12 Mar 2014

Sacked PNG Treasurer admits differences with PM over loan

10:44 pm on 12 March 2014

Papua New Guinea's sacked Treasurer has defended his position to oppose a move to take up a massive loan to buy back the state's shares in Oil Search.

Don Polye was sacked this week by the Prime Minister Peter O'Neill who said the treasurer was causing instability in government.

Mr Polye has been vocal about the government's limit on borrowing and keeping its deficit under control, and admits he opposed the Prime Minister's move to look at a 1.2 billion US dollar loan to buy back shares in Oil Search.

Mr O'Neill, who is acting Treasurer, is expected by some observers to sign off on the loan.

But Mr Polye says he couldn't have approved of the loan in good faith.

"With a three billion loan from UBS, that's going to blow that debt policy. And also to bring on such loans, I have to go to the floor of parliament under section 209 of the constitution to seek parliament sanction."