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U4 Practice Insight 2013: 1 U4 PRACTICE INSIGHT 2013: 1 Lessons from Nicaragua’s Ananda S. Millard Partner experience with the Joint Nordic Consulting Group Donor Anti-Corruption Fund Since 2002, the Joint Donor Anti-Corruption Fund (FAC) in Nicaragua worked with the national government to respond to corruption. The FAC brought together a group of nine donors to jointly support the strengthening of public institutions. This effort provides interesting lessons in terms of multi-donor funds, which can establish a common donor voice, place anti-corruption on the agenda, and foster coordination between government bodies. These lessons can help inform joint efforts elsewhere. U4 PRACTICE INSIGHT March 2013 No 1 Lessons from Nicaragua’s experience with the Joint Donor Anti-Corruption Fund Nicaragua, corruption, and the to increase the impact of the available devel- birth of the Joint Donor Anti- opment assistance. Increased coordination Corruption Fund helps avoid the potential for overlaps between donor-supported interventions. These funds Spanish names of When Nicaraguan President Dr. Enrique Bola- also provide an opportunity to jointly agree institutions/laws: ños Geyer (in office 2002–2006) was elected, with a recipient government on a common set Attorney General’s he felt that a concerted anti-corruption effort of priorities. More importantly it has the po- Office: Procuraduría General de was required to re-establish the credibility of tential for broad and coordinated approaches la República the Nicaraguan government in the eyes of the with strong national ownership. Office of Public Ethics: people and the international community. In Oficina de Ética Pública order to confront the challenge of corruption In view of the increasing attention being paid Public Ministry: faced within state institutions, the president to joint donor responses to corruption, joint Ministerio Público sought the support of the donor community, donor funds allow donors to speak with one General Audit Office: as he could not count on support from within voice and to arrive at mutually agreed per- Contraloría General de his own administration. Discussions between formance targets with the recipient govern- la Reública the president and the donor community led to ment. Rewards can be given when targets are Law of recourse: ley de amparo the establishment of the Joint Donor Anti-Cor- achieved, and sanctions when they are not. ruption Fund in Nicaragua (FAC) (in Spanish: Finally, with often limited resources available Fondo Anticorrupción). The objective of the for large reform agendas, pooling funds holds FAC was to launch a concerted effort to com- real opportunities for support to anti-corrup- bat corruption within the public sector. The tion efforts. FAC focused on addressing corruption within the civil service in order to improve service With eight donors and one United Nations delivery in key institutions. At the time of its agency as part of the fund, the FAC did pool establishment, the FAC brought together nine a significant proportion of funding available donors: Denmark, Finland, Germany, Nether- for support of anti-corruption efforts in Ni- lands, Norway, Sweden, Switzerland, United caragua. The participating donors also jointly Kingdom, and the United Nations Develop- agreed with the Nicaraguan government on a ment Programme (Barbini 2009; Araus, Bain, common set of priorities. This Practice Insight and Mattila 2008). seeks to highlight the achievements and limi- tations of the approach taken by the donors in An effort such as the FAC was considered Nicaragua, as well as lessons learned of poten- necessary, as corruption in Nicaragua at the tial interest when considering similar modali- time was a structural and endemic problem ties in other countries. obstructing the establishment of a solid and robust democratic process. Today corruption The FAC: who was funded and for remains a challenge in the country. However, what? this should not necessarily be understood as About the author: a failure of the FAC. Rather it highlights the The focus of the FAC was the work of the civil Ananda S. Millard is a complexity of the problem and the need for service. Its aim was to improve the provision partner at the Nordic long, sustained, and multi-faceted efforts. In of services through support to existing govern- Consulting Group (www. ncg.no). She holds a PhD Nicaragua corruption is manifested at multiple ment institutions. From the outset the FAC in Peace Studies, and levels within society and affects all provision supported the Attorney General’s Office, the an MA in International of services. National Council for Combating Drugs (which Conflict Analysis. Her main fields of work later became the National Council Against include capacities and Finding solutions: a joint donor Organised Crime), the Office of Public Eth- vulnerability analysis, and development and fund ics, the Public Ministry, and, since the start humanitarian support of the third phase in 2010, the national police. in conflict/post conflict A joint donor fund offers many advantages for These institutions were targeted, as they make environments. donors. By pooling funds, donors can leverage up the majority of the key institutions directly available resources for a specific intervention involved in anti-corruption efforts. 1 Lessons from Nicaragua’s experience with the Joint Donor Anti-Corruption U4 PRACTICE INSIGHT March 2013 No 1 The support provided by the FAC consisted professional services. In short the FAC has primarily of three types of initiatives: facilitated the government’s ability to respond to the increased demand for anti-corruption– • Salary support: funding for staff posi- related services. tions dedicated exclusively to anti-corrup- tion–related tasks. The funding distribution in most recent years, shown in Figure 1, shows the distribution of • Running costs and material support: funding by type of area of support. The visible funding for both supplying offices with trend has been to reduce the amount of funds adequate equipment and material, as well destined to equipment, as these were under- as covering running costs in order to en- stood as one-off purchases, in favour of opera- able anti-corruption work. tional costs for activities that could be carried out. Salaries have traditionally accounted for • Capacity building: funding of workshops a substantial proportion of the funding alloca- and trainings on anti-corruption issues tion, but a reduction is also notable here. This ranging from activities focusing on how reduction accounts for efforts by the Nicara- to prevent corruption in the workplace to guan government to assume the responsibility efforts on how to investigate and bring to for some staff positions, which had been pre- trial corruption cases. viously funded by the FAC. This is critical to ensuring the sustainability of the programme. The support provided by the FAC enabled the funded offices to provide a wider coverage In terms of funding the public sector, the rea- of anti-corruption activities including sons for why certain institutions were priori- better policing, increased number of tised and others omitted is unclear. Notably awareness-raising activities, more qualified/ absent was the General Audit Office, as well specialised staff, and an increased number of as the Supreme Court and the National Assem- investigations of anti-corruption cases. The bly, all of which have a critical role to play in FAC also supported Nicaragua in meeting its any efforts to come to terms with corruption. international obligations in the area of anti- The omission of these institutions, and as such corruption. FAC support seems to have been not involving all agencies that play a key role instrumental in enabling the relevant state in anti-corruption within the civil service, is a institutions to provide more expedient and weakness of the FAC. Figure 1: Proportion of funding allocation by general category 46% 46% 56% 67% 65% 21% 12% 48% 25% 40% 33% 22% 10% 4% 6% 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 Equipment Operational costs Salaries 2 U4 PRACTICE INSIGHT March 2013 No 1 Lessons from Nicaragua’s experience with the Joint Donor Anti-Corruption Fund This suggests that for a joint approach such as which are conducted jointly (i.e., representa- the FAC, either all key organisations need to tives from all government funded agencies be included from the start or there should be a and donors) result in the formulation of a pro- phased process that dynamically identifies key gramme document that governs the funding institutions at the different stages of develop- period/phase. ment of the anti-corruption effort. Ensuring that key institutions are involved, particularly Reporting on implementation is quite limited. those that could become bottlenecks for other Indeed it only requires funded agencies to pro- efforts should be a pre-condition established vide numerical data on activities conducted by a joint fund. based on the objectives outlined in the pro- ject document. The effects of any one activity, The FAC: how was it dministered? let alone of the entire programme, is neither discussed nor problematised in the reporting The way the FAC has been administered has documents. The general emphasis has been on changed over the years. On the donor side a quantitative deliverables rather than a qualita- single agency – the donor focal point – has been tive understanding of the impact of any one responsible for interacting with the government deliverable/output. This resulted from donors’ counterpart and this agency changed only once; and government agencies’ broad and unde- from Norway to Switzerland. On the part of the fined approach to anti-corruption, in which government the organisation and mechanism they were prepared to work towards objectives to communicate with the donor focal point and in a very flexible way without placing an em- coordinate activities by government agencies phasis on the need for clear indicators of suc- have changed numerous times. During the first cess. The donor community may have relied phase the FAC’s government focal point was too heavily on the perceived political will of the Office of the President.
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