The Solomon Islands, Finance Minister, Hon. Gordon Darcy Lilo has confirmed that he has revoked his earlier approval of a loan to purchase a Dash-8 aircraft.Solomon Airlines, the Solomon Islands national carrier, had asked for the loan from the National Provident Fund.
Speaking to local media yesterday, the Finance Minister Mr. Lilo explained that his final decision to revoke his initial approval was made after carefully studying the Auditor General's Report, with respect to Solomon Airlines financial records to December 2010.
Minister Lilo said that according to the report, Solomon Airlines is not in a financial position to borrow the amount it requested.
Mr. Lilo said he cannot approve the loan request from Solomon Airlines when it is clear that the auditor general's report does not favour it.
He said as the minister responsible for the board of trustees of the National Provident Fund, revoking the approval for the loan is the right thing to do.
Meanwhile, the government says processes to appoint new board members for Solomon Airlines has been delayed because of regulation oversight in the S-O-E Act.
Finance Minister Gordon Darcy Lilo says the oversight has been discovered very recently.
Mr. Lilo made the clarification in response to accusations by chairman of the Public Accounts Committee, Hon. Mathew Wale, who indicated that the delay in the appointment of new board members to the S-O-E was due to vested interest in the airlines by the finance minister.
Minister Lilo however explained that current regulations require the existing board members will have to assess applications for a new board membership.
The problem, he says, was that most of the existing board members have applied for re-appointment into the new board.
He said board members assessing their own applications is unfair and does not reflect transparency.
Mr. Lilo said the government will make amendments to that regulations so that an independent body is established to advertise and assess SOE board members applications to ensure transparency in the selection process.