Minister for Commerce and Industry Win Daki has been stripped of his ministerial portfolio pending an independent investigation into the Government’s K200 million Small and Medium Enterprise (SME) Fund, with Finance Minister Thomas Opa taking over the ministry in addition to his existing responsibilities.
Daki will remain in Cabinet as a Minister without Portfolio.
In a statement this yesterday, Prime Minister James Marape announced the decision, saying the move was an administrative measure to allow a transparent and independent investigation into allegations surrounding the administration of the SME Fund.
The Prime Minister also directed Commerce and Industry Secretary David Ganaii to step aside while the investigation is conducted to ensure there is no interference in the process.
A reputable independent audit firm will be engaged to carry out a comprehensive forensic audit of the SME Fund, examining budget appropriations, Treasury cash releases, transfers to partner financial institutions, acquittals and all related financial transactions.
Mr. Marape said the investigation would establish how much funding had actually been released by Treasury, how much had been transferred to approved financial institutions, and whether there had been any departures from Government policy or the law.
He stressed that the Government’s SME policy remained unchanged and reaffirmed its commitment to supporting small and medium enterprises across Papua New Guinea.
The Prime Minister said Government policy required SME funding to be channeled through approved financial institutions, principally BSP, the National Development Bank (NDB) and Mama Bank, rather than being directly distributed by government departments.
He said if the full K200 million allocation had been released, the intended distribution would have been K80 million to BSP, K70 million to NDB, K30 million to Mama Bank and K20 million for programme administration, monitoring and supervision.
Mr. Marape said the banking model was designed to prevent political or departmental involvement in the direct allocation of SME loans and ensure eligible Papua New Guineans accessed finance through established banking processes.
He reiterated that the investigation would independently determine whether public funds had been managed in accordance with the Public Finance Management Act and other relevant laws.
The Prime Minister said any impropriety, unlawful transaction or misuse of public funds uncovered by the investigation would be dealt with through the appropriate legal and administrative processes.
He also emphasized that the administrative changes should not be interpreted as findings of wrongdoing, noting that Minister Daki would remain in Cabinet without a portfolio while the investigation proceeds.