Documents Considered by the Committee on 22 October 2014 - European Scrutiny Committee Contents


4 EU support for rehabilitation following the earthquake in Haiti

Committee's assessment Politically important
Committee's decisionNot cleared from scrutiny; further information requested; drawn to the attention of the International Development Committee
Document detailsEuropean Court of Auditors' (ECA) Special Report on EU support for rehabilitation in Haiti following the 2010 earthquake
Legal baseArticle 287(4) TFEU; —
DepartmentInternational Development
Document number(36359), —

Summary and Committee's conclusions

4.1 Haiti is one of the most fragile states in the world; the earthquake that struck the country on 12 January 2010 dramatically exacerbated the situation. In March 2010, 55 donors pledged $5.37 billion of rehabilitation and development for the 2010-12 period and a further $2.96 billion for 2013 and beyond. The EU was one of the main donors, making a single pledge of €1.23 billion.

4.2 This European Court of Auditors' (ECA) Special Report covers the support provided to Haiti over the period 2010 to 2013 by the European Commission's Humanitarian Aid and Civil Protection department (ECHO),[12] the Directorate-General for Development and Cooperation (EuropeAid)[13] and the Service for Foreign Policy Instruments (FPI).[14] The audit includes a review of 13 EU-funded programmes; seven ECHO programmes, three EuropeAid programmes and three FPI programmes. The review assesses the relevance, design and outcomes of these programmes.

4.3 The audit focuses on whether EU funding:

—  addressed priority recovery and reconstruction needs;

—  ensured linkages between relief, recovery and reconstruction and longer term development; and

—  ensured effective implementation of EU support for recovery and reconstruction.

4.4 The auditors found that EU support for rehabilitation was well designed overall, addressing the country's major needs. However, the programmes were not implemented effectively enough and the link between relief, rehabilitation and development (LRRD) was insufficient.

4.5 At the time of publication, Hans Gustaf Wessberg, the ECA Member responsible for the report, commented thus:

    "In their efforts to support rehabilitation and provide rapid aid, the European Commission and other donors faced serious challenges, having to manage their aid with weak national authorities in such a way as to encourage ownership and help build a properly functioning government. The Commission identified and addressed priority rehabilitation needs, and adopted a sound cooperation strategy and appropriate division of labour with other major donors. It also continued its support for long-term socio-economic development of the country. However, it could and should ensure that EU support in the field is implemented more effectively."[15]

4.6 The EU's auditors found that 10 of the 13 programmes that were examined had delivered — or were likely to deliver — their planned outputs, although almost all experienced delays.

4.7 Three programmes achieved limited progress, including the 10th European Development Fund general budget support programme.[16] The auditors say that: while the Commission was well aware of the difficult context, it did not sufficiently manage some significant risks to the implementation and achievement of its programme objectives; and that, while programmes were monitored on the basis of an appropriate framework, the Commission and the European External Action Service (EEAS)[17] did not take timely action to strengthen the resources of the EU delegation in Haiti, leaving it with insufficient capacity to perform on-the-spot visits, which would have been particularly useful in a rapidly evolving situation.

4.8 The Court recommends (in bold) that during operations in the context of a post-disaster or fragile situation, the Commission should:

—  improve risk management: the Commission accepts this recommendation, noting that the recommendation is already in place for budget support programmes since the adoption of the new budget support guidelines in January 2013; detailed risk management procedures are in place to ensure assessment of likelihood, potential impact and mitigation measures in the design of the programme; during the implementation, risk management will be considered in the framework of the already existing procedures;

—  adopt a common strategy to ensure the linkage and synergy between emergency aid, rehabilitation and development: the Commission accepts this recommendation, noting that it is already implementing an LRRD strategy and will continue to do so in the framework of the resilience agenda; the objectives of the common strategy are defined (context specific) as part of the preparation of the country plans;

—  when providing budget support, focus on key public finance management (PFM) functions and reforms and, where appropriate, set out shorter-term measures for safeguarding EU funds against waste, leakage and inefficiency: the Commission accepts the Court's recommendation, but also underlines that for countries in situations of fragility and crisis/post-crisis, assistance has to be adapted to the situation in order to achieve a measure of success; and has accordingly developed a specific instrument of intervention known as the "state building contract" containing provisions for such situations;

—  develop business continuity procedures including provisions for emergency personnel redeployment: the Commission and the EEAS accept this recommendation and point out that:

·  business continuity procedures, which are the responsibility of the EEAS, and provisions for emergency personnel redeployment, have been established for all delegations in the meantime; and

·  the safety and security of EU personnel is the first priority in situations of crisis or disasters in a country in which EU staff are present.

4.9 The Minister (Lynne Featherstone) highlights creating disaster resilience as key to bridging humanitarian and developmental effort, the latter providing an exit strategy for the former. In this regard, she explains that, in 2012, the Political Champions for Disaster Resilience was established, co-chaired by UK Secretary of State for International Development and the Administrator of United Nations Development Programme (UNDP), whose purpose includes "promoting investment in disaster resilience" and of which the EU is also a member, as well as the Government of Haiti following its selection as a pilot country.

4.10 She welcomes Commission acceptance of all the Report's recommendations, and that a range of remedial measures to address the principal concerns are already being implemented. She highlights in particular the preparation of a Joint Humanitarian-Development Framework to support a coherent approach between humanitarian and development actors, which she says should help to further improve internal coordination between the EU Delegation and ECHO.

4.11 However, she also says, it is too early to judge how effective these measures will prove to be: for example, although, the Minister says, the Commission has made extensive efforts to integrate the concept of resilience into its programmes at the policy level, it has yet to make a direct contribution to specific resilience programmes under the auspices of the Political Champions.

4.12 The approaches taken by the ECA — taking account of the extremely difficult context — and the Commission — defending its performance where appropriate but accepting the ECA's recommendations — appear to be entirely reasonable.

4.13 However, despite highlighting creating disaster resilience as key to bridging humanitarian and developmental effort in these crisis situations, the Minister says no more than that she and her team "will continue to emphasise the need to bridge humanitarian and development effort, including through our role as co-chair of the Political Champions Group as an advocate of disaster resilience".

4.14 The Minister does not, however, explain what this Group is, and how it operates; nor, therefore, what the significance is of the example she gives above (which, to the non-expert, is obscure), though the implication is that EU membership of it has not yet made much difference. And, though highlighting the importance of a "Joint Humanitarian-Development Framework to support a coherent approach between humanitarian and development actors", she provides us with no idea of who is responsible for this or when she expects it to become operational.

4.15 This is surprising, given that the EU is one of the world's largest donors, providing life-saving assistance to people affected by various crises; and that the Council, Commission and EEAS have devoted a great deal of time and resources to thinking about the key question of resilience: a Commission Communication of 2012, Council Conclusions on an EU approach to resilience in 2013 and then a Commission Staff Working Document, Action Plan for Resilience in Crisis Prone Countries 2013-2020.

4.16 The Communication outlined how the Commission proposed to help countries and communities to be better prepared to cope with and recover from natural disasters. Resilience would become an integral component of EU humanitarian and development assistance, addressing a broader set of risks, such as flooding and cyclones. Future programmes would focus much more on building people's long-term resilience to predictable shocks and stresses.

4.17 In May 2013, the Council noted that the frequency and severity of natural and man-made disasters was likely to continue given the impacts of climate change and other factors that exacerbate poverty, fragility and vulnerability; and that the new approach to building resilience provided an opportunity to bring together political dialogue, humanitarian and development work and priorities "in a comprehensive, coherent and effective approach to achieve better results on the ground". Building resilience "not only reduces suffering and loss of life but is also more cost effective". [18]

4.18 The Committee scrutinised and subsequently cleared the Commission Communication, including the Minister's report of the Council Conclusions, a year ago.[19]

4.19 The consequential Commission Staff Working Document sets out an Action Plan on how the European Union will support vulnerable people and countries better in withstanding, coping with and quickly recovering from natural disasters and conflict. It was developed by ECHO, the Directorate-General for Development and Cooperation (EuropeAid/DEVCO) and the EEAS: if successful, the Plan would reduce humanitarian need and the safeguard development gains — these being seen as of growing importance because of the rising costs of disasters as a result of more severe weather and the growing risks associated with population growth, urbanisation, resource competition, fragility and conflict. All of this is supposed to tie in with a new US Resilience Strategy, a World Bank report on Managing Disaster Risk for a Resilient Future and the Government's own commitment to embed disaster resilience in all its country programmes by 2015. When submitting it for scrutiny in August 2013, the Minister told the Committee:

    "The challenge now is to implement these policies on the ground. This Action Plan is an important step forward in achieving this for the EU."

4.20 We agreed with the Minister that what would matter most would be how effectively the Action Plan was implemented — especially the sharing of lessons and making sure, as the Minister put it:

    "this becomes an integral way of how it does business how well the different parts of the EU system work together, how they generate and pool the political engagement and technical capacity to support delivery, and increase the flexibility of engagement, including finance, in order to adjust to changing risks on the ground."

4.21 In clearing it from scrutiny, we asked the Minister to write to us in a year's time with whatever information was then available about the reviewing of implementation and an indication of what the future review timeline would be (an annual report, for example; or a review by the European Court of Auditors).[20] A year has gone by, but we have not heard from the Minister.

4.22 We should be grateful if the Minister would explain more about these areas of future endeavour, and how — if successful — they will remedy this existential challenge in situations that are forecast to become more frequent; in particular:

—  what the Political Champions Group is;

—  if the EU is not working effectively with it, why this is so;

—  what the "Joint Humanitarian-Development Framework to support a coherent approach between humanitarian and development actors" is; and

—  what has happened to the Action Plan for Resilience in Crisis Prone Countries 2013-2020, and how it ties in with all of the above.

4.23 In the meantime, we shall retain this European Court of Auditors' Report under scrutiny.

4.24 We are also drawing this chapter of our Report to the attention of the International Development Committee.

Full details of the documents: (36359), —: European Court of Auditors' (ECA) Special Report No. 13/2014: EU Support for Rehabilitation Following the Earthquake in Haiti.

Background

4.25 The ECA was established to audit the EU's finances and contribute to improving EU financial management by promoting accountability and transparency. The ECA's role as the EU's independent external auditor is to check that EU funds are correctly accounted for, are raised and spent in accordance with the relevant rules and regulations, and have achieved value for money. The results of the ECA's work are used by the European Commission, the European Parliament, the Council and the Member States to oversee the management of the EU budget and, where necessary, make improvements.

4.26 The ECA has three main categories of audit reports:

—  annual reports on the EU budget and the European Development Funds, which mainly comprise the annual statements of assurance, but also cover performance issues, and are published in November each year;

—  around 50 annual reports on the annual financial audits of the EU's agencies, joint undertakings and other decentralised bodies;

—  Special Reports (around 20 each year) setting out the results of ECA's selected performance and compliance audits of specific budgetary areas or management topics.[21]

4.27 In her Explanatory Memorandum of 10 October 2014, the Parliamentary Under-Secretary of State at the Department for International Development (Lynne Featherstone) notes that the Report concludes that EU support for recovery and reconstruction after the 2010 earthquake in Haiti was well designed overall but the programmes were not implemented sufficiently effectively. She highlights the following other findings:

—  though, in common with other donors, the European Commission faced serious obstacles in its efforts to support recovery and reconstruction, it could have improved its management of some factors under its control;

—  relief, recovery and reconstruction and longer term development goals were not sufficiently linked; though the Commission used a range of complementary instruments flexibly and designed individual recovery and reconstruction programmes to ensure the linkage between relief, recovery and reconstruction and longer-term development, ECHO and EuropeAid had no clear common country strategy to optimise the combined effort and smooth transition between their respective activities;

—  weak national administration and insufficient government commitment to reform were significant challenges to effective recovery and the creation of conditions for sustainable development;

—  while aware of the difficult context, the Commission did not sufficiently manage some significant risks to the implementation and achievement of its programme objectives;

—  the monitoring of programmes was based on an appropriate framework but the EU delegation had insufficient capacity to perform on-the-spot visits.

The Government's view

4.28 The Minister accepts that Haiti represents a complex environment for both humanitarian and development actors, observing that, following the earthquake, "there were a large number of actors, divergent methods, lack of commonality in approach, weak government structures and collapsed institutions, all of which contributed to a very challenging situation for donors".

4.29 With regard to LRRD (Linking Relief, Recovery and Development), the Minister says:

    "More concerning from a UK Government perspective is the Report finding that EU relief, recovery and reconstruction and longer term development were insufficiently linked. Differing perspectives between humanitarian and development actors in the Commission coupled with the absence of a joint strategy appear to have resulted in incoherence and programming gaps, disjointed handover, and absence of an exit strategy for ECHO. Although the EU supported the Haitian government in setting up a new coordination mechanism in 2012 (Coordination de l'Aide Externe au Developpement d'Haiti (CAED)) this has not yet proved sufficiently effective and cannot be seen as a substitute for a joint EU strategy in linking humanitarian and development effort."

4.30 With regard to disaster resilience, the Minister says:

    "Creating disaster resilience is key to bridging humanitarian and developmental effort, providing an exit strategy for the former. In 2012 the Political Champions for Disaster Resilience was established, co-chaired by the UK Secretary of State for International Development and the Administrator of United Nations Development Programme (UNDP). The purpose of this group includes promoting investment in disaster resilience and the EU is also a member, as well as the Government of Haiti following its selection as a pilot country."

4.31 In respect of budget support and risk management, the Minister notes that the Report pointed out that the EU committed €44 million through the 10th EDF as budget support, despite particularly weak public financial management systems, and says:

"Payments were subsequently withheld in summer 2012 after the publication of a report by a Special Audit Commission that identified irregularities in public finances. This brings into question the level of rigour applied in assessment of risk at the outset. The Commission have since adopted new guidelines in 2013, with tighter criteria for the provision of budget support."

4.32 With regard to the Report's finding that, although programme monitoring was based on an appropriate framework, human resources were insufficient to manage it, and that the Commission and EEAS did not take timely measures to send enough staff with relevant skills and experience in the critical phase post-earthquake, the Minister says:

"From a UK Government perspective, it is hard to assess the validity of this assertion, as the capacity of the Delegation to absorb additional staff in the post-earthquake phase due to security and other constraints is unclear. However, learning from the experience of the earthquake in Haiti and crisis events in other countries, the Commission and the EEAS have introduced a number of rapid response measures. One example of these measures is a system of floaters for Delegations which allows sending additional staff to Delegations on a short-term basis to cover staff shortages or additional workload."

4.33 In sum, the Minister:

—  welcomes Commission acceptance of all the Report's recommendations, and that a range of remedial measures to address the principal concerns are already being implemented, including:

·  preparation of a Joint Humanitarian-Development Framework to support a coherent approach between humanitarian and development actors;

·  promulgation of revised budget support guidelines;

·  adoption of rapid response measures for deployment of additional staff and technical capacity;

—  but says that it is, however, too early to judge how effective these measures will prove to be, giving as an example that, although the Commission has made extensive efforts to integrate the concept of resilience into its programmes at the policy level, it has yet to make a direct contribution to specific resilience programmes under the auspices of the Political Champions;

—  also says that effective EU programme implementation and coordination was hampered by the complexity of the environment and challenging conditions in the post-earthquake phase: however, there is still scope to further improve internal coordination between the EU Delegation and ECHO, which should be assisted by a joint Humanitarian and Development Framework;

—  she and her officials' Government "will continue to emphasise the need to bridge humanitarian and development effort, including through our role as co-chair of the Political Champions Group as an advocate of disaster resilience".

Previous Committee Reports:

None, but see (35181), 11554/13: Seventeenth Report HC 83-xvi (2013-14), chapter 17 (17 October 2013) and (34303), 14616/14 (2013-14), chapter 38 (4 September 2013).





12   ECHO: Directorate-General for Humanitarian Aid and Civil Protection Its mandate includes saving and preserving life, preventing and alleviating human suffering and safeguarding the integrity and human dignity of populations affected by natural or man-made disasters. It provides humanitarian aid, short-term rehabilitation support and disaster prevention and preparedness support. Back

13   EuropeAid: Directorate-General for Development and Cooperation - EuropeAid implements a wide range of the Commission's external assistance instruments financed by the EDFs and the general budget. Almost all the EDF interventions are managed by EuropeAid. Back

14   FPI: Service for Foreign Policy Instruments: a Commission department established on 1 January 2011, reporting directly to the High Representative of the Union for Foreign Affairs and Security Policy. Expenditure managed by the FPI mainly relates to actions implemented under: (a) the common foreign and security policy; (b) the Instrument for Stability (IfS); (c) the election observation missions; (d) the Industrialised Countries Instrument. Back

15   See European Court of Auditors' press release accompanying the Report; http://www.eca.europa.eu/Lists/ECADocuments/INSR14_13/INSR14_13_EN.pdf. Back

16   EDF: European Development Funds; the main instrument for providing European Union aid for development cooperation to the African, Caribbean and Pacific (ACP) countries and overseas countries and territories (OCTs). The partnership agreement signed in Cotonou on 23 June 2000 for a period of 20 years (the Cotonou Agreement) is the current framework for the EU's relations with ACP countries and OCTs. Its main focus is on reducing and eventually eradicating poverty. GBS: general budget support programmes typically consist of a support package involving the transfer of funds, capacity-building measures, dialogue with the partner country and the establishment of conditions for disbursement. Back

17   The EEAS was launched on 1 December 2010. The EEAS prepares the Commission decisions for country allocations, country and regional strategy papers and national and regional indicative programmes jointly with relevant Commission departments, as part of the programming cycle for most external action instruments Back

18   28 May 2013 Foreign Affairs Council Conclusions on EU approach to resilience; available at http://www.consilium.europa.eu/uedocs/cms_Data/docs/pressdata/EN/foraff/137319.pdf. Back

19   See (34303), 14616/14 (2013-14), chapter 38 (4 September 2013). Back

20   See (35181), 11554/13: Seventeenth Report HC 83-xvi (2013-14), chapter 17 (17 October 2013). Back

21   See http://www.eca.europa.eu/en/Pages/ecadefault.aspx for full information on the ECA. Back


 
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