Fiscal Transfers important to ensure balance at all levels of Government: Painap

Date Published:
Thu, 02/22/2024 - 08:43

Story by Merolyn Ten of Post Courier (Date: 20th Feb 2024- page 14)

The National Economic and Fiscal Commission Chairman and Chief Executive Officer Patrick Kennedy Painap says the Intergovernmental Fiscal Transfers is paramount importance at all levels of the government and the country.

This was highlighted at a recent workshop on intergovernmental financing arrangement review consultation in Mt Hagen, Western Highlands Province.

“The fiscal transfer to sub-national governments refers to the funds transferred from the National Government to the provincial and local level governments,” he explained.

Mr Painap said fiscal transfers takes various forms where each has its own objectives and conditions.

“Conditional transfers come with specific conditions or requirements that can include mandates to spend the funds on certain sectors, compliance with specific policies or regulations or the achievements of specific performance targets.

“Conditional transfers are often used to promote specific service delivery objectives or incentivized sub-nationals to achieve desired outcomes” said Mr Painap.

He said, while unconditional transfers provide to subnational without any specific conditions or restrictions, which aims to provide sub-national governments with a certain level of financial autonomy and enable them to address their own local needs.

Mr Painap stressed that the fiscal transfers were bottled into three categories: the recurrent, development and staffing.

“By category, the grants would be specified as recurrent grants were function grants, development grants were DSIP, PSIP, DSG, SSG, PIP and others, while staffing grants were public servants salaries, teachers salaries, public servants leave fares, teachers leave fares and others.

“However, the main aim of the fiscal transfers to sub-nationals is to promote equity, fiscal stabilization and service delivery or the provision of public goods and services across different levels of government”.

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