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 Chuave MP James Nomane has warned that PNG is now facing what he describes as a “budget bombshell” under the Marape Government, claiming the country’s fiscal position has deteriorated to levels not seen in decades.

Nomane said official budget documents from 2019 to 2025 exposed a pattern of “careless borrowing, entrenched deficits and collapsing services” despite the Government’s record spending. He said the Final Budget Outcome (FBO) and Mid-Year Economic and Fiscal Outlook (MYEFO) showed that key fiscal targets had been abandoned.

According to him, public debt has more than doubled under the current administration, rising from under K30 billion in 2019 to around K65 billion next year. He said more than K40 billion in new loans were raised in six years and that this breached the Fiscal Responsibility Act, which limits debt to 35 per cent of GDP.

Nomane said interest costs had climbed to about K2.5 billion per year and would reach K3.5 billion in 2025, representing 12.4 per cent of the national budget. He said this level of debt servicing had eroded development funding and weakened essential services, especially in infrastructure, health and education.

He said the Government had repeatedly promised “budget repair” but had failed to stabilise the fiscal position. Deficits averaged –5.4 per cent of GDP since 2019, with the 2024 FBO confirming a K6.6 billion deficit and the 2025 MYEFO projecting another K5.9 billion shortfall. “This is not correction. It is collapse under the weight of debt,” he said.

Nomane said the borrowing spree had distorted domestic credit markets. He referred to the Bank of Papua New Guinea’s warnings that government reliance on Treasury Bills and other short-term instruments was absorbing liquidity and preventing SMEs and investors from accessing credit. “When government takes the whole oxygen supply, the private sector suffocates,” he said.

He said the deterioration in public spending quality had compounded the crisis. He cited NRI and INA reports highlighting low execution rates in the Public Investment Program (PIP), stalled projects and procurement opaque to public scrutiny. He said record budgets of K27.3 billion in 2024 and K28.4 billion in 2025 had not translated into improvements on the ground.

International assessments raised similar concerns. Nomane pointed to the World Bank’s 2024 PNG Economic Update, which reported declining real incomes, worsening inequality and over 40 per cent of the population living below the national poverty line. Health and education indicators had also fallen, with maternal mortality and dropout rates increasing.

He said research from the ANU’s Devpolicy Centre showed that service delivery at district and provincial levels had collapsed due to centralisation of funds and politicisation of DSIP distributions. Transparency International reports and media investigations had also exposed misuse of COVID-19 funds. “The Government has yet to release its COVID-19 expenditure report. That says everything,” he said.

Nomane accused the Government of relying on excuses instead of discipline. “External shocks were real, but the response was to spend, borrow and repeat. Weak leadership has turned temporary problems into long-term crises.”

He urged MPs to confront what he called “performative governance” and insisted Parliament had a duty to restore credibility. “PNG deserves leadership that puts national interests ahead of political survival,” he said.

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