Swamp Ghost sale was ‘illegal’
The National [ January 24, 2010 | Read Article Online ]

THE Swamp Ghost may well be on its way to the United States but the conduct of State agencies in failing to retain it in PNG has come under fire.
Indeed, a scathing report by the Parliamentary Public Accounts Committee (PAC) recommended that the Swamp Ghost aircraft not be sold.
Despite this the Swamp Ghost finally left PNG shores last week destined for the United States.
While the Ghost might be beyond recovery, the PAC report gives us cause to really examine what goes on in the National Museum and Art Gallery, what potential this rather shy agency of Government has in PNG.
PNG is a treasure throve for its arts, crafts, and for its war surplus materials.
In the absence of any really public scrutiny and taking this PAC report as a guide, there appears to have been much going on that does not bode well.
The PAC report was tabled in Parliament last year and although its recommendations in relation to the Swamp Ghost are specific, no action has been taken by the Government.
The PAC concluded that the National Museum and Art Gallery had “failed to act in a lawful manner when dealing with foreign “salvors” of War Surplus Materials, failed to co-operate with the Office of the Auditor General, failed to comply with its own Guidelines for the consideration of applications to salvage war surplus, failed to protect State property at all, illegally failed to comply with Financial Instructions, failed to take reasonable steps to ascertain the bona fides of foreign salvors, was subject to external influence and threats, failed to account properly or at all for monies or “gifts” received from foreign “salvors” and acquiesced in the on sale of State property by foreigners with no concern for the interests of the State”.
One trustee of the NMAG described the Museum to the Committee as a “national disgrace”, a description which the Committee was “inclined to agree with”.
Said the PAC: “The Director and management of the National Museum and Art Gallery have, quite unlawfully, assumed power to sell War Surplus Materials which are owned by the State. The Museum has no right or ability to do so.
“The Director and management of the National Museum and Art Gallery have assumed an agency for and on behalf of the State, which it does not have and has acted unlawfully in negotiating and executing a contract of sale of State property – namely the Swamp Ghost aircraft.
“The Director and management of the National Museum and Art Gallery have illegally entered into a contract to sell State property to foreigners for no return or revenue to the State.
“The National Museum and Art Gallery has for many years allowed the sale, removal and on-sale of State property – namely War Surplus Materials – illegally and with no checks or controls on dealing in State property by foreigners. There has been no return or gain to the State from virtually any of these transactions.”
The PAC reported that the National Museum and Art Gallery has no power whatsoever vested in it to sell, approve removal or export or to collect money from the sale, removal or on sale of War Surplus Materials.
Further it has found that the National Museum has failed to implement and maintain competent or adequate systems of accounting, control or monitoring of War Surplus Materials removed from Papua New Guinea.
Where it has received money it seems to have misused and misapplied a considerable amount of received by it from foreign salvors of State property.
The National Museum and Art Gallery has been accused of being under the influence of and “still is subject to the considerable and improper influence of foreigners and foreign companies which unlawfully obtain, export and on-sell War Surplus Materials from Papua New Guinea – which materials are and remain, State property”.
In entering into the contract to sell the Swamp Ghost aircraft the NMAG would appear, so the PAC declares, to have breached the Public Finances (Management) Act and the National Museum and Art Gallery Act and the War Surplus Materials Act.
That it held itself out as representing the State and as having the power to sell the Ghost, both powers which it did not have, the NMAG and its officers might also have breached the Criminal Code, the PAC declared.
In entering a contract to sell the Swamp Ghost aircraft, the NMAG ignored legal advice from the Office of the State Solicitor to the effect that it had no power to sell State property unless in accordance with the terms of the Public Finances (Management) Act – i.e. by public tender – and that any proceeds of sale were treated as Trust Funds belonging to the State.