How Corrupt Is the World Food Program?

The Journal of the American Enterprise Institute

By Till Bruckner, with Jon EntineSunday, April 11, 2010

Filed under: World Watch, Government & Politics

How pervasive are the problems at the World Food Program, the largest hunger relief agency in the world and the United Nations agency responsible for food aid? It’s a $2.9 billion question—the amount of direct aid disbursed by the WFP. A significant part of its budget comes from U.S. contributors, and USAID coordinates some of its work through the WFP.

It’s been a month since the leaking of a scathing evaluation of WFP’sSomalian relief program written by the UN Monitoring Group onSomalia. The body, created by the U.N. Security Council, alleges that three Somali businessmen who held about $160 million in WFPtransport contracts were involved in arms trading while diverting the agency’s food aid away from the hungry. A New York Times report also claimed food was being siphoned off by radical Islamic militants and local UN workers.

Allegations had been simmering for months. The WFP suspended the contracts of the three businessmen but continues to deny there were serious problems. It has tried to frame the findings as unfounded or exaggerated. Speaking from WFP headquarters in Geneva, Executive Director Josette Sheeran said there was “zero evidence” for the allegations of a large-scale diversion of aid. “These estimates of diversion are not apparently based on any documentation, but rather on hearsay and commonly held perception,” the UN's aid chief in Somalia, Mark Bowden, wrote in the letter to the monitoring body. Bowden didn't provide his own estimate. The WFP said it would welcome an investigation.

Somalia is one of the most challenging places in the world for aid work, making the allegations difficult to verify. Food has to pass through roadblocks manned by insurgents and bandits. Investigators, who face the peril of kidnapping or even assassination, could end up relying on the people they are probing to provide for their protection.

Certainly an agency as large and diffuse as WFP—it has offices in 80 countries and provides food relief to 100 million people a year—is bound to have some problems. But questions remain as to how WFP executives monitor their vast network and how transparent and responsive they are when questions arise.

Somalia is not the WFP’s only controversy, only its most recent and most public. Its operation in Ethiopia, which is one of the largest recipients of food aid in the word, is reportedly in disarray, with the transport companies controlled by the country’s authoritarian government at the center of the controversy. According to the U.S. State Department, in 2008 only 12 percent of food aid (most of it overseen by the WFP) made it to its intended recipients in the poverty-stricken eastern region.

The trucking situation is little better in Afghanistan, where reports suggest that WFP is paying two to three times more than commercial rates, taking large chunks out of the $1.2 billion, three-year relief effort. The WFP has admitted that it inflated its shipping costs in North Korea by funneling business through dictator Kim Jong Il's government.

In each case the WFP has denied the magnitude of the problem. But the responses miss the point. Why hasn’t the WFP, which portrays itself as a model of transparency, opened its books so the international community can exercise appropriate accountability and oversight? And what actions are other international agencies requiring of humanitarian aid agencies to ensure transparency?

The Georgian Mess

The trucking situation is little better in Afghanistan, where reports suggest that WFP is paying two to three times above commercial rates, taking large chunks out of the $1.2 billion, three-year relief effort.

The problems with WFP food aid now coming to light are not isolated. I experienced them firsthand while in the republic of Georgia from 2008 to 2009, where I was the post-war aid monitoring coordinator of Transparency International Georgia. I was researching my doctoral thesis about aid accountability in a country where I myself had been an aid worker between 2002 and 2006.

The WFP had already been working in Georgia for several years when the brief but bitter conflict with Russia broke out in August 2008. Several days of intense fighting left hundreds of people dead. Nearly 130,000 Georgians were forced to flee their homes, suddenly displaced within their own country. Driven by strategic considerations and humanitarian concerns, international donors pledged to provide more than $4 billion in aid. One billion dollars of this money was pledged by the United States, making it the largest donor to Georgia. Millions of dollars were to be used to provide emergency food aid to tens of thousands of Georgians who had been affected by the fighting, including many who had been forced to flee their homes during the conflict and were now internally displaced.

In the wake of the conflict, WFP and numerous other nongovernmental organizations (NGOs) started delivering emergency humanitarian assistance in addition to continuing work on their longstanding development projects. My research in Georgia revealed that the WFP, in cooperation with four international charities, used donor money to distribute insufficient, inappropriate, and in some case useless food rations to thousands of Georgians traumatized by war and displacement. As appears to be the case in Somalia, there was at best spotty oversight of the relief effort; also, to date, no one has been called to account.

In this case, the issue was not the transport infrastructure but the handling of the actual food rations. While most Georgians had been able to return home by the end of 2008, tens of thousands of people remained displaced and in need of support. Food aid was managed by the WFP and four aid agencies—CARE, the International Orthodox Christian Charities, Save the Children, and World Vision—all of which are still operating in Georgia. The food was delivered to people displaced by the conflict and to residents of the so-called “buffer zone,” a rural area where much of the fighting had taken place.

According to the U.S. State Department, in 2008 only 12 percent of food aid (most of it overseen by the WFP) made it to its intended recipients in the poverty-stricken eastern region of Ethiopia.

One of the key responsibilities of a food aid agency is to provide a daily minimum diet to prevent malnutrition and starvation. In Georgia, food rations were not adjusted upwards to account for the bitter winter, and therefore fell below globally accepted minimum standards, including those of Sphere, the guiding global humanitarian and disaster relief charter. Neither the Georgian government nor international donors realized thatWFP and the four NGOs were delivering food that fell short of the minimum needs of those who were enduring the harsh Georgian winter. As a result, aid recipients experienced a food gap until February 2009, when—in an unrelated development—the UN distributed credit-like cards to food aid beneficiaries so they could buy fruits and vegetables. It was supposed to supplement their wheat-heavy regular aid, but many of the recipients instead had to use these cards to bridge the gap left by WFP in their basic food needs.

The problems were compounded because the aid recipients had no way to communicate with WFP or its sister relief agencies. They had been provided with a nonworking hotline number that left Georgians helpless and frustrated.

While the quantity of food was clearly insufficient, the quality of the rations at times was even worse. In early 2009, using its global procurement system, similar to what was in place in Somalia, WFP purchased 1,800 tons of wheat flour from a supplier in Turkey and began distributing it. It could not be used to make Georgian bread due to a problem with the flour’s gluten index, although it technically met WFP standards. When people tried to bake bread, it turned hard, making it inedible. Mixing this flour with flour from other sources did not solve the problem. The absence of edible bread left thousands of people with a huge calorie gap.

Why hasn’t the WFP, which portrays itself as a model of transparency, opened up its books so the international community can exercise appropriate accountability and oversight?

The WFP and its partner NGOs were fully aware of the problem but downplayed its significance. “There is an issue with the gluten index which results in poor performance when bread is baked,” the WFP acknowledged in March 2008. “But since the flour is perfectly fit for human consumption,WFP is not planning to take back the distributed tonnages.” This statement flatly contradicted a qualifying line in the draft report that WFP kept from becoming public when the official report was released: “Anecdotal reports from the field suggest that some IDPs [internally displaced persons] are using the wheat flour as animal feed because they cannot use it to bake bread.”

WFP together with its NGO subcontractors continued distributing this flour for weeks. In total, 800 metric tons—equivalent to the flour content of 1.6 million individual daily rations—costing more than half a million dollars were distributed to tens of thousands of people before WFP finally ordered a halt.

The Accountability Gap

U.N. Secretary-General Ban Ki-moon has not yet responded to calls to authorize an independent investigation of the WFPoperations in Somalia or elsewhere. But everyone, even the beleaguered food agency, acknowledges there is a problem. Bowden, the Somalian aid director, said UN bodies have spent over $350,000 to improve monitoring in Somalia since 2008, and adopted other steps to limit risks in a “complex environment where a war economy has predominated for many years.”

What can the international community do to prevent the kind of problems that simmer in Somalia, Georgia, and other parts of the world that depend on international aid to feed the displaced and hungry? In theory, aid agencies are accountable to a variety of stakeholders, including private and institutional donors, their beneficiaries, the governments of the countries they work in, and the wider aid community. In practice, accountability is almost nonexistent because international standards either do not exist, are not enforced, or become victims of political crossfire. In Somalia, WFP has rejected one of the recommendations by the UN monitoring agency, to allow monitors to use UN Humanitarian Air Services to travel around the country. "The work of the monitoring group has been determined to be political in nature and therefore ... it would not be appropriate to make UNHAS flights available to them," Bowden said.

In practice, accountability is almost nonexistent because international standards either do not exist, are not enforced, or become victims of political crossfire.

The WFP has set up a firewall in Georgia as well. When I contacted them, the WFP and the four aid agencies refused to release the agreements governing their relationship—a violation of standards set by InterAction, an international coalition of humanitarian agencies, and of the Code of Conduct for NGOs in Disaster Relief (which WFP requires sub-contracting NGOs to follow). That made it impossible to determine how much aid money WFP pays to NGOs to distribute food.

Private donors in wealthy countries simply lack the information needed to hold aid and development NGOs to account for how their donations are used thousands of miles away. The only information available is that which is voluntarily provided by the NGOs, which are extremely reluctant to open their operations to scrutiny.

U.S. citizens concerned about the use of their tax dollars abroad may find it equally hard to discover how NGOs awarded grants by USAID are spending their money. I filed a Freedom of Information Act request with USAID in May 2009, requesting copies of all NGO project budgets financed with American taxpayers’ money during the second half of 2008. Almost a year later, USAID has still not released these documents.

Institutional donors like USAID usually do have a presence on the ground in developing countries, but they rarely directly monitor NGO activities in the field. Instead, they usually, though not always, rely on information provided by their grantees. Interviews with dozens of donor and NGO representatives in Georgia, Afghanistan, and Tajikistan suggest that neither NGOs nor donor country offices have an incentive to document instances in which aid money is stolen, wasted, or unwisely spent. Projects are almost invariably portrayed as successful, irrespective of realities on the ground.

Private donors in wealthy countries simply lack the information needed to hold aid and development NGOs to account for how their donations are used thousands of miles away.

Government officials in Somalia or Georgia are unlikely to try to hold theWFP or other international NGOs accountable for their activities. They lack the capacity to do so effectively and NGO projects typically do not receive funding from host governments. When the flour scandal finally made headlines in the Georgian media, the opposition quickly blamed the government rather than WFP, so the UN agency was never called to account.

The beneficiaries—the displaced and the hungry—are often caught in the middle. NGOs have a vested interest in presenting themselves as accountable to the needy to keep funds pouring in. But NGOs face no institutional pressures to meaningfully follow through on such commitments. They live off private donations and government grants, so being responsive to beneficiaries is irrelevant to organizational growth and survival.

Most Georgians receiving food aid come from villages and do not speak English. They do not know (and frequently do not care) which NGO delivers what aid. Whether intentionally or not, NGOs fail to identify themselves, don’t provide contact details, or leave beneficiaries in the dark about their entitlements. Georgian beneficiaries did not know when to expect the next delivery or even whether there would be a next delivery at all.

An Intractable Challenge?

Aid organizations have responded to concerns about their lack of accountability through a variety of initiatives and mechanisms intended to create transparency within the aid community. Senior staff members at NGOs’ global headquarters readily sign up to noble-sounding initiatives and commit their organizations to meeting certain standards. But these measures lack teeth and often require organizations to act as a whistleblower against a partner agency. As a result, they are almost universally ignored in practice. Few field-level aid workers are aware of the various commitments that their organizations have made, so they are not in a position to press for reforms.

Interviews with dozens of donor and NGO representatives in Georgia, Afghanistan, and Tajikistan suggest that neither NGOs nor donor country offices have an incentive to document instances in which aid money is stolen, wasted, or unwisely spent.

When issues do come to light, as in Somalia, agencies in the crosshairs invariably claim that the food relief program is largely helpful and successful and there will always be some problems in emergency response situations. The WFP notes it faces enormous challenges inSomalia, where more than 3 million people—or about half the population—suffer from malnutrition and need aid.

An independent investigation could be illuminating, but launching yet another NGO-to-NGO mutual accountability initiative likely would be fruitless. The problem is not a lack of standards and codes of conduct, but lack of enforcement and sanctioning of existing standards. Oversight by institutional donors such as USAID is inherently difficult because institutional incentives reward donor country offices for reporting successes and punish them for highlighting failures. Adding more of the same red tape, encumbering NGOs that are already drowning in bureaucratic requirements, could reduce the ability of committed NGO field workers to assist those in need, and would likely do little to address inefficiencies.

NGO project budgets are the single exception to this rule. USAID could require all grant recipients to post their proposed project budgets online before funding is released. These budgets already exist as part of the formal project proposals, so publicly revealing them would require negligible additional effort by NGOs. At a minimum, this would act as a constraint on some NGOs’ tendency to pay grossly inflated tax-free salaries to their international staff. However, as Transparency International Georgia’s experience has shown, any such initiative might be resisted by NGOs, and probably also by USAID itself, and is therefore unlikely to succeed in the absence of serious and sustained congressional pressure.

For the poor and hungry, the situation is daunting. Raising aid agency responsiveness towards beneficiaries may hold out the greatest hope of improving accountability in international aid. But exact mechanisms to make that happen are elusive. In order to have real effects, such transparency and disclosure must be backed by effective sanctions when the performance of aid agencies falls short of beneficiaries’ entitlements.

Till Bruckner is completing a PhD thesis on accountability and corruption in international aid to Georgia at the University of Bristol, United Kingdom. Jon Entine, co-director of Global Governance Watch and a visiting fellow at the American Enterprise Institute, helped write this account and added additional reporting.

FURTHER READING: Entine has discussed food security and crop research in “Green Revolution in the Balance.” AEI's R. Glenn Hubbard says it's time for “The Berlin Wall of Aid” to fall, while John Bolton unlocks “The Key to Changing the United Nations System.”

Image by Darren Wamboldt/Bergman Group.