The Deputy Chairman of the Public Accounts Committee and Hiri- Koiari MP, Keith Iduhu, has raised serious concerns over the legality of the Connect PNG program, highlighting that it has been operating for five years without the legally required Development Trust Fund.
Speaking at a Parliamentary inquiry held at the State Function Room this morning, the Deputy Chair pressed Departmental Heads and Senior officials of the Department of Works and Highways to clarify the legislative basis for the program, citing the Road Fund Management Act 2020 and the Connect PNG Implementation and Funding Arrangements Act 2021.
He emphasized that all Connect PNG funds must flow through a single, dedicated trust account, overseen by the PNG Road Fund Board, rather than being administered at the discretion of the Department of Works and Highways.
“Parliament never intended for Connect PNG funds to be routed through multiple or discretionary accounts,” the Deputy Chair noted.
In response, Secretary for Works and Highways, Gibson Holemba, confirmed that the Connect PNG Development Trust Fund has not been established.
“Since 2020, Connect PNG has been funded through budgetary allocations administered directly by the Department of Works, not through a trust account,” he said.
Secretary Holemba provided financial figures showing K7.4 billion in procured works, K5.9 billion in running contract value, and only K1.8–1.9 billion paid, leaving K4–4.8 billion outstanding.
“While spending complied with Appropriation Acts, the policy intent of the trust fund was project security, ensuring money is available to honor contracts,” Mr. Holemba explained to the PAC.
The Secretary also suggested a governance restructuring, proposing separate boards for maintenance funds and capital Connect PNG funds.
However, the Committee rejected this proposal.
“No amendment has been passed by Parliament.
The existing law remains binding,” said Mr. Iduhu.
The Committee said that the non- establishment of the Development Trust Fund is the single most critical failure of the program.
It has directed the Board and Treasury to establish the trust fund within 30 days and submit a formal compliance report to Parliament in March.
While reaffirming strong support for the Connect PNG program, the Committee stressed that compliance with the law is non- negotiable, particularly given the scale of public funds involved.
Committee Members also expressed concern over delayed payments to contractors, warning that continued non- payment could negatively affect agriculture, tourism, rural services, and the program’s broader development goals.