Some international and local NGOs’ reluctance to cooperate with government institutions has hampered the post-tsunami reconstruction in certain areas, stated an Interim Report launched yesterday by the Institute of Policy Studies of Sri Lanka.
The report said that poor coordination among domestic and external agencies have emerged as serious problems, together with the sensitive issues of balancing political considerations and humanitarian assistance to the needy.
“The modalities of aid spending, including procedures and mechanisms should be reviewed to improve quick and effective responses”, it stated.
The report said the promised external assistance of a total of US$ 2.2 billion over the next two to three years appeared to be more than adequate to cover reconstruction costs. But problems have emerged with relief payments, providing credit facilities, distribution of funds, coordination of reconstruction activities and mismanagement of funds.
The report also said that overall macro-economic management circumstances and policies were critical to the success of reconstruction. The tsunami hit at a time of serious macro-economic imbalance and paradoxically helped to mask them for a time.
The report added that the imbalance was re-emerging now, fuelling inflation, lowering the real value of aid funds, constraining the government’s fiscal capacity and adversely affecting reconstruction.Wider macro-economic imbalances should be addressed directly by targeting their sources, it added.
“The cash grants for rebuilding and repairs of houses are inadequate. The government’s initial MoU’s with donors and companies for stipulated design envisaged a cost of around Rs. 400,000. But surveys and field interviews shows a rapid cost escalation. The poorer households will find it very difficult to rebuild with current levels of assistance. Therefore the IPS recommends an upward revision of the grant, at least for the poorer households, using designated donor funds”, said the report. -