A royal commission into a controversial loan from Swiss bank UBS to the Papua New Guinea Government has been told at least four ministers opposed the deal.
The $US921 million loan had bypassed the usual cabinet and parliamentary procedures.
Peter O'Neill Photo: Supplied
This was an enormous amount of money at a time when the PNG economy was in a precipitous nosedive after the heady early days of the ExxonMobil LNG scheme coming on stream.
The loan money was to buy shares in PNG company Oil Search, which was one of the partners in the LNG scheme, but the company's share prices fell sharply following the purchase, amid declining prices for commodities.
The government struggled to meet the payments on its UBS loan and when it went to sell its stake there was little left.
The Australian Financial Review reported former PNG prime minister Peter O'Neill, who championed the deal, told the inquiry he regarded the transaction as "urgent."
He said it "was not feasible to put all such "loans and borrowings" through parliament.
This was despite legal advice, tendered to the inquiry and attached to O'Neill's own cabinet submission, stating that parliamentary approval was required for the deal to be approved.
O'Neill said the loan was eventually approved by Parliament, almost eight months later, as part of the broader budget process.
"In my view that was sufficient," he said.
The inquiry heard outside legal advice was sought to validate the decision not to seek parliamentary approval.
