Jordan Times
Sunday, September 18, 2005
Sizing up Socio-Economic
Transformation Plan
By Francesca Sawalha
AMMAN — With the Socio-Economic Transformation Plan phasing out to make way for
the next titanic reform effort — the National Agenda — decision makers,
politicians and analysts take stock of the lessons to be carried over into the
next development stage.
Politicians' assessments of the SETP are overall
positive.
According to the Ministry of Planning and International Cooperation (MoPIC),
scores of new schools, health centres and hundreds of miles of new roads were
built over the past three years. Also, 60,000 teachers were retrained, better
water and sanitation services were provided to some 1.5 million citizens, the
e-government drive finally took off, tens of laws in all fields were amended
with a view to modernise each sector and spur growth, important fiscal and
pension reforms were introduced.
Beyond the physical infrastructure on the ground, the SETP is credited with
having put Jordan on Arab and foreign investors' charts: Even a seemingly
negligible piece of reform such as scrapping one article from the higher
education law produced the sizeable result of attracting American universities
to Jordan.
Analysts stress the SETP brought a revolution in government spending patterns.
According to the MoPIC, capital expenditures in education and healthcare
represented an inadequate 4.5 and 14 per cent of total expenditures in 2001.
Whereas previously running costs were draining the greatest majority of
resources, all SETP funds went into capital expenditure.
Even the staunchest government opponents recognise that the programme represents
“a national treasure,” as Islamic Action Front (IAF) Deputy Musa Wahsh puts it.
Still, the SETP has come under fire over the past year. Most critics were
generally viewed as trying to settle personal scores. Others attacked specific
parts of the programme, saying the identification process for some small local
projects was flawed. The Islamists protested against a parliamentary
investigation that they charged was intended solely to cover up some anomalies.
The SETP and the controversy around it represent a wealth of lessons.
“The lesson is that, no matter how good a plan is, someone will always be there
to criticise it,” a former official said, shaking his head in dismay and asking
not to be named.
Deputy Wahsh agrees, but only partly. “It is possible that some of those who
criticised the SETP meant to target certain officials personally, perhaps
because they didn't get money for some projects they wanted to see funded. But
there was some confusion in the selection process of some of the [small-scale,
local social productivity] projects, and for some projects there were no
feasibility studies. These two observations were also made by the Audit Bureau.”
Wahsh says the lesson is that public scrutiny might have a few unpleasant
outcomes, but it is always worth the risk, as it grants more credibility to the
plan itself and the country as a whole.
Officials stress that another important lesson to be learnt from the SETP is
that reforms have more chances to succeed if they are part of a comprehensive,
all-encompassing plan, as in the SETP's case.
A third lesson is that, if you have a really good plan, donors will listen.
“Donors do not finance projects if they're not part of a vision,” says former
Planning Ministry official Amin Khleifat, who headed the SETP division at the
MoPIC until 2004. “We could raise funds, approach the donors and be taken
seriously because we had a comprehensive development programme.”
A fourth lesson cited by many current and former officials closely echoes
Murphy's Laws: Any development job will take twice as long as expected.
The SETP was supposed to cover the 2002-2004 period, but many projects had to be
carried over in the 2005 Budget Law, and many others will have to be included in
next year's budget. “Delays are not failures,” states Omar Rafie, director of
the Social Productivity Programme unit at the MoPIC. “They are part of the
learning curve, especially when local communities and players in rural areas are
closely involved.”
From SETP to National Agenda
The National Agenda being drafted by a 27-member, Royally appointed Steering
Committee, aided by some 200 experts, and expected to be unveiled within weeks,
will place more emphasis than the SETP on political and administrative reforms.
Analysts say the National Agenda can be seen as a natural evolution of the SETP:
After the latter addressed some of the most urgent socio-economic development
issues, the former can now lay out the vision of political and administrative
reforms over the next decade.
“The National Agenda will benefit greatly from the lessons of the SETP,”
explains Khleifat. “We can enrich the National Agenda, if we know the weaknesses
of the SETP.”
Both the National Agenda and the SETP stem from national consensus on reform
policies.
In the SETP's case, consensus was rallied at two National Economic Forums in
2000 and 2001.
When the SETP was officially unveiled, in November 2001, sceptics said it was
too ambitious. The plan set a two-year deadline to draft and amend some 60 laws,
implement radical reforms such as introducing English and IT courses as of the
early grades in all public schools, launch an e-government strategy, build tens
of new clinics in rural areas, and develop Aqaba as a Special Economic Zone.
But “we didn't have money to do any of this,” Khleifat recalls.
An aggressive search for financing was launched, championed by His Majesty King
Abdullah and relentlessly followed up by then-Planning Minister Bassem Awadallah,
generally considered, for better or for worse, the first “guardian” of the SETP.
USAID alone contributed 55 per cent of SETP's total JD579 million budget,
providing JD336 million.
Saudi Arabia, Kuwait and the United Arab Emirates provided JD171 million.
Japan donated JD32 million.
Officials and deputies have yet to tire of thanking the donors.
USAID Director Anne Aarnes says her agency supported the plan because of its
integrated approach, and the fact “it is comprised of targeted projects which
contribute towards goals that better the lives of all Jordanians, especially the
poor and underprivileged.”
“USAID's partnership with the MoPIC and other ministries in the successful
implementation of bilateral development projects was the primary factor in
gaining USAID support,” Aarnes continues.
“The World Bank's involvement in the programme design and impact assessment were
also positive developments which contributed to USAID's interest,” she adds.
All the government had to chip in, in the end, were some JD40 million taken from
privatisation proceeds and channelled into the SETP in 2002.
Since 2002, the SETP has been a line item of the yearly Budget Law.
For many ministries, it meant a vital injection of cash to invest in
development, and an increase in the volume of operations, demanding increase in
operations.
“Take the Ministry of Education,” says Khleifat. “For the previous 50 years,
their yearly target was to build one, two or a handful of new schools a year.
With the SETP, their target became to build 160 new schools in two-three years.”
Obviously, not all needs could be met. The Ministry of Health, for example, said
at the inception of the SETP that it needed 73 new health centres in rural
areas, but only 55 could be funded.
The achievements
A complete list of the achievements of the SETP is currently being finalised by
a consortium of US, Canadian and Jordanian consultants and should be released in
a couple of weeks.
Before this impact assessment is published, any inventory and analysis of the
SETP's achievements can only be partial. Some argue that, even once the study is
unveiled, it will assess only preliminary results, as some of the SETP projects
will be completed next year.
However, analysts agree that the SETP largely kept its promise to be an
investment in human resources, and its biggest results are often ascribed to the
education sector.
According to the MoPIC, 60,000 public school teachers have been retrained,
mainly in IT-related certifications, 160 school buildings either have been built
or are being built, including 300 KG classrooms.
JD15 million were invested in the computerisation of the eight public
universities and the “Connecting Jordanians” initiative.
At least 700 schools were computerised under the SETP, and the ratio of 30
students to one PC was halved to 15 students to one PC.
All 2,010 Jordanian public schools are now connected to a made-in-Jordan
intranet — EduWave — which is setting standards in the field of e-learning
beyond the region.
Particular emphasis was placed on vocational training, with 12 vocational
training centres built across the country and the launch of a national training
programme.
Plus, according to the MoPIC, more than 30 youth centres were opened in all
governorates.
In the water sector, Al Fidan, Abu Zighab and Husban dams (all in the
centre-south areas) were built, water and sewage services were either brought to
or improved in 26 rural areas inhabited by 1.5 million people.
Roads were either built, renovated, or widened — small agricultural roads as
well as strategic stretches such as the Queen Alia International Airport Road or
the Sweimieh Road at the Dead Sea.
The MoPIC also reports that at least 10 new civil defence centres were built in
rural areas.
Other achievements of the SETP didn't cost money, but greatly impacted the lives
of millions of people. Free medical insurance was extended to children and some
half a million new beneficiaries. As part of the pension reform, military
personnel are registered as of 2003 with the Social Security Corporation, and no
longer with an army pension fund.
By funding the Enhanced Social Productivity Programme (ESPP), the SETP sought to
meet specific needs in particularly poor rural areas. Physical infrastructure
work included housing projects and an array of other initiatives, such as the
school nutrition programme. Social productivity centres were established, for
potential small entrepreneurs to receive training, consultancy and help in
accessing financial credit facilities.
According to Rafie, 29,000 would-be microentrepreneurs in rural areas have been
trained, 2,000 microenterprises have been set up and 1,500 loans have been
facilitated since 2002 thanks to the ESPP's social productivity centres.
The ESPP is also the only programme directly managed by the MoPIC — though most
of the ESPP projects are outsourced by the ministry to other government
agencies, local and international NGOs, community-based organisations, and the
private sector.
In all other SETP programmes, the MoPIC plays a fund-raising, monitoring and
evaluation role, while actual management is entrusted to the competent
ministries.
The hullabaloo
Notwithstanding its achievements, the SETP has come under fire on at least two
occasions from Lower House deputies.
A few conservative deputies criticised the plan during the debate on the 2005
Budget Law. At the time, most analysts interpreted such criticism as personal
score settling, part of a strategy by some political figures to antagonise and
eventually isolate former minister Awadallah. The bad blood between the SETP's
main architect and some Lower House deputies resulted in Awadallah resigning his
planning portfolio first, in February 2005, and his finance portfolio five
months later, in what the King termed “a sacrifice.”
But even with Awadallah gone, during the summer extraordinary session of
Parliament a few deputies asked for a probe into the SETP. Lower House Speaker
Abdul Hadi Majali responded by appointing representatives from each
parliamentary bloc and independents to form an investigation committee.
The 11-member committee, headed by Jerash Deputy Mufleh Ruheimi, started meeting
in mid-August and surprisingly handed over its assessment — a very positive one
— as early as September 4, after less than three weeks of work.
The IAF protested that the investigation committee's work was an “an attempt to
absolve the programme and all those in charge, and to conceal facts from
citizens.”
Deputy Jamal Dmour (Karak), himself a member of the committee, insists that the
team worked diligently. After meeting with top officials, from relevant
ministries, the Audit Bureau and the Central Bank, having obtained all requested
documentation and having received independent reports by international
consultants, there was nothing more that needed to be probed.
The parliamentary investigation committee included a majority of lawyers and
accountants who wouldn't need long to smell financial irregularities, Dmour
continues. Dmour is a former military prosecutor general specialised in
financial cases, and in that capacity investigated the biggest financial scandal
in Jordan's history — the Petra Bank affair, between 1989-1992.
Finally, Dmour concludes, the debate over the SETP might have started as a
personal matter, due to some deputies' opposition to Awadallah, “but it also
cast doubt on national institutions and the national economy.”
On his part, Deputy Wahsh (Amman), who represented the IAF on the investigation
committee, charges that the Lower House speaker exercised pressure on the
committee to come up with a positive report speedily.
“We [the committee] agreed on a work plan, which also included field visits to
some of the projects, but Majali directed that we conclude our work.”
“We didn't even have the time to read all the documentation,” Wahsh says,
pointing to three hefty black files on a shelf next to his desk.
“Why would a committee be formed just to be dissolved this way? “We [IAF]
support this programme, it helps national development, and we want to make sure
that it is in the safest possible hands.”
Though the IAF is protesting first and foremost the parliamentary investigation
— or lack of thereof — Wahsh adds there are also a few parts of the SETP whose
implementation may have been irregular. He refers specifically to some
small-scale projects under the ESPP, and second-hand reports of irregularities
in the awarding of funds — not exceeding five-six digit figures — to some NGOs
in rural areas.
Former and current officials let an independent international consultant report
speak on their behalf.
Financed and commissioned by USAID and presented in July 2004, a Grant Thornton
International study praises the MoPIC for its management of the plan and its
rigorous adherence to all financial rules and regulations.
“Over the last three years since the programme was initiated, the SETP Tracking
Unit [at the MoPIC] has done a commendable job in monitoring, control and
follow-up on SETP operations with limited staff and a variety of constraints,
including no authority to institute corrective measures.
“To date, the programme has implemented 173 major projects, consisting of 1,173
sub-projects, in all 12 governorates. The Tracking Unit has successfully
coordinated its activities with multiple donors, almost all ministries,
governorates and decision making bodies at the highest levels of government.
“Most importantly, the financial controls and auditing procedures used in the
programme closely adhere to the rigorous and stringent standards established by
the government of Jordan. These controls are by all accounts effective in
discouraging any potential anomalies. The success of the programme and its
management to date reflects well on the MoPIC and involved ministries.”
Ahmad Barakat contributed to this analysis