By George Atkin 

Kira Kira Correspondent

The Makira Ulawa Provincial Assembly has repealed its Investment Arm, the Makira Ulawa Province Investment Corporation – MUPIC.

The Makira Ulawa Province Investment Corporation has been operating under an Ordinance, a previous Provincial Government created in 1998.

But the Makira Ulawa Provincial Assembly in its meeting on March 27, 2021 in Kira Kira, the Provincial Capital of the Province decided to repeal the ordinance following a motion moved by the Premier, Julian Maka’a.

He said there were three factors that acted as pillars for moving the motion, the first being MUPIC had failed to fulfill its functions and powers.

Mr Maka’a said the Investment Corporation was established with noble commercial and economical intentions under the Ordinance which was passed by the Makira Ulawa Provincial Assembly then.

He said the Corporation became operational with certain very general purposes as contained in Part 2 of the Ordinance, adding it had existed with specific objectives under its Functions and Powers as also spelled out in Part 2 of the Ordinance.

Premier Maka’a told the Assembly that Section 4 (1) of the Ordinance MUPIC was set up purposely to promote economic development within the Province, it should be responsible to ascertain businesses and other enterprises were developed within the Province and their efficient and regulated operations were secured.

And since its inception, he said, MUPIC had been operating a Rest House in Kira Kira; had rented out a Warehouse at Kira Kira landing area; had rented out a building to a retailer at the Kukum housing area within Kira Kira; had rented out several leaf huts for catering meals at Rain-tree area next to the Kira Kira Football Field; had been leasing out Residential Quarters at Kola’a Ridge in Honiara and had bought a piece of land at Okea on the Guadalcanal Plains on Guadalcanal Province.

He said the Corporation has not developed the Okea land since it bought it.

And on the question of whether or not MUPIC has in the past 20 years been attaining and fulfilling its established purposes and functions, Premier Maka’a said “in my very humble, logical and respectable observation, my simple and pragmatic response to that critical question is but a simple NO”.

Mr Maka’a said it was obvious the Corporation had not been promoting economic development; had not been developing businesses and other enterprises and had not been securing efficient and regulated operations of those supposed to be businesses and enterprises within the Province as stipulated in the Ordinance.

Taking those failures into consideration, he said “I will strongly maintain that the Corporation has failed miserably to fulfill its obligatory purposes and functions as demanded by the Ordinance”.

Mr Maka’a said the second pillar was the due Reform necessary to change in circumstances, situation and environment.

The Makira Ulawa Province Investment Corporation was formed in 1998, 20 years ago, and it is important to note it was amidst social and economic situations and circumstances which were totally different from the experiences of today.

And in the dynamics of change, Premier Maka’a said much had evolved and changed the initial environment as development had either caught up with “us or bypassed us, and the many good determinations made in the past.

“But we must accept the fact that the World is scientifically circumventing faster than it used to be, hence alarming visible changes emerge, which is called in the political language “Reform”.

He said the notion must not be overlooked as “we need to be current and be able to live in the World today, we must embark on Reform the moment its need becomes evident and inevitable otherwise we continue to live in our own outdated world.

“Let us not lax and lay by as matters deteriorate before our very eyes. We must get up, flex up and act lest we fall below the resurrection line, as the changes have inevitably distorted the initial environment necessary for the initial functions and purposes devised for MUPIC.

“Then, there were no Provincial Government Strengthening Program, no Provincial Capacity Development Fund, no regular auditing, and compliance was on the verge of extinction.

“Elements of Good Governance, Transparency and Accountability were obscene features in governance and the good environment we now witness had almost disappeared.

“But we have now changed all those with Good Governance now featuring highly the elements of Transparency and Accountability in the systems and mechanisms, credible systems of accountability, regular reporting and auditing are now obligatory to ensure compliance to frameworks of the day which are now common happenings, not seen before”.

The Makira Ulawa Premier, Mr Maka’a said Resource, Opportunity in gaining and losing considerations made up the third reason for moving the motion, so members could ponder and deliberate on the economics of MUPIC.

He said since the Corporation’s inception, tremendous attempts had been made to secure financial professionals to tidy up its mess in not keeping financial records, but they had come to no avail; failure to keep proper records as required under Part 111, Section 15 (1) of the Ordinance continued to impede on MUPIC from producing Financial Statements, these Reports were also required by Part 111 of the Ordinance; No audit had been carried out on MUPIC as there were no financial records or systems in place to be audited; the failure to produce financial reports made it difficult to gauge, ascertain and declare whether or not MUPIC was making profits or losses, an obligation also contained in Part 111 (Finance) and the chain of subsequent downsides of MUPIC continued to rise and its inability to report profits or losses resulted further in its inability to declare dividends due to the shareholder, the Makira Ulawa Provincial Government.

On the other side of the coin, Mr Maka’a said MUPIC had not strictly been honoring its Superannuation and Taxation obligations as required under law with arrears mounting and causing ultimate burden to the Makira Ulawa Provincial Government; MUPIC is the Economic Development Arm of the MUP Government, naturally therefore, it is connected to the Provincial Government, as such they are compelled to jointly declare their financial activities through consolidation of their two separate Accounts or Financial Reports; this has not been forthcoming for many years as MUPIC has not provided credible reports, resulting in plaguing the Audit Reports of the Makira Ulawa Provincial Government to this day.

Premier Maka’a told the meeting that Provincial Governments including MUPG will be missing out Provincial Capacity Development Fund resources if they fail to provide Income Accountability because it is a Performance Measure it uses when considering funds towards their Investment Corporations.

The measures are keeping proper Account Books; producing regular credible financial reports; consolidating their Accounts with those of the Provincial Governments; getting accounts audited; realizing profits and profitability; declaring profits and distributing dividends to shareholders, the Provincial Governments.

Premier Maka’a said the report he had provided portrayed a gloomy picture of MUPIC, but they were necessities as they could ensure its credibility, prudence and profitability; they could ensure satisfying returns of the Provincial Government’s investments and certainly the Provincial Government would not desire to continue putting its money in an institution that was not making profits and was not giving out rewarding dividends.

He said why he was trying to impress on the third factor of the reasons for repealing the MUPIC Ordinance were Makira Ulawa Provincial Government and the Province had been losing and would continue to miss out on good resources including those from PCDF if the Provincial Government continued to hold on MUPIC.

In the final analysis, Premier Maka’a said it was a common knowledge that the loss of resources from PCDF was due to the Makira Ulawa Provincial Government not scoring in the associated Performance Measure in PCDF, adding the Prime Minister carried huge funds that could be shared amongst the nine provinces.

He said the Performance Measures will be elevated to become a Minimum Condition as from the next PCDF Assessment due towards the end of the year.

The motion was passed and the MUPIC Ordinance is now due to be repealed.