Wherever there are funds flowing, there is a risk of corruption. That’s a fact anywhere in the world and international aid, despite its humanitarian intent, is unfortunately no exception. In the event of a crisis, corruption risks are further compounded because standard controls either simply do not apply or because they take a back seat in the name of urgency. In Lebanon, corruption is already very high – for 2020, the corruption perception index (CPI) score and rank are 25/100 and 149/180 respectively – and crisis mode intensity is actually threefold, owing to the financial meltdown, the pandemic situation, and the aftermath of the Beirut Port explosion. In other words, the risk of international assistance funds to Lebanon being lost to corruption is not just high, it is skyrocketing! The obviously nagging question is therefore: what can be done about it? And yes, there is something to be done.
Accountability and Transparency
Managing these extra layers of risk requires vision and closely coordinated collective action along the supply chain of international assistance with a view to ensure the accountability and transparency of the flow of donor funds. In this context, a main requirement for transparency and accountability is timely and reliable data as well as access to it. This is exactly the focus of UNDP’s collaboration with the European Union and the World Bank towards the realization of the Reform, Recovery and Reconstruction Framework (3RF). The 3RF “presents a set of sequenced, specific, and targeted reforms that support recovery and reconstruction in key sectors during the short term” and across three strategic priorities. One such priority is Anti-Corruption, Integrity and Transparency and core to it is to “fully implement the Access to Information Law and related Action Plan as part of the effective and coordinated implementation of the National Anti-Corruption Strategy.” The Access to Information law, ratified in 2017, is a valuable legal instrument that should be used strategically to this effect where civil society and the media both have a fundamental function as watchdogs of implementation in addition to raising the awareness of the population with regard to this law and mobilizing it to be vigilant.
Another key requirement for transparency and accountability is corruption risk management which entails an elaborate process of risk identification, evaluation against related benefits, mitigation, and finally monitoring. It preempts the leakage and misuse of resources as opposed to looking for them after they have taken place and measuring their toll on organizational resources. It is the cost effective approach to addressing corruption and a key dimension of both the National Anti-Corruption Strategy and the 3RF. Pillar 1 of the 3RF, Improving Governance and Accountability, advocates for carrying out rapid corruption risk assessments in ‘key reconstruction sectors’ in an ‘inclusive manner and using specialized methodologies’ as a means to “reduce opportunities for leakage and political co-opting of reconstruction resources, thus strengthening public trust in recovery efforts.”
Role of Civil Society
Effectively, the world, and particularly the Lebanese community, are looking to civil society to play an even greater role than simply that of being a watchdog or raising awareness. This comes across obviously in the 3RF, which explicitly establishes the engagement of civil society actors as a critical success factor and priority – be it in the context of high-level dialogue, decision-making fora, 3RF institutional arrangements, or implementation oversight.
Moreover, in a country where disaster is a common feature of national history, the post-Beirut blast reconstruction efforts have been almost entirely driven by non-state actors. As such, there is a general direction to channel donor funds through non-governmental organizations (NGOs). There is also an expectation that NGOs, given their insights into the Lebanese context, will actively contribute to the assessment of corruption risk and the design of effective and targeted risk mitigation strategies along the supply chain of international assistance, given that risk management is a key component of the 3RF.
It goes without saying that NGOs are also expected to model transparent and ethical behavior as a means to compete fairly for international funding. This entails: 1) transparent and timely reporting including of plans, budgets, processes, beneficiaries, clear operating standards (what help is available/ to whom/ in what quantities), and ex-post cost-effectiveness analysis; 2) maintaining clear, efficient, and confidential community complaint mechanisms; and 3) subjecting themselves to third-party assessments or at least having the willingness to do so. Such practices not only inspire trust, but also sow a culture of transparency and accountability in a community where such a culture is in strong demand, and optimize both the performance and integrity of the civil society sector itself, neither of which should be taken for granted. In fact, some NGOs are presumably affiliated with politicians where they serve as vehicles to further perpetuate corruption of the political elite. Thus, the transparency of NGO practices and operations is a key component of the success of international aid efforts and it is very important to note in this regard that the onus is on the donors to demand this transparency as per international best practices and to hold NGOs accountable accordingly.
Short-term Response vs Long-term Reconstruction
That said, caution should be taken against turning Lebanon into an “NGO state.” A scenario where funds are controlled by NGOs and contracts are executed by the private sector is not without risk – a good example of which is price gouging by private sector actors in the healthcare industry with regards to the global pandemic. It is therefore critical to make sure that international standards are met before private companies are awarded contracts in situations of crisis and reconstruction. This is incumbent on the international community and on the government as well. In other words, even where public trust has been lost, a nation cannot do away with the role of the State. There are a number of functions that underpin day-to-day transactions – such as drafting and passing laws and preserving law and order, including maintaining a sound judicial system, to name a few – and these can only be shouldered by the public sector. However, at such a critical juncture where the State has been utterly crippled by the long-standing political deadlock and endemic corruption, the only way forward is to differentiate between short-term response and medium- and long-term reconstruction, a distinction that is adopted by the 3RF. In the short term, channeling aid through civil society and within a properly controlled transparent mechanism may well be the only means towards a relatively swift response for the benefit of those whose very livelihoods are hanging by a very thin thread. For medium- and long-term reconstruction and recovery however, there will be a need to engage the Lebanese government, and this is exactly what the 3RF calls for: a partnership framework that brings together the various stakeholders including public sector and civil society actors where each has their role to play towards creating a sound system of checks and balances. That said, a prerequisite is for the said government to begin to regain its legitimacy by means of a firm and demonstrable commitment to appropriate governance reform grounded in sound public financial management practices within the context of the 2020 National Anti-Corruption Strategy. In alignment with the 3RF, such engagement would be based on a sectoral risk assessment where civil society actors would also play a critical role in informing these assessments and as watchdogs. Of course, true reform requires an independent judiciary and independent institutions as the ultimate safeguards to ensure the rule of law.
In conclusion, international aid to Lebanon faces significant corruption risks, the management of which requires a carefully strategized multi-stakeholder approach for both short-term disaster response and longer-term reconstruction and recovery. Civil society is a key stakeholder in both phases and must model transparent and ethical behavior. The State is evidently also a key stakeholder, the engagement of which is envisioned for the latter phase and contingent on its efforts to regain the public trust. Efforts to implement the 2020 National Anti-Corruption Strategy are an imperative step in that direction.
Disclaimer: The analysis, views and policy recommendations of this article do not necessarily reflect the views of the United Nations, including UNDP, or its Member States. The article is an independent piece commissioned by UNDP as a build up to the “Transparency and Accountability in International Assistance” webinar organized in partnership with Executive Magazine.