Ensuring accountability through transparency in public spending in the health sector

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Governments around the world are playing a crucial role in providing lifelines for people and businesses to help fight the pandemic and its economic fallout. To support the effectiveness of these efforts, it is important that these expenditures are also subject to transparency and accountability. UNICEF, the Islamic Development Bank (IDB) and the International Monetary Fund (IMF) recognize these conditions as essential conditions for better governance in the health sector.

In fact, the IMF has now made it clear that accountability is essential and can only be generated through good governance both with regard to spending on purchasing necessary health items and in the operation of health facilities. or in obtaining vaccines to stem the growth and spread of the Covid pandemic. These measures should govern health dynamics if a country seeks IMF financing during this crisis. It’s logic.

Associate economists at the World Bank, IMF and Asian Development Bank also reaffirmed that the financial assistance matrix should also include commitments from affected Parties to publish pandemic-related procurement contracts and property. actual number of companies awarded with these contracts, as well as COVID-19 expense reports and audit results. It is believed that such an approach will reduce the risk of corruption and also the possibility of wastage of funds.

In this regard, international financial institutions have also hinted that they have noticed on numerous occasions that funds received are needlessly consumed by travel in the name of greater experience with sanitary measures in other countries. This is being undertaken despite greater advances through digitization.

The measures are adapted to the circumstances of the country and the seriousness of the corruption risks. In addition, all recipient countries undertake to undertake a due diligence exercise to ensure that a country’s central bank is able to provide reliable information and transparently manage the funds it receives from the IMF. .

Most recently, Chady El-Khoury, Associate in the Financial Integrity Group of the IMF Legal Department, Jiro Honda, working in the IMF’s Fiscal Affairs Department; Johan Mathisen, member of the IMF’s Strategy, Policy and Review Department, and Etienne B. Yehoue, economist at the International Monetary Fund, collectively came to some important conclusions after extensive research.

They noted that it is not easy to approach the paradigm related to corruption very easily. Sometimes you can only see the tip of this iceberg. This generates a focus on the existing problem, but it does not mean that everything is clear and easily discernible. It was pointed out that tackling corruption could take time. In this regard, it should be noted that the IMF, having recognized that the longer-term governance challenges associated with corruption are here to stay, drafted a framework for increased engagement of the Fund in 2018, with the specific aim of resolve issues arising from IMF multi-year loans. agreements associated with the health sectors of IMF member countries. This is quite understandable. It is understandable that the competent institutions of the European Union have also followed this exercise.

Since the advent of the Covid pandemic in early January 2020, particular emphasis has been placed in this regard on certain regions and countries. Task forces have been established to gather information on how these countries have implemented their governance measures in spending related to the pandemic.

The above-mentioned expert group and others associated with such an exercise focused on different dimensions. In the case of the Dominican Republic, Guinea, Nepal and Ukraine, they found that capacity constraints had contributed to limited progress in the IMF’s ability to provide capacity building to support implementation. artwork.

However, in another area – regarding the publication of information on contracts, most of the commitments have been or are in the process of being fulfilled. This aspect includes the collection and publication of the benefits that flow from the ownership of the contracting companies. This is a step forward because such a measure will help deter corruption that could arise by facilitating possible conflicts of interest involving public officials. This has the connotation that it is required that bidding companies during a call for tenders will have to provide the names of the persons having effective control over a company, also known as “beneficial owners”.

This information should be provided to the procurement agency, which in turn should publish it. The implementation of this innovative practice has proven difficult in some cases, with only half of the countries (including Benin, Ecuador, Jordan, Malawi and Moldova) having implemented this commitment or made progress substantial in its achievement. However, these commitments made in the context of IMF financing during the pandemic helped to encourage some countries, such as Kenya and the Kyrgyz Republic, to adopt this reform on a permanent basis.

After that comes another relevant dimension. This relates to the important aspect of the audits that must be carried out on emergency spending. Normally, the deadline for carrying out ex post audits is usually 3 to 12 months after the end of the financial year. Some analysts have observed that this delay makes it too early to assess the implementation. However, some countries, such as Jamaica, Honduras, Maldives, and Sierra Leone, have already taken swift action by performing real-time risk-based audits. Where appropriate, the IMF has stepped up its capacity building to assist Supreme Audit Institutions in designated countries in fulfilling their responsibilities. They also supported efforts to ensure that this information is easily retrievable. Such additional support certainly helps to reduce corruption and increase accountability.

The IMF and the World Bank also face other important challenges. They need to focus on certain other aspects associated with accountability and transparency in responding to the crisis. It also includes broader governance and anti-corruption reforms and how they progress in the context of the IMF’s multi-year financing arrangements. Analysts in this regard referred to the ongoing fiscal governance reforms in some African countries – Gambia, Liberia, Senegal and Rwanda, Ecuador in South America and Jordan in the Middle East. Likewise, attention is paid to reviewing and improving frameworks for combating corruption and money laundering in some African countries – Angola, Republic of Congo, Kenya and Tunisia. Financial sector supervision and central bank governance have also been of interest in the case of Liberia in Africa and Ukraine in Europe.

These efforts undertaken in these countries should serve as a way of guiding public spending and the use of loans made to Bangladesh by institutions associated with our health sector as well as by companies that have an interactive engagement with these institutions.

We must remember that transparency and accountability are major factors in the crisis response to this ongoing pandemic. They are important to all countries, regardless of their income level – developing or developed. We must also remember that such an approach to governance is a given and a common thing in many countries like Norway and Sweden, which are not primarily busy trying to get IMF financing to solve their problems. health.

However, attention should be drawn to the fact that some countries publish detailed expenditure information on dedicated transparency portals such as Colombia, Costa Rica, France and Peru. Others, like South Korea, frequently perform external audits to verify pandemic-related spending. Some are also developing clear guidelines for emergency purchases, such as Spain. There is also Romania which tries to detect conflicts of interest by analyzing data on beneficial owners and financial disclosures of senior officials. The UK and US are generally ahead in terms of accountability, but the lack of required governance also sometimes surfaces when it comes to the activities of certain pharmaceutical companies and their socio-metric overlap with politicians. This has also been observed in several countries in South Asia, the Middle East and South East Asia.

We must remember that in these difficult times, a sustained commitment of countries in governance and the fight against corruption will be necessary to support the effective implementation of the reforms undertaken during the pandemic and beyond. We need to go beyond the fight against corruption to address fiscal governance, financial sector supervision, central bank governance, market regulation, rule of law and anti-money laundering frameworks. ‘silver. There is no other option.

Once we agree on such a required paradigm, in our country we can then seek the technical assistance and training facilities needed to implement the good governance measures necessary for capacity building. We must also remember that efforts to improve governance will also depend on high-level political ownership of reforms, international cooperation, and a joint effort with civil society and the private sector, among other stakeholders. It won’t be easy, but it is possible.

Muhammad Zamir, former ambassador, is an analyst specializing in foreign affairs, the right to information and good governance.

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