The National Economic & Fiscal Commission has revealed that a total of K7.8 billion has been distributed as Function Grants to sectors at the subnational level since 2009.
NEFC Chairman and Chief Executive Officer Patrick Kennedy Painap highlighted this during the opening of the Regional Consultation Workshop held at the Gateway Hotel in Port Moresby yesterday.
He said within a span of 14 years, since 2009 when the Intergovernmental Financial Agreement was first reformed and introduced, the function grants have increased from K135m to K770m.
The growth in the allocation of function grants has been increasing at an average rate of 10% yearly.
Mr Painap said additionally, around K7 billion in GST revenue has been given to Provinces. Since 2009, Core Sectors have been given priority such as K1.2 billion for health, K1.7 billion for infrastructure, and K1.3 billion for education.
He said in the next 3 years based on the current average growth of 10%, they are anticipating a total of K1 billion a year as Function grants to be distributed to support the key Sectors. There will also be an increase in GST revenue from K700 million to an estimated K1 billion in the next 3 years.
With over K7.8 billion being given in function grants since its inception in 2009 with an additional K7 billion in GST, Painap says these are just two fiscal transfers alone. However, he says when considering the SIP funds, PIP, and donor grants to the sub-nationals, the total envelope of fiscal transfers has been enormous.
Mr. Painap said the increased funding over the years has provided a vital lifeline for service delivery mechanisms and not just financial injections.
