Parliamentarians go to Washington to demand greater oversight

13 June 2005

Parliamentarians from eight countries travelled to Washington for the Bank-Fund spring meetings to present the international parliamentarians’ petition demanding greater oversight of the operations of the IFIs. Their concerns were echoed in a report published in May by the UK NGO World Development Movement (WDM).

MPs presented the petition, signed by over 1000 parliamentarians in over 50 countries to Ian Goldin, World Bank vice-president for external affairs and Tom Dawson, his counterpart at the IMF. In the two-hour workshop which followed, MPs highlighted instances of IFI infringement of parliamentary sovereignty. Drajad Wibowo, Indonesian MP, cited electricity, oil and gas laws driven by IMF conditions which had been implemented by the executive only to be later overturned by constitutional courts. Mario Cafiero, Argentine MP, decried a situation where parliaments rubber-stamp “measures pre-approved in letters of intent with the IMF”.

Jean-Francois Rischard, World Bank vice-president for Europe, avoided responding directly to the MPs’ points. He claimed that there had been a “revolution” in the Bank in the “last few years”, saying that 85 per cent of country staff reported meeting with parliamentarians on a regular basis. Rischard emphasised World Bank Institute efforts to “train parliamentarians about how to improve their oversight role”. He claimed that the Parliamentary Network on the World Bank (PNoWB) is the place where parliamentarians can address their concerns. Tom Dawson seconded the comments of his colleague from the World Bank, and highlighted Fund efforts to establish a wide range of parliamentary capacity building programmes, particularly in the transition countries and Africa.

parliaments rubber-stamp measures pre-approved in letters of intent with the IMF

The second section of the workshop focused on positive steps which had been taken to improve parliamentary scrutiny. Senator Francesco Martone from Italy called on the Bank and Fund to disseminate information in a timely and effective fashion. He called for other countries to regularise the practice of executive directors reporting to parliaments, and for government departments in the north which liaise with the IFIs to draw up medium-term plans with objectives to which civil society could hold them to account. Finally, he called for parliamentarians to demand that they be included in official delegations to the spring and annual meetings of the institutions.

Ivan Valente, Brazilian MP, described the work of a ‘parliamentary front’ on the IFIs (see Update 34) which works to ensure the observance of a constitutional requirement that all letters of intent and country assistance strategies have to appear before parliament. The group had introduced a bill to see that Brazilian representatives to the IFIs are vetted by congress and accountable to them.

Many of the MPs left the workshop frustrated that neither the Bank nor the Fund conceded any responsibility for the lack of parliamentary scrutiny. They expressed their commitment to continue to spread support for the petition, and to work from the national level to change the relationships with the IFIs.

Denying democracy

The WDM report, entitled Denying democracy: How the IMF and World Bank take power from people, points to four shortcomings in the democratic accountability of the BWIs: the design of the PRSP process to “deny real country ownership”, the IFIs lack of “interest in promoting parliamentary scrutiny”, the imposition of policy choices on governments, and the “internal democratic defict” at the IFIs.

On the issue of parliamentary oversight, the report highlights a case study of Ghana. In discussions over a new loan in 2003, the IMF insisted that a new tariff on imported poultry not be enforced. The legislated tariff increase was subsequently removed in early 2004. In August the Ghanaian poultry association began court proceedings against the government, arguing that the u-turn on the poultry tariff (which had been passed by parliament) amounted to a contravention of the constitution. In March 2005, the Ghanaian courts ruled that the government’s overturning of the tariff under pressure from the Fund was indeed illegal.