 6,000,000 6,000,000 6,000,000 6,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 591 : Hela Provincial Administration Project Name Tari to Ambua Road

Fund Source GoPNG

Status Ongoing

Objective

To rehabilitate the Tari to Abua Road


Rahabilitation and maintenance of the Tari to Abua Road


There may be some achievements but this cannot be reported at this stage due to the unavailability of reports from the Provincial Government.



Revised Appro.

Actual Exp


5,000,000 5,000,000 5,000,000 5,000,000 5,000,000

Issues & Risks


Recommendations

DNPM needs to follow up on the reports from the Provincial Government as well and undertake a monitoring visit to verity he progress of the projects.

DRAFT



592 JIWAKA PROVINCE

Agency Code 592 : Jiwaka Provincial Administration Project Name Jiwaka Provincial Office Maintenance

Fund Source GoPNG

Status Ongoing

Objective

The objective is to enable the maintenance of the Hela Provincial Administration Office.


Maintenance of the Provincial Office 2014 Progress & Achievements:

There may be some achievements but this cannot be reported at this stage due to the unavailability of reports from the Provincial Government.



Revised Appro.

Actual Exp


30,000,000 30,000,000 30,000,000 30,000,000

Issues & Risks


Recommendations

DNPM needs to follow up on the reports from the Provincial Government as well and undertake a monitoring visit to verity he progress of the projects.

DRAFT



Agency Code 592: Jiwaka Provincial Administration Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Jiwaka Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 592 : Jiwaka Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

To assist Jiwaka Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


15,000,000 15,000,000 15,000,000 15,000,000 15,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 592: Jiwaka Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT



MOMASE Region

The funding appropriation to the four (4) provinces is shown in the graph below.

The scope of Public Investment Program varies across different provinces. The list below shows the number of projects that have been funded under each province.

1. Morobe Province (i) Special Support Grant (hidden

Valley) (ii) District Support Improvement

Program (DSIP) (iii) Provincial Support

Improvement Program (PSIP) (iv) Support to LLGs

2. Madang Province

(i) Madang Town Roads (ii) Manam Islanders Resettlement

Project (iii) District Support Improvement

Program (DSIP) (iv) Provincial Support

Improvement Program (PSIP) (v) Support to LLGs

3. East Sepik Province (i) District Support Improvement

Program (DSIP) (ii) Provincial Support

Improvement Program (PSIP) (iii) Support to LLGs (iv) Nagum to Urimo Road Upgrade

4. Sandaun Province (i) Vanimo Water supply (ii) Telefomin District Airstrip

Development (iii) District Support Improvement

Program (DSIP) (iv) Provincial Support

Improvement Program (PSIP) (v) Support to LLGs (vi) Telefomin Road

Morobe Province, 155,900, 34%

Madang Province, 112,500, 25%

East Sepik Province, 103,000, 23%

Sandaun Province, 84,500, 18%

Distribution of Funding by Provinces

DRAFT



2014 Expenditure Report by Province by Provinces (K’000)

Development

Funding per

Province

Original

Budget

Revised

Budget

Warrants

Year to Date

Expenditure

to Date

Unused WA

Morobe Province 155,900 155,900 155,900 152,600 3,300

Madang Province 112,500 112,500 112,500 107,600 4,900

East Sepik Province 108,000 103,000 103,000 92,400 10,600

Sandaun Province 84,500 84,500 84,500 76,800 7,700

Total 460,900 455,900 455,900 429,400 26,500

Key Issues

The key issues identified are same as the ones that discussed above relating to the Highlands Provinces. Most importantly, there is lack of political will and drive in most provinces in terms of ownership of the development projects. Other issues that compound to this is the bureaucratic delays in the procurement processes and the releas of funds.

Reecommendations

Since the issues are similar in nature, the same recommendations for the Highlands Provinces are recommended to address issues encountered by the Provinces in the Momase Region (refer to Highlands Region Recommendations)

DRAFT



MOROBE PROVINCE

Agency Code 582: Morobe Province

Project Name Special Support Grant (Hidden Valley)

Fund Source GoPNG

Status Ongoing

Objective

To support projects in the communities specifically affected by the Hidden Valley Mine development. Components & Scope of Works:

The project components comprises projects agreed in the Hidden Valley MOA that will specifically assist and enhance the communties affect by the mine. 2014 Progress & Achievements:

The status of the project is unknown due to lack of reports from the Morobe PG.



Revised Appro.

Actual Exp


4,400,000 4,400,000 4,400,000 4,400,000 4,400,000

Issues and Risks


Recommendations

DNPM will need to liaise with MPG for these reports.

DRAFT



Agency Code 582: Morobe Provincial Administration Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Morobe Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


90,000,000 90,000,000 90,000,000 90,000,000 90,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 582 : Morobe Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist Morobe Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


45,000,000.0 45,000,000.0 45,000,000.0 45,000,000.0 45,000,000.0

Issues & Risks


Recommendations


DRAFT



Agency Code 582 : Morobe Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective










16,500,000 16,500,000 16,500,000 16,500,000 6,600,000

Issues & Risks


Recommendations


DRAFT



583: MADANG PROVINCE DEVELOPMENT

Agency Code 583 : Madang Provincial Administration Project Name Madang Town Roads

Fund Source GoPNG

Status Ongoing

Objective

To continue and upgrade all roads within the Madang Town


Reconstruction and up-grading of all major roads within Madang Town





Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT



Agency Code 583 : Madang Provincial Administration Project Name Manam Islanders Resettlement Project

Fund Source GoPNG

Status Ongoing

Objective

To relocate displaced Manam islanders on suitable portions of State land due to volcano eruption.


Establishment of the relacatio site on the Mainland





Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 583: Madang Provincial Administration Project Name District Support Improvement Program (DSIP)

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Madang Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


60,000,000 60,000,000 60,000,000 60,000,000 60,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 583: Madang Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist Madang Province to address development needs on each of the sectors according to the Provincial Fiver-Year Development Plan and priorities.







Revised Appro.

Actual Exp


30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 583 : Madang Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


9,500,000 9,500,000 9,500,000 9,500,000 9,500,000

Issues & Risks


Recommendations


DRAFT



584: EAST SEPIK PROVINCE DEVELOPMENT Agency Code 584 : East Sepik Provincial Administration Project Name Nagum to Urimo Road Up-grade

Fund Source GoPNG

Status Ongoing

Objective

To construct and up-grade Nagum to Urimo road


Construction and upgrading of the Nagum Urimo Road





Revised Appro.

Actual Exp


5,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 584: East Sepik Provincial Administration Project Name District Support Improvement Program (DSIP

Fund Source GoPNG

Status Ongoing

Objective

To support districts in East Sepik Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


60,000,000 60,000,000 60,000,000 60,000,000 60,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 584: East Sepik Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist East Sepik Province to address development needs on each of the sectors according to the Provincial Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 584: East Sepik Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


13,000,000 13,000,000 13,000,000 13,000,000 10,400,000

Issues & Risks


Recommendations


DRAFT



585: SANDAUN PROVINCE

Agency Code 585 : Sandaun Provincial Administration

Project Name Vanimo Water Supply Project

Fund Source GoPNG

Status Ongoing

Objective

To provide good clean water supply and sanitation system to the town residents and business houses that are living and working in Vanimo.

Components & Scope of Works: Design phase and construction of water and sanitation projects





Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT




Project Name Telefomin District Airport Project

Fund Source GoPNG

Status Ongoing

Objective

To provide a reliable and regular air transport service in the Telefomin Distirct

Components & Scope of Works: Design and upgrade of the Telefomin Airport 2014 Progress & Achievements:




Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 585: Sandaun Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To support districts in Sandaun Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


40,000,000 40,000,000 40,000,000 40,000,000 40,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 585: Sandaun Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To assist Sandaun Province to address development needs on each of the sectors according to the Provincial Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues & Risks


Recommendations


DRAFT





Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


8,500,000 8,500,000 8,500,000 8,500,000 8,500,000

Issues & Risks


Recommendations


DRAFT



Agency Code 585: Sandaun Provincial Administration Project Name Telefomin Road

Fund Source GoPNG

Status Ongoing

Objective

Upgrade of the Telefomin Road

Components & Scope of Works Design phase and construction including maintenance

Progress and Achievements There may be some achievements but this cannot be reported at this stage due to the unavailability of reports fromt the Provincial Government.



Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 5,000,00

Issues & Risks


Recommendations


DRAFT



NEW GUINEA ISLANDS REGION

The New Guinea Isands have five (5) provinces (East New Britain, West New Britain, Manus, New

Ireland and Bougainville). The funding distribution by province are reflected in the graph below.

Bougainville received the highest funding of K161.5 million (46%). The highest funding is reflective of the National Government’s fixed commitment to Bougainville Restoration Program. East New Britain Province got the second largest funding of K69.0 million (20%) followed by New Ireland, West New Britan and Manus. Out of the total funding received by each province, the flowing projects have been funded as indicated below;

1. Manus Province (i) Lorengau Town Water and

Sanitation Project (ii) District Support Improvement

Program (DSIP) (iii) Provincial Support

Improvement Program (PSIP) (iv) Special Infrastructure Grant (v) Support to LLGs

2. New Ireland Province

(i) Special Support Grants Nimamar SPA

(ii) New Ireland Provincial Government SSG

(iii) Special Support Grants - Simberi

(iv) IDG (New Ireland) (v) District Support Improvement

Program (DSIP) (vi) Provincial Services

Improvement Program (PSIP) (vii) Support to LLGs

3. East New Britain

(i) District Support Improvement Program (DSIP)

(ii) Provincial Support Improvement Program (PSIP)

(iii) Support to LLGs

4. West New Britain Province (i) District Support Improvement

Program (DSIP) (ii) Provincial Support

Improvement Program (PSIP) (iii) Support to LLGs

5. Bougainville (i) Restoration and Development

Grant (ii) Inclusive Development in Post

Conflict Bougainville (iii) District Support Improvement

Program (DSIP)

Manus Province, 33,000, 9%

New Ireland Province, 53,700,

15%

East New Britain, 69,000, 20%

West New Britain, 35,500, 10%

Bougainville, 161,520, 46%

PERCENTAGE DISTRIBUTION OF FUNDING BY PROVINCE (K'000)

DRAFT



(iv) Provincial Support Improvement Program (PSIP)

(v) ABG High Impact Projects

DRAFT



2014 Expenditure Report by Provinces (K’000)

Development Funding per

Province

Original Budget

Revised

Budget

Warrants Year to

Date

Expenditure to Date

Unused WA

Un-Issued

WA Manus Province 33, 000 33,000 23,000 21,800 1,200 7,000 New Ireland Province 53,700 53,700 53,700 47,800 5,900 0 East New Britain 69,000 69,000 69,000 62,280 6,720 0 West New Britain 35,500 35,500 35,500 33,440 2,060 0 Bougainville 161,520 161,520 161,020 45,080 115,940 500 Total 352,720 352,720 342,220 210,400 131,820 7,500

Key Issues

The key issues identified are same as the ones that discussed above relating to the Highlands Provinces. Most importantly, there is lack of political will and drive in most provinces in terms of ownership of the development projects. Other issues that compound to this is the bureaucratic delays in the procurement processes and the releas of funds.

Reecommendations

Since the issues are similar in nature, the same recommendations for the Highlands Provinces are recommended to address issues encountered by the Provinces in the Momase Region (refer to Highlands Region Recommendations)

DRAFT



586: MANUS PROVINCE DEVELOPMENT

Agency Code 586: Manus Provincial Administration Project Name Lorengau Town Water & Sanitation Project

Fund Source GoPNG

Status Ongoing

Objective

To construct a new reticulated sewerage system in Lorengau Town


The projects components:

1. Preliminary design and survey; 2. Site Clearance; 3. Supply and delivery of Project Materials; 4. Excavation; and, 5. Construction.

Progress and Achievements The expenditure report shows that funding has been expended. There may be some achievements but this cannot be reported at this stage due to the unavailability of reports fromt the Provincial Government.



Revised Appro.

Actual Exp


2,000,000 2,000,000 2,000,000 2,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 586: Manus Provincial Administration

Project Name Special Infrastructure Grant (SIG)

Fund Source GoPNG

Status Ongoing

Objective

To support the implementation of priority infrastructure to improve services and enhance economic growth for Manus Province as highilighted in the MOA agreements in support for the Asylum Seeker establishement in Manus.



1. Feasibilities, design and scoping of projects; and, 2. Construction or rehabilitation of existing or new identified impact projects.

Progress and Achievements The expenditure report shows that funding has been expended. There may be some achievements but this cannot be reported at this stage due to the unavailability of reports fromt the Provincial Government.



Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks


Recommendations

DNPM needs to follow up on the reports from the Provincial

DRAFT



Agency Code 586 : Manus Provincial Administration

Project Name District Services Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Manus Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 586 : Manus Provincial Administration Project Name Provincial Support Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To assist ManusProvince to address development needs on each of the sectors according to the Provincial Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


5,000,000 5,000,000 5,000,000 5,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 586 : Manus Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


6,000,000 6,000,000 6,000,000 6,000,000 6,000,000

Issues & Risks


Recommendations


DRAFT



587: NEW IRELAND PROVINCE

Agency Code 587 : New Ireland Provincial Administration

Project Name Special Support Grant - Nimarmar

Fund Source GoPNG

Status Ongoing

Objective

To support implement of various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to in the Lihir MOA for the Mimarmar area.




Reporting of the SSG projects implementation has not been effective from the New Ireland Provincial Administration.



Revised Appro.

Actual Exp


4,400,000 4,400,000 4,400,000 4,400,000 4,400,000

Issues & Risks


Recommendations

DNPM must work closely with New Ireland Provincial Administration to ensure that the SSG reports are provided regularly to to all stakeholders.

DRAFT




Project Name Special Support Grants - Simberi

Fund Source GoPNG

Status Ongoing

Objective

To support implement of various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to in theSimberi MOA for the mining impact area.







Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT




Project Name Special Support Grant – NIPG

Fund Source GoPNG

Status Ongoing

Objective

To support implement of various development projects identified in the Provicial and District Development Plans as well as to support projects agreed to in theSimberi and Lihir MOAs.







Revised Appro.

Actual Exp


10,360,000 10,360,000 10,360,000 10,360,000 10,360,000

Issues & Risks


Recommendations


DRAFT




Project Name Infrastructure Development Grant (IDGs)

Fund Source GoPNG

Status Ongoing

Objective

To support all priority infrastructures identified in the Provinical Plan and the MOAs for the mining developments in the Province


All priority identified infrastructure 2014 Progress & Achievements:

Reporting of the IDG projects implementation has not been effective from the New Ireland Provincial Administration. Take note that the funding has been fully expended.



Revised Appro.

Actual Exp


3,000,000 3,000,000 3,000,000 3,000,000 3,000,000

Issues & Risks

IDG support from the National Government is a fix commitment and it is extremely important that the funds are spent well on projects to achieve tangible developments.

Recommendations


DRAFT




Project Name Provincial Support Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To assist New Ireland Province to address development needs on each of the sectors according to the Provincial Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks


Recommendations


DRAFT




Project Name District Services Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To support districts in New Ireland Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 587 : New Ireland Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


Issues & Risks


Recommendations


DRAFT



588 EAST NEW BRITAIN PROVINCE DEVELOPMENT Agency Code 588 East New Britian Provincial Administration


Fund Source GoPNG

Status Ongoing

Objective

To assist East New Britain Province to address development needs on each of the sectors according to the Provincial Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 588 : East New Britian Provincial Administration Project Name District Services Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To support districts in East New Britain Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


40,000,000 40,000,000 40,000,000 40,000,000 40,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 588 : East New Britian Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


9,000,000 9,000,000 9,000,000 9,000,000 9,000,000

Issues & Risks


Recommendations


DRAFT



589 WEST NEW BRITAIN PROVINCE’S DEVELOPMENT PROJECTS

Agency Code 589 : West New Britain Provincial Administration Project Name Provincial Support Improvement Program (PSIP)

Fund Source GoPNG

Status Ongoing

Objective

To assist West New Britain Province to address development needs on each of the sectors according to the Provincial Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


10,000,000 10,000,000 10,000,000 10,000,000 10,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 589 : West New Britain Provincial Administration Project Name District Support Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To support districts in West New Britain Province to achieve their sector goals by supporting district based development projects in each of the sectors.







Revised Appro.

Actual Exp


20,000,000 20,000,000 20,000,000 20,000,000 20,000,000

Issues and Risks


Recommendations


DRAFT



Agency Code 589 : West New Britain Provincial Administration Project Name Support to LLGs

Fund Source GoPNG

Status Ongoing

Objective








Revised Appro.

Actual Exp


5,500,000 5,500,000 5,500,000 5,500,000 4,400,000

Issues & Risks


Recommendations


DRAFT



590 AUTONOMOUS REGION OF BOUGAINVILLE Agency Code 590 Autonomous Region of Bougainville Project Name Restoration & Development Grant

Fund Source GoPNG

Status Ongoing

Objective

To assist the Autonomous Region of Bougainville in its peace and restoration efforts in order to bring normalcy to the region after BougainvilleCrisis.


The components of this program are to assist peace building activities in almost all communities throughout the ARB. 2014 Progress & Achievements:

Thought the funding has been fully expended, the progress and achievements for this grant remain unknown due to lack of reporting by the AROB Administration



Revised Appro.

Actual Exp


15,000,000 15,000,000 15,000,000 15,000,000 15,000,000

Issues & Risks

The restoration grant is a special commitment from the National Government to assist the rebuilding of AROB and it is extremely important that the funds are spent well on intended purposes.

Recommendations

DNPM must work closely with AROB Administration to ensure that the reports are provided to to all stakeholders.

DRAFT



Agency Code 590: Autonomous Region of Bougainville Project Name Inclusive Development in Post Conflict Bougainville

Fund Source GoPNG

Status Ongoing

Objective

To contribute to the rebuilding of post-conflict social capital at the community level by:

(a) Strengthening the capacity of women’s organisations and civil society organisations; and, (b) Increasing the implementation of community development activities which are more inclusive

of women in planning and decision making processes focusing more on development priorities of women.



1. Building capacity for inclusive community development; 2. Small grants for inclusive community development; 3. Project Management and knowledge sharing; 4. Project management, monitoring and evaluation; and, 5. Knowledge sharing and networking.





Revised Appro.

Actual Exp


Issues & Risks

The grant is a special commitment from the National Government to assist the rebuilding of AROB especially the womenfolk and it is extremely important that the funds are spent well on intended purposes.

Recommendations

DNPM must work closely with AROB Administration to ensure that the reports are provided to to all stakeholders.

DRAFT



Agency Code 590 : Autonomous Region of Bougainville Project Name High Impact Projects

Fund Source GoPNG

Status Ongoing

Objective

To restore and increase economic activity through the implementation of a five-year infrastructure program that will benefit the people of Bougainville.


The projects components are:

1. Buka Ring Road Sealing; 2. Kokopau Buin Road sealing 3. Arawa Siwai Road Sealing 4. Buin-Siwai Road sealing 5. Aropa Airport Upgrading/Sealing & Terminal (K10m) 6. Kieta port upgrade (K5m) 7. Arawa Hospital; 8. Arawa & Buka water supply and sewerage; 9. Bougainville power upgrading; 10. Arawa Township Redevelopment Projects; and, 11. Bougainville Bridge Program.





Revised Appro.

Actual Exp


100,000,000 100,000,000 100,000,000 100,000,000 100,000,000

Issues & Risks

PMs directive to stop the release of funding has impacted the progress on the projects Projects have been funded over a period of time

Recommendations

1. DNPM must work closely with AROB Administration to ensure that the reports are provided to to all stakeholders.

2. DNPM to provide a Minsterial Brief to PM noting the progress and issues surrounding the projects.

DRAFT



Agency Code 590 : Autonomous Region of Bougainville Project Name Provincial Support Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To assist Autonomous Region of Bougainville to address development needs on each of the sectors according to the Regions Five-Year Development Plan and priorities.







Revised Appro.

Actual Exp


15,000,000 15,000,000 15,000,000 15,000,000 15,000,000

Issues & Risks


Recommendations


DRAFT



Agency Code 590 : Autonomous Region of Bougainville

Project Name District Support Improvement Program

Fund Source GoPNG

Status Ongoing

Objective

To support districts in Autonomous Region of Bougainville to achieve their sector goals by supporting district based development projects in each of the sectors.






Revised Appro.

Actual Exp

Funding Level

(GoPNG)

30,000,000 30,000,000 30,000,000 30,000,000 30,000,000

Issues and Risks


Recommendations


DRAFT

