PUBLIC POLICY UPDATE June 8, 2012 WASHINGTON UPDATE Food for Peace Action in Both House and Senate

Wednesday, the House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration and Related Agencies approved its FY2013 Agriculture spending bill, FY2013 which would provide $1.15 billion for P.L. 480 Title II Food for Peace grants and $180 million for the McGovern-Dole International Food for Education Program. While the proposed level for Dole rogram. McGovern-Dole funding is about 2 percent ($4 million) below FY2012 levels, the proposed Food Dole percent for Peace level is a full 22 percent ($316 million) below the FY2012 enacted level, and 38 percent ($690 million) below the FY2010 level. Democrats on the subcommittee objected to the proposed cuts, noting the ongoing food shortages around the world, but the chair of the Agriculture hair Subcommittee, Jack Kingston (R (R-GA), was reported to have said after the markup that he expected amendments if/when the bill came to the floor cutting the program in half or eliminating it altogether. Full committee consideration of the bill is expected the week of June 18, though it has not yet been formally scheduled. Meanwhile, on the Senate side, floor debate on a new Farm Bill began, starting what could be weeks of consideration. Among many other things, the bill would reauthorize the Food for Peace onsideration. and Food for Education programs, and would set aside $40 million for cash grants and local and regional purchase (LRP) of food, slightly expanding a pilot begin in the pr evious reauthorization previous bill. While some advocates are disappointed that the bill maintains the local purchase pilot as a small, distinct program rather than incorporating its approach into the core of U.S. food assistance and feel the set-aside for LRP sh aside should be higher and some also raised a concern that the amount the bill sets aside for non non-emergency programs is low they were glad to see the LRP program linked to the McGovern Dole Food for Education program, and overall viewed the bill as McGovern-Dole moving in the right direction. A summary of the bill is available on the Senate Agriculture he Committee website here, with commentaries by InterAction members available at the following , links: World Food Program USA Oxfam USA Mercy Corps Catholic Relief Services New Budget Table Comparing House and Senate Numbers Weve put together an updated budget table (available on our website) that does the following: ) a. fills out and updates the numbers from both House and Senate full committee passage, dates including factoring in a rescission and some directed transfers (from ESF, to MRA and NED) in the House levels; and b. compares the House and Senate levels, calculates the midway point bet between them, and compares that midway point to FY2012 and, for a slightly longer time perspective, FY2010 levels. If the House and Senate end up passing an omnibus that reconciles the two bills, it is not at all certain they will end up splitting the difference on every account or even on any difference accounts last year the final levels ended up closer to the Senate numbers for many accounts. Still, the exercise gives some sense of what the possibilities are: 1

It shows that for most poverty-focused accounts, even the midpoint between the two bills would be higher than FY2012 enacted levels. It also shows that the comparison to FY2010 would be more mixed, with some accounts coming out lower than their FY2010 levels, others coming out higher.

The table contains a lot of numbers in a small space, but readers are encouraged not to be intimidated. A straight edge to read across rows and some time getting familiar with what columns are where will be helpful in extracting maximum value from the numbers presented. UPCOMING HEARINGS Hearing: Nomination Committee: Senate Foreign Relations Committee Witnesses: Richard Morningstar, to be ambassador to the Republic of Azerbaijan Timothy Broas, to be ambassador to the Kingdom of the Netherlands Jay Nicholas Anania, to be ambassador to the Republic of Suriname When: June 13, 2:45 p.m. Where: 419 Dirksen Senate Office Building Contact: 202-224-4651 http://foreign.senate.gov Hearing: China and Clean Energy Committee: Senate Energy and Natural Resources Committee Witnesses: TBA When: June 14, 9:30 a.m. Where: 366 Dirksen Senate Office Building Contact: 202-224-4971 http://energy.senate.gov HEARING SUMMARIES Investigation Waste, Fraud and Abuse in Afghanistan House Committee on Foreign Affairs Subcommittee on Oversight and Investigations June 6, 2012 Witnesses: Panel 1 John P. Hutton, director of acquisition and sourcing management, Government Accountability Office (GAO) Charles Michael Johnson, Jr., director of international affairs and trade, GAO Panel 2 Larry Sampler, Jr., senior deputy assistant to the administrator & deputy director of the office of Afghanistan & Pakistan affairs, USAID Opening Statements: Chair Dana Rohrabacher (R-CA) Expressed concern about U.S. support of an overly-centralized Afghan government led by the Karzai family. o Even with U.S. and NATO backing, Afghanistan remains on the brink of collapse. 2

GAO should look at business deals involving President Hamid Karzai that have used U.S. funds. o Inadequate recordkeeping prevents GAO and USAID from providing answers on who is benefitting from American aid. State Department and Congress are reluctant to conduct investigation of corruption. o Corruption threatens U.S. military missions and the Afghan governments legitimacy. o Bureaucracy cannot hide the Kabul Bank scandal, which required an $825 million bailout. GAO and USAID must suggest better methods of controlling American money. o

Ranking Member Russ Carnahan (D-MO) The U.S. needs greater accountability, efficiency and transparency in its transactions with Afghanistan. o Regular detail and oversight is vital. Panel 1 John P. Hutton USAID faces systemic challenges in managing contracts and assistance instruments. o Needs better visibility for decision making and oversight. o Lacks reliable data on the number and value of contracts, assistance instruments and personnel in Afghanistan. o Seeks to mitigate risk through its vendor vetting program. o GAO called for joint plan from USAID, Department of Defense and State Department to provide required information; coordination alone is not sufficient. GAO has begun reviewing the agencies April 2012 report to Congress. USAID has taken action to strengthen oversight and program performance. o High risk security environment and large staff turnover at USAID Mission to Afghanistan hinder program oversight. o USAID has established mandatory technical guidelines, approved a performance management plan and delegated more authority to field program officers. USAID has taken action to improve accountability of direct assistance. o Requires pre-award risk assessments. o Promotes multilateral direct assistance. Questioning: Chair Dana Rohrabacher (R-CA) 1. How much U.S. money has been given toward civilian aid since liberation? Hutton: o $46-47 billion; Afghanistan cannot support itself. 2. How much U.S. money has been given solely for civilian purposes? Hutton: o $12-15 billion in expenditure and disbursement from 2006-2010; earlier money was mainly security related. o $45 billion has been spent on non-Department of Defense (DoD) purposes since liberation. 3. We do not have an efficient accounting system. Is it possible to know where exactly the money goes and who is benefitting from it? 3

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Hutton: o There is a lack of trained personnel to monitor those figures. Do we cut off aid to people who have released individuals who have killed our troops? Hutton: o We do not have appropriate monitoring and oversight to answer. The Kabul Bank scandal yielded an $825 million loss due to bankruptcy. The U.S. government has used that bank as a vehicle for aid. How could the bank go belly-up with such direct U.S. involvement? Johnson: o GAO has not looked into it corruption investigations are turned over to the Inspector General. Is there a blacklist of people to whom you will not give money? Johnson: o None by GAO. Is there a possibility that the people we work with are engaged in blatant corruption? Johnson: o There is a push for the government to directly provide monetary assistance.

Ranking Member Russ Carnahan (D-MO) 1. How can we build upon the successes of agricultural teams? Hutton: o There is a renewed focus on progress in alternative development sectors, such as agriculture and water. We must elevate civilian involvement and ensure agriculture remains a priority. 2. There has been increased funding in Afghan civilian police training but no evaluation to date. How can we evaluate the program beyond the number of people that have been trained? Hutton: o Evaluation is forthcoming in a DoD report due by December/January. 3. What are we doing to increase the presence of women in the police? Hutton: o No numbers to report. 4. Comment on the possibility of joint contingency operations in alleviating tensions between DoD and State. Hutton: o GAO is ready to meet contingency needs of Congress. Panel 2 Larry Sampler, Jr. USAID has accomplished a great deal over the past decade. o Improved access to quality education, healthcare and economic opportunities. o Focus on areas with greatest potential for ensuring sustainability. o Involvement of private sector and gender focus. o Committed to building Afghan governments capacity, reducing reliance on foreign aid. o Presidents Obama and Karzai signed Strategic Partnership Agreement last month. USAID Accountable Assistance for Afghanistan Initiative was established to safeguard development assistance in the following categories: o Award mechanisms 4

o Partner vetting o Financial controls o Project oversight USAID supports development of professional Afghan civil service with training through the Afghan government. More assistance money has recently been concentrated directly through Afghan government. USAID hopes to establish framework for mutual accountability with Afghan government and donors.

Questioning: Chair Dana Rohrabacher (R-CA) 1. How much money has been spent on civilian aid from 2002-present? Was it given directly to people in the Afghan government or did it go through the Kabul Bank? Sampler: o $15.7 billion was given directly to the government; no transactions have been made through the Kabul Bank. o A USAID program with DeLoitte at the Afghan Central Bank was originally supposed to supervise the subordinate bank, but was not stable enough to do so. 2. Does USAID have a blacklist of people to whom money is not given? Sampler: Money is never given to individuals; it is all delivered to ministries with the help of interagency task forces. 3. An article from Politico earlier this year stated that USAID is struggling to keep NGO overhead below 70 percent. Do you agree with this statement? Sampler: USAID is successful at keeping overhead below 70 percent. This is not a credible article. 4. Is using NGOs a viable alternative for development strategies? Sampler: Yes, NGOs are better able to provide assistance for certain tasks. We can use an Afghan partner to build from the ground up and to train competency. 5. Do you believe Karzais brother benefited from the bank scandal? Was he involved with drugs? Sampler: All of my knowledge on this topic comes from the press; have not seen a documented, credible story. 6. Regardless of the scandal, you are still providing money to the Afghan government? Sampler: USAID supports the Afghan government in carrying out its own programs, but we do not know about specific families. 7. Does our new agreement with the Afghan government tie the U.S. into a relationship in which 50 percent of our money goes to the government, not contractors? Sampler: We agreed to try to achieve that goal. 8. USAID gives most aid to southern territories. Why does it not support the northerners who helped defeat that Taliban? Sampler: o We provide aid to the South on the basis of military support. We aim to avoid political distribution and provide support according to the needs of the U.S. and Afghan governments. o USAID is constantly realigning its portfolio. 9. Is there any resistance from the Pushtan communities regarding the education of both boys and girls? 5

Sampler: There is resistance, but increased exposure and radio programming are helping to spread the message. 10. Has U.S. presence influenced the structure of the Afghan government, which led to corruption? Sampler: o Centralization is not indicative of corruption. o It is important to hold the Afghan people to high achievable standards, yet to recognize that this is a long-term investment. 11. There needs to be a system that appropriately addresses their culture, perhaps by making decisions at the tribal level. Would a parliamentary system work? Sampler: The Afghan Rule of Law states that decisions must be made with elders. The U.S. must recognize that the Afghan system is different than ours and build off its strengths and weaknesses. ARTICLES AND REPORTS IRIN June 1: HEALTH: Fighting non-communicable diseases The UN World Health Organization aims to reduce non-communicable disease (NCD) deaths by a quarter before 2025. While NCDs account for a growing percentage of deaths, some fear that setting up systems to measure such health data will prove to be prohibitively expensive. The Washington Post June 7: U.N. observers blocked from reaching site of reported Syrian massacre U.N. observers have been denied entry into the Syrian village of Qubair, where reports claim that as many as 78 people were killed by government loyalists on Wednesday. International actors have redoubled their condemnation of the Assad regime, encouraging harsher sanctions. The Economist June 4: A verdict in Egypt: Back to the square Egyptian demonstrators have returned to Tahrir Square to protest the lenient sentencing of former president Hosni Mubarak and some of his top aides. Their frustration may benefit the Muslim Brotherhoods presidential candidate Muhammad Morsi over Mubarak-era Prime Minister Ahmed Shafiq. Al Jazeera June 6: Afghan civilians killed in NATO airstrike NATO forces and locals dispute the number of casualties of a NATO airstrike Wednesday. Locals claim that 18 civilians were killed in a strike against Taliban fighters, while NATO acknowledges only that two civilians sustained minor injuries. The New York Times June 2: Starving Its Own Children Sudans offensive against rebels in the Nuba Mountains reached its one-year mark this week. The almost daily bombing of civilians has decimated the regions productivity. With food stores depleted, Sudanese too weak to flee to refugee camps subsist on leaves, hoping for food aid.

Los Angeles Times June 7: Syria peace plan not working, U.N. envoy Kofi Annan says UN special envoy Kofi Annan warned of impending civil war in Syria Thursday. Recent massacres attributable to government loyalists have left close to 200 civilians dead. China and Russia continue to oppose a U.S.-backed resolution that would pressure Assad to step down. BBC June 1: Khartoum expels foreign aid agencies from eastern Sudan The Sudanese government expelled four humanitarian aid groups Friday, saying only that the groups had failed in their planned projects. The expulsion may be related to fear in Khartoum at the prospect of rebellion in three impoverished eastern Sudanese states. Disclaimer: Articles linked in the Update are intended to provide a dashboard view of newsworthy and topical issues from popular news outlets that will be of interest to readers of the Update. The articles are an information sharing vehicle rather than an advocacy tool. They are in no way representative of the views of InterAction or the U.S. NGO community as a whole.