Home > Carbon Trading, Papua New Guinea > PNG govt still paying millions to McKinsey for climate strategy

PNG govt still paying millions to McKinsey for climate strategy

Documents obtained exclusively by PNG Exposed show the Papua New Guinea government paid almost US$ 500,000 (PGK 1.37 million) to international consultancy firm McKinsey & Co in September 2010 for 10 weeks work assisting with the development of PNG’s ‘Climate Compatible Development Strategy’.

Download the documents here – pdf file is 4.8mb

These monies were in addition to the US$2.2 million PNG Exposed revealed last year was paid to McKinsey to prepare a draft ‘National REDD and Climate Change Plan’ ahead of the United Nations climate conference in  Copenhagen in December 2009.

The new documents show that on 27 Sept 2010 US$491,678 (PGK1,373,405) was transferred to McKinsey & Co bank account in Singapore on the orders of the Department of Environment and Conservation.

This transfer appears to have been in settlement of an invoice submitted by McKinsey on July 39, 2010 in the sum of US$528,000. There is no explanation for the difference of $36,322 between the invoiced amount and the amount transferred.

The invoice describes the fee as being for ‘professional fees and out-of pocket expenses for Phase II (February to April 2010) in connection with PNG’s Climate Compatible Development Strategy’. In this period McKinsey drafted two documents for the PNG government, a Prelimary draft Climate-compatable development strategy for PNG (dated February 2010) and a further final Climate-compatible development strategy for PNG (dated March 2010).

US$500,000 for the development of a 44-page report works out at about $11,350 per page – not bad work if you can get it!

Interestingly the documents also reveal that McKinsey and Co have refused to comply with PNG laws and register with the Investment Promotion Authority and Internal Revenue Commission. In a confidential memo, dated February 10 2010,  McKinsey say that in order to register it would need to provide a list of it shareholders and copies of audited accounts for the last three years. McKinsey says such information is considered to be ‘highly confidential’.

Since April 2010 McKinsey has done yet further climate related work for the PNG government. It has produced ‘A Fast Start REDD Partnership Proposal between PNG and Norway (dated May 2010) a summary of ‘PNG Fast Start Actions’ (dated July 2010) and an Interim Action Plan for Climate-Compatible Development (August 2010). It is not known, at this stage, how much the PNG government has paid for this further work.

As PNG Exposed pointed out last year, the PNG government, rather than developing its own indigenous, Papua New Guinean response to climate change, has been happy to pay for a team of foreign consultants to produce a plan offshore – just so the government has some glossy documents to parade on the international stage in the hope of duping the international community to channel billions of dollars into its coffers.

Of course the money the PNG government is spending on this costly exercise is money taken from the public purse – money that could have been spent on much needed health care or schools.

But the engagement of McKinsey fits well with PNGs whole climate change strategy which is being run off-shore by American consultant Kevin Conrad and his Italian colleague, Federica Bietta, with no accountability in Papua New Guinea or effective consultation with landholder, bureaucrats or politicians.

PNG’s whole climate change strategy has never been debated by PNG’s Parliament or disclosed to the PNG people.

  1. christian tres
    July 13, 2011 at 10:48 pm

    Look for documents, the supplementry budget of k3m was used to settle the bill for 2011. There is outstanding for 2012.

  2. Sili Muhlli
    August 11, 2011 at 11:37 am

    Update me regularly, please.

  1. June 13, 2011 at 5:50 pm
  2. December 5, 2011 at 11:28 am
  3. January 18, 2012 at 5:41 pm

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