The government expressed serious concern over 50 percent direct release to non-governmental organisations under the Kerry Lugar arrangement without any monitoring mechanism. US administration has refused to take measures to deal with this concern.
This was revealed to the National Assembly's Public Accounts Committee's sub-committee meeting on Tuesday while reviewing the audit paras of Economic Affairs Division. Secretary Economic Affairs Division (EAD) Sibtain Fazal Haleem recalled that during the meeting of the National Assembly's Standing Committee of SAFRON, members also expressed their concerns that money supplied under Kerry Lugar without any monitoring might go into the hands of terrorists which poses a serious threat to national security.
Secretary EAD stated, "We cannot push the US administration hard to spend money through government channels as this money is US tax payers." Under their legislation, US administration wants to utilise development funds through both government and NGO channels.
He recalled that US aid assistance had been suspended subsequent to the nuclear test in 1998. After 9/11 World Trade Center attack in the US, bulk of assistance was spent through non-government channels. "Out of one billion dollar aid, 800 million dollar was released to NGOs and a limited amount of 200 million dollar was disbursed to the government kitty," he added.
Secretary elaborated that government had signed agreements with 99 registered international non-governmental organisations. Without signing agreement they could not open offices in Pakistan. And donor agencies persisted in relying on their own audit and evaluation system rather than utilise our monitoring system, he said.
To a question, he replied the government had been negotiating with the US administration for the timely release of the remaining support under the Kerry Lugar bill that envisages 1.5 billion dollars per annum. "We have received 185 million dollar cash for the current fiscal year as budgetary support out of the committed 195 million dollar under this head so far under the Kerry Lugar agreement," Secretary EAD said.
"The Kerry Lugar funds would be released after signing of implementation letters with US administration," he stated adding that details of the on-going development projects are contained in implementation letters but 'we need approval for some of the new projects by ECNEC before placing them in the negotiation list.'
He maintained that US administration has indicated to the government that they would release around 700 million dollar for development projects till the end of September (end of financial year of US). Remaining balance would be disbursed through non-governmental channels.
Federal Secretary informed the committee that US administration explained that in the next five years no other aid would be available to Pakistan other than under the Kerry Lugar arrangement. This aid would be spent in three priority sectors including energy, human capital development and food security, he added.
Secretary further said that last year only 900 million dollar were disbursed out of the pledges made at forum of Friends of Democratic Pakistan. Out of this total amount 700 million dollar was injected through government's channels while the remaining was directly disbursed to NGOs.
He said total foreign loans to Pakistan stood at 52 billion dollar. He also mentioned that global economic recession forced the government to slash the amount of foreign component in Public Sector Development Programme. In the current PSDP, government included a projection of Rs 115 billion foreign component, which has been slashed to Rs 78 billion.
He further contended that the government was evolving a development assistance database in the Ministry. This would help us finalise future planning for development of various sectors. This database would contain details of all the donor agencies and their predictable financial assistances. "Some donor agencies were not providing their database in time which needs to be streamlined," he said. He also announced that EAD had been working on a comprehensive national aid policy and expressed the hope that this would be completed in one year's time.
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