PNG Budget reports lack transparency - economist

7:49 am on 3 August 2018

The Papua New Guinea government is inflating revenue figures and understating spending, an Australian economist says.

Paul Flanagan said this week's Budget Outcome report showed PNG Treasurer Charles Abel was massaging figures to restore credibility to the country's economic management.

Economist Paul Flanagan

Economist Paul Flanagan Photo: ANU

The report and earlier ones lacked transparency, Mr Flanagan said.

An example of that was a supposed surge in income from Goods and Services Tax (GST), he said.

The GST figures were hard to reconcile given what was known about the struggling PNG economy, the economist added.

"It looks like a lot of that is driven by simply not making some GST payments to the various provinces that are required," said Mr Flanagan.

"It also looks as if the government isn't paying refunds of GST that are legitimately owed to businesses," he said.

"So if you do those two things you can have an increase in your GST net collections, which looks good for the Budget but in fact it's not an increase really in your levels of revenues."

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