Papua New Guinea’s Education Department headquarters in Waigani, National Capital District (NCD), will be locked by 5pm on Monday if the state fails to pay K39 million (NZ$19 million) in unpaid rent.

The arrears — accumulating since 2017 — are owed to Grand Columbia Limited, owner of Fincorp Haus.

The landlord’s action means 1049 staff of the Education Department and Teaching Services Commission will not be able to access their workplace from Tuesday.

This will have severe repercussions — the most immediate being fortnightly salaries for almost 60,000 teachers nationwide.

A lockout will mean these hardworking men and women will go without their pay, at least for a fortnight or two, depending on how fast the department scrambles technical staff and equipment.

Next-up will be the selection of successful students to attend higher schools and institutions next year.

The process is time-barred and any delay will only affect the timely commencement of the scheduled academic year in 2023.

Not opening gates
The state reportedly paid K3 million (NZ$1.5 million) to GCL on Wednesday to offset some of what it owes but GCL insists it will not open its gates until all arrears are paid.

In a desperate move, the department’s top management convened a special meeting yesterday to start allocating space for all its workers.

Most staff will be housed at the Papua New Guinea Education Institute.

And the ministry is also looking at a number of secondary and technical schools in NCD to help with space.

The staff have begun packing important work documents to start the exodus.

TSC chairman Samson Wangihomie said their staff would be operating at either Wardstrip Primary, Gordon Secondary School or PNGEI.

This news comes on the back of news that public servants will receive a 3 percent pay increase and the final K158 million (NZ$77 million) GTFS was disbursed this week to schools.

Referred to Finance
Education Secretary Dr Uke Kombra referred the Post-Courier to the Department of Finance, saying the Department of Education does not manage its rentals.

“We wish this was given to the departments to manage,” he said.

“At the moment it’s all centralised by DoF.”

Education Minister Jimmy Uguro expressed serious concern at the threat of a lockout.

He said: “Of course the closure of Fincorp Haus will affect operations of Education services in the country.

Teachers pays, examinations, inspections and general education services will be affected.

“I call on the government through the office sector to see and assist the issue as a matter of urgency.

BOLT arrangements
Over the years the ministry and the department have been negotiating to have a Build, Own Lease and Transfer (BOLT) arrangement with development partners, but this is not happening.

“We would like to invite those who can offer the best BOLT arrangement so that the office allocation authority can assist to implement the plan.

“Despite such a disruption, the Education Department is keen and will continue to provide services needed by our schools and citizens.”

Grand Columbia Limited in its notice of closure said the building would close at 5pm on Monday, October 31, due to failure by the state to honour its contracted obligations to pay rent.

It stated that rental payments allowed the landlord to maintain the place, look after the workforce and other expenses.

The GCL is adamant, it will not open its gates after Monday.

It stated that of 24 months, only two months’ rent has been received with significant rent outstanding dating back to 2017, 2018, 2019 and 2020.

The Education Department and TSC have been housed by the Fincorp Haus since the establishment of these two offices in the late 1980s.

Phoebe Gwangilo is a PNG Post-Courier journalist. Republished with permission.

Article by AsiaPacificReport.nz

The Mexican standoff over the closure of Papua New Guinea government offices due to nonpayment of rentals has ended.

The National Court has ordered superannuation fund landlord Nambawan Supa Limited (NSL) to remove all locks to Vulupindi Haus, Treasury Haus, Eda Tano Haus in Waigani and Revenue Haus in downtown Port Moresby.

At the same time, the government has honoured its commitment to pay a further instalment of K30 million (NZ$15.3 million) to NSL, bringing the outstanding total paid up to K82 million (NZ$42 million).

The Waigani National Court presided by acting judge Justice Emma Wurr granted on Friday the ex-parte application filed by Finance Secretary Dr Ken Ngangan for the removal of locks to the buildings.

Dr Ngangan instituted the proceeding as the chairman of the Government Office Allocation Committee through his lawyer Milfred Wangatau of ACE Lawyers, ordering Nambawan Super Ltd to remove the locks on government offices.

NSL had locked doors to its buildings that housed major government departments over outstanding rental arrears.

The five major government agencies affected were the Department of Finance, Department of Treasury, Department of Lands, Department of National Planning and Internal Revenue Commission.

During the hearing, Wangatau submitted to the court that the state had paid NSL more than K50 million in September.

Committed to settle arrears
He submitted that while the state did admit that there may be some outstanding rental arrears, it stood committed to settle its arrears but NSL decided to go ahead and lock the offices.

“NSL’s abrupt decision to lock out very important government public service delivery agencies should be the last resort as it only goes to hold the people of the nation at ransom when vital government services are disrupted,” Wangatau submitted.

He added that damages would be irreparable if the reliefs sought in the application were not granted as it would certainly have an adverse effect on the public at large.

Wangatau further submitted that it was in the interest of justice that the court should grant temporary mandatory orders ordering NSL to unlock all the government offices and allow government business and public service delivery to return to normalcy pending the substantive hearing.

Justice Wurr agreed and granted the interim orders and adjourned the matter until this Friday, for inter parte hearing.

Among the orders issued, Justice Wurr ordered that the defendant (NSL), its employees, servants and agents must immediately unlock all doors to the Vulupindi Haus, Revenue Haus, Treasury Haus and Eda Tano Haus to allow staff and officers of the respective state departments to have access to ensure government business and service delivery can resume as usual.

Justice Wurr ordered NSL to comply with the orders immediately upon services of the orders.

NSL ‘relieved’
Meanwhile in a press statement, NSL said it was relieved to receive a further K30 million payment from the state last Friday in its new commitment to offset rental arrears it owes to the fund’s contributing members.

This brings the total amount paid by the state to K82 million.

And representatives from the Departments of Finance and Treasury have signed a Letter of Agreement committing to pay the outstanding balance of K90 million in a series of monthly payments starting in November.

Nambawan Super chairman Mr Reg Monagi said: “We are pleased to have received the second payment of K30 million and we thank the Departments of Finance and Treasury, who after extensive discussions and negotiations, have committed to an agreement for the settlement of these arrears.”

“Acting in good faith after the State’s positive actions, on Friday night, we lifted the lockout of the Revenue Haus (Internal Revenue Commission), Vulupindi Haus (Department of Finance) and EdaTano Haus (Department of Lands & Physical Planning) and Treasury Haus (Department of Treasury).

“We hope that as we have acted in good faith, the State will continue to honour its commitment to our members by settling the remaining outstanding rental arrears.

Retirement outcomes ‘now protected’
“Nambawan Super appreciates that the State has recognised how important the payment of these arrears are to ensuring that our over 214,000 members’ retirement outcomes are protected.

“The unpaid rentals that accumulated over three years have already impacted the returns for members causing fewer funds available to reinvest and grow.”

“Any further delays to the scheduled payments will have a further detrimental impact on the returns of Nambawan Super members.”

“NSL remains committed to working closely with the State to ensure the payment of all outstanding arrears are made as agreed in the payment schedule, and will not hesitate to lock out the State again if it is unable to do so,” Monagi said.

Republished with permission.

Article by AsiaPacificReport.nz