Published in the August 2013 PNG Report magazine
With a generous aid program designed to make up for the lack of financial capacity in the fledgling nation, PNG over the years appears to have become even more intertwined with the ways of its master.
One of the early manifestations of PNG's desire to "break loose" was provided by former Prime Minister Paias Wingti in the early 1990s when he outlined a "Look North" policy.
The desire for greater independence showed its face again a few years later when Australia, following the Jackson Inquiry on aid to PNG, recommended that Australian aid, provided in the form of grants, be diverted from budgetary support in favour of project aid phased in by 2000.
The then PNG Prime Minister, Sir Julius Chan, complained bitterly about the change but this went unheeded in Canberra.
The Australian Government decided its aid programs were not working optimally, a view endorsed by Jackson.
To some observers it seems that Australia, despite being a very open society these days, has always had difficulty moving away from the supercilious attitudes of the ‘White Australia' era during which it exercised its colonial powers in PNG.
This cultural bias, almost like a superiority complex, was a factor in the Jackson Report and Australian attitudes at the time.
Although embraced by all parties in Australia it is clear in retrospect that the shift to project aid was designed primarily to bolster Australian interests rather than give primacy to PNG's development aspirations.
With the benefit of hindsight it is clear the shift to project aid had effectively curtailed PNG's chances of gradually reducing its dependence and asserting its independence.
If aid continued to be channelled via the budget there would have been a greater chance for it to have been gradually reduced as domestic funding capabilities grew. But this was not to be.
The shift in aid priorities also provided a benchmark for the deterioration in PNG's social indicators, which began in the early to mid-1990s.
While Australian aid was channelled through the PNG budget it helped governments of the day to better funds health, education and other priorities.
Its withdrawal, albeit in a phased manner, left a budget gap that was largely filled by rising public sector debt.
There has been no known analysis of the efficacy of project aid. Much of the deterioration in living standards until around 2003 could be coincidental since other factors were at play, including rising levels of graft and corruption and politicisation of the public service and a decline in its performance and accountability.
Into this scenario PNG now encounters the Rudd factor. The umbilical cord of almost four decades ago is being replaced, it seems, by a noose, at least in terms of the continuing deterioration in the PNG bureaucracy's ability to provide improved services.
As a quid pro quo for accepting refugees heading to Australia and for agreeing to relocate a good number within PNG, the PNG Government will get more handouts to reinforce the view it remains incapable of reforming and modernising its public hospitals and higher education sectors without ‘Big Brother'.
This is not the first time Prime Minister Rudd has been "Big Brother' in PNG.
The last time around, prior to his temporary ouster by Julia Gillard, Rudd had forced the PNG Government to order the closure of the Kodu copper-gold project because of its proximity to the Australian Icon, the Kokoda Track.
In return Rudd had promised to provide financial and technical assistance to the long-suffering communities and clans along the track, promising to offset their loss of job opportunities, royalties and other benefits from Frontier Resources' plans for Kodu.
The exploration licence held by Frontier, under which Kodu was proven up, was expropriated by the PNG Government at the urging of Rudd. Today Frontier, instead of being operator of a middle sized prosperous mine, has been forced to suspend all its exploration activities to survive the current negative climate for junior explorers.
Even more sad is the plight of the legendary people who helped Australian soldiers survive during World War II, who continue to personify the poor living standards that is the lot of most Papua New Guineans. More than 50% of their children are unable to attend school and all have poor access to modern health facilities.
Hopefully the Rudd Mark II refugee plan will be more successful than the Rudd Mark I Kokoda plan.
Rudd had forced the PNG Government to order the closure of the Kodu copper-gold project.
There has been no known analysis of the efficacy of project aid.
