Foreign Assistance:

Inadequate Accountability for U.S. Donations to the World Food Program

NSIAD-94-29: Published: Jan 28, 1994. Publicly Released: Mar 7, 1994.

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Pursuant to a congressional request, GAO reviewed U.S. food donations to the World Food Program (WFP), focusing on the: (1) Agency for International Development's (AID) procedures for ensuring that accountability is maintained over U.S. donations; and (2) United States' responsiveness to WFP emergency food requests.

GAO found that: (1) WFP has lost thousands of tons of U.S. donations through theft and mishandling because of its inadequate accountability procedures and AID inattention to its accountability and internal control problems; (2) AID has exempted WFP from accountability requirements because it is a United Nations agency, and failed to follow AID regulations governing its relationship with WFP; (3) AID believes WFP has adequate management and accountability procedures to safeguard U.S. donations; (4) WFP has delegated its responsibility to manage commodity donations to host governments and nongovernmental organizations without imposing adequate accountability requirements on them; (5) AID cannot detect WFP procedural weaknesses and commodity losses because it is unfamiliar with WFP monitoring practices and WFP donor reports are incomplete and inaccurate; (6) WFP has not fully implemented many of its auditors' recommendations to improve its accountability, monitoring, and reporting procedures; (7) the United States is often not responsive to WFP emergency food requests because AID does not have a system to expedite WFP emergency requests and the Department of Agriculture uses the same procurement and shipping procedures for emergency and nonemergency orders; and (8) WFP recipients have not suffered from the United States' slow response to emergency food requests because WFP has been able to substitute food stocks from other sources until U.S. supplies arrive.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Director of WFP, with U.S. assistance, has launched a series of management initiatives designed to strengthen the Program's financial and commodity management, oversight, and auditing functions. AID officials believe that these management improvements will contribute directly to improved control for the distribution, monitoring, and safeguarding of donor commodities. They cited as examples of WFP's strengthened procedures WFP's recent decision to withdraw the WFP program in the Congo and Guinea Bissau due to high commodity loss rates.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to develop effective procedures with strong internal controls for distributing, monitoring, and safeguarding donated commodities.

    Agency Affected: Department of State

  2. Status: Closed - Implemented

    Comments: The Director of WFP, with U.S. assistance, has launched a series of management initiatives designed to strengthen the Program's financial and commodity management, oversight, and auditing functions. AID officials believe that these management improvements will contribute directly to improved control for the distribution, monitoring, and safeguarding of donor commodities. They cited as examples of WFP's strengthened procedures WFP's recent decision to withdraw the WFP program in the Congo and Guinea Bissau due to high commodity loss rates.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to develop effective procedures with strong internal controls for distributing, monitoring, and safeguarding donated commodities.

    Agency Affected: United States Agency for International Development

  3. Status: Closed - Implemented

    Comments: WFP, with U.S. assistance, has made substantial progress on this recommendation. WFP now reports in-country food losses by country, including actions taken to reduce food losses. The U.S. delegation also suggested WFP hold country directors accountable for all losses and reflect this on their annual appraisals. Based on suggestions from the U.S. delegation, WFP now holds country directors accountable for all losses and reflect this on their annual appraisals. As a result of this new policy, a country director in Africa was fired in 1996.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to require complete and accurate commodity loss reports to donors on a project-by-project basis.

    Agency Affected: Department of State

  4. Status: Closed - Implemented

    Comments: WFP, with U.S. assistance, has made substantial progress on this recommendation. WFP now reports in-country food losses by country, including actions taken to reduce food losses. Based on suggestions from the U.S. delegation, WFP now holds country directors accountable for all losses and reflect this on their annual appraisals. As a result of this new policy, a country director in Africa was fired in 1996.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to require complete and accurate commodity loss reports to donors on a project-by-project basis.

    Agency Affected: United States Agency for International Development

  5. Status: Closed - Implemented

    Comments: The U.S. delegation, working with other donors, assisted WFP in strengthening its monitoring and evaluation unit. Since then, WFP evaluation reports have noted persistent weaknesses in WFP's impact reporting and monitoring. AID officials said that these evaluations now include commodity management problems, and point to the evaluation of Guinea Bissau as a case in point. In addition, WFP has replaced the Director of the Office of Evaluation to increase the quality of WFP evaluations.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to include in WFP project evaluations commodity management problems and actions taken by WFP to correct project deficiencies.

    Agency Affected: Department of State

  6. Status: Closed - Implemented

    Comments: The U.S. delegation, working with other donors, assisted WFP in strengthening its monitoring and evaluation unit. Since then, WFP evaluation reports have noted persistent weaknesses in WFP's impact reporting and monitoring. AID officials said that these evaluations now include commodity management problems, and point to the evaluation of Guinea Bissau as a case in point. In addition, WFP has replaced the Director of the Office of Evaluation to increase the quality of WFP evaluations.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to include in WFP project evaluations commodity management problems and actions taken by WFP to correct project deficiencies.

    Agency Affected: United States Agency for International Development

  7. Status: Closed - Implemented

    Comments: WFP now provides donors a status report on the External Auditor's recommendations. The U.S. delegation has suggested similar reporting for the Office of the Internal Auditor. However, donors did not support this proposal. They indicated that this would violate both UN protocol and practice for UN Offices of Internal Audit. Without donor support, this portion of the recommendation cannot be implemented.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to require annual reports to the Committee on the status of principal external and internal audit findings and recommendations affecting the program.

    Agency Affected: Department of State

  8. Status: Closed - Implemented

    Comments: WFP now provides donors a status report on the External Auditor's recommendations. The U.S. delegation has suggested similar reporting for the Office of the Internal Auditor. However, donors did not support this proposal. They indicated this would violate both UN protocol and practice for UN Offices of Internal Audit. Without donor support, this portion of the recommendation cannot be implemented.

    Recommendation: The Administrator, AID, and the Secretary of State should direct the head of the U.S. delegation to the WFP Committee on Food Aid Policies and Programs to work with other delegations and the WFP Executive Director to require annual reports to the Committee on the status of principal external and internal audit findings and recommendations affecting the program.

    Agency Affected: United States Agency for International Development

  9. Status: Closed - Implemented

    Comments: AID has updated its requirements for missions. Missions must now evaluate both WFP operations and WFP and host country capabilities. AID guidance now specifically states that the United States is responsible for ensuring that WFP and the host countries have adequate capabilities to manage U.S. donations effectively.

    Recommendation: To strengthen the U.S. delegation's ability to assist WFP in establishing more effective accountability procedures, the Administrator, AID, should require missions to fulfill their requirements to periodically assess and report on host government and WFP capabilities to manage and monitor WFP projects.

    Agency Affected: United States Agency for International Development

  10. Status: Closed - Implemented

    Comments: AID officials and documents indicate that the U.S. Delegation now develops comprehensive position papers on all WFP proposals and programs. However, no new directive or policy has been issued to require this practice.

    Recommendation: To strengthen the U.S. delegation's ability to assist WFP in establishing more effective accountability procedures, the Administrator, AID, should require that the U.S. delegation to WFP develop comprehensive position papers on WFP project proposals, including comments on host government and WFP capabilities, to ensure adequate accountability practices for presentation and consideration at the Subcommittee on Projects.

    Agency Affected: United States Agency for International Development

  11. Status: Closed - Implemented

    Comments: AID has taken a variety of measures to improve its responsiveness to WFP emergency requests. AID has re-engineered its food aid procedures, including its procedures for the review, approval, and implementation of its emergency food programs. Under this new system, which is being implemented, AID plans to systematically log and monitor the status of WFP emergency requests. The new system also streamlines the approval documentation for emergency requests. For the first time, AID, in cooperation with the Department of Agriculture, used expedited procurement procedures for emergency food requirements for Burundi. AID is also reviewing the efficiencies of pre-positioning commodities at select ports in the United States and sub-Saharan Africa.

    Recommendation: To improve U.S. responsiveness to WFP emergency operations, the Administrator, AID, should establish a system to expedite the approval of WFP requests for emergency food aid.

    Agency Affected: United States Agency for International Development

  12. Status: Closed - Implemented

    Comments: AID did not pledge title II commodities to the WFP International Emergency Food Reserve. According to AID officials, however, AID has used other mechanisms to expedite the U.S. response to WFP emergency food requests. They stated that the increasing availability of cash has been a key factor in ensuring a rapid response to emergencies through local and regional purchases. Toward this goal, AID pledged $3 million in fiscal years 1994 and 1995 to WFP's Immediate Response Account. WFP has also drawn cash from the U.N.'s Central Emergency Revolving Fund. According to AID, these options are relatively new and are key factors in expediting WFP's ability to respond to food emergencies. Lastly, AID can also rely on the Office of Foreign Disaster Assistance's cash resources if additional money is needed. AID officials said that these alternatives meet the intent of GAO's recommendation.

    Recommendation: To improve U.S. responsiveness to WFP emergency operations, the Administrator, AID, on a test basis, should pledge a limited amount of title II commodities to the WFP International Emergency Food Reserve.

    Agency Affected: United States Agency for International Development

 

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