By GEORGINA MICHAEL
MINISTER for Rural and Economic Development and Joseph Lelang yesterday confirmed that Treasury has released K100 million of the K1billion fuel stabilization package.
“I confirm that the K100 million has been released by the Treasury and moved to the Bank of Papua New Guinea as of yesterday. I thank the cabinet for its decision to absorb 100% of the increase in fuel price due to the US- Iran War in the Middle East. This is an important decision made to protect the PNG economy and protect the people who will pay more for food and transportation,” he said.
Mr Lelang, who is the Chairman of the High Level Cabinet Task Force on addressing the fuel shortages, said the one day delay in the announcement was to allow the industry and the State to discuss how the subsidy would work.
“The first K100million was made available on the 14th of April. This relief package will be parked with the Bank of Papua New Guinea and will be allocated to importers to cover the difference of their actual purchase price from overseas markets and the domestic controlled prices as and when they source fuel from the international market.
“The relevant agencies including the Department of Treasury, Bank of PNG, Department of Finance ICCC, Internal Revenue Commission (IRC)., PNG Customs, and the Department of National Planning and Monitoring, Office of the Chief Secretary are working on the fundamentals and the implementation framework for the government fuel relief package.”
ICCC Commissioner Roy Daggy then highlighted the process involved with the fuel relief execution mechanism saying the process will directly be managed by an independent accounting and audit firm to ensure transparency and accountability of the money including the funding disbursement.
“With the fuel relief mechanism in place, the fuel importers including Puma Energy PNG Limited, Mobile Oil New Guinea Limited and ExxonMobil, Islands Petroleum Limited and Ok Tedi Mining will submit pro-forma invoices and price differentials to be confirmed by Bank of PNG, Customs, IRC, Treasury, and the ICCC,” Mr Daggy said.
“Once, Verified, the importer proceeds to the point of Import, particularly Bank of PNG and presents the verified pro-forma invoice and price differentials to claim the direct subsidy amount, net of all taxes.
“Under the fuel relief assistance, fuel importers will be able to source fuel at prevailing higher international prices and sell domestically to the retail domestic service stations or their contracted customers at March Prices while the fuel relief package will cover the difference in the next six months.”