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Aid fiasco in Sri Lanka

Sri Lanka''s Auditor General, Mr. S.C. Mayadunne, has studied state expenditure aid on rehabilitation efforts in the first six months after the December 26 tsunami devastated Sri Lanka’s northern, eastern and southern coastlines, killing over 31,000 people and displacing half a million.



“Considerably large amounts of money had been received by the Government and other parties in the form of local and foreign loans, aid and donations for the recovery of losses caused by the Tsunami disaster,” he said.



But large amounts of the aid had been misspent or simply disappeared, he said.



Actions “contrary to” procedures outlined in government circulars were observed by local authorities and in some cases there were “instances of blatant violation of provisions.”



The government circulars set out procedures for the drawing of tsunami-related funds (by individuals, NGOs and relief departments), expenditure on the supply (by third parties) of cooked meals, payments for damaged houses, and so on.



Indeed, Mayadunne also criticised the repeated issuance of circulars, saying “instructions had been subjected to [ad hoc] changes during a very short period due to the absence of a clear policy,” resulting in over-spending also.



There had been no action by authorities to maintain records of individuals and institutions collecting aid from the government for reconstruction activities.



Out of Rs 4.3 million drawn by 20 institutions, meanwhile, only 37% had been spent, with the rest being retained by 18 of them, in some cases “had been invested in fixed deposits.”



There had also been “irregular collection of funds by the Ministries, Departments, Public Corporations, etc. [and] retention of collections and incurring expenditure.”



Misappropriation of funding allocated for housing and reconstruction had been effected by making payments for houses that were undamaged by simply assessing them as damaged or making payments for houses actually built with NGO funds.



Payments were being made for vehicle hire without being used for any work and there were no records of the whereabouts of hundreds of vehicles brought into the country for tsunami-related relief.



Meanwhile, genuine needs are not being met, the Auditor General said.



Although almost 49,000 houses had been damaged by the waves, only 2% had been repaired.



In Hikkaduwa, for example, payment has been approved for only 25% of over 4,000 damaged houses.



The tsunami completely destroyed almost 64,000 homes, along with 73 schools, almost 400 places of worship and nine hospitals. Over 100 schools and 18 hospitals were damaged.



It also left 141,000 families (half a million people) displaced. And the report found distribution of aid to recipient families was also flawed.



In Negombo there are only 599 displaced families. But payments totaling Rs 76m have been made to a staggering 15,843 families.



Over distribution of flour and wheat in some cases had resulted in recipients selling it on, whilst others had gone without.



In Kalmune, 65 electric generators, 78 water tanks, 88 tents and a water motor supplied to the Divisional Secretary, simply “disappeared” as did another Rs 1m of goods.



In the Amparai district, Kalmune was singled out financial irregularities. The Al Ameen Community Development Centre, for example, had been compensated to the tune of Rs.2.5m – “even though it had not supplied meals.” Rs 1m was paid to individuals in the area who are not entitled to aid.



Another area highlighted for irregularities was the Tangalle Divisional Secretariat, particularly concerning fund allocations for fictitious reconstruction and ineligible assistance for displaced.



Over Rs. 1m was reportedly spent on cooked meals in Mannar – even though the area, on the west coast, was unaffected by the tsunami.



Mayadunne said even the information collected had been unearthed with difficulty due to a lack of proper documentation and sluggish cooperation from official departments.



“The scope and extent of [my study] were such as to enable as wide an audit coverage as possible within the limitations of staff, other resources and time available to me,” he warned.



He pointed to the “the absence of systems for recording assistance in the form of cash and goods/materials” and in particular the “lack of a national level register/record to use as a base document for the supply of relief and assistance.”



The Central Bank, meanwhile, had not made available information he requested on tsunami expenditure and electoral registers in the hardest-hit Amparai district were not provided.



There was “difficulty in identification of concurrent relief measures provided jointly by the Government and the private sector and the duplicated /multiplied state of relief provided.”



Apart from government expenditure, Mayadunne also criticised Sri Lankan Customs for missing large amounts of goods which passed through Katunayake airport, for failing to keep proper records and several other breaches.



“Up to date records of goods cleared had not been maintained by Customs[and] non-recording of air freight goods, failure to issue numbers for clearance of such goods, same number issued for several consignments etc. were observed.”



Large amounts of aid were languishing in the ports, he said: “4,018 container loads of aid materials had been received [up to April 30] and out of this only 2,864 containers had been cleared.”



“686 containers received by NGOs had been abandoned” because customs had not cleared them, the report said.



Meanwhile, there “was no evidence to support the distribution” had taken place of duty-free goods cleared by NGOs and various individuals for distribution through the District Secretaries.



Out of over 500 vehicles brought into the country, 207, 290 and 9 had been released to Government Institutions, Non-Governmental Organizations and other institutions respectively.



“Nevertheless, the General Treasury did not have the particulars of institutions or individuals who are using these motor vehicles.”