(By Krishna Sapkota)

Kathmandu, July 4: Nepal witnessed an upsurge of donors’ pledge amounting to $4.4 billion (NPR 440 billion) for reconstruction in the June 25 International Conference on Nepal’s Reconstruction (ICNR) held in Kathmandu. The government had put assiduous efforts to garner the pledge of generous support in the form of grants ($2.2 billion) and soft loan ($2.2 billion) for its long march towards a resilient Nepal.

The overwhelming response –more than anticipated– from the international community has showcased Nepal’s unexplored institutional capacity to act during the time of emergency. However, the question now is how to respond better with action to deliver the mammoth support towards reconstruction and resilience in a meticulous manner, so as to lead the country into a new lease of life rising from the ripples of devastating earthquake.

Money is a vital factor for the government to create enabling environment to deliver its promises to citizens, but it is also extremely prone to misallocation, corruption, unplanned and wasteful spending and illicit financial flows. It is the money which builds on success of the government if utilized wisely and purposefully but then it may also erode public trust and legitimacy in no time when spent redundantly without accountability obligations.

Hence, the evidence-based response to the stakeholders’ genuine question – where does the money come from and where it ends up– is spectacular allowing taxpayers of donor and recipient countries to demand accountability from the government and check aberration flow of money. It helps to reduce the fiduciary risks and increases government’s credibility on the one edge and creates space for citizens to follow the public money – a key imperative of the fiscal democracy, on the other.

During the June 25 high-profile conference, the donors also stressed transparency on part of Nepal government in spending the post-disaster recovery funds in her rebuilding efforts. Addressing the conference, head of delegates from key bilateral donor countries including India, China, Japan, USA, UK, European Union, as well as multilateral funding agencies, World Bank and Asian Development Bank (ADB), had urged Nepal government to ensure that their support would reach out to the disaster-hit people.

At the conference, Indian Minister for External Affairs Sushma Swaraj had pointed out that it is as equal challenging to spend funds as to generate them. “For efficient and transparent utilization of fund, it requires a robust institutional framework envisioning empowered teams of human resource with unswerving dedication”, she said.

Prime Minister Sushil Koirala in his inaugural speech at the conference emphatically noted that the government was committed to best utilize the assistance received from the donors and maintain its transparent operation. “Rule of law, citizen’s well-being and good governance, among others, will remain an important part of rebuilding process”, he added. The executive chief has repeatedly asked the stakeholders to monitor the mobilization of the funding, keeping the door open for accountability checks.

Transparency and proper utilization of resources received is largely agreed and promised. However, there is a question as to how it would be maintained. “To keep the public pledge for openness, the government should come up with the accountability mechanism allowing third party to independently monitor spending of public money received to the state coffers both through donor financing and Prime Minister Disaster Relief Fund”, says Basanta Lamsal, who served as the Lead Researcher in the study on ‘Aid Transparency in Nepal’ that empirically assesses the level of donors openness in Nepal.

Referring to the post-conflict governance experience of Afghanistan where he worked for four years as a development practitioner in various capacities, Lamsal prescribes a high-powered third party civic monitoring mechanism to look for the transparency of process and effectiveness of the public money – where does it come from and where it ends up. “Afghanistan witnessed a failed development approach with the government becoming weak and donors at the high hand”, he said, adding the Nepal government should maintain vigil on possible foul play meant for hijacking Nepal’s development especially during the time of crisis.

Importantly, the government also unveiled principles and priorities of the upcoming budget in the parliament on July 1, placing emphasis on the timely reconstruction, among others. The government has already revised budget ceiling for the fiscal year 2015-16, adding Rs 106 billion for reconstruction works, which will be handled by the to-be-formed Reconstruction Authority. The government has also floated the idea of issuing the ‘Reconstruction Bond’ to raise money to meet funding gap for the purpose. It indicates that there will be a raise of big chunk of money for the reconstruction and rebuilding of Nepal.

Therefore, placing functional mechanisms that provide window of opportunity to civic bodies to follow the public money or to put third party monitoring is more pressing need of the hour. Once it is in-built to our country’s system the initiative will yield evidence-based results of the operation of public funds that will ultimately leverage Nepal’s effective march towards resilience.

(Source: National News Agency (RSS)