Of donor half-truths on aid modalities

Let’s cut the crap and the boring diplomatic statements that are dangling both carrots and sticks to the Malawi Government.

Donors, or Development Partners (DPs) as they like to be called these days for public relations purposes, are slowly, but surely, shredding the Paris Declaration (PD) of 2005 as we know it—at least in the case of Malawi—and as reinforced by the Accra Agenda for Action (AAA) in 2008.

Under these two documents, donors and recipient countries, as partners, made five thematic commitments—ownership, alignment, harmonisation, managing for results and mutual accountability in the management of aid.

In the present context, I will dwell on the alignment commitment, which largely comes in two forms.

The first is the provision of aid in line with country strategies, in our case, the Malawi Growth and Development Strategy (MGDS).  But I will not dwell much on this one either.

My interest is on the second form of alignment, which involves donors’ pledge to use country systems and procedures when providing and monitoring aid.

But as things stand now, you can forget about donors’ use of our systems—they don’t trust them. This is the confidence deficit I always talk about.

We just learnt the other day that even the institution entrusted with the all-important job of protecting our public funds, the country’s supreme auditing body—the National Audit Office (NAO)—has dived into the gravy train while throwing all of us under the locomotive.

NAO has left us for dead in its gold rush to share or ‘chew’ public resources, including those from donors, through questionable allowances and other sleazy ways bordering on fraud and outright abuse of resources.

We may now need another bureaucratic institution to protect us from NAO’s predatory behaviour.

Our computerised accounting system, IFMIS, is so porous that clever civil servants are siphoning billions out of it without any trace.

This money is later cleaned up on the real estate market where they buy and/or build mansions in new low density suburbs of Lilongwe’s Area 43, Area 18, Area 6, Area 25’s Dzenza and others.

Relevant governance institutions don’t even bother to investigate how all this can be achieved with a salary of less than K200 000 and even that pay is for those above the post of assistant director.

I get surprised and a little jealous, of course, at how many houses, for example, some accounts assistants and other lowly-paid civil servants with no known extra income, have in town and the slick cars they drive. Where does that money come from? Your guess is as good as mine.

Our public finance and economic management system has collapsed and we have removed every teeth in the Anti-Corruption Bureau’s (ACB) mouth so that it can only bark at corrupt fat cats, but never bite.

You can look, but you can’t touch, is what the so-called graft-busting body has become. The Office of the Director of Public Procurement (ODPP) has reduced itself to a doodling ‘No Objection’ lapdog.

And you expect donors to use country systems for channelling their resources?

Frankly, there are no systems any anymore. This country, as a friend of mine in government likes to say, is on auto pilot. And diplomats are using their coded language to tell us that they know and that they are putting us on notice.

I have listened to chairperson of the Common Approach to Budget Support (Cabs) Asbjørn Eidhammer, who is also Norwegian Ambassador to Malawi, urging all of us to sacrifice.

I have lent my ears to German Ambassador to Malawi Dr Peter Woeste, who says his government thinks that the success of Malawi is not necessarily based on budget support only, but other aid interventions in social sectors. On Thursday, I read about British High Commissioner to Malawi Michael Nevin telling us to think beyond aid; that budget support is not the solution to the county’s problems. He also said something very brunt: Cut unnecessary spending. All donor capitals are doing the same.

Our donors have realised that more than half of the money they give Malawi through the national budget to help its poor people ends up in politicians and bureaucrats’ pockets, not the targeted beneficiaries. That is while they are shredding the PD to change the aid modality so that accountability is not encumbered by Capital’s weak and corrupt systems. Donors are now taking a closer look at ring-fenced financing such as basket funding, dedicated grants, projects or indeed entrusting it with CSOs, not our national budget.

And then there is the China factor. You won’t hear them say this in public, but Western donors, who support roughly 30 percent of our general budget support—with which we can do as we please—are uncomfortable with the loans, some of them commercial, we are contracting from our new Chinese friends to build hotels, luxurious villas and other things. What will stop the Malawi government, they wonder, from using general budget support to repay loans to China—their ideological and economic foe?

These are the facts, not the half-truths being bundled about with diplomatic
smiles.