Independent Group backs stronger laws for SIMHL and a Sovereign Wealth Fund to protect Solomon Islands mineral wealth.
Honiara, Solomon Islands – The Parliamentary Independent Group has welcomed steps by the Minister for Finance and Treasury to regularise Solomon Islands Mineral Holding Limited (SIMHL), while calling for the company to be established through an Act of Parliament.
Leader of the Independent Group, Peter Shanel Agovaka, acknowledged the Minister’s efforts to rectify the incorporation and ownership arrangements of SIMHL and bring the company into compliance with the State-Owned Enterprises Act and the Companies Act.
He also welcomed the Minister’s commitment to bring the necessary corrective measures before Cabinet for collective consideration and decision.
Agovaka said the steps are important towards ensuring proper governance, accountability and transparency in the management of State assets and the country’s mineral resources.
The Independent Group also supports the proposal raised by the Minister for Finance and Treasury in Parliament to establish a Sovereign Wealth Fund through a constitutional amendment.
Agovaka said the proposal presents an important opportunity for Solomon Islands to establish a permanent constitutional framework for managing the country’s mineral and other natural-resource wealth for the long-term benefit of its people.
However, he said the GREAT Government should consider going a step further by using the Sovereign Wealth Fund as the constitutional foundation upon which SIMHL is established and governed.
“Rather than relying solely on incorporation under the Companies Act, consideration should be given to establishing Solomon Islands Mineral Holding Limited through an Act of Parliament,” Agovaka said.
He said establishing SIMHL by statute would provide a stronger legal foundation for the State’s ownership and management of mineral interests.
Under such an arrangement, the proposed constitutional amendment could establish the overarching framework for the Sovereign Wealth Fund, while an Act of Parliament could establish the Mineral Holding Company as a statutory institution operating within that framework.
The Independent Group said such legislation could clearly define the ownership of the State’s mineral interests, the relationship between the Sovereign Wealth Fund and the Mineral Holding Company, and the powers and functions of the company.
It could also set out how mineral revenues and returns are managed, the appointment, qualifications and responsibilities of directors, and strict conflict-of-interest and integrity requirements.
The legislation could further provide for financial reporting and independent auditing, parliamentary scrutiny and reporting obligations, Cabinet’s policy role and clear limitations on political interference.
Agovaka said it should also establish mechanisms to protect the assets of the people of Solomon Islands and appropriate safeguards against the disposal or encumbrance of strategic national assets without proper parliamentary authority.
“Most importantly, the Mineral Holding Company should be directly accountable to Parliament for the stewardship of the mineral assets and interests entrusted to it,” he said.
Agovaka said the fundamental principle must be that Solomon Islands’ mineral resources are national assets and are managed for the long-term benefit of the people.
“Our mineral resources must not be managed for the benefit of any individual, political interest or government of the day. These are national assets that must be protected for our people and future generations,” he said.
The Independent Group believes the proposed constitutional amendment establishing a Sovereign Wealth Fund provides an opportunity to create a durable framework that can endure beyond changes in government and political cycles.
It said a Mineral Holding Company established by law within that constitutional framework could become the institutional vehicle through which the people of Solomon Islands retain and benefit from the country’s mineral wealth.
The Independent Group therefore calls on the GREAT Government to consider establishing SIMHL by statute alongside the proposed constitutional amendment establishing the Sovereign Wealth Fund.
“This would provide Solomon Islands with stronger constitutional protection, statutory governance, parliamentary accountability and intergenerational stewardship of our mineral wealth,” Agovaka said.
“The objective is simple. Our mineral wealth must belong to the people, be protected by law and be managed transparently for the benefit of present and future generations of Solomon Islanders.”
SOURCE// Independent Group Press Release
