Secret funds exposed

Lean years for the populace are the years of fat for the bosses – thanks to Taiwan


IT’S a well-kept secret – until now that is.

Investigation by Island Sun has established that despite official denials over the past years, Taiwan has been providing up to $17 million a year since 2015 to keep the government intact.

The revelation comes as undercurrents continue to dog Prime Minister Ricky Houenipwela’s new government.

PM Hou and his predecessor have never spoken directly since December because of differences over payment of $50 million for the Hell’s Point land, east of Honiara, insiders have confirmed to Island Sun on condition of anonymity.

Hou is against payment while his predecessor and former Prime Minister Manasseh Sogavare is allegedly pushing, arguing his successor had reneged on his undertaking on the matter.

The revelation of the existence of the secret fund from Taiwan is likely to be the spanner in the works in an already fluid situation, with numbers fluctuating daily.

According to those in the know, the amount of the slush funds coming from Taiwan fluctuated between $17 million and $11 million each year from 2015. If this was so, it meant that all DCC Government MPs could have received in total up to $42 million in average in the three years to December last year.

The money, dubbed the Prime Minister’s Discretionary Fund – is separate from and additional to Taiwan’s $50 million annual grants to the Rural Constituency Development Fund (RCDF).

It comes directly to the Prime Minister’s Office from Taipei.

Documents obtained by Island Sun show Sogavare had asked Government Caucus in early 2015 about how the money should and could be used.

After a short deliberation, Caucus decided the money should be shared equally amongst Government MPs only – ministers and backbench members alike.

“That’s what they did. Each Government MP received on average some $285,000 a year, irrespective of whether you are a Minister or backbench, you receive the same amount,” those familiar with the secret funding, said.

Opposition MPs and those from the Independent Group in Parliament were never included in the secret payments.

“Payment of Government MPs was usually made just before Christmas with instruction that retirement of the money be lodged with the Office of the Prime Minister and Cabinet, which in turn would retire all the payments together before it was sent to the Taiwanese Embassy in Honiara,” they said.

Island Sun is unable to independently verify whether all Government MPs at the time received the payment.

The number of Government MPs at the time fluctuated between 29 and 33. For example the record of Caucus meeting on March 23, 2016, showed government numbers stood at 33 MPs.

Based on this figure, each Government MP would have collected $333,333. In 2016, there was a delay in Taiwan furnishing the money.

Former Accountant General Paula Uluiniceva was approached for an advance from SIG coffers. He stood his ground.

“That’s the reason why the DCC Government decided not to renew his contract,” insiders said.

And if you think that’s all that was happening behind the scene, think again.

On March 23, 2016, government Caucus decided the annual $7 million per Constituency RCDF grants should be divided into two components – hard cash and direct payments to government’s preferred supplier(s) for goods and services.

Initially, it was agreed that $1.4 million from the $7 million be paid in hard cash to Constituencies through MPs. The balance would be paid to the government’s preferred suppliers for goods and services.

But the Caucus meeting that day decided to increase the cash component by an additional $300,000 per Constituency. This means that each time RCDF grants were paid out, a cash component of $1.7 million is paid to the Constituency through MPs.

It is not clear whether the payment of the cash components included MPs in the Opposition and the Independent Group at the time. Attempts by Island Sun to verify this yesterday were unsuccessful.

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