November 1, 2021 (WASHINGTON) – This statement is delivered on behalf of the Modernizing Foreign Assistance Network (MFAN) by Co-Chairs Lester Munson, Larry Nowels, and Tessie San Martin.
The Modernizing Foreign Assistance Network notes the release of nine remaining Senate Appropriations bills for fiscal year 2022 by Chairman Patrick Leahy on October 18, including the State, Foreign Operations, and Related Programs bill (SFOPS). We commend Chairman Leahy and subcommittee Chairman Christopher Coons for a robustly funded bill at $60.56 billion for U.S. diplomatic, development, humanitarian assistance and other programs, representing a $5.1 billion increase over the prior year enacted level.
Among MFAN’s highest priorities in strengthening the impact of U.S. foreign assistance is the need to focus on local priorities for greater sustainability of U.S. investments. MFAN commends the Committee on its commitment to locally-led development and humanitarian response both through increased funding of USAID’s Local Works program and in support of locally-led approaches to delivering assistance for Central America. Additionally, MFAN supports the Committee’s strong language throughout the Committee Report which calls on the agency to work with the Committee to develop ways to strengthen locally-led development and work toward its successful implementation. We especially note that the Committee directs the USAID Administrator to adopt policies that reward staff who demonstrate the skills and commitment to this effort. It is by taking actions like these that true policy transformation may occur.
While MFAN historically does not call on Congress to fund explicit development sectors at specific levels, we have long supported adequate funding for the agency’s Operations and Expenses (OE) account. Insufficient staffing and operations funding impair USAID’s ability to carry out its programs at missions across the globe. We note that staff at missions have been especially pressed in recent years, responding to COVID-19 pandemic needs in addition to emerging and existing humanitarian crises. Key approaches leading to greater aid effectiveness and sustainability – such as locally-led development, gender equality, evaluation & learning, diversity and inclusion, and adaptive management – also require more staff training and time. We applaud the Committee for supporting a robust OE funding level above the administration’s request to support USAID operations to carry out US priorities in the field.
The COVID-19 pandemic, together with recent years of strong congressional control of development funding, have left the agency with little flexibility to adjust funds according to changing and local priority needs in partner countries. MFAN has consistently called on Congress to reduce country and program directives and instead work to ensure that country priorities drive partner investments and that this flexibility is accompanied by increased agency accountability and transparency. The FY2022 Senate appropriation takes a step in that direction. MFAN applauds the Committee’s efforts to begin a conversation with the foreign assistance agencies about funding flexibility by addressing operational and programmatic reforms. The coalition further commends the addition of language that allows the Secretary of State to exceed the 10% deviation limit in instances of national interest.
MFAN also notes the Committee’s support for USAID’s elevation of diversity, equity and inclusion at USAID, including the agency’s establishment of a Chief Diversity, Equity, Inclusion, and Accessibility Officer.
MFAN remains concerned that Congress’ intent under the BUILD Act regarding the financing of important economic development projects through the Development Finance Corporation (DFC) continues to be restricted by how equity investments are scored by the White House (Office of Management and Budget) and the Congressional Budget Office. We commend the Senate Appropriations Committee for its efforts in working with the DFC to seek options for resolving these financing challenges. We also support the Committee’s attention to the agency’s focus on its development mission.
For many years MFAN has supported USAID and Treasury efforts to engage with partner countries on Domestic Resource Mobilization (DRM). We appreciate that the Senate report continues to encourage foreign assistance agencies in these efforts. However, we continue to express concern that these efforts will wane without a clear and comprehensive whole-of-government DRM strategy and again call on the Appropriations Committees to include such a requirement as the Congress finalizes its FY 22 SFOPS bill.
Accountability of U.S. foreign assistance – through transparency, monitoring, evaluation, and learning – has been a long-standing reform pillar of MFAN. We applaud the Committee’s continued focus on improving the accountability of U.S. foreign assistance by requiring that agencies make public all reports produced for the Committee under this legislation and its requirements that implementing partners establish procedures to gain feedback from program beneficiaries of this assistance. These requirements strengthen both accountability and sustainability of U.S. investments.
Finally, as we expressed in our statement regarding the House FY22 SFOPS bill, we are also concerned about the Senate’s decision to rescind $515 million from the Millennium Challenge Corporation (MCC), as requested by the Biden Administration. While we understand that much of the proposed rescission was the result of MCC’s decision to cancel its compact with Sri Lanka, we again note that MCC maintains a unique model among US development agencies that is centered around development effectiveness. The decision to rescind this level of funding risks undermining the MCC model. We encourage Congress to work with the Corporation to ensure its ability to fully fund its compacts with partner countries going forward without risking the MCC’s unique partnership relationship with these countries.
Once again, MFAN congratulates Chairman Leahy and SFOPS Subcommittee Chairman Coons and their staff on the work in drafting this important piece of legislation. We look forward to continuing to work with them as they finalize the appropriations measure.
