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K38 million Maserati purchase made through Sri Lanka ‘backyard firm'. Bryan Kramer slams O'Neill govt & demands it ‘come clean’

InvoiceKEITH JACKSON

PORT MORESBY – Prominent Papua New Guinea Opposition MP and Member for Madang Bryan Kramer has slammed APEC Minister Justin Tkatchenko for the purchase of 40 luxury Maserati sedans, which he says would retail in PNG for at least $400,000 (K950,000) each taking into account excise duty, clearance and freight.

And he's in possession of what he says is a leaked pro forma invoice (right) to back him up.

The cars will be used to ferry world leaders attending the APEC leaders’ summit that PNG will be hosting in Port Moresby next month.

“While the country faces a polio outbreak, failing health and education systems, systemic corruption, and escalating law and order issues, prime minister O’Neill appears to be more concerned about impressing world leaders,” Kramer said in a statement.

“The bottom line is, we cannot afford to be this extravagant. Our country is broke and the O’Neill government continues to be irresponsible and reckless.”

In a statement released on Wednesday, Tkatchenko said, “Maserati Quattroporte sedans have been secured and delivered and are being committed to be paid for by the private sector.”

But Kramer says that, if the vehicles have been bought by the private sector without any cost to the government, the sale is illegal.

“The Public Finance Management Act requires any State assets to be acquired or disposed of by calling for public tender,” he said. “The question is: when was the public tender called?”

Kramer says he has obtained documents including an invoice issued by Ideal Choice (Private) Ltd and addressed to APEC CEO, Christopher Hawkins.

The pro forma invoice, dated 31 August 2018, is for US$5 million (K16.7 million) for “40 units of brand new MY 19 Quattroporte Diesel, Granlusso-3.0L V6 Diesel Engine 275, HP [high performance] Acceleration”.

The payment terms on the invoice included a 35% non-refundable advance with the balance payable after 30 days. The airfreight charge of US$1,352,800 (K4.5 million) was 100% non-refundable in advance with insurance costing US$4,884. The total invoice amount came to US$6,357,684 (K21.3 million).

Ideal Choice (Private) Ltd is a auto spare parts and sales company based in Colombo, Sri Lanka.

“The Italian automobile manufacturer must now come out publicly to explain why they agreed to sell 40 Maseratis destined for PNG APEC to a small dealership based in Colombo, Sir Lanka,” said Mr Kramer.

"Further, I just can’t see world leaders agreeing to be ferried in luxury vehicles that appear to be procured through a small backyard dealership.”

Mr Kramer demanded that the O’Neill government “come clean on how the purchases were made and who in the private sector have committed to purchase these vehicles after the final APEC meetings”.

Comments

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Paul Oates

William, I think Gabriel has a point here. If the PNG government wants to order Maseratis and splurge on other things like Falcon jets and sponsored overseas trips, perhaps even possess secret bank accounts and, dare I say, enter into private deals between government ministers and overseas private companies, who are we to say this is not right?

So the country has a health system in rapid decline, the education system is in tatters, the public service isn’t performing, etc. Why are we who live elsewhere and enjoy the benefits of a government system that works (mostly), feel compelled to seemingly pontificate about our neighbour’s affairs?

Surely it is the right of every nation to elect those leaders who will perform effectively and give their supporters what they clearly want?

We should merely retreat back over the anachronistic national border of the Torres Straight and mind our own business.

Clearly all the previous billions of aid dollars have been totally wasted on such spurious programs as ‘Strongim Gavaman’. All those self-actualising, warm and fuzzy programs aimed at ‘bettering the participants’ by social engineering the local society are just merely ‘samting nating’.

Puuf! Liklik win nau i rausim ol simok bilo displa kain bulsit tok na pasin.

We Australians are misguided at best and at worst, just plain wrong in what we are trying to achieve.

Let’s stop calling a spade a shovel. We need a new approach. Our aid programs are being misrepresented by those who are supposed to receive the benefits. Our intent is surely being misinterpreted. Our so called aid programs are and have been mostly a useless waste of hard earned Australian taxpayer money.

Let us therefore actually learn from those who are in fact, really making a difference.

So who are those who really do control PNG? Who are those who are causing the nation and her people to become beholden to vast government loans that admittedly aren’t achieving what is being claimed they should?

If you can’t beat ‘em, join ‘em I say.

Chris Overland

Setting aside the ethics of buying these vehicles and the decidedly odd way they were acquired, the PNG government might actually make money out of this dodgy deal.

My brief research suggests that the vehicles were acquired at a cost of A$175,837 per unit, which is well below the starting price in a Sydney showroom, which is around $210,000 for a base model or $250,000 for a fully optioned model.

Even allowing for freight and insurance costs, the potential is there to make a profit provided the vehicles can be sold for no less than the current asking price in Sydney.

We shall have to wait and see who ultimately buys these vehicles and at what price. I would not be betting on a transparent process being used though.

All that said, this is a very bad look for the PNG government and the way they have handled it looks and feels bad too. Basically, this deal doesn't pass the sniff test in a country beset by many, many problems.

Like Keith, I'd love to know just what this has got to do with Australia and look forward to Gabriel Ramoi's detailed account of how this is the case.
_________

My suspicious mind thinks there may have been two invoices - KJ

William Dunlop

Gabriel - The so called weaknesses in today's PNG government procurement system are a result of Melanesian creativeness both within and outside the present government procurement system since Independence.

The buck stops directly at the chief executive of Papua New Guinea and his hangers on.

As an Australian by choice, I resent on behalf of myself and my fellow Australians your imputation and generalisation that Australians are the cause.

I am also recognised as a citizen of Ireland and the United Kingdom by right of birth.

Gabriel Ramoi

As the dust settle it is now apparent that it is Australian citizens who are leading the charge in taking advantage of the weak oversights in the government procurement system to make a killing in PNG.
________

Interesting comment from Gabriel. Do you have more information, Gabriel - KJ

Bernard Corden

"One of the necessary accompaniments of capitalism in a democracy is political corruption" - Upton Sinclair

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