IFI governance


Parliaments reign in IFIs: International campaign gains momentum

21 September 2004

Over 170 parliamentarians worldwide have signed a petition demanding a greater role in scrutinising the operations of International Financial Institutions (IFIs) within their nations as a way to reassert the sovereignty of legislatures in parliamentary democracy.

The international parliamentarians’ petition seeks to strengthen the capacity for effective parliamentary oversight of national economic policy-making and interaction with the IFIs. It is being signed by both developed and developing countries. On the 60th anniversary of the BWIS, a target of 60 parliamentarians in 60 different countries will be mobilised in support of the petition for presentation to the Bank and Fund at the spring meetings in 2005.

The petition has already received support in a wide range of countries with preliminary national launches held. The Parliamentary Network on the World Bank (PNOWB) and the Committee of Parliaments of the Americas (COPA) have officially endorsed the petition and are distributing it amongst their membership. The Committee for a Democratic United Nations have expressed their support and will encourage individual members to sign on. Support is anticipated from the International Parliamentary Union, the European Parliamentary Forum and Commonwealth Parliamentarians Association.

the petition has struck a strong chord with elected representatives

Unprecedented UK support

To date 134 MPs have endorsed the petition in the UK. The all-party group in Heavily Indebted Poor Countries (HIPC) with over 170 members from both houses of parliament is co-sponsoring the petition and has secured the support of the overseas and world government all-party groups. A briefing and launch of the campaign took place at the Palace of Westminster 8 September attended by 40 MPS and Peers. Speakers included Dutch MP Bert Koenders, chair of the PNOWB, Tony Worthington MP and international development select committee chair and Mark Curtis director of the World Development Movement.

Ann McKechin MP and co-chair of the all party group on HIPC sponsored a private members’ debate on ‘oversight of IMF and World Bank policies. She lamented the norm that ensures “little debate or scrutiny of the Government’s record in either institution, despite the fact that we hold a permanent directorship on the boards of both and are viewed as a key world player”. Appreciating that the UK is not unique in its lack of parliamentary scrutiny, she voiced support for the petition: “the petition has struck a strong chord with elected representatives, who often feel powerless to influence decisions that have such an impact on their electorate. The aims of the petition are relatively modest but can go a long way to establish better governance both in our multilateral institutions and in individual nation states”.

On the question of scrutiny in the house, economic secretary to the Treasury, John Healey responded that Treasury’s annual report on the UK’s relations with the IMF sets out the UK’s key agendas and general positions and conceded that it could go further in making clear the stance taken in the IMF board. He promised that the next report would be more explicit. Also, the Department for International Development has committed to produce an annual statement to parliament on the positions that it has taken on the World Bank board.

To further the principles of the petition UK parliamentarians are demanding the following reforms:

  • full parliamentary scrutiny and oversight of national Poverty Reduction Strategy Papers (PRSPs). This would shift the approval of PRSPs from the boards of the Bank and Fund to the national parliaments of recipient countries.
  • Ensuring parliamentarians can hold their governments to account for decisions made at the boards of the Bank and Fund by altering the structure and practices of the institutions. For example, publishing detailed minutes of meetings of the executive boards and senior management. Obliging Executive Directors to make available their policy positions and statements made at meetings of the boards.
  • Reforming the governance structures of the IMF and World Bank to have a more equal and fair distribution of votes that leaves no country with a veto and disproportionate influence.

Civil society organisations in the north and south are urged to assist in mobilisation and to provide general support at the national level for the campaign. Groups are encouraged to pledge network contacts and opportunities to rally support and signatures for the petition. Efforts should take advantage of existing campaigns, using national context and identifying key moments within parliaments such as debates on IFI policy, budgets or economic conditionality as entry points to seek support from MPS.

For further information on the petition please contact andomo@brettonwoodsproject.org

International parliamentarians’ petition for democratic oversight of IMF and World Bank policies

We the undersigned Parliamentarians:

  • Noting this is the 60th anniversary year of the creation of the International Monetary Fund (IMF) and World Bank – the Bretton Woods Institutions (BWIs).
  • Recognising that the IMF and World Bank have voiced a commitment to ensuring individual countries determine their own economic policies.
  • Noting that key economic policies continue to be imposed by both the World Bank and IMF as conditions for receiving debt relief and new loans, with the Boards of the BWIs retaining the power of veto over all measures including those in Poverty Reduction Strategy Papers.

We therefore call on the BWIs and their principal shareholders to ensure that the democratically elected representatives of recipient nations are the final arbiters of all economic policies in their countries.

It is vital that national parliaments in recipient nations have the right and obligation to be fully involved in the development and scrutiny of all measures associated with BWI activities within their borders, and hold the final power of ratification.

Ensuring the primacy of sovereign national parliaments in this way will improve implementation of measures to reduce poverty, enhance good governance, and foster democracy.

Translations of the petition text into French, Portuguese, Spanish, Swedish and Kiswahili are available from info@brettonwoodsproject.org