So­mali gov­ern­ment funds mis­used

Only a pit­tance for as­sis­tance to the starv­ing

The Washington Times Daily - - World - BY KATHARINE HOURELD

NAIROBI, KENYA | While tens of thou­sands of its cit­i­zens were dy­ing from famine, the U.n.-backed So­mali gov­ern­ment spent only $1 mil­lion on so­cial ser­vices de­spite hav­ing $58 mil­lion in rev­enue, ac­cord­ing to a re­port by a for­mer So­mali gov­ern­ment of­fi­cial.

The whistle­blow­ing re­port shines a light on chaotic and se­cre­tive fi­nan­cial deal­ings and says the So­mali gov­ern­ment failed to ex­plain how the $58 mil­lion it recorded re­ceiv­ing last year ac­tu­ally was spent.

So­mali gov­ern­ment of­fi­cials dis­puted the re­port by Ab­di­razak Far­taag, the for­mer head of the Public Fi­nance Man­age­ment Unit, a So­mali gov­ern­ment body charged with over­see­ing the coun­try’s fi­nan­cial man­age­ment.

“The gov­ern­ment is very com­mit­ted in terms of fight­ing cor­rup­tion,” said gov­ern­ment spokesman Ab­di­rah­man Omar Os­man. “That re­port does not re­flect the re­al­ity on the ground, and it lacks cred­i­bil­ity and data.”

More than $2.6 mil­lion was bud­geted for so­cial ser­vices, ac­cord­ing to the re­port.

Mr. Far­taag was fired around the time he wrote an­other re­port say­ing tens of mil­lions of dol­lars were miss­ing from gov­ern­ment ac­counts. Im­proved ac­count­ing of the money that comes in and out of the gov­ern­ment is vi­tal to solv­ing So­ma­lia’s 21-year-old civil war, an­a­lysts say.

As long as war­lords and cor­rupt of­fi­cials are able to ben­e­fit from the chaos, they have lit­tle in­cen­tive to end it.

At a con­fer­ence at­tended by world lead­ers in London last month, donors and So­mali of­fi­cials agreed to set up a joint board to man­age So­ma­lia’s fi­nances.

The fail­ure to keep track of So­ma­lia’s cash has proved deadly. Politi­cians fight for con­trol of the cash, but lit­tle of it reaches the needy.

A prom­ise to end cor­rup­tion was a key re­cruit­ing tool for the Is­lamist in­sur­gency fight­ing the gov­ern­ment.

The fight­ing was a key cause of last year’s famine, which killed 50,000 to 100,000 peo­ple, ac­cord­ing to the Bri­tish gov­ern­ment.

A re­fusal by in­sur­gents to al­low many aid groups ac­cess to dis­trib­ute food also is a ma­jor prob­lem. The United Na­tions is ap­peal­ing for $1.5 bil­lion this year to aid So­ma­lia.

“So­ma­lia needs a solid frame­work that im­proves trans­parency,” said Com­fort Ero, the Africa pro­gram di­rec­tor for the In­ter­na­tional Cri­sis Group think tank. “[The gov­ern­ment] hasn’t pro­vided ba­sic ser­vices.”

The re­port, while not pub­licly re­leased, was pre­sented to So­mali leg­is­la­tors last month. It is based on bank­ing records, the gov­ern­ment bud­get and other fi­nan­cial doc­u­ments.

Last year, the gov­ern­ment raised about $58 mil­lion, in­clud­ing about $20 mil­lion in do­mes­tic rev­enue and an ad­di­tional $3.7 mil­lion seized at the air­port as part of a con­fis­cated ran­som for pi­rates.

The gov­ern­ment also re­ceived at least $34 mil­lion in cash do­na­tions from mainly Arab na­tions, said Mr. Far­taag.

About $41 mil­lion was with­drawn in cash by in­di­vid­ual politi­cians, mili­tia lead­ers and other lead­ing So­ma­lis who gave no iden­ti­fi­ca­tion other than their names.

Most of the rest of the money was also taken in cash by in­di­vid­u­als who pro­vided the Cen­tral Bank of So­ma­lia with their name and the min­istry that em­ployed them. An ad­di­tional $1.2 mil­lion in cash went to ho­tels, phone com­pa­nies and air­lines in Mo­gadishu, ac­cord­ing to the re­port.

Dur­ing the whole year, only about $1 mil­lion was recorded as be­ing spent on so­cial ser­vices, the re­port said. It was un­clear how the money was spent be­cause it was part of the $41 mil­lion with­drawn in cash.

Some of the cash with­drawn is be­lieved to have been spent on gov­ern­ment salaries, but it is un­clear how much. The gov­ern­ment did not respond to re­quests for records.

Dur­ing that time, So­mali chil­dren were dy­ing in the streets, and starv­ing fam­i­lies were flow­ing into the ru­ined sea­side cap­i­tal in an ef­fort to es­cape the drought and war con­sum­ing their vil­lages.

In Septem­ber, the United Na­tions said 100 chil­dren were dy­ing ev­ery day. The gov­ern­ment spent $165,000 on “dis­as­ter pre­pared­ness” dur­ing the famine, ac­cord­ing to the re­port.

“Ev­ery­thing is done on a cash ba­sis, and no one has to ac­count for it,” said Mr. Far­taag. “Noth­ing is func­tion­ing, ev­ery­thing is a briefcase in­sti­tu­tion. ... That’s why they can’t pro­vide ser­vices like water, hos­pi­tals or schools.”

The Bri­tish gov­ern­ment wants to ad­dress So­ma­lia’s tan­gled fi­nances by es­tab­lish­ing a board made up of So­ma­lis and for­eign­ers to over­see the failed state’s fi­nances.

A So­mali and a for­eigner would have to sign off on each with­drawal. London is also en­cour­ag­ing na­tions that make pay­ments to the So­mali gov­ern­ment to pub­lish the fig­ures.

“The find­ings of the Far­taag au­dit are un­con­firmed, but the joint fi­nan­cial man­age­ment board is in­tended to tackle ex­actly the types of cor­rup­tion and mis­man­age­ment that it raises,” said Matt Baugh, Bri­tain’s am­bas­sador to So­ma­lia.

“The [board] will also re­duce any risk of cor­rup­tion in the as­sis­tance pro­vided to So­ma­lia by in­ter­na­tional part­ners and im­prove the ac­count­abil­ity and trans­parency of that aid.”

Bet­ter man­age­ment could make a huge dif­fer­ence. Mr. Far­taag said the gov­ern­ment could eas­ily earn it­self $179 mil­lion a year, mainly by col­lect­ing a 3 per­cent tax from telecom­mu­ni­ca­tion com­pa­nies.

The gov­ern­ment could also tax re­mit­tances from So­ma­lis liv­ing abroad and tax sales of the nar­cotic leaf called qat. It could also raise money by prop­erly col­lect­ing rev­enue from the main port in Mo­gadishu, the re­port said.

De­spite the cir­cum­stances de­scribed in the re­port, So­ma­lia’s gov­ern­ment has made small im­prove­ments. Some civil ser­vants were paid last year, although many did not re­ceive their salaries in the past months.

Gov­ern­ment rev­enues are up from 2010, and more for­eign do­na­tions are be­ing de­clared.

The gov­ern­ment is also de­bat­ing a bill to im­pose an un­spec­i­fied tax on telecom­mu­ni­ca­tion com­pa­nies with an es­ti­mated an­nual rev­enue at about $540 mil­lion.

AS­SO­CI­ATED PRESS PHO­TO­GRAPHS

The dusty streets of Mo­gadishu, So­ma­lia, are part of the crum­bling in­fra­struc­ture the gov­ern­ment is ne­glect­ing, de­spite $58 mil­lion in rev­enue last year. A re­port by a for­mer So­mali gov­ern­ment of­fi­cial says that while tens of thou­sands were suf­fer­ing and dy­ing from famine, the U.N.backed So­mali gov­ern­ment spent only $1 mil­lion on so­cial ser­vices last year.

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