In the context of the public sector reform program initiated by the Morauta government in 1999 and continued under the Somare government of 2002–2007 (see chapter 3 above), [25]there has been an explicit recognition that governance and service delivery cannot be improved without a concerted effort to improve performance at the sub-national level. Indeed, the government’s Medium Term Development Strategy 2005–10 stated:
…in the years since the passage of the Organic Law (the OLPGLLG), service delivery has deteriorated. On the whole service delivery systems are dysfunctional and there remains widespread confusion over functional (who does what) and financial (who pays for what) responsibilities across the three levels of government (MTDS, 9–10).
In 2000–2001 the Morauta government negotiated a National Development Charter as a mechanism for delivering priority services at subnational level, primarily through matched national and donor funding and district funds allocated through the Rural Action Program/district support grants. The National Development Charter appears to have lapsed around 2002 (Barter says that in 2004 DPLGA could not find a copy of it), but was restored in 2004, with proposals for a Planning Systems Support Program (to support the implementation of a uniform planning system across all levels of government), a Provincial Services Cadetship program (to support tertiary students interested in a career in provincial and district administration), and provincial medium term development strategies. In 2005 a District Roads Improvement Program (DRIP) was added, under which provincial governments and JDPBPCs are to receive matching national government and donor funding for specified road projects, and it was planned to introduce similar programs in health and education.
The MTDS 2005–2010 included a number of activities ‘designed to identify practical solutions to the functioning of the decentralized system of government’ (MTDS, IV, chapter 4). Among a number of initiatives introduced since 2002 in the area of decentralization have been: a program to strengthen the Department of Provincial and Local Government Affairs (DPLGA); the revival of the NMA/PLLSMA and the development of systems to monitor provincial government performance in relation to minimum service delivery standards; the launching of a Provincial Performance Improvement Initiative (PPII), initially in three provinces (East New Britain, Eastern Highlands and Central)[26], intended to improve provincial accountability and the integrity of budget systems; a District Services Improvement Program (DSIP) to support local-level governments; a District Treasury Roll-out program which aims to bring not only Treasury facilities but also banking and postal services to all district headquarters;[27] and encouragement for the (re)establishment of provincial and district management teams (PMT/DMT) designed to achieve improved coordination of provincial and local-level government activities (though the relationship between PMTs and JPPBPCs remains unclear, and some provincial administrators have complained that the PMTs usurp the position of the provincial administrators). Also, between 2002 and 2006 the NEFC undertook detailed studies, first, to specify functional responsibilities for the three levels of government — ‘who decides, who actions and who pays’ (see Simonelli 2003); secondly, to measure the relative costs of providing services at district level; and, thirdly, to assess the relative revenue-raising capacities of the provinces (see NEFC 2005). On the basis of these studies it recommended new intergovernmental financial arrangements designed to achieve some degree of fiscal equalization amongst the provinces; draft legislation to this effect had passed the first reading stage in the National Parliament in late 2006. A less developed districts grant program (for districts identified by the NEFC and DNPRD) was introduced as part of a package of interim proposals for new intergovernmental financial arrangements in 2003.[28] AusAID has strongly supported (if it has not in fact initiated) these initiatives, in part through its Sub-national Initiative (which in 2006 was upgraded to a Sub-national Strategy).
All these initiatives presume the continuation of the broad arrangements established by the 1995 OLPGLLG. However there have been continuing demands for fundamental structural change to the provincial government system, notably from opposition leader Peter O’Neill, who in 2006 succeeded in having the National Parliament amend the OLPGLLG and pass a District Authorities Act intended to do away with provincial governments and shift responsibilities to district authorities (composed of the open MP, LLG presidents and some appointed members) and local-level governments.[29] Former Inter-Government Relations minister, Sir Peter Barter, has given (qualified) support for O’Neill’s proposals (Barter 2004 fn.10), and reports of the Public Sector Reform Advisory Group (PSRAG 2002, 2005)) have argued similarly for a further decentralization to district and local level. In fact, this has been a recurring theme of decentralization reform proposals since the early 1990s, starting with the Electoral Development Authorities Act and the Village Services Program, following on through the recommendations of the Bi-partisan Parliamentary Committee on Provincial Government and the Constitutional Review Committee, to the 1996 amendments to the OLPGLLG which created the JPPBPCs/JDPBPCs. There is, therefore, no guarantee that a new government will not review the system yet again. [30]
Meanwhile, following the conclusion of the Bougainville Peace Agreement in 2001, the Autonomous Bougainville Government has been set up, with elections in May 2005, and the newly elected government is addressing the challenges of autonomy. [31] Encouraged by the Bougainville example, East New Britain is now pressing for an autonomous government and there have been tentative moves in at least one other province (Morobe).
[25] For a more detailed account of the reform process since 1999 see May (forthcoming).
[26] The PPII is part of an AusAID Sub-national Initiative, which in 2006 was expanded to become the Sub-national Strategy.
[27] The District Treasury Roll-out program was always an ambitious initiative. It involves the provision of office and staff accommodation and computer facilities in district headquarters which usually lack such infrastructure for existing staff and where power comes from generators which are chronically short on fuel, and where security is frequently a problem. In July 2006 the former Finance minister, Bart Philemon, said that he had personally opened 42 (of a planned 83) district treasuries in seven provinces (though some of these appear to have become moribund). He lamented the fact that progress appeared to have stopped after his loss of portfolio, and that the K50 million DSIP which was to have commenced in 2006, complementing the Treasury Roll-out, had not proceeded (see The National 13 July 2006).
[28] See NEFC (2004). Funds (amounting to K3.3 million in 2005) allocated for less developed district grants were in fact diverted elsewhere (mostly for expenditures in the Southern Highlands).
[29] See O’Neill (2003, 2006) (the latter reproduces the District Authority Act). However, there has been no move to implement the act, which at various points seems to clash with the OLPGLLG. (See also Tuck 2006.)
[30] Following the election of Sir Michael Somare as Prime Minister in 2007, a Taskforce on Government and Administration, chaired by Sir Barry Holloway, was appointed to review the structure of government and administration in Papua New Guinea, including intergovernmental relations.
[31] (For a review of the Bougainville experience see Wolfers 2006; Ryan 2008.)