Budapest, 17/05/2011(Agence Europe) - Direct budgetary support to ACP governments, provided that it is transparent (subject to democratic control by parliaments and civil society) is an excellent means of distributing development aid. The aid is not a blank check and this ought to remain the case, explained the ACP-EU Joint Parliamentary Assembly (JPA), despite any misgivings there might be about how this assistance is channelled. Apart from a few reservations, there was a genuine appeal in favour of maintaining this instrument for countries that respect the eligibility criteria, as MEPs and ACP states (Africa/Caribbean/Pacific) discussed on Monday 16 May in Budapest. The debate took place at the very time the European Commission is in consultation to draw up a communication on the subject. This communication is expected in the second half of this year, as part of the post-2013 financial perspectives. The co-president, Louis Michel (ALDE, Belgium), for whom this is a pet question, said that he was very concerned about any threats to this instrument.
Support for state building. Michel said that “this is an extremely important subject. I do not know of any better way to support state building because this mechanism improves the predictability of aid, its approval by partner countries which can thus focus their financial resources on their national priorities and strengthen their institutions and national systems for reducing poverty. Some donors are questioning this kind of aid modality and this is very serious because there is no approval without the necessary resources for the state budget”. He also underlined the fact that these funds enabled developing states to ensure that the main functions of the state were guaranteed (education, health, etc). He hammered home the fact that “those who criticise budgetary support suggest that there is no control over the use of resources. This is not true. Control is more systematic than for other development aid operations. It is said that budgetary support benefits all developing countries. This is false. It only benefits those that satisfy the eligibility criteria, whose macro-economic criteria are laid down by the World Bank and IMF”.
The most efficient instrument. Enrique Guerrero Salom (S&D, Spain), European co-rapporteur for the draft resolution to be voted on this Wednesday, said that “when the right conditions are in place, this is the most appropriate instrument. General or sectoral budgetary support is a great challenge to the international community, which seeks optimum efficiency in compliance with the Paris agenda (OECD) and the Accra action programme”. The European Commission itself is planning, in the next European Development Fund (EDF), to allocate 50% of resources through budgetary support.
An instrument promoting political dialogue. He underlined that “everybody knows that budgetary support helps improve political dialogue between peers, that it enables beneficiary countries to develop their own national strategy, which promotes the leadership of these countries and reduces any aid fragmentation and funding costs”. Nonetheless, he deplored the fact that there was resistance to the draft resolution. The compromise text on the table argues that budgetary support can be gradually applied, which is compatible with other aid instruments. The JPA is calling on the Commission to make budgetary support its main instrument but also for beneficiary countries not to have to bear additional conditions. It calls for the priority to be given to education, health, jobs and infrastructure and for control to be exerted by both parliaments and civil society. The EU co-rapporteur explained that “we want the Commission to produce a report on implementation of budgetary support and to promote this support”. His colleague, Mohamed Abdallahi Ould Guelaye (Mauritania), ACP co-rapporteur, also drove this message home. He declared that budgetary support “produces transparency and traceability and subsequently more efficient parliamentary control (exclusively for project support), obliges governmental responsibility when choices are made and reflects an interactive dialogue between donors and beneficiary countries”.
Duty to provide transparency and explanations. Andris Piebalgs, the European commissioner for development, thanked MEPs and their counterparts for collectively “supporting the Commission, which had falsely been accused of seeking to undermine budgetary support”. He added that “the debate on financial perspectives is approaching. Time is the essence. I'm asking you to believe in it and to explain things because there is a lot of misunderstanding.” He provided assurances that the JPA resolution would be taken into account in the communication, to be presented next November. Among the barriers that needed to be overcome, Andris Piebalgs mentioned the lack of transparency and the diverging national perceptions of member states. He said that this therefore required “greater visibility, otherwise citizens would lack an accurate perception” of the situation. This therefore also meant that they needed to adopt a united approach in order to provide a clear overall picture: “Budgetary support is the transfer of funds from one taxpayer to another, through the intermediary of a specific agency (the European Commission) and a government”. This unified approach, “which takes into consideration the political consequences” of budgetary support should, according to the commissioner, help eradicate any misunderstandings and criticism of the Commission for supporting countries displaying a democratic deficit. It is also necessary for all beneficiary ACP countries to agree to political dialogue (Article 8 of the Cotonou agreement). The commissioner explained that “there are countries where this dialogue has not taken place for 18 months. This is no good! We need total trust.” In other words, if the “MDG contracts” (budgetary support for countries on track towards meeting the Millennium Development Goals) do not go in the right direction “beneficiary countries will have to be accountable - for example, saying how many children have been able to go to primary school - because we have to be accountable to citizens”.
The commissioner considers that budgetary support “is the best solution but without political support, it is in danger”. He also appealed for a very tough implementation framework for both sides (ACP and EU), “because when there is good governance, it is very easy to justify this kind of aid”. During the debate, which achieved a very high level of consensus, Michèle Striffler (EPP, France), the EP's permanent rapporteur on humanitarian aid, was almost alone in underlining that “certain countries with controversial regimes benefit from budgetary support”. She demanded that the Joint Parliamentary Assembly be informed about eligibility and follow-up criteria, especially in crisis periods. Assarid Imbarcaouane, the second vice president from Mali's National Assembly, provided assurances that budgetary support had to obtain approval from the National Assembly and be subject to control on the ground. This ACP parliamentarian affirmed: “We control all the budgetary support from the EU.” (A.N./transl.fl)