4. REPORT OF THE PORTFOLIO COMMITTEE ON PUBLIC ENTERPRISES ON THE PARLIAMENTARY NETWORK ON THE WORLD BANK CONFERENCE, 21 TO 23 OCTOBER 2005, HELSINKI, DATED 16 NOVEMBER 2005:

The Chairperson of the Public Enterprises Portfolio Committee, Mr Yunus Carrim, having attended the Parliamentary Network on the World Bank Conference, from 21 to 23 October, in Helsinki, Finland, reports as follows:

 

  1. "Beyond the Year of Development: What Now?"

  1. The Chairperson of the Public Enterprises Portfolio Committee, Yunus Carrim, was invited to attend the Annual Conference of the Parliamentary Network on the World Bank (PNoWB), held in Helsinki, Finland, from 21 to 23 October. At a meeting of the Portfolio Committee on 7 September 2005 it was decided that the Chairperson should attend the conference.
  2. The PNoWB defines itself as ‘an independent association of some 800 MPs from 110 countries. Established in 2000 and governed by a nine-member board of parliamentarians, PNoWB mobilises parliamentarians in the fight against global poverty, promotes transparency and accountability in international development and offers a platform for policy dialogue between the Bank and parliamentarians". PNoWB sees itself as "an action-oriented network of parliamentarians". PNoWB activities are supported by, among others, governments, the World Bank, the United Nations (UN) and the International Monetary Fund (IMF).
  3. The theme of the conference was "Beyond the Year of Development: What Now?" It came after the July G8 "development summit" in Gleneagles and the September United Nations World Summit in New York, and before the next round of the World Trade Organisation (WTO) Ministerial Meeting in Hong Kong in December.
  4. This "Year of Development" has "presented an unprecedented opportunity to mobilise political support behind efforts to reach the Millennium Development Goals", said the organisers of the Conference. The objectives of the Conference were to "identify what parliamentarians can do to promote action on pressing development issues, and to help strengthen the accountability and transparency of international financial institutions".
  5. About 200 MPs from 90 countries attended. Other participants included officials from the World Bank and other multilateral institutions, technical experts, academics, the private sector, civil society representatives and others.
  6. The range and calibre of speakers, some connected with the Conference through video link, was very impressive. Among the key speakers were Susilo Yudhoyono, President of Indonesia; Paul Wolfowitz, President of the World Bank; Pascal Lamy, Director General of the World Trade Organisation; Erkki Tuomioja, Minister of Foreign Affairs of Finland; and Mary Robinson, former President of Ireland and currently the Director of Realising Rights: The Ethical Globalisation Initiative.
  7. Among the topics discussed, often in parallel sessions, were:
      1. There were various round table discussions including on making aid more effective, promoting a pro-poor outcome of the Doha development agenda at the WTO Hong Kong Ministerial Meeting; the role of MPs beyond the "Year of Development"; and the role of the PNoWB.
      2. There were regional sessions organised as well along the following lines:

8. The Conference also served as the PNoWB’s general assembly. A progress report since the last conference in 2004 was tabled and a new Board was elected.

B. World Bank Relations with MPs

1 The World Bank is owned and governed by 184 countries. In 1944 the representatives from the Bank’s founding countries decided that the organisation would deal with its member states through their finance and development ministries only and focus on economic matters only. A section of the Articles of Agreement, the international treaty that established the World Bank, stated: "The Bank and its officers shall not interfere in the political affairs of any member".

2. In view of the tremendous changes in the global economy since then, and the pressure from parliaments, civil society organisations, academics and others for the World Bank to be more open, transparent and accountable, the Bank has increasingly begun to accept that its interpretation of the above section of the Articles is too narrow. The Bank has begun, over the past five years or so, to expand its relations with MPs, parliaments, civil society organisations and other stakeholders.

3. The Bank says that its relations with parliamentarians have certainly expanded in recent years. It contextualised this. "First, the world has seen an explosion in the number of electoral democracies, from 66 in 1987 to 121 in 2003. The growth of civil society is equally spectacular; companies, grass-root organisations, campaign groups, trade unions, elected officials and academics have joined governments on the international stage as agenda setters and decision makers. This is the second big transformation. The third trend relates to how development assistance is carried out. Experience has shown that policies and projects to reduce poverty are most effective when priorities are set by countries receiving the aid – based on broad consultations – rather than by donors."

4 The Bank, according to its "Issue Brief" on "The World Bank and Parliaments", believes that "well functioning parliaments promote development and the rule of law. Engaging elected representatives on development issues and strengthening the capacity of parliamentary institutions are important objectives of the World Bank".

5 The "Brief" notes that "in developing countries, parliamentarians can be agents of change. They represent their constituent’s needs and views, and can contribute to designing and overseeing implementation of World Bank-financed projects. Legislators can champion social and economic reforms, speak out on HIV/AIDS, take on corruption. In many countries, Bank projects are subject to parliamentary approval directly, through ratification, or indirectly through budget approval. In some cases, parliamentarians create debate and pass new legislation linked to World Bank-supported reform programmes."

6. The "Brief" notes further that in countries providing development assistance, "parliamentarians can be advocates for development. They debate and approve foreign aid budgets, shape and review development policies and promote coherence across policy areas. In a progressively borderless world, parliamentarians exercising their oversight role are paying more attention to matters handled by multilateral organisations. The World Bank is the world’s single largest external funder of development programs as well as an important source of knowledge and advice on how to tackle global issues such as international trade, poverty, HIV/AIDS, corruption, and climate changes."

C. Some Key Issues Raised at Conference

  1. An aspect of the Conference certainly seemed to be an attempt by the World Bank to consolidate and expand its links with MPs. In his keynote address to the Conference, World Bank President, Mr Wolfowitz, said ‘As World Bank President, I intend to build on the partnerships that the Bank has already established with parliaments around the world. Their oversight role has an important bearing on the mission to fight poverty. Across the world, parliamentarians monitor public resources and provide a crucial link between the World Bank and the local communities in both developing and developed countries." He said it was vital that MPs asked tough questions and ensured that pressing development issues are placed on national agendas.
  2. A major theme of the Conference, as explained above, was the role MPs could play in ensuring that the Millennium Development Goals (MDGs) are achieved. Overall, the concern was how we could use our positions and parliament as an institution to fight poverty, and how we could mobilize our constituencies to do so too.
  3. Much of the stress of the Conference was on sub-Saharan Africa. The World Bank President said too: "I have said often – and I am prepared to say it many times – I think the situation of sub-Saharan Africa is not acceptable. It has to be the first priority of the World Bank; but it’s not something that the World Bank or development community can do unless there is leadership in Africa ready to take on the challenge of reducing poverty in Africa. And, increasingly, I find leaders and governments, including the parliaments, stepping up to that challenge, and that makes me hopeful about the future of sub-Saharan Africa".
  4. A parallel session was devoted to "designing and implementing Poverty Reduction Strategies." MPs from sub-Saharan Africa complained that they are often excluded from having a say in the PRS process (PRSP). All the participants stressed the need for parliaments to become more involved in monitoring and implementing the PRSP. There was also a focus on how civil society organizations might become involved – but this discussion was not taken far enough. Among the key suggestions which emerged from the discussion were the following:
    1. There was also a specific session on "Ensuring Accountability: How to Strengthen the Parliamentary Voice on Development and Global Issues". Most MPs felt that the governments of their countries were not keen that their relations with the World Bank and other multilateral institutions and the decisions they take through these relations be subject to the scrutiny of parliaments. Governments do not feel comfortable with parliaments having a meaningful say on global and development issues. A few MPs suggested that the World Bank itself must take some responsibility for this, because of the way they have related to governments. Most MPs felt that it is difficult to engage effectively on global and development issues because of their complex and technical nature. MPs lacked the skills, and there was inadequate research and other support for us to be effective. However, overall, more recently, there has been a slight improvement in the levels of participation of parliaments in global and development issues. There are also the World Bank Institute and other education and training programmes designed to assist MPs in this regard. Among issues raised were the following:
      • The effective use of the role of parliaments in approving budgets.
      • The key role of Finance committees in parliaments.
      • The need for greater co-operation between parliamentary committees.
      • The specific role of women MPs in development issues.
      • More effective oversight of World Bank-funded projects.
      • The mobilization of the public through public hearings, constituency meetings and other forms.
      • The need to intensify the current education and training programmes for MPs and improve the research and technical support given.
      • More effective co-operation of MPs from the donor countries with MPs from developing countries.
      • The need to avoid "donors crowding out the policy space".
      • The more effective tackling of corruption by parliaments.
      • A possible role for parliaments in considering draft lender documents.
      1. The importance of developing infrastructure in developing countries was stressed in several sessions. 40% of the World Bank’s lending is to be for infrastructure. There was a lot of interest in the massive infrastructure roll-out planned by Eskom and Transnet in this country, especially during informal exchanges with participants.
      2. Among the many other issues dealt with, mainly in sessions parallel to those this participant attended, were the following:
        • The extent to which inequalities actually limit the possibilities of growth, and the need for this reason too – economic sense – to significantly reduce inequalities.
        • The need for strong democratic institutions, including parliaments, for economic growth.
        • The crucial need to ensure gender equity and the valuable role of women in development issues.
        • The need to ensure that NEPAD is effectively implemented and the G8 and other commitments to Africa are fulfilled.
        • The need to understand the impact of HIV/Aids and more effectively tackle it to ensure growth and social development.
        • The importance of cross-country regional development.
        • The need to avoid conflicting messages and proposals between the World Bank and other multilateral institutions.
        • Issues of "donor fatigue" in developed countries and the accountability of MPs in these countries to their electorates for support given to developing countries. The need for MPs from different donor countries to co-operate more on donor support to developing countries.
        1. President Yudhoyono of Indonesia offered a very inspiring speech on the need for all the countries to work together to tackle poverty, and he stressed the importance of achieving the Millennium Development Goals.
        2. Mr Lamy of the WTO dealt with the challenges in getting agreement at the WTO Ministerial Meeting in Hong Kong in December. "There was mountains of work and very little time to do it", he said. He said that there was "some progress" in agriculture but the parties were "too far apart on market access." "We need to see movement on this issue for the rest of the topics to fall into shape." He was very cautious about the prospects of success in Hong Kong, and was concerned that if there was not enough progress in December, there would be very little chance that the round finishing in 2006 will achieve anything at all. "Then, the trade agreements of 10 years ago will have to apply", he said.

        D. Some Overall Observations

        1. The Conference was certainly valuable. There were too many parallel sessions, and it was difficult to choose which to attend. There was no effective report-back from the separate sessions to the plenary. But the Bank is to produce a report on the whole Conference shortly, which will give a fuller sense of the Conference as a whole.
        2. Perhaps the nature of the PNoWB and the Conference does not easily allow for it, but it would have been more useful if a concrete programme of action, even if in a limited form, had emerged to guide MPs on how to take issues forward. Beyond the general proposals, where exactly we go from here and how we monitor progress is not clear enough.
        3. While it is clear that MPs from developing countries lack certain skills and have very inadequate research and other support, we can, certainly, do far more than we are doing in respect of our oversight responsibilities on global and development issues. We need to display greater political will!
        4. There was not enough focus on mobilising civil society, and the relationship of parliaments to this. MPs seemed unduly cautious about engaging with civil society. Yet civil society is such a key actor!
        5. PNoWB is seeking to become more decentralized. The Africa chapter is encouraging the formation of regional structures, including one in Southern Africa. This seems an obvious next step.
        6. The World Bank seems very keen to extend its co-operation with MPs and parliaments. At some stage our parliament might want to address this issue formally and decide what links we think are appropriate?