Egypt:

U.S. Government Should Examine Options for Using Unobligated Funds and Evaluating Security Assistance Programs

GAO-15-259: Published: Feb 11, 2015. Publicly Released: Mar 12, 2015.

Additional Materials:

Contact:

Charles Michael Johnson, Jr
(202) 512-7331
johnsoncm@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

U.S. strategic objectives and levels of assistance to Egypt have generally remained constant since fiscal year 2009, though the U.S. government adjusted some aspects of its assistance in response to events in Egypt. According to documents and senior U.S. officials, U.S. strategic objectives are to assist Egypt to be stable, democratic, and prosperous; uphold the peace treaty with Israel and advance regional stability; counter terrorism and extremism; and continue to provide strategic benefits to the U.S. government. After Egypt's 2011 revolution, the U.S. government increased its emphasis on democracy and economic growth initiatives. After President Morsi's removal in July 2013, the U.S. government suspended some assistance and adjusted its economic assistance to focus more on directly benefitting the Egyptian people and its security assistance to focus more on shared interests. The administration has now resumed some assistance, enabled in part by new legal authorities provided by Congress.

As of September 30, 2014, the U.S. government had disbursed or committed almost $7.5 billion (about 80 percent) of over $9.3 billion in assistance allocated for Egypt in fiscal years 2009 through 2014. The U.S. government allocated 98 percent of this funding from the Foreign Military Financing and Economic Support Fund (ESF) accounts. The Department of State (State) and the U.S. Agency for International Development (USAID) reported $460 million in unobligated ESF balances for Egypt—equal to about 230 percent of their fiscal year 2015 budget request of $200 million. This included $260 million in prior year funding allocated for a cash transfer to Egypt that the administration announced in October 2013 that it would not carry out. According to U.S. officials, these funds have not been reprogrammed for other purposes. Given U.S. government resource constraints, it is important that U.S. agencies have plans for using existing resources.

Examples of Military Systems Purchased by Egypt Using U.S. Security Assistance

Examples of Military Systems Purchased by Egypt Using U.S. Security Assistance

While USAID has evaluated some economic assistance, State has not evaluated the results of billions of dollars in security assistance to Egypt. Since fiscal year 2009, USAID has evaluated 15 projects in Egypt totaling over $600 million and has completed all of the evaluations required under its policy. USAID officials noted that they have used evaluations to inform decisions about assistance. In May 2014, State attempted to commission a first-ever evaluation of results of security assistance to Egypt but received no proposals in response to its solicitation. State officials said that the agency remains committed to completing such an evaluation and is considering alternate approaches, although State has not established specific time frames for doing so. Standard practices in program management include a plan to execute projects within a specific time frame.

Why GAO Did This Study

Since the signing of the Egypt-Israel Peace Treaty in 1979, Egypt has been a key strategic partner of the United States and the recipient of almost $64 billion in U.S. security and economic assistance, including an annual average of about $1.3 billion in security assistance and $245 million in economic assistance since fiscal year 2009. State outlines strategic objectives for Egypt, State and USAID are primarily responsible for funding and managing assistance provided to Egypt, and the Department of Defense implements most security assistance. Since the January 2011 revolution that ended the almost 30-year presidency of Hosni Mubarak, Egypt has experienced a series of tumultuous political transitions that have raised concerns about how U.S. assistance is supporting strategic objectives.

This report examines, for fiscal years 2009 through 2014, the extent to which (1) U.S. strategic objectives and assistance evolved, (2) the U.S. government disbursed funds allocated for assistance to Egypt, and (3) the U.S. government evaluated the results of its assistance. To address these objectives, GAO analyzed U.S. government documents; interviewed U.S. officials in Washington, D.C.; and conducted fieldwork in Cairo, Egypt.

What GAO Recommends

GAO recommends that (1) State and USAID develop a plan for other uses for $260 million previously allocated for a cash transfer and (2) State establish specific time frames for completing a required evaluation of security assistance. State and USAID generally agreed with these recommendations.

For more information, contact Charles Michael Johnson, Jr., at (202) 512-7331 or johnsoncm@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Priority recommendation

    Comments: In written comments on our draft report, State and USAID generally concurred with our recommendation. State and USAID reported in May 2016 that the agencies had reprogrammed $230 million of the $260 million previously allocated for the cash transfer to the Egyptian government for programs in Syria, Iraq, Tunisia, and Egypt, among other countries. As of May 2017, State and USAID had not yet made a decision on how to best utilize the remaining $30 million. GAO will continue to monitor agency efforts to fully implement this recommendation.

    Recommendation: Given the significant unobligated balances of about $260 million in the ESF account for Egypt previously allocated for a cash transfer that the administration has stated it no longer intends to carry out, the Secretary of State and the USAID Administrator should work to develop plans for an alternate use of these funds, in consultation with the appropriate committees of Congress. As part of planning for these funds, State should also consider ways that this funding could potentially be used to offset future budget requests.

    Agency Affected: Department of State

  2. Status: Open

    Priority recommendation

    Comments: In written comments on our draft report, State and USAID generally concurred with our recommendation. State and USAID reported in May 2016 that the agencies had reprogrammed $230 million of the $260 million previously allocated for the cash transfer to the Egyptian government for programs in Syria, Iraq, Tunisia, and Egypt, among other countries. As of May 2017, State and USAID had not yet made a decision on how to best utilize the remaining $30 million. GAO will continue to monitor agency efforts to fully implement this recommendation.

    Recommendation: Given the significant unobligated balances of about $260 million in the ESF account for Egypt previously allocated for a cash transfer that the administration has stated it no longer intends to carry out, the Secretary of State and the USAID Administrator should work to develop plans for an alternate use of these funds, in consultation with the appropriate committees of Congress. As part of planning for these funds, State should also consider ways that this funding could potentially be used to offset future budget requests.

    Agency Affected: United States Agency for International Development

  3. Status: Open

    Comments: State agreed with this recommendation. State noted that while evaluation of security assistance to Egypt poses challenges, it views evaluation as a critical tool for accountability and program improvement and will continue to pursue a formal evaluation of security assistance to Egypt. As of August 2017, State had not established specific time frames for such an evaluation. However, according to State officials, the department had begun preliminary data collection in anticipation of an evaluation at some point in the future. GAO will continue to monitor agency efforts to fully implement this recommendation.

    Recommendation: To help ensure the timely completion of an evaluation of security assistance to Egypt that is required by State policy, the Secretary of State should establish specific time frames for completing such an evaluation.

    Agency Affected: Department of State

 

Explore the full database of GAO's Open Recommendations »

Nov 13, 2017

Oct 31, 2017

Oct 26, 2017

Oct 19, 2017

Oct 12, 2017

Oct 4, 2017

Sep 28, 2017

Sep 19, 2017

Sep 13, 2017

Looking for more? Browse all our products here