DHAKA, Bangladesh (Thomson Reuters Foundation) – Amid allegations of misuse of climate funds, Bangladesh is formulating a plan to coordinate expenditures across agencies and ensure greater transparency and accountability in climate change-related activities.
Officials said the move is part of efforts to ensure appropriate and effective use of funds in offsetting the impacts of climate change on Bangladesh, one of the most vulnerable nations to the global warming.
“In the fiscal budget, funds are being allocated for climate change-related projects for almost all the ministries. But the spending lacks coordination thus (it is) sometimes being misused which now we are trying to bring under strict regulations,” Rafiqul Islam, the joint chief of the Planning Commission, told Thomson Reuters Foundation.
He said huge amounts of money are being spent in a scattered way which causes frequent repetition and duplication of projects. “Several organisations embark on the same types of projects, while many areas remain unattended,” he noted.
Islam said if a “climate fiscal framework” is formulated and properly followed, agencies would have a clearer idea what projects are in place and how much money is involved with each of them.
The government has already changed the format of development project proposals (DPP) to include climate change issues.
“From now on, while preparing a DPP for a project, it has to be mentioned if any climate change-related components are there or not. That will help in keeping track of how much money is being spent in what types of climate change-related projects,” Islam said.
He said countries like Indonesia and Cambodia already have in place climate fiscal frameworks that help them more easily tracking spending on climate change programmes.
The Bangladesh framework is being formulated under a project on “Poverty, Environment and Climate Mainstreaming”, funded by the United Nations Development Programme.
Currently, Bangladesh spends money on climate change projects from two major government and donor-sponsored funds.
The Bangladesh Climate Change Resilience Fund (BCCRF) is a fund operated by the Bangladesh government, development partners and the World Bank. A separate Bangladesh Climate Change Trust Fund (BCCTF) is financed solely by the government from public funds.
Alongside the two major funds, there is spending to reduce climate change impacts by various non-government organisations, foreign sources, and even private households.
As of June 2013, developed nations had made climate finance pledges of $594 million to Bangladesh, although much of the money has yet to be delivered. In addition, the South Asian nation had received $147 million out of $149 million promised by a group of wealthy states through BCCRF, the multi-donor fund administered by the World Bank.
NO CLEAR SPENDING PICTURE
Rezai Karim Khondker, a professor at the Dhaka School of Economics and head of the team building the climate fiscal framework, said so far there has been no clear calculation of how much money was being spent on climate change and from which sources.
“The framework aims at bringing coordination in climate change-related spending,” he said.
Khondker said a large amount of money was needed to combat the impacts of climate change on low-lying Bangladesh. The framework will help keep a tally of the sources of funds and also of where those are being spent, and for what purpose.
Experts and various civil society organisations have raised questions about transparency in climate fund spending and produced evidence of mismanagement of money. The Bangladesh chapter of Transparency International (TIB) last October released a study on climate fund governance which revealed political influence, nepotism and corruption in the selection of non-governmental organisations (NGOs) to carry out work on the ground.
It said some groups paid 20 percent of their allocation as “commission” in order to be chosen for adaptation projects.
Transparency International Bangladesh Executive Director Iftekharuzzaman told Thomson Reuters Foundation that civil society organisations have been demanding transparency and accountability in climate fund spending from the very beginning.
“There should be policy directives for spending funds in need-based projects. Transparency has to be ensured at the implementation level so that people who are in need benefit,” he said.
BASIS FOR COMPENSATION?
Iftekharuzzaman said industrialised nations, who are primarily responsible for climate change, should offer compensation for countries hardest hit by climate impacts, but are unlikely to do so without transparency in how funds are being spent.
“Unless the good governance of funds is ensured, they won’t cooperate,” he said.
He said participation of civil society and experts needs to be increased in governance of climate funding, and that people with conflicts of interest need to be kept out of policy decisions.
Ainun Nishat, a noted environmentalist and vice chancellor of Brac University, agreed that monitoring mechanisms for climate spending have to be made stronger to ensure transparency, and that the decision to create a climate fiscal framework was “timely.”
“Steps have to be taken to eliminate the causes of slow release of funds by the donors,” he said.
Nishat said information on spending of climate funds and on projects underway should be made publicly available via websites to help reduce misuse of funds.
Published in Thomson Reuters Foundation on 12-02-14. Link