THE Cabinet will carry out a financial audit and report back to the Legislative Assembly on the defunct Tonga Forest Product Limited (TFPL) which led Government to recently sign a TOP$9 million management contract with a Maori Trust of New Zealand.
Government maintains the contract is for the New Zealand company to control and manage TFPL for 50 years with an option to renew for further 25 years.
Parliament last week approved the motion after ‘Eua Noble Representative, Lord Nuku strongly opposed Government’s decision to lease TFPL to a foreign company.
The motion was unanimously approved by all MPs except for Ha’apai 13 constituency MP, Veivosa Taka.
Lord Nuku said MPs have no access to Cabinet’s paper work on the contract signed, therefore it should produce an audit report on TFPL’s performance and valuation of ‘Eua forest.
He recalled in his parliamentary constituency visit to ‘Eua in 2013, ‘Eua forest valuation was at about TOP$20 million worth.
Such valuation according to the Minister of Public Enterprises Hon. Poasi Tei and the Minister of Inland Revenue and Customs Hon. Tevita Lavemaau is misleading. They asserted Parliament, the last valuation of ‘Eua forest in 2007 valued at TOP$3.2 million.
Hon. Tei explained that TFPL was experiencing financial difficulty because no funds available to purchase new machinery needed and for the replanting process in ‘Eua.
In Government’s attempt to bail the company, it brought in new management and injected TOP$1.5 million to TFPL last year. However the Auditor Office discovered it was not making any profit.
Government had two options whether to let the company close down and about 80 employees will lost their jobs or bail the company financially.
Hon. Tei said Cabinet’s only solution is to bring in the Aotearoa Trust to give life to TFPL. He was also convinced the contract is not a sale of TFPL but for the Maori Trust to manage and control the debt burdened company.
The new entity is now called the Aotearoa Tonga Forest Limited. It is granted land leases over the ‘Eua Forest Reserve, Vaitaki Sawmilling Site and Mataliku Forest Plant.
Meanwhile, the Hon. Prime Minister ‘Akilisi Pohiva admits in Parliament TOP$4 million is still unaccounted for. Book keeping records were believed to have been burnt by former TFPL’s management.
The Hon. Prime Minister ‘Akilisi Pohiva reassured Parliament that Cabinet has nothing to hide and once audit work is completed, it will report back to the House.
Hon. Tei said a valuation process of the ‘Eua forest reserve was carried out by the Maori Trust and the value was less than TOP$10 million.
Lord Nuku argued the value of the ‘Eua forest reserve is now diminishing from its previous value of around $18-20 million in 2013.
For this reason and due to the conflicting amount of forest valuation raised, Lord Nuku called for an audit work to be carried out.
The ‘Eua Noble Representative insisted that ‘Eua forest reserve is Government’s property therefore Cabinet must produce an audit report and report back to Parliament.
In response Hon. Tei said Cabinet has requested assistance from New Zealand for experts to carry out the valuation process of the ‘Eua forest. He guaranteed Parliament once that is completed it will submit a report to Parliament.
Vava’u number 2 Noble Representative Lord Tu’ilakepa also moved the motion on reasons that book keeping records were allegedly burnt. He said police should further investigate the allegation and prosecute those in responsible.
Hon. Tei said police investigation have led to prosecution and now pending trial in court.