From the House, by Pesi Fonua

Tonga Legislative Assembly, Minute No. 11, Monday June 20, 2005.

- Noble Fohe, called 'Akilisi Pohiva a liar, for saying that Fohe was paid for sleeping in the House. He warned 'Akilisi that next time he said bad things about him he would knock his brains out.

- Financial report on Public Enterprises.

- The Minister of Finance was not sure if the Government's $21.5 million loan from the Trust Fund was legal.

- Tonga Rugby Union asked for a grant of half a million.

- Noble Veikune said that the House surrendered its authority over government finance to government in 1972.

- 'Akilisi said that Shoreline was the biggest problem facing the country. He said that the Reserve Bank approved the transference of millions of pa'anga by Shoreline to pay companies in New Zealand and Hawaii for goods that never arrived in Tonga.

The 'Eua People's Representative, Sunia Fili started off the day with a number of Thank You's from himself and the Noble's Representative for 'Eua, Noble Lasike. He thanked the Minister of Finance for responding to their request, with $8,000 for the 'Eua Festival Week, which started last Sunday.

He also thanked government for the establishment of a branch of the Ministry of Agriculture and Fisheries in 'Eua, the work on the 'Eua Wharf, which though slow, was moving ahead. He said they had got $110,000 from the New Zealand government for the roads but the Ministry of Works was very slow with their work.

He also requested if it was possible for the petition for the vanilla growers from Vava'u, Ha'apai, Tongatapu and 'Eua to be read.

Fohe

Noble Fohe was one very angry Noble's Representative. He said that he saw one evening 'Akilisi Pohiva on the TV discussing the outcome of the Nobles' Parliamentary election, and referring to why they elected him when all he was doing in the House was sleeping, and then being paid. Fohe said that the reason he slept was because he hated his speeches.

He said that 'Akilisi came to his village, Puke, while campaigning for election and had been to see some of the new buildings that had been built in the village, the Church, a public hall at his home, the residence of their church minister and the schools. Fohe said that those buildings were built with his own salary. He said that during the program someone asked 'Akilisi for his salary from the House and he said tens of thousands. He said that 'Akilisi was just a liar, and when people asked him for money he said no, he had no money. He said that 'Akilisi had nothing by lies. He fooled the educated and the church ministers. He said that lying seemed to be a good thing, it can make you rich. "I have warned him not to do that to me again because I could knock his brain out." He said he did not know where 'Akilisi came from, but he was spreading rubbish everywhere, and he did not want to get involved in cultural activities or church obligations.

Tonga Rugby Union

Noble Lasike, requested for a letter from the Tonga Rugby Union to be read.

The Governor of Vava'u, Hon. Akau'ola, said that he received the letter from the Speaker to prepare some food for the feast on the King's birthday, but Tonga High School ex-students would be preparing a feast for the opening of the Tonga High School's new school building, he wondered if they could be excused.

The Speaker said that the letter from the Tonga Rugby Union would be read at 2 pm, and with regards to the King's birthday feast, he said that it was voluntary.

Budget debate

The Legislature dissolved into Committee.

The Chairman of the Committee said that that was the final day to debate on the budget statement of the Minister of Finance, then eight days left to debate on the budget before the beginning of the new financial year.

A Ha'apai People's Representative, 'Ulilti Uata talked about the number of public enterprises, which received funds from government, but were also becoming a matter of great concern because of the amount of money that government had to pour into them, and an increasing number of them were going bankrupt. He wanted to know why the Minister of Finance did not include in his Budget Statement the amount of money government allocated to these enterprises and how much revenue government was getting from them. He also wanted to know how much Treasury was hoping to collect from Consumption Tax on services.

The Minister of Finance Hon. Siosiua 'Utoikamanu, said that government received an annual dividend from these enterprises. He said that the figures should appear in the Budget but it would also be in his annual report. He said that CT from service should be between $7 and $8 million.

'Ulilti said he did not like the way the Minister answered his question. He said that what he wanted to know was the business arrangement that government made with these enterprises, how they were managed and the percentage on dividends.

The Minister of Finance said that all profit from these enterprises were supposed to be paid back to government, but it was allowed for them to withhold some if there was a good reason. The details would be in his Annual Report. He said that loans, which were guaranteed by government, were on Page 98.

'Uliti said that all the information about public enterprises should be in the Budget Statement. He asked the Minister if he could provide them with the name of the enterprises and all the relevant information.

The Minister asked for time to prepare the information.

Government loans

'Akilisi reminded 'Uliti of a government loan of $18 million from the Trust Fund for the Sea Star, Teufaiva Stadium, the High Commission in London, Tonga Oil and others. The Minister should give us all that.

The Minister of Justice proposed that they should pass the Budget Statement so that they could get into the Budget and looked at all the details that members were interested in.

When the House reconvened at 11 am after their morning tea break, the Minister of Finance read out a financial report on public enterprises, their expenditures, revenues, and profits.

International Dateline Hotel's unaudited figures for 2002

- Revenue $2.9 million

- Expenditure $2.9 million

- Net Profit, loss

Shipping Corporation, audited figures 2003

- Revenue $1.7 million

- Expenditure $1.6 million

- Net operating profit $160,00

- Profit after tax $30,000

Port Authority 2004 figures

- Revenue $3.3 million

- Expenditure $3.1 million

- Net operating profit $130,000

Tonga Broadcasting Commission 2003 latest figures

- Revenue -$1.6 million

- Expenditure $1.4 million

- Net Operating Profit $214,000

Tonga Communications Corporation 2004 figures

- Revenue $20.8 million

- Expenditure $14 million

- Profit $6.8 million

- Profit after tax $5.4 million

Tonga Development Bank 2004 figures

- Revenue -$5.8 million

- Expenditure $2.8 million

- Net operating profit $2.8 million

Tonga Electic Power Board. Unaudited 2004 figures

- Revenue $508,000

- Expenditure $300,000

- Net operating profit $200,000

- Loss

Tonga Investment Ltd 2003 figures

- Revenue $5.9 million

- Expenditure $5.9 million

- Loss

Tonga Timber Ltd 2004 figures

- Revenue $3.1 million

- Expenditure $3 million

- Net Operating Profit $138,000

Tonga Water Board 2004 figures

- Revenue $2.8 million

- Expenditure -$3.4 million

- Loss

Tonga Corporation unaudited 2003 figures

- Revenue $31,000

- Expenditure -$257,000

- Loss .

Labour opportunities

Samiu Vaipulu called on the Ministry of Education to sanction certificates issued on short training courses. He also called on the Minister for Labour to explore the opportunities for Tongan labourers to go and work in New Zealand picking fruits, and to investigate a New Zealand government project, the Vailima Project, which enabled Samoans to find employment in New Zealand.

The Acting Minister of Education told the member that the House had passed the Tonga National Qualification Act and some of the $14 million that had been donated by NZ would be used to set up a National Qualification Board.

Samiu said that the problem with aid project was that because of lack of maintenance they fell apart after a few years, an example was the bridge in Vava'u, which should be removed because it was falling apart. He suggested for future aid projects to include a maintenance budget, which would be invested to be used the need arose.

He went to say that government put so much emphasis on agriculture and fisheries but not enough on tourism. He proposed for government to offer incentives to encourage tourism and other businesses development.

He said that the impact of the poor domestic air service on tourism in Vava'u would take five to ten years for the industry to recover. He felt that government could have invested and kept the domestic operation of RTA running, because it would be far better than its replacement. He said that the saving grace was the Polynesian Airline service that came to Tongatapu via Vava'u.

When he was asked by 'Akilisi about the intervention, which stopped the competition between Fly Niu and Peau Vava'u. Samiu said it was unfortunate because it would have been the only way possible to offer domestic service to all the island groups if the two airlines were allowed to compete.

Trust Fund

One final question from Samiu was why there was only $10 left in the Trust Fund. The minister said it was a wrong figure.

'Isileli Pulu wanted to know if the $21.5 million government loan from the Trust Fund for its enterprises would be repaid.

The Minister of Finance expressed doubt if the loan was legal because it was not approved by the House as it was stated in the General Loan and Stock Act.

After lunch a letter from the Tonga Rugby Union was read. The national rugby team 'Ikale Tahi's program for this year, including the Tri-nations against Fiji and Samoa, which would also be the qualifying games for the 2007 Rugby World Cup. The 'Ikale Tahi will also tour Europe later in the year, and will play test matches against France and 'Italy, and minor matches in the UK. The Union was asking for a half a million grant from government.

The PM asked for the Acting Minister of Education to submit a report on the annual allowance for sport and the amount that was usually given to appeal from rugby. He said that requests for funding from sporting organizations came to the House about this time every year, but because the PRs complained all the time about taxes and government collecting revenues, he said he was expecting 'Akilisi and 'Uliti to be up saying why give money to a losing team. He said that the government budget was a routine to collect money for public services, but there were emergencies, begging and complaints.

'Ulliti responded that he was not supporting the appeal for funds from the Tonga Rugby Union.

Clive Edwards proposed for the letter to be tabled into committee for debate, he said that the matter was not only for the Acting Minister of Education to decide.

The Speaker suggested to give the Acting Minister of Education time to present a report.

The Legislature dissolved into Committee and debate continue on the Budget Statement.

Lepolo expressed her concerned over the illegal use of government's money. The Governor of Ha'apai responded by asking the member to clarify her comment. Lepolo pointed out that it was clear from what the Minister of Finance had said that there was a grey area over the Trust Fund, Sea Star and financial allocation to other government enterprises.

The Governor of Ha'apai insisted that it was wrong to say that money has been illegally transferred to public enterprises.

'Akilisi rescued the Niua PR by explaining that what Lepolo was referring to were government monies given to enterprises but when those enterprises went bust they left back debts of several millions, leaving government in a situation that it would not be able to claim them back. He gave a few examples, Sea Star, Tonga Electric Power Board, and Shoreline.

Need for better shipping service

Lepolo went on with her speech about the need for better service to the Niuas. She suggested that it was probably better to take $100,000 from the allocation to build a Royal Chapel and increase the frequency of the shipping service to the Niuas to once a month.

Sunia Fili supported Lepolo's proposition and said that 'Uliti had a better and a faster ferry than the government's 'Olovaha, and 'Uliti was just waiting for the Prime Minister and Minister of Finance for some funds.

The Prime Minister did not think so, he pointed out that the PRs were the ones who kept trying to stop government from spending on services, saying that it was not commercial. He pointed out that it was the PRs who killed the extension of the air service, the expanding of runways, the RTA, and tourism.

Fineasi Funaki asked Lepolo what were products that the Niuas could export, if say for example if the Minister of Finance said there was $100,000 available for the Niuas.

The Chairman said that it was proposed last year for the Niuas to start marketing firewood and coconut, but the member may know of other products.

Lepolo said there were shells and good woods for carving, but she supported a proposal by Clive for a Market Research Department to be established.

Noble Veikune

Noble Veikune made an effort to get the debating in the House into perspective. He said that under Clause 18 of the Constitution it was the responsibility of the government to protect its population and their wealth. He said that Clause 19 outlined the direction for government and the parliament.

He said that before 1972 parliament had full control over government's finance, but in 1972 the House surrendered that authority to government, but that authority had been questioned this year. He said that there was nothing wrong with it, but that was exactly what happened.

He went on to say that it had been said a number of times in the House that members were elected by the people, but he would like to ask, Whose people?

Clive wanted to know which page of the Budget Statement the noble commented on.

Noble Veikune said that what he was talking about was not in the Budget Statement but he was responding to comments that had been made in the House about being elected by the people and the fact that if there were no people there would be no government. But whose people? He said that the people were looked after by the Nobles as according to the information that was given to them when they were given their noble titles, to look after the people in accordance with the law and the Constitution.

Community land

On a completely different issue, Vili Kaufusi requested for Government to grant a piece of land where a home could be build for community groups from Vava'u to stay when they visited Tongatapu. He said that there were three rugby teams, one woman and two men from Vava'u in Nuku'alofa, and it would have been better if Vava'u had a home in Nuku'alofa for them to stay instead of cramping into other people's private homes.

Vili also requested for a freezing facility to be established at the Halaevalu Wharf, Neiafu, making it easy for the preparation for export of over 100,000 kape later this year.

'Isileli Pulu pointed to a drop in fish exports from 1700 tonnes in 2003 to 556 tonnes in 2004. He suggested for government to redirect their financial assistance to the processing and the exporting of sea weeds instead.

Chinese immigration

'Akilisi in preparation for an attack on government told Cabinet Ministers to accept the PRs views and criticism because that was what they did best. He said that praising the system was the full-time occupation of many people including the punakes, composers of traditional music and dance. He said he had called a meeting with leaders of the Chinese community to find a way for Tongans and Chinese to live together and to shape a new Tonga. He said he was worried that Tonga was going the way of Fiji, Hawaii and New Zealand where the indigenous people became second class citizens in their own country.

He said that unless something was done the Chinese would run the country in the future. He said that we should try and absorb the Chinese into the Tongan community, and even encourage inter-marriage.

The Minister of Police expressed his disapproval with 'Akilisi and said that the responsibility of the House was to make sure that Tonga was for Tongans only.

The PM said that the countries that 'Akilisi mentioned, Fiji, New Zealand, Australlia, America and Hawaii were all democratic countries, so the member did not want Tonga to be democratic.

'Akilisi said that he did not think the PM understood what he was talking about, but he would move on. He said that what Noble Veikune was talking about was not a matter of concern because the transference of government money to public enterprises had been legalised with legislation, the concern was over what those enterprises were doing with the money, and whether they would ever be able to pay them back. He said that the main difficulty facing government was that they seemed to find it very difficult to pressure enterprises that the Crown Prince was involved with to pay their debts. Because government could not collect these debts other companies used that as an excuse to say if you could not do that then you can't pressure us.

He said that after the Crown Prince left Sea Star there was an outstanding debt of $4 million, but government as a share holder did not do anything, or demand an auditor's report before the Crown Prince left in order to get their records straight. Nothing was done and again other Public Enterprises used that as a smoke screen. He said that $300,000 was given to Tonga Oil but about a month later it died and nothing has been done about it.

He said that Shoreline was the biggest problem facing the country, and it was not necessarily the money but the way it was done, and the people were not happy that government had not done anything about it. He said that there was a sub-committee of three ministers that had been given the task to deal with the Shoreline. The questions were have they done anything? Have they asked for an auditor's report?

'Akilisi did not think that the people would ever forget the Shoreline issue.

'Akilisi said he asked the Crown Prince about how Shoreline transferred millions of pa'anga overseas to purchase materials from these companies, Diamond Head Ltd, NZ, Island Cooling Equipment NZ, and Preferred Construction Ltd, Honolulu. They need a permission from the National Reserve Bank to transfer such a huge amount, they got the approval of the Reserve Bank, then ANZ transferred the money. He said that to this day no goods had arrived in Tonga from these companies. The question was where were those millions? He said that the Crown Prince replied that he did not believe what he said and if 'Akilisi could not accept that then he should ask the Reserve Bank.

The PM called on the member to return to the Budget Statement.

'Akilisi said that if the Minister approved the transference of these millions of pa'anga overseas, to companies that did not exist, then it was the kind of Mafia operation that was going on in the country. He believed that if this problem could be solved then everything was fine in Tonga.

The PM said that the member was wasting time but he should be thankful that the people were still willing to pay his salary, but he should get back to the budget.

'Akilisi responded that the PM wanted him to get back to the budget, but it was he who approved $25 million duty exemption, and also allowed them to run the public utility, and made huge profits and part of that money they collected from the people was transferred overseas.

The Chairman told the member that he had completed his time.

The Committee dissolved into Legislature and the Speaker Noble Veikune took his chair.

The Speaker said that they would vote on the Budget Statement the following day. He said that by 11 am they should have already passed the Budget Statement and then get into the estimated Budget.

The PM said that he would table a motion from government the following day for the formation of a sub committee with two representatives each from government, nobles and the PRs. Their task would be to formulate the working agenda before they started on each working day.