Solomon Islands government defends new treatment of public money

Transcript

The Solomon Islands government has defended its new law to distribute public funds through individual constituency offices.

The Constituent Development Funds Act was passed by Parliament in March and public interest groups say they are concerned its removes accountability and gives rise to corruption.

But a government minister says there's more risk of corruption doing it any other way.

Alex Perrottet reports:

The law changes the way money is allocated to applicants, including those for whom international aid donors are aiming their project funds. Previously, ministries were responsible for handling funds and setting up projects. The problem, as Finance Minister Rick Hou says, is that the ministries, with their layers of bureaucracy, don't have any projects.

RICK HOU: Ministry officials are more corrupt than anybody. This is a serious thing and we are working through it. And we don't see anything going through the ministries getting to the constituencies in an effective more quick way than going through the constituency officers.

But the International Budget Partnership says it's concerned the MPs have too much control over centrally allocated funds. The two signatories on payments under the law are the MP and the Constituent Development Officer. Daniel Fenua from Transparency Solomon Islands says the MPs should be at arm's length from these decisions.

DANIEL FENUA: The current practice is that a lot of MPs are misusing the money. We just need more investigation into how these people spend the money. And we think this is not the right thing to do. MPs are not project managers. They have their legislative role to look after. Public funds should be the responsibility of public servants.

His comments come in the wake of the sentencing of former MP Japhet Waipora last week, after his own constituents took evidence of the misappropriation of funds to the police. The Finance Minister himself is currently under investigation from the Leadership Code Commission for not declaring an interest, after his Ministry awarded funds to a lodge run by his wife. Rick Hou defended his decision, which was later reversed after a public backlash, but says his wife was just one successful applicant among five others and he was just doing his job.

RICK HOU: People will make a complaint - 'Why do you build a bridge there if it goes through the village of some of your voters?' That's the same complaint that just comes. So what do you do? Don't build the bridge?

But Emmanuel Kouhota from the LCC says accountability is about declaring interests and 21 MPs have been threatened with fines and for not disclosing financial statements.

EMMANUEL KOUHOTA: Some of them just don't care to make a declaration to the commission. I remind our leaders that they should comply with their obligations and duties that are placed on them by the constitution and the Leadership Code Act.

International donors are currently working with the government on regulations that will provide more checks and balances. But observers say that's a sign there's something wrong with the Act and although the policy does work in some countries, it's a band-aid solution to the inadequacy of Parliament itself to reform and influence budget allocations.