Ashika bought with China funds [1]
Thursday, February 18, 2010 - 11:00. Updated on Friday, May 9, 2014 - 21:27.
The MV Princess Ashika costing FJ$600,000 was bought with funds given by the People's Republic of China to Government of Tonga, the Royal Commission of Inquiry into the Ashika sinking was told on February 17.
The Minister of Finance and Public Enterprise Hon 'Afualo Matoto in continuing his evidence in the afternoon session agreed that Government had no allocation in its budget to purchase the replacement vessel.
Counsel Assisting Manuel Varitimos asked the Minister if it was correct to say expenditure spent by Government needed authorisation and that a budget is passed by Legislative Assembly; and the Minister agreed.
"So if money was paid outside the budget, it is unauthorised funds, and funds paid for the Ashika were unauthorised funds submitted?" said the counsel.
But the Minister disagreed and pointed out to the aid funds and added that the money was taken from aid funds and that the donor did not specify what it was to be used for or its purpose. He added that there was arrangement that the funds were for orbital slots.
$15 million
The Minister confirmed that the funds from the People's Republic of China given to Government in December 2008 amounted to more than $15 million. "The purpose of the money was in respect of arrangements between the government and the People's Republic of China with respect of the purchase of an orbital slot from Tongasat by the People's Republic of China," he said.
"A slot for satellite purposes . . . for telecommunication purposes?" asked the counsel; and the Minister agreed.
The counsel put to him that this was a far cry from purchasing a vessel.
The Minister then said the payment was given as a grant by the PRC for the purchase from Tongasat by the Chinese Government of that orbital slot. It was a fund from China but there were no specifications for the utilisation of the money and it was up for the Government of Tonga's consideration.
The counsel put to the witness that aid funds are money given to be used for something; and the Minister agreed.
"Was the People's Republic of China ever consulted that the money was used for Ashika? said the counsel.
The Minister said, no it was not necessary, and it was not done.
"The arrangement was made by Tongasat and the People's Republic of China, but the grant was given to the Government," said the Minister.
"When you signed the Cabinet Memorandum on April 20 had you had any contemplation about the money from China or when did you seek view of the money from China," said the counsel.
Looking for aid
The Minister said they were looking for aid funds and considered that New Zealand Government might assist, but there were no other aid funds available apart from the China funds.
It was also revealed in the Minister of Finance's affidavit submitted to the inquiry, that on April 23, 2003 Cabinet meeting the Prime Minister Hon Feleti Sevele wanted to know if the replacement vessel could be purchased with aid funds.
He was of view that Government should only resort to using its own funds if aid money was unavailable, stated the Minister of Finance.