Government is looking for options with payment by check



The government could be forced to open a full-time trust account with BSP after the central bank refused to accept government checks, Finance Minister Sir John Pundari told parliament yesterday.

Sir John, while answering an unannounced question from East Sepik Gov. Allan Bird, who wanted to know what action the government had taken following the hack into the finance ministry’s financial management system.

He also wanted to know if the PNG Bank has opened its doors to accept government checks and, if not, what steps are being taken to allow payments by check to the addressed service provider.

Sir John said the Central Bank is not cooperating with the Ministry of Finance after the government’s financial system, the Integrated Financial Management System (IFMS) was hacked three weeks ago.

“The attack on the nation’s heartbeat is an act of terrorism and the Prime Minister has called for a meeting of the National Security Council to consider the matter,” Sir John said.

A malware attack is a common cyber attack where malicious software (normally malware) performs unauthorized actions on any system and, in this sense, an attack on the government’s financial management system.

While Finance has rectified the malware, the actions of the Governor of the Bank of PNG Loi Bagani and his senior management are frustrating as they use COVID as an excuse not to be at work.

He said BPNG did not accept the department’s digital exchange of check usage reports (CURs) because they wanted to protect their system from being hacked.

However, Sir John said the Central Bank should help show leadership at a time when they are affected, but that is not happening.

“The attack on the heart of government calls for some understanding.

He calls on Finance and Treasury and BPNG to work together, but that’s not happening, so we’re looking at other options like opening an account with BSP, but it depended on legal advice.

“We are trying to be proactive because there are companies and service providers that need to be paid,” he said.

Sir John said that in addition to trying to open a full-time trust account with BSP (subject to legal advice), the Department of Finance uses an interim trust account to help process payment of service providers.

Among other discussions, the government is considering other options, such as the introduction of the accounting system known as the PGAS system or the maintenance of the IFMS system.

He said that the enterprise system upgrade will be very strong as they hope such attacks will not be repeated.

Sir John said the NEC has also approved funding to investigate the issue and those found responsible will have to pay for their wrongs.


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