Corruption

Little clarity on how aid gets spent

Shawn Donnan
Financial Times
December 23, 2005
When Jan Egeland, the United Nations top disaster official, announced
in March that PwC, the professional services firm, would help monitor
the expenditure of funds collected under the UN’s $1.1-billion tsunami
“flash appeal” he offered a simple gauge for what would result.

The new
system, he said, would mean that “my aunt can go in and can see how her
money for Unicef (the UN children’s fund) is being spent”. Mr Egeland
had good reasons for pledging transparency. UN officials cite Paul
Volcker’s investigation into corruption in the UN’s oil-for-food
programme, well under way when last December’s tsunami struck, as part
of the impetus. So too was the sheer size of the outpouring from
companies, governments, and individuals worldwide in response to the
tsunami and the responsibilities that came with that. Yet a year after
the disaster Mr Egeland’s aunt would have a difficult time learning
very much. Not unless, as a senior UN official puts it, Mr Egeland has
a “very smart aunt”. Or, “she is very patient”, adds a senior official
with a large aid agency. Mr Egeland contends only that nine months
later his aunt “would be happy with a work in progress”. A year after
the tsunami, pledges of transparency and accountability for the UN’s
appeal appear a long way from being realised. This is primarily blamed
on duelling UN bureaucracies and accounting methods plus what in many
cases appears to be institutional paranoia. “The good news is that it’s
the best [financial] tracking ever. The bad news is that it’s not good
enough,” Mr Egeland conceded in an interview this week. According to
the UN’s publicly available figures, as of yesterday more than $635
million (_530 million, œ360 million) of the $1.1 billion pledged had
been spent on areas such as “food” ($152.6 million), “co-ordination and
support services” ($106.5 million), “health” ($94.7 million), and
“shelter and non-food items” ($84.6 million). What is harder to
determine is how that money has actually been spent, according to a
two-month investigation by the Financial Times. Mr Egeland argues that
procedures are changing. “In a few years from now there will be a whole
different degree of openness,” he says. For the time being, however,
there is no publicly accessible information detailing how much of the
flash appeal – only a small portion of the more than $13 billion raised
for tsunami relief worldwide according to UN estimates – has gone to
$10,000-a-month consultants or administrative overheads as opposed to
the delivery of relief supplies, for example. The only way to get
financial details of what in some cases are $100-million projects with
titles such as “emergency support for basic education” is to approach
each of the 39 agencies listed in the appeal, UN officials say. The FT
approached many of those agencies. Some declined, or ignored, requests
for information. Others offered incomplete or, as with the UN
Environment Programme, “preliminary, unconfirmed and unofficial”
expenditure data. Information often took weeks to obtain. Mr Egeland’s
own agency, the UN Office for the Co-ordination of Humanitarian
Affairs, OCHA, had still to provide numbers at the time of going to
press. An initial request for information from Unicef was sent on
October 20. But it was not until this week that the agency provided
details of the $169.5 million it had spent as of November 1, almost 20
per cent of which went on staff and administrative or related costs.
The UN Development Programme said it had spent $82.5 million of the
$120.2 million it received under the flash appeal as of December 8.
Five per cent of the $120.2 million was allocated to administrative
overheads while staff salaries amounted to $1.4 million. William Orme,
the UNDP’s lead spokesman in New York, said that absent from those
costings, however, were the salaries of the highly paid consultants who
do much of the UNDP’s field work.

Categories: Corruption, Odious Debts

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