by Dr Kristian Lasslett - International State Crime Initiative

Although it has been in the pipeline for months, last week the O’Neill government formally announced that the National Housing Estate Limited (NHEL) would be taking over large chunks of the National Housing Corporation’s assets, and presumably its functions too.

Apparently this move was motivated by a desire “to provide affordable housing for Papua New Guineans” Post-Courier (3/12/12). If true, it deserves applause.

However, we must now pause for thought following Sunday’s press statement by NHEL’s Executive Chairman, John Dege (see also ABC Radio, 4/12/12). Among other things, Dege’s statement catalogues a number of housing projects the NHEL is about to embark upon. To this end, he remarks:

 “NHEL is...a major proponent in the Paga Hill housing development project undertaken by Paga Hill Development Company (PNG) Limited”.

This is a startling admission for the NHEL to make. After all, the Paga Hill Development Company (PHDC) – which hopes to build a 5-star hotel, luxury marina and residential/commercial complex on the former national park at Paga Hill – and its executives, have between them been censured in no less than six official reports into corruption and public mismanagement in Papua New Guinea.

For example, in 2006 the Public Accounts Committee alleged that PHDC’s lease over Paga Hill was acquired through “corrupt dealings”. The Public Accounts Committee then goes on to describe PHDC as a “private, foreign speculator with no ability to even pay the Land Rental, much less build anything on the site”.

Other inquires by the Auditor General’s Office (AGO) and Public Accounts Committee have probed the past of PHDC executives, including its Chairman, Gudmundur Fridriksson, and its Director, George Hallit. Together these two men ran a consultancy firm CCS Anvil.

The AGO claims when working as an agent for the Public Curator’s Office, CCS Anvil “withheld a significant amount of monies it has received from the proceeds of the realisation of assets of deceased estates, including sale of properties, shares and investment and rent...The AGO can find no evidence that any money realised by Anvil on behalf of estates has been paid into the Estate Trust Account”.

The AGO also allege that CCS Anvil’s Papua New Guinea principal was certifying government payments to his own firm, for as much as K500,000. These findings were followed up, and confirmed, by the Public Accounts Committee in 2006.

CCS Anvil was also censured in two other Public Accounts Committee reports and an AGO investigation.

As if this was not enough, one of PHDC’s Directors recently acknowledgedcomplicity in the attempted forced eviction – they prefer the term “forced relocation” – of Paga Hill’s 3000  residents, some of whom have lived on the hill’s foreshore for four generations. During the forced eviction exercise, RPNGC officers attacked residents with sticks, metal bars, machetes, and automatic rifles; even the then Leader of the Opposition, Dame Carol Kidu, was not exempt from the violence – she was frogmarched from the scene by officers as colleagues opened fire on bystanders.

How could NHEL not know all this? It really defies belief.

Ironically, NHEL came to the fore, owing to alleged corruption and ineptitude within the National Housing Corporation (see Post-Courier 19/9/12). Yet already NHEL is at risk of following the path of its predecessor. NHEL’s relationship with PHDC is one red flag, others have been raised with respect to NHEL’s involvement in the Gerehu Stage 3B-2 Project (see Post-Courier 24/10/12/), and its treatment of residents at the Waigani Hostel,   who allege they were “victims of heavy handed, abuse and oppression perpetrated by the management of NHC in collaboration with National Housing Estates Limited” (Post-Courier 29/11/12).

This is a terrible start to what could have been an exciting new era in affordable housing for Papua New Guineans.

The International State Crime Initiative’s report, ‘The Demolition of Paga Hill’, can be accessed here:http://statecrime.org/online_article/the-demolition-of-paga-hill-a-report-by-the-international-state-crime-initiative/