Operators cheating the governments of both Australia and Papua New Guinea

PAPUA New Guinean trekking operators along the Kokoda Trail have formed an association to safeguard their interests and to regulate the industry.

The Kokoda Trekking Operations Association (KTOPA) will also seek to limit the number of Australia-based operators.

This follows recent allegations in the media that the Kokoda operations of Australian companies are illegal and that they have been cheating the governments of both Australia and PNG of taxes.

Said allegations surfaced after an Airlines PNG aircraft crashed in Kokoda, killing 13 people, including nine Australians.

One of the people behind the initiative is Australian Aaron Hayes, who runs Ecotourism Melanesia.

He told The National that lack of training, resources and information technology knowledge was all that was preventing locals from competing in the lucrative Kokoda trekking industry – PNG’s biggest tourism money spinner.

He also revealed how Australian operators were cheating the PNG Government of millions of kina in taxes every year.

“The operators’ association that we have formed has plans to provide training and support to local operators,” he said.

“The trouble is, we have not been able to get any support from anybody yet.

“A meeting will be held at the Ecotourism Melanesia office on Sunday at 2pm.

“The purpose of the meeting is to discuss a way forward for KTOPA now that Australian operators and some larger PNG operators have decided to form another association.”

Mr Hayes said their association was set up with a constitution that allowed only PNG-based operators to be full members. Australian companies can be associate members without voting rights.

“This enables PNG operators to stay in control of the association,” he said.

“However, Australian companies don’t want to join on this basis, and the larger PNG companies, who shall remain nameless, won’t support it because they don’t want more operators coming into competition with them.

“We asked the Kokoda Track Authority to help us get a volunteer to further develop our operational plan and funding proposals to send to the Tourism Promotion Authority and AusAID, but they refused.

“They say they only want to assist an association that represents all operators.

“This year, some Australian government projects along the track have become a concern to operators and the Australian operators decided they needed to quickly have an association in place to be the mouthpiece of trekking operators.

“Because of the long time it takes to incorporate an association, they decided to meet with KTOPA to find out if we could change our constitution to allow both PNG and Australian companies to be members with equal rights.

They also wanted the training and support programme for local operators to be scrapped from the operational plan, that is, they wanted to hijack the association for their own purposes, Mr Hayes said.

“Max Kaso and I who are the interim committee would not allow this, so they decided to set up a new association which will include Australian and PNG operators but no special help for locals.

“Apparently, this will be announced soon.”

Mr Hayes said the KTOPA will continue to pursue its own goals separately and ask the Government to support local operators.

They will also propose to the Government to regulate the industry by, amongst other things, limiting the number of Australia-based operators and giving more access and opportunities to local operators.

“For example, by legislation that requires all Australian operators to sub-contract their trekking logistics to a PNG company that is not a subsidiary of their Australian company, because if an Australian company registers itself in PNG, it will still collect all its client payments in Australia and only transfer enough money for operational costs to the PNG subsidiary.

“This means the PNG subsidiary will operate on break-even basis only, will never declare a profit, and will never pay company taxes to the PNG government.

“On the other hand, a 100% PNG-owned company will more likely declare a profit and pay tax.”