FIJI UPDATE 11/14: "GUILTY" IN CORRUPTION CASE;

C O N F I D E N T I A L SUVA 000494

SIPDIS

SIPDIS

E.O. 12958: DECL: 11/14/2016
TAGS: PREL MARR PGOV ASEC CASC FJ
SUBJECT: FIJI UPDATE 11/14: "GUILTY" IN CORRUPTION CASE;
RFMF OVER-SPENDING; TROUBLES IN FLP

REF: SUVA 489

Classified By: Amb. Dinger. Sec. 1.4 (B,D).

Former Agriculture CEO "guilty" in corruption case
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1. (C) Peniasi Kunatuba, who was CEO of the Agriculture
Ministry during part of the Qarase interim administration in
2000-2001, was found guilty on corruption charges on Nov. 14
in Justice Nazhat Shameem's Suva court. PM Qarase and
several of his current and former Ministers were called to
testify in the case that alleged that Kunatuba had the
Agriculture Ministry distribute farm tools, and perhaps cash,
with no legal authorization in an attempt to mollify
frustrated ethnic-Fijian villagers after the coup of 2000 and
in the lead-up to 2001 elections. Qarase denied knowledge of
any wrongdoing in his testimony. Some speculate that this
successful case opens the opportunity for prosecutors to cast
a wider net.

Auditor General reveals embarrassing RFMF laundry
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2. (U) Thus far on Tuesday, Nov. 14, Republic of Fiji
Military Forces (RFMF) leaders and spokesmen have been
publicly quiet. Newspaper headlines trumpet a Fiji Auditor
General's finding that the RFMF overspent its 2005 budget by
over 19%: F$80.4 million instead of a budgeted F$67.1
million. Most of the overage was attributed to higher
personnel costs due to the outcomes of job-evaluation,
ration-allowance, and COLA exercises. The Auditor General
noted, though, that it appears the Army paid for rugby-team
expenses and a "truth and justice" campaign against the
Qarase government from an account that was to be utilized
only for assisting in the installation of telephone satellite
stations in rural areas. The Fiji Police also overspent on
personnel costs, but by a much smaller figure, around F$2
million.

Qarase has offered FLP's Chaudhry DPM
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3. (U) Fiji Labor Party leader Chaudhry admitted today that
PM Qarase has offered him the opportunity to be Deputy PM.
Chaudhry said he has yet to make up his mind, though he said
his opposition to a VAT increase proposed for the 2007 budget
would make accepting a government role difficult, at least
until policy differences are sorted out.

FLP Cabinet Ministers squirming
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4. (U) Meanwhile, FLP Labor Minister Krishna Datt has
indicated he is likely to support the Qarase budget. That
would solidify Chaudhry's ongoing effort to expel Datt from
the party, which would, eventually, trigger a by-election.
Note, though, that Qarase has suggested he could retain FLP
Ministers in his Cabinet throughout the course of any legal
challenges to such FLP expulsion, a process that could take
years. Several other FLP ministers have indicated they are
likely to oppose the budget, which Qarase has warned will
cause their immediate removal from Cabinet. We understand
Energy Minister Vayeshnoi is preparing a media statement very
critical of Qarase.

Comment
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5. (C) A rumor is circulating in Suva that a few of Qarase's
SDL parliamentarians have been convinced to bolt the PM when
the budget vote takes place later this month. One name
mentioned is Ratu Naiqama Lalabalavu, a former RFMF officer
but also one of those convicted for coup-related crimes in

2000. He is a paramount chief and currently Fijian Affairs
Minister, one of those seen as most in favor of the
"controversial bills" now before Parliament, and allegedly
one of those most despised by Bainimarama. If indeed a few
SDL members were to rebel, and if nearly all the FLP Cabinet
Ministers were to stick with their party, the budget could be
voted down. That would trigger a "no confidence" motion that
could generate a new election, as happened in 1994. RFMF
Commander Bainimarama and FLP leader Chaudhry would be very
pleased by that scenario. What is not at all obvious is the
advantage SDL "rebels" might see in it. But as Bainimarama
is fond of observing: Fiji politics is a very nasty,
cut-throat business with constantly shifting alliances. One
never knows.
DINGER