Tibaijuka: I'm not a dictator

The Citizen -Tanzania

April 11, 2011

By Tom Mosoba, The Weekend News Editor

Dar es Salaam. Lands, Housing and Human Settlement Development minister Anna Tibaijuka has strongly defended her record at the helm of United Nations Human Settlements Programme (UN-Habitat) in Nairobi, rejecting allegations of lack of transparency and mismanagement.

Prof Tibaijuka told The Citizen on Sunday in an exclusive interview early in the week that she took great exception to the suggestion that she was a poor or rigid manager, insensitive or even corrupt when she headed the UN agency, which she left to return home and run for Parliament.

The minister rejected the findings of an audit in February, by the United Kingdom’s Department for International Development (DFID) that could badly dent her image as one of the only two Tanzanian women to have risen to the top in the UN system.

Prof Tibaijuka was the highest-ranking woman, at the level of Under Secretary-General, before Dr Asha-Rose Migiro, who was the Tanzanian Foreign minister, was appointed in February 2007, as Deputy Secretary General. It is highest position a woman has ever held in the world body.

In defending her 10-year record at the helm of UN-Habitat, Prof Tibaijuka dismissed some of the findings of the DFID audit that led to a decision by the UK Government to withhold up to 1million pounds sterling (Sh2.4 billion) in core annual funding to the Nairobi-based agency.

“I take great exception to the insinuations contained in the audit because it is prejudicial and does not reflect the true position,” said the minister, when contacted for comment.

Prof Tibaijuka, who is highly regarded internationally and locally, is serving her first five-year term as the MP for Muleba South in Kagera Region, and was appointed to the Cabinet by President Jakaya Kikwete, who handed a docket aptly fitting her credentials.

Some analysts were reported in foreign media, as warning that the withdrawal of funding to UN-Habitat would not only severely hamper its programmes and projects, but also dent Prof Tibaijuka’s image. The Tanzanian has prided herself on raising the profile of the UN agency and helping to increase contributions to the organisation threefold during her time.

They noted that the DFID review was conducted while she was still in office, and, therefore, any shortcomings would be directly attributed to her leadership and management style. Some critics and insiders claim she was authoritarian and secretive.

A senior UN-Habitat official was quoted as saying that the current problems were caused by “poor leadership.” He added: “One of the reasons UN-Habitat and other agencies continue performing poorly is that they do not allow themselves to be audited externally. This creates a lot of room for corruption.”

The DFID audit was ordered by the British Secretary of State for International Development, Mr Andrew Mitchell, as part of the UK’s review of its funding to 43 multilateral organisations, as the Prime Minister David Cameron-led coalition embarked on serious efforts to curb expenditure.

The audit was also critical of several other UN agencies, whose funding it scaled down or withdrew altogether. They include the UN Industrial Development Organisation (Unido), the International Labour Organisation (ILO) and the UN International Strategy for Disaster Reduction.

According to DFID’s findings, many UN agencies and other multilaterals consistently fail to deliver results on the ground, partly because of lack of results-based management.

More than two-thirds of the multilaterals assessed were found to be weak in strategic and performance management. A significant number were said to be not sufficiently focused on reducing costs and cutting waste.

The report found that only nine of the 43 organisations offered “very good value for money”. They include Unicef, the Global Fund to Fights AIDS, TB and Malaria, and the Global Alliance for Vaccination and Immunisation (GAVI), all of which will receive increased British aid in future

That UN-Habitat scored “weak” and “very weak” ranking in almost all the yardsticks tested, was alarming enough for Prof Tibaijuka’s successor, Mr Joan Clos, to write to the UK to protest the poor rating and freeze of funding. He assumed office last October.

In a letter dated March 2, Mr Clos informed the UK Minister of State, Mr Alan Duncan, that he was disappointed, considering the crucial role that UN-Habitat plays in international development. He also pleaded for the rescinding of the decision to cut funding and pledged reforms to improve performance in line with the UK’s objectives.

UN-Habitat reportedly performed unsatisfactorily in strategic and performance management and cost and value consciousness. The review says that the agency has a poor record of institutional performance and transparency.

It states: “UN-Habitat does not operate under a presumption of disclosure. It provides some information on projects to the governing body, but does not publish full details on project performance.”

The DFID said the agency had not significantly contributed to the goal of improving slum dwellings.

But Prof Tibaijuka said it would be insincere to accuse her of poor leadership or corruption. “I worked tirelessly for the agency and for the improvement of the plight of poor urban dwellers,” she said, pointing out that she even won the prestigious 2009 Göteborg Award for Sustainable Development.

Recently, she was named by the Steering Committee of the Water Supply and Sanitation Collaborative Council (WSSCC), as its new chair to succeed Dr Roberto Lenton, whose second and final term ended last month.

“My record at the UN-Habita has seen the centre rise to a fully fledged UN office on the continent, while at the time of leaving office there was some $52 million (over Sh73 billion) in its accounts,” said Prof Tibaijuka.

The agency had made a mark that would continue to attract funding and support from more donors.

“There will be no proof to back up the audit claims of corruption or mismanagement. By withdrawing funding, the DFID has shown that it does not care for the urban poor and the role that housing could bring to the poor economies where we work,” Prof Tibaijuka told The Citizen on Sunday.

She added that the only plausible explanation for the move was that the DFID had removed urban housing from its core priorities, even in London.

The minister said the timing of the UK decision was also inappropriate “because it would have been logical that they support the incoming management instead of deserting them”.

http://thecitizen.co.tz/sunday-citizen/40-sunday-citizen-news/9845-tibaijuka-im-not-a-dictator.html

$6,347,415,000 and What It Bought

by Claudia Rosett @pajamasmedia.com

That’s the amount of money America gave to the United Nations in fiscal 2009, according to President Barack Obama’s White House budget office. What did it help pay for?

Why, lots of things. Among them, the General Assembly that elected Libya’s envoy as its 2009-2010 president, and molded the “reformed” Human Rights Council that brought us the now famous — make that infamous — Goldstone report on Gaza, hosted Iran’s President Mahmoud Ahmadinejad at the Durban Review conference in Geneva, and gave seats to Russia, China, Saudi Arabia, Cuba, Cameroon and Libya (before suspending Libya but now entertaining the candidacy of Syria).

Those American dollars helped maintain and service the grand General Assembly Hall which in September 2009 provided a global stage for Libya’s Muammar Gaddafi, Iran’s Ahmadinejad, Zimbabwe’s Robert Mugabe, Venezuela’s Hugo Chavez and their despotic brethren — and was pressed into service more recently as a theatrical venue for the celebrity-studded U.S. premiere of an Israel-trashing commercial movie. They helped provide tax-exempt “post-adjusted” take-home lucre topping U.S. congressional take-home pay for hundreds of UN senior officials who worked on such projects as jetting around the globe preparing for the December, 2009 climate bacchanal in Copenhagen. And they helped bankroll the activities of UN Secretary-General Ban Ki-Moon, who has been bragging up a UN financial “disclosure program” in which senior UN officials are not required to disclose anything, and who made a trip to Washington in the spring of 2009, during which he referred to America — by far the UN’s biggest donor – as “deadbeat.”

With reason, Congress is now looking at ways to try — yet again — to reform the UN, and require accountability and maybe even decency in how American tax dollars get spent there. This starts with getting a handle on how much money the U.S. actually provides and where the money goes. To that end, the House Committee on Foreign Affairs held a hearing this past Thursday, April 7, at which the sole witness was the person one might assume would know more than anyone else about U.S. dealings with the UN — Obama’s ambassador to the UN, Susan Rice. During that hearing, against the backdrop of America’s runaway budget and soaring debt, Rep. Dana Rohrabacher tried to get some straight answers about how much money the administration is now proposing to pour into the UN.

Somehow, in the course of answering that question, Rice came up not with a total, but with a subtotal that sounds oddly short — by a couple of billion — of what the U.S. has actually been spending. Has there been some dramatic cut in funding that neither the UN nor the U.S. has noticed? Or was there a disclosure malfunction of majestic proportions?… more in my column on “Magic With U.S. Money for the United Nations.

http://pajamasmedia.com/claudiarosett

Israel should topple Hamas: Lieberman

JERUSALEM — Israel should not settle for a truce with Hamas in Gaza, and should instead seek to topple the Islamist rulers of the coastal strip, Foreign Minister Avigdor Lieberman said on Monday.

"The goal that we have settled on, of seeking a return to calm, is a grave error because it will allow Hamas to reinforce along the lines of Hezbollah," Lieberman told public radio, referring to the Lebanese militia with which Israel fought a 2006 war.

"The objective must be to force Hamas out of power," said Lieberman, who heads the ultra-nationalist Yisrael Beitenu party.

www.google.com/hostednews/afp/article/ALeqM5ggOJkG2x-Z9j1Jn_DSlxE5fd6W8A?docId=CNG.490daf03504981722977bcaf5c8cc45c.5b1

The 'Business' of International Aid

What if Marriott paid hotel guests $50 per night, then bragged about its occupancy rates?

The Wall Street Journal

http://online.wsj.com/article/SB10001424052748704425804576220524034207558.html

April 11, 2011

By JONATHAN STARR

Mr. Starr is a former financial executive and co-founder and managing director of Abaarso Tech, based in the Maroodi Jeex region of Somaliland.

What if Marriott operated without any revenue, room-rate or other meaningful customer-usage data from its individual hotels? Suppose it remitted money to cover salaries and other expenses, without knowing if any of it was producing a product for which customers were willing to pay. Imagine further that Marriott asked only for self-graded quarterly "report cards" from its managers, and that, as its only act of supervision, it simply audited its hotels' expenditures.

You don't need to run a Fortune 500 company to know how quickly such a system would run amok. Absent accountability, managers and staff would have no incentive to provide a reasonable service. They'd have to be somewhat honorable to even bother showing up to work. In short order we'd find employees buying $10,000 worth of furniture for $20,000 and splitting the difference with the vendor. Come audit time: $20,000 expense item, $20,000 vendor receipt, "check and check, all looks clean here."

If you think that no business would operate this way, then you're evidently not familiar with the "business" of international aid. International nongovernment organizations get their funding from governments and other donors, not the men, women and children they are supposed to be serving. Without revenue or other quality customer-satisfaction metrics, NGO executives and donors have no way of measuring whether employees on the ground are providing a product of value to their impoverished "customers."

They then take a bad situation and make it completely unworkable by routinely paying beneficiaries to avail themselves of NGO services. Having bought their customers, NGOs send home reports about the great attendance that led to successfully training X-number of people on fishing/farming/water/waste/health. It would be as if Marriott paid guests $50 per night to stay in its hotels and then bragged about its occupancy rates. If the poorest people in the world require payment to take your services, what does that say about your services?

Because NGOs lack the ultimate customer-feedback metric of revenue, one would expect them to achieve accountability through oversight by executives on the ground with operations in a single geographic market. Sticking to one geographic market makes sense on many levels since there are no economy-of-scale advantages to being a multinational NGO (no bulk purchases, no manufacturing, no branding advantage) and all kinds of diseconomies of scale (foremost the lack of accountability). So why do countless NGOs operate as multinationals in dozens of countries with their executives sited in Washington, New York, London, Addis Ababa, Nairobi and Geneva? The obvious answer is that like everyone else, these executives respond to incentives, and what works on the ground isn't what pays their salaries. John Smith, NGO administrator, maximizes his personal value by going multinational while staying proximate to his donors, never mind the damage that model inflicts on the poor communities he purports to serve.

It doesn't have to be like this.

A few years ago I quit a career in finance and dedicated 100% of my time to improving education in Somaliland, my uncle's home country. Happily ignorant of the aid industry's modus operandi, I designed the Somaliland non-profit organization, Abaarso Tech, to be run like a business with the Somali people as both shareholders and customers.

I began with the precept that our employees' principal form of compensation would be pride in a worthy deed well done. Not only is generous pay unnecessary for success in development work, it is counterproductive. With low accountability, highly compensated individuals will choose the path of longest-term funding over good solutions (I suspect one case in point are NGOs in Haiti, which deploy money notoriously slowly). So I donated a large portion of my savings and promised not to take any salary. Having led by example, I was able to recruit like-minded individuals also willing to make financial sacrifices for equity in something special.

Turn a deaf ear to the aid agencies that tell you they cannot recruit quality employees without compensation packages that are far larger than what they could make in the for-profit world; the pay is essentially tax-free and NGOs already cover virtually everything, including room and board and all kinds of paid vacations. In Abaarso Tech's short history our teachers have included Ivy League graduates, a Ph.D. in physics, a Ph.D. in chemistry and nearly 20 well-trained, native English-speaking American, Canadian or British teachers. Our $3,000 annual salary basically pays interest on their college loans with enough left over for the occasional can of Pringles. Our staff works 70-hour weeks because they are motivated by the mission's goal and feel ownership for its success.

Managing a single geographic market with executives on the ground, highly efficient costs and properly motivated employees was a good start. But our nonprofit still needed to offer programs that the Somali people would value. Somaliland is one of the poorest nations in the world, but that doesn't mean Somalis won't scrape together what they have to buy something good. Just 20 months after landing here, Abaarso Tech has 100 students in its secondary boarding school, 100 in adult English classes, 20 in the undergraduate School of Finance, 50 in primary-school tutoring and 30 in the graduate business courses. Almost all of those 300 enrollees find a way to pay something towards their education. One of our top boarding-school students cannot afford much, but his family still brings us a bag of fruit each term as their way of saying "thank you." On the other extreme, we have a couple of wealthy British Somalis who left U.K. private school to join our boarding school at a tuition of $5,000 a year. Our program is a living repudiation of the notion that development beneficiaries need be paid to accept the services of their benefactors. Today, our program's net operating loss is approximately equivalent to the compensation package of a typical NGO worker.

Which brings me to a second question for the taxpayers and donors who, over the past few years, have provided hundreds of millions of dollars of aid to Somaliland: Even accepting that our boarding school and finance program would have been too sophisticated for a typical development agency, why, after spending all that money and far more time on the ground, has no other NGO thought to provide native English-speaking teachers for adult English courses? We just started the program in January, charging $200 for three months of classes, and our phones won't stop ringing with Somalis who want to pay to learn proper English. This isn't brain surgery; it is just listening to what the customers are asking for and finding a way to provide it at a reasonable cost. It is exactly what Marriott does every day.

Somalis are good people who could use well-spent aid money to rebuild their country from an awful civil war (which was in part caused and funded by Western food aid—see Michael Maren's 1997 book, "The Road to Hell"). However, until we take the perverse incentives out of the international NGO business, and only provide funding to those organizations whose executives are on the ground overseeing the otherwise unmanageable, the bulk of the money spent on international aid will, at best, be wasted.

http://online.wsj.com/article/SB10001424052748704425804576220524034207558.html

Carbon credits run aground on UN bureaucracy

South China Morning Post

Joe Cochrane in Jakarta

5 April 2011

Every day, Joseph Hwang leaves his home in Jakarta and travels to one of the filthiest places in Indonesia.

Off a highway in West Java, and up a winding bumpy two-lane road past rice fields and a shanty town of garbage scavengers, lies the Sumur Batu landfill. The 10-hectare site is the final resting place for about 500 tonnes of garbage hauled daily from Bekasi, a city of 2 million people south of Jakarta. To call it a landfill is a stretch: Sumur Batu consists of mountains of garbage, the older ones overgrown with grass and weeds, the fresh ones emitting a vomit-inducing reek.

Local scavengers including children jump onto the trucks as they approach Hill Number 4 and fight each other for plastic and metal they collect for a small recycling operation that pays them the equivalent of US$35 a month. In 2006, a garbage landslide killed 24 people.

"It's a dirty and dangerous place," says Hwang, a British citizen of Chinese descent. But Hwang also knows there is proverbial gold in these hills, which is why, as the production manager of Gikoko Kogyo Indonesia, an engineering and manufacturing company, he chooses such an unsavoury workplace.

Beneath the garbage hills are countless tonnes of methane, a greenhouse gas 20 times more effective in trapping heat in the atmosphere than carbon dioxide. Bacteria that eat the organic refuse create the methane, which, despite being extremely hazardous to the environment, is a potential energy source.

Gikoko runs a methane flaring plant that sucks more than 17,000 tonnes of gas out of the hills per day using a web of hoses and burns it.

There is an added bonus: the plant can use the methane it burns to generate up to 2 megawatts of power, which Gikoko plans to sell to the state power utility Perusahaan Listrik Negara. Hwang's company will also provide lighting to the landfill as well as sorting equipment to make the scavengers' jobs safer and more efficient.

"This is a good example of how CDM can contribute to sustainable development," he said, referring to the Kyoto Protocol's Clean Development Mechanism, which allows countries to earn carbon credits through cutting emissions. These credits can then be sold to other countries or companies to help them meet emission reduction targets.

However, Hwang's story is not totally a happy one. His company has been waiting two years for United Nations-appointed auditors to sign off on Gikoko's flaring operation so it can begin selling its certified emission reduction credits to European Union governments. The process is only supposed to take six months.

"It's a long process and frustrating," Hwang said. "There are a lot of obstacles, problems and difficulties."

And Gikoko is not the only clean energy company stuck in limbo. The snail's pace of the UN verification process is a persistent problem globally, according to sector players, who say the much-touted carbon credit scheme is less of a godsend than is fashionable to admit right now.

"Globally, the verification process is an impediment for any kind of carbon reduction programme," said Agnes Safford, co-founder of Greenworks Asia, which does carbon financing. "There is no commercial sense over at the UN Framework Convention on Climate Change.

"They get hung up on little things like checking boxing. The whole thing is bureaucratically constipated. I think carbon credits are a great concept, but they don't work because of the whole system that's been put in place."

A running joke among carbon credit players is that CDM actually stands for "complicated, difficult mechanism".

But it is no laughing matter for Hwang. His company has received US$1.5 million in loans from the World Bank and Asian Development Bank, and has not been able to sell a single credit. Gikoko, which has flaring projects at landfills in Palembang, South Sumatra and Makassar, South Sulawesi, expects to produce 40,000 tonnes worth of carbon credits a year from the Bekasi landfill once it is certified by UN-appointed auditors.

And Gikoko cannot begin earning revenue by selling electricity now because it would have to submit an entirely new application to the UN, which could take another two years.

Hwang acknowledged that the company is having cash flow problems. "Everyone is under pressure," he said. "I'm sure the UN is under pressure to go faster."

Ina Binari Pranoto, who works in the environmental unit at the World Bank in Jakarta, said the UN-backed carbon credit scheme was not as simple as people might think.

"If they are not giving the certification, then it won't move. Then they won't issue the CER [certified emission reduction], the certification for the credit," she said, "and then the buyer won't pay for the credits."

Gikoko also has problems closer to home, namely getting the Indonesian government and Bekasi administration to practise better landfill management. "It's a fight against time," Hwang said. "If they don't move quickly, there will be less gas from which to create credits and to fight global warming."

www.scmp.com/portal/site/SCMP/menuitem.2af62ecb329d3d7733492d9253a0a0a0/?vgnextoid=117d474ec602f210VgnVCM100000360a0a0aRCRD&ss=Asia+%26+World&s=News

Foreign donors block aid for Malawi; Questions over Scottish cash after African nation found to be squandering money.

By Mark Macaskill and Mabvuto Banda

The Sunday Times

April 3, 2011

THE UK government withheld £500,000 of aid to Malawi after an audit found large amounts of taxpayers' money had been squandered in the povertystricken country.

Officials at the Department for International Development (DFID) decided to punish the Malawi government for its failure to ensure that best value for money was achieved when spending British aid.

A grant awarded in January was reduced by £500,000 after a detailed investigation by DFID identified examples of "poor procurement" by the African nation.

Sources close to DFID said auditors felt officials in Malawi did not achieve best value for money when buying goods such as hospital equipment, drugs and stationery.

The disclosure will raise questions over how efficiently £13m of aid awarded to Malawi since 2005 by the Scottish government has been spent. In total, about £30m has been handed over in the last six years by a range of Scottish individuals and organisations, including schools, charities and churches.

"Our detailed audit found no evidence of fraud but did find some areas of poor procurement," a DFID spokesman said last week.

"The government of Malawi, along with other donors, has now implemented measures to ensure the situation is not repeated. The UK government is committed to ensuring that we get maximum impact from taxpayers' money, and where we find poor performance we will take action."

There is mounting international concern over human rights abuses and corruption in Malawi.

International donors grouped under the Common Approach to Budgetary Support, including Britain, Germany and Norway, have only disbursed £60m of the £95m slated for Malawi this year.

The money has been withheld amid concerns over a new media law that allows ministers in Malawi to ban publications deemed "contrary to the public interest", as well as concerns over a ban on public demonstrations and same-sex marriages.

In January, the US government withheld a £200m grant to rehabilitate Malawi's energy sector, demanding that it respects the rights of minorities and that a media law allowing ministers to ban publications deemed "contrary to the public interest" is repealed.

Last month, it emerged that plans by Madonna, the pop singer, to build an academy in Malawi to educate young girls had been abandoned.

An audit claimed the management team employed to build the school spent a big chunk of £2.4m on expensive architects, large salaries and a private chauffeur and golf course membership for the school's director.

Eight charity workers are suing the pop icon for unfair dismissal and non-payment of benefits.

Opposition politicians in Malawi have also reacted angrily after it emerged that the wife of Binguwa Mutharika, the Malawian president, enjoys a substantial salary as the country's ambassador for safe motherhood.

The role was previously held by one of Mutharika's ministers but did not attract special remuneration.

Leaked documents reveal that Callista Mutharika is paid the equivalent of £4,500 a month for the position, about double that paid to cabinet ministers.

"This is unprecedented because in our history no first lady has ever been put on a payroll for doing charity work," said John Tembo, president of the Malawi Congress Party, the country's main opposition party.

"The money that government is now paying the first lady could go a long way to saving the lives of many women dying in our hospitals from preventable pregnancy complications."

Hetherwick Ntaba, a spokesman for Mutharika, said the first lady was justified in getting paid for her work to improve the lives of vulnerable women.

"What she is doing is work and therefore she has to get remuneration for that. There is nothing wrong in the president putting the first lady on the payroll for her work."

A spokeswoman for the Scottish government, said: "Scottish government funds go directly to Scottish organisations who have demonstrated that they have the relevant skills, capacity and expertise to deliver services on the ground to the people of Malawi. Funding does not go to the Malawian government. Rigorous monitoring is in place and shows that funding is having a positive impact on the lives of Malawians."

www.thesundaytimes.co.uk/sto/public/sitesearch.do?querystring=malawi&sectionId=2&p=sto&bl=on&pf=all

Book Review: Lords Of Poverty: The Power, Prestige, And Corruption Of The International Aid Business by Graham Hancock

... The chief, if not the sole beneficiaries of foreign aid, Hancock shows, are the local elites in the recipient countries, special interest groups in the developed counties, and the aid bureaucracy itself. The chief losers? The First World taxpayers and the poverty-stricken in the Third World.

The aid “industry” is quite lucrative for those who administer its programs. Incomes for employees of international agencies are determined by the “Noblemaire Principle,” named after Georges Noblemaire, an employee of the League of Nations in the 1920s. According to this principle, salaries for employees of international organizations should be high enough “to attract as employees citizens of the country with the best-paid national civil service.” United Nations pay rates, Hancock notes, must therefore exceed “those of the federal civil service of the richest country on earth—the United States.”

As a result, not only does base pay for U.N. officials exceed that for U.S. civil servants by an average of 25 percent, but the fringe benefits are also far more lucrative. Promotion comes twice as fast for U.N. employees than for U.S. civil servants. It takes a U.S. civil servant 14 years to accumulate as much sick pay as a U.N. staffer is entitled to on his very first day. U.N. pensions exceed those of the U.S. civil servant by 43 percent. And this is only the beginning.

An increasingly large part of aid budgets is for travel (first class, of course). And most of the travel is not to poverty-stricken areas in the less-developed world, but to poverty seminars normally held at posh hotels in exotic and very attractive locations. In just one year, Hancock notes, the Executive Board of the Educational, Scientific and Cultural Organization received $1,759,584 for travel and lodging. During the same time it spent $49,000 on education for handicapped children in Africa, and $1,000 to train teachers in Honduras.

Interestingly, despite the Noblemaire Principle which is supposed to attract experts, U.N. agencies increasingly rely on the expertise of “outside consultants.” The minimum salary for a consultant is $100,000. The average salary is probably closer to $150,000. Since the number of consultants exceeds 150,000, this puts the cost at more than $22 billion. When the salaries of the regular employees are combined with the costs of consultants, the amount is well over half of all that is spent by governments on aid each year. In fact, “personnel and associated costs,” Hancock notes, “today absorb a staggering 80percent of all U.N. expenditures.”…

www.thefreemanonline.org/columns/book-review-lords-of-poverty-the-power-prestige-and-corruption-of-the-international-aid-business-by-graham-hancock/#

A Miasma of Corruption: The United Nations at 50

by Stefan Halper

Stefan Halper, a former White House and State Department official, is a nationally syndicated columnist. [Senior Fellow at the Centre of International Studieswww.polis.cam.ac.uk/contacts/staff/halper-stefan.html]

… Bureaucracy Run Amok

Since the Third World majority took control of the United Nations and its budget, total UN employment has ballooned from 1,500 to more than 50,000 worldwide. The latter figure does not include the nearly 10,000 consultants or the peacekeeping forces, which at their height in 1993 numbered some 80,000. No exact figure on total employment including consultants--the hiring of consultants is a popular and much-abused practice at the United Nations--can be given. That is because until 1994 there was no central, computerized list of personnel. Even today there are no records of many appointments in the Secretariat.[18]

The personnel costs (including generous pension benefits) of that army of bureaucrats consume an estimated 70 percent or more of the UN operating budget. Given the lack of transparency, the percentage could be even higher. That leaves relatively few financial resources for the actual missions of the United Nations and its specialized agencies, including the organization's much-touted humanitarian programs.

The salary and benefits packages of UN employees based in New York City are incredibly lucrative. Statistics compiled in 1995 revealed that the average annual salary for a midlevel accountant at the United Nations was $84,500. The salary for a comparable position in non-UN businesses and agencies was $41,964. A UN computer analyst could expect to receive $111,500 compared to $56,836 paid counterparts outside the UN bureaucracy. An assistant secretary general received $190,250; the mayor of New York City was paid $130,000.[19] The raw figures do not convey the extent of the disparity, however, since the salaries of UN employees are free of all taxes. In addition to their bloated salaries, UN bureaucrats enjoy an array of costly perks, including monthly rent subsidies of up to $3,800 and annual education grants (also tax-free) of $12,675 per child. The UN pension program is so generous that entry-level staffers whose pay rises only as fast as inflation can retire in 30 years with $1.8 million.[20]…

www.cato.org/pubs/pas/pa-253.html

Opulent Conditions for International Bureaucrats While Taxpayers Struggle

January 4, 2011

by Dan Mitchell

The International Monetary Fund is a great place to work – at least for those who don’t feel guilty about getting extravagant salaries from taxpayers. And what do IMF bureaucrats do for the money we pay them (American taxpayers finance the biggest share of the bureaucracy’s expenses)?

Many of them jet around the world in business class, stay at first-class hotels, and tell nations to raise taxes and devalue their currencies. And to add insult to injury, they specialize in misallocating global saving and investment by bailing out irresponsible nations.

This is not to say the bureaucrats are always wrong. While the IMF often is bad on taxes and monetary policy, the bureaucrats sometimes give good advice on trade, regulation, and government spending.

But even when they give good advice, that doesn’t justify their big salaries (which are tax-free, by the way). The real question, though, is whether the IMF should even exist – especially when the bureaucracy more often than not is on the wrong side of key public policy issues.

Unfortunately, instead of being cut back or phased out, the IMF is getting even bigger. While the rest of us are having to tighten our belts, the bureaucrats at the IMF are having fun spending our money. The gold-plated international bureaucracy now wants to spend big bucks to upgrade it already lavish headquarters in Washington. Here’s a blurb from the UK-based Guardian.

…the International Monetary Fund’s bureaucrats plan to concentrate on a matter closer to home in the new year – sprucing up their offices in downtown Washington DC. Dominique Strauss-Kahn, the fund’s managing director, quietly announced last week that he would be asking permission from the organisation’s cash-strapped member states to refurbish its main headquarters building. …Pressure groups greeted the news with scepticism, pointing out that eight years ago the fund spent $150m on a second building, complete with external waterfall, after saying its original site – known as HQ1 – was no longer big enough for its staff of highly-paid international officials.They said the fund was now flush with cash after selling some of its stock of gold and extracting fees and interest payments from troubled countries such as Ireland and Greece. …Peter Chowla, programme manager at the Bretton Woods Project, a think tank that monitors the activities of the IMF and the World Bank, said: “After a nice financial crisis, the IMF’s balance sheet is looking very health – lots of interest to pour in from Greece and Ireland and commitment fees on money never even lent to Colombia, Mexico and Poland. So the fund is thinking about spending some of the proceeds on remodelling its headquarters.”

http://danieljmitchell.wordpress.com/2011/01/04/opulent-conditions-for-international-bureaucrats-while-taxpayers-struggle/

The International Monetary Fund is living large at U.S. taxpayers’ expense

The Daily Caller

February 15, 2011

By Matt Kibbe

Matt Kibbe is the President and CEO of FreedomWorks.

Last year, the International Monetary Fund’s (IMF) bailout of Ireland and Greece put U.S. taxpayers on the hook for over $46 billion. It’s time to get ready for the next round of European bailouts in 2011. IMF First Deputy Managing Director John Lipsky says that “we will stand by with our European partners to provide support.” Speculation has been circulating that this will mean an upcoming taxpayer bailout of Portugal and Spain.

According to the Washington Post, “Portugal remained the most immediate concern, with analysts sounding alarms over its failure to meet targets to reduce government spending. But given Portugal’s tiny economy, the more important issue continued to be conditions in Spain — the fourth-largest economy among the 16 nations that share the euro as their currency.

“Though Spain’s fiscal situation is far better than that of Portugal, Ireland or Greece, analysts fear its banks might be harboring hidden bad debts from a real estate crash similar to the ones in Ireland and the United States.”

A couple weeks ago, the IMF sent a special unit to meet with the Bank of Spain to discuss a proposed rescue package. In order to survive, the IMF must provide credit. These potential bailouts will line the pockets of the IMF at the expense of taxpayers. The UK-based Guardian writes that “fresh from imposing tough conditions on Ireland as the price of its bailout, the International Monetary Fund’s bureaucrats plan to concentrate on a matter closer to home in the new year — sprucing up their offices in downtown Washington, DC.”

Just eight years ago, the IMF spent $150 million on a second building complete with a stunning external waterfall. They claimed that the original headquarters was simply too small for their staff, who receive bloated salaries. Peter Chowla, program manager at the IMF watchdog Bretton Woods Project, states, “after a nice financial crisis, the IMF’s balance sheet is looking very healthy — lots of interest to pour in from Greece and Ireland and commitment fees on money never even lent to Colombia, Mexico and Poland. So the fund is thinking about spending some of the proceeds on remodeling its headquarters.”

Taxpayer bailouts of Spain and Portugal will make things worse. By holding out the prospect of a bailout to any country or big bank that fails, the IMF has only encouraged reckless behavior. Unfortunately, IMF officials have an incentive to expand the roles and functions of the international bureaucracy. Most IMF staff members are paid six-figure salaries with generous perks including housing and education for family members. These IMF officials jet-set around the world giving mostly bad economic advice to nations.

IMF officials who receive tax-free salaries are notorious for wrongly advising nations to raise taxes. In a recent report, the IMF urged the United States to enact their plan, which would increase taxes by up to 60 percent. IMF bureaucrats have recently told Eastern European states to repeal their successful flat taxes. In many of these countries, the real problem is overspending and taking on too much debt. According to the IMF’s European Department Senior Adviser Anne-Marie Gulde, “The idea of moving away from the flat tax to a progressive tax is very much one of the measures that we’re looking at. It could help to increase revenues while putting more of the burden on higher-income groups.”

We must pressure Treasury Secretary Tim Geithner to veto these irresponsible taxpayer bailouts. American taxpayers should not be forced to reward countries with poor economic policies and banks that make risky loans. These bailouts encourage reckless behavior and allow IMF bureaucrats to live large at our expense.

http://dailycaller.com/2011/02/15/the-international-monetary-fund-is-living-large-at-u-s-taxpayers-expense/#ixzz1Ga81ScAv

Pay raises at World Bank, IMF draw criticism

The Washington Post

June 25, 2010

By Howard Schneider

Austerity may be the new reality for public employees in the developed world, whether it is pay cuts in Greece, layoffs in Germany or pension reform in Britain.

But the International Monetary Fund and the World Bank have pushed ahead with pay raises above the rate of inflation for thousands of workers -- despite opposition from major funders in the United States and Europe.

U.S. representatives on the IMF and World Bank boards abstained in the recent votes that approved raises of 4.9 percent and 3.7 percent, respectively. They were joined by European nations that felt the increases set the wrong tone when governments are being pushed to retrench. The IMF just released its "Ten Commandments for Fiscal Adjustment in Advanced Economies."

Raises at the World Bank were approved at a Wednesday board meeting, just a day after Britain released an austerity package featuring new taxes and spending cuts -- not the best timing for winning the British board member's support.

"We greatly value the hard work and expertise of bank staff," said Rob Kelly, a spokesman for Britain's Department for International Development. But "when governments worldwide are cutting public spending, increasing taxes, and reducing or freezing public-sector pay, to award an above-inflation pay rise risks making the bank appear out of touch."

The dispute mirrors some of the broader dynamics in the world economy. The United States and Europe remain the major financial backers of the IMF and World Bank, and they were recently tapped to help replenish the coffers of both institutions after the global crisis spurred record lending to support economies around the world. Salaries of top World Bank staff were frozen last year in recognition of the crisis.

At the same time, developed nations are coping with the uncomfortable new role as a source of world economic weakness. Although that status made representatives from some countries leery of approving raises at the two institutions, officials from Latin America and Asia noted that there were no such complaints when their countries went through similar periods of crisis and retrenchment, according to officials familiar with the discussions.

In the bank's case, raises for the roughly 7,000 employees at its headquarters are set by a formula based on inflation and labor-market data in the United States. Inflation is currently about 2 percent annually; the formula would have allowed raises of up to 4.3 percent, but the request was scaled back to 3.7 percent. According to bank officials, individual raises are based on job reviews, and most employees will not receive the full amount. The IMF uses a similar system; its pay raises were approved in April.

"Our board representing 187 countries approved this recognizing [the] record work by staff on behalf of clients during the crisis, and it is well below other multilateral institutions," such as the IMF and major development banks, said Hasan Tuluy, vice president for human resources at the World Bank.

The World Bank's overall budget was approved at the same meeting without abstention, and at $1.77 billion, it was essentially flat compared with the year before when adjusted for inflation, according to bank officials.

U.S. officials, speaking on the condition of anonymity because the pay discussions were private, said they are pushing for a fuller review of a compensation system that outpaces the cost of living.

www.washingtonpost.com/wp-dyn/content/article/2010/06/24/AR2010062406316_pf.html

Confidential Note shows how U.N. manages its Human Resources

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courtesy of InnercityPress.com