17 Jun 2008

Niue assessing aid use in budgetary spending

1:41 pm on 17 June 2008

Niue is still working to resolve which donor funds were used to provide a cash flow for the government three or four years ago.

A financial report to the government for last month, indicated that up to 650,000 US dollars was used incorrectly.

Niue's caretaker finance minister, Fisa Pihigia, says under an agreement reached with New Zealand two years ago, separate bank accounts have been set up to keep donor funds apart from budgetary spending.

But he says the messy past spending situation is still to be cleared up:

"We want to sort out all the legacy that has been plaguing Niue for past few years and we sort those things out not only the donor funds, but also the outstanding subscription with agencies. So we managed to make a deal with New Zealand that we sort these things out and then sit down."

A spokesman for the New Zealand Ministry of Foreign Affairs said there is no indication that any donor funds have been used incorrectly in the past two years.

The head of the special relationship unit, David Payton, says the figure of 650,000 US dollars is a top estimate and the actual amount may be lower.