There is a perception that while government bodies in Nepal tend to be opaque, international aid agencies working in the country, though often blamed for trying to impose their agenda, are nonetheless transparent in their dealings. But if the latest Freedom Forum report is to be believed, that is more a myth than reality. According to the report A Pilot Study on Situation of Aid Transparency in Nepal, the high level of transparency claimed by donor agencies fails to materialize in practice, even though senior management at those agencies are well aware of the need for transparency and accountability. The report, based on a survey of seven donor agencies—the World Bank, the Asian Development Bank, the Department for International Development, Japan International Cooperation Agency, Norwegian Embassy, USAID and the UNDP—found that none of the agencies provided complete budgetary information; many kept beneficiaries in the dark about budget and were reluctant to provide information on their activities.
During the survey, all seven agencies reported sharing documents on project agreements and policies with stakeholders, but none of them were found to be sharing complete information on budget. USAID, for instance, provided information on total committed amount for 2009, 2010 and 2011, but was mum on actual disbursement during those years. The DFID did not even clarify whether the aid was in the form of grant or loan, nor could it offer a yearly breakdown of its commitment and disbursement. The situation was found to be even worse at the district level when it came to information dissemination. Only 30 percent of the beneficiaries in Chitwan and Dolakha were aware of project budgets, while 64 percent of project offices claimed they shared enough information with beneficiaries.
The report points to many discrepancies between donor agencies’ words and actions, and suggests timely measures like strict donors’ adherence to the country’s Right to Information Act and disclosure of relevant information every three months. Indeed, it is important that a strong accountability system be established for donor agencies, which were responsible for bringing in a whopping US $1.08 billion into the country in 2010-11. The report’s other recommendations like one-door policy for all donors, and publication and dissemination of aid information to all stakeholders “in a non-technical way” are well placed as well. But while the donor community certainly has to get its act right, it cannot do so alone. It is important that relevant government agencies and the donor community work in close concert to improve the country’s dismal record on aid effectiveness and transparency. Also, last six years have made it amply clear that political instability reduces aid effectiveness significantly.
The reasons include everything from absence of local-level government representatives (which has significantly reduced oversight of important projects, while encouraging local political operatives to divert aid) to the absence of a complete budget (which creates confusion on long term government commitments).
In these times of great uncertainties, it is easy for the country’s development partners to lose track of their goal, aided and abetted by unaccountable and unresponsive government operatives. But the big glitches in the way they operate, so clearly outlined in the latest Freedom Forum report, also suggest they have a lot to do to establish themselves as credible partners in Nepal’s development.
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