Free education programme faces big cut in PNG budget

9:00 pm on 2 December 2019

A major cut to the free education programme is one of the hallmarks of Papua New Guinea's new national budget.

The Treasurer Ian Ling-Stuckey has handed down a US$5.3-billion budget while projecting a difficult fiscal year ahead as the country's economy shrinks.

Papua New Guinea parliament facade.

Papua New Guinea parliament facade. Photo: RNZI / Johnny Blades

The budget includes a 50-percent cut to the Tuition Fee Free (TFF) education policy of former prime minister Peter O'Neill's government that was ousted in May.

Referring to the cuts to education, Mr Ling-Stuckey said it was a shared responsibility and that funding would be directed towards the costs of higher education which are a lot more burdensome to Papua New Guinean families.

As well as the education cuts, the budget features stringent new debt-servicing measures, tighter control on government salaries and higher taxes.

There's a 25-percent tax on tobacco and alcohol, while other tax reform measures include a simplified tax regime to help small to medium sized businesses.

EMTV reports that the budget deficit was placed at US$1.14-billion as Mr Ling-Stuckey blamed PNG's economic woes on the leadership of former prime minister Peter O'Neill.

The Treasurer said that during Mr O'Neill's almost eight years in charge, the average living standard went backward by over 100-kina per person annually.

In recent months, Mr O'Neill has been the subject of repeated criticisms by the Treasurer. But the former leader said his management of the economy allowed fiscal stability in PNG. He also alleged that the new James Marape-led government has frightened investors away.

Mr O'Neill has also defended the TFF policy, saying that under the programme, many more children, especially girls, were able to attend school across the country. The Ialibu-Pangia MP warned against making cuts to the programme.

Meanwhile, Mr Ling-Stuckey said that PNG's employment market was not looking good in 2020. He reiterated estimates by the World Bank and the Asian Development Bank that formal job creation has dropped from an average of 15,000 a year to 10,000 over five years.

The opposition has until later this week to prepare its response to the budget in parliament.