Less-than-transparent: Transparency to run graft hotline for US

Berlin based organisation tasked to ensure proper use of American aid money.

KARACHI: In what has the makings of an awkward situation, the United States has, for ensuring proper use of financial assistance it has provided Pakistan, enlisted the services of an organisation that has been at bitter odds with the government of Pakistan as of late.

The much-maligned Transparency International (TI) will set up and run a graft hotline that will be open to Pakistanis who want to report any peculiarities or complaints regarding the use of American aid by both government and private parties. The service will be run in all local languages, said Ambassador Robin Raphel, US Coordinator for Economic and Development Assistance to Pakistan at a press briefing on Monday at the consul general’s residence.

The confidence that the US government is reposing in Berlin-based TI is in stark contrast to the relationship between the Pakistan government and the TI’s local wing, whose chief claims that he has been facing all sorts of pressure – including ‘death threats’ – following the release of a contentious corruption report by the organisation. The report had it that corruption had increased in Pakistan since the current government took over – a claim that the government took umbrage to, saying it was unsubstantiated and mala fide, and aimed at hurting the PPP’s credibility.

Since then, there has been plenty of mudslinging, including a lawsuit filed by the TI-Pakistan chief against key government leaders, and a resolution passed by the Sindh provincial assembly against the corruption report.

It is unclear how this conflict will be dealt with, but the understanding is currently in the process of vetting. If it goes through, it could present an embarrassing situation for the PPP-led current government, which has gone out of its way to stress that the TI-Pakistan was pushing vested agendas – a claim that has found support in many quarters, including the media.

Meanwhile, speaking more regarding the efforts to ensure transparency, the US administration’s point person for handling the millions of dollars in aid it is providing Pakistan for rebuilding its infrastructure in the aftermath of devastating floods, Ms Raphel said that reports regarding USAID having approached the National Accountability Bureau (NAB) over some cases of graft were untrue.

She said that the meeting was only between the US’ own financial taskforce and NAB on how to improve coordination and communication in cases of graft.  She said that the Islamabad office of USAID had an Inspector General working on cases of auditing and irregularities.

She added that the US had put in place safeguards, which included the setting of “benchmarks” in projects to track where and how the money was being spent. Another safeguard, she said, was a strict and thorough “pre-award assessment” of companies vying to use US funds”.

The money provided by the US to the government, said Ms Raphel, goes into a “special account” and is not pooled in with other money being spent on similar projects, so that it can be tracked. This, she said, was all an effort in “responsible stewarding of [American] taxpayers’ money.”

Clearly, there are plenty of measures in place – but when asked if she was satisfied with them, the ambassador avoided a direct answer, and said that such questions always cropped up when financial aid of this magnitude is provided.

Devolution

Ms Raphel said that she was in Karachi to consult with government officials, civil society and other parties to cater to “the specifics of each province.” Ms Raphel stressed that the needs of each province were unique, and such an initiative was also important in light of the 18th Amendment and the devolution plan.

She said she had already met leaders of the Muttahida Qaumi Movement (MQM) and would continue to meet with the provincial leaderships of the provinces.

RGST

Ambassador Raphel also spoke positively of the contentious reformed general sales tax (RGST) initiative by the government. She said that the RGST would not be the “only” initiative that the government would require, but is one that the government needs to take immediately.

Speaking about the opposition that the government is facing on the issue, Ambassador Raphel said that new taxes and tax systems always face opposition. Maintaining good relations with institutions such as the International Monetary Fund was important for Pakistan, she said.

Republicans in the Congress

The purse strings of the state are controlled by the lower house of the parliament, said Ambassador Raphel, referring to potential hurdles in finances and assistance for Pakistan.

Following the mid-term elections, the Republicans have gained control of the lower house, which means that the Democrat-run administration will be fettered when it comes to fresh initiatives in the face of a hostile house.

The ambassador corroborated fears about the policy hurdles that were in place following the elections.

Published in The Express Tribune, November 30^th, 2010.