USAID responds to Conaway-Rouzer food aid letters amidst concern about cash assistance
July 17, 2015 |04:31 PM
The U.S. Agency for International Development has issued a public response to a letter about closed-door negotiations to amend or change the Maritime Security Program that House Agriculture Committee Chairman Michael Conaway, R-Texas, and House Agriculture Livestock and Foreign Agriculture Subcommittee Chairman David Rouzer, R-N.C., sent on July 8.
In the letter to USAID Acting Administrator Alfonso Lenhardt, Conaway and Rouzer said they were concerned about a May 15 article in the American Shipper that said the administration was engaged in negotiations to increase the MSP stipend to the Merchant Marine fleet in exchange for allowing USAID to spend 45 percent of its food aid budget on local and regional purchases rather than buying food in the United States.
“This appears to be another attempt on the part of USAID to shift from U.S. in-kind commodity-based food aid to cash vouchers,” Conaway and Rouzer wrote, noting that the Government Accountability Office recently issued a report finding weaknesses in USAID’s financial oversight of cash-based international food assistance.
Current law, they noted, requires that at least 50 percent of U.S. agricultural commodities, financed by U.S. food aid programs, be shipped on privately-owned U.S.-flag commercial vessels.
“Unfortunately, this proposal would have dire consequences for U.S. farmers and taxpayers, generally,” Conaway and Rouzer wrote and asked USAID to send all documents and communication about this proposal to them by July 21.
In a talking-points memo sent to The Hagstrom Report by a USAID official, the agency said it is preparing a response to Conaway and Rouzer, but “supports food aid reform to provide more flexible humanitarian responses when appropriate, especially as the number of refugees and internally displaced persons (IDPs) rapidly increase around the world, to reach more people in need with the same amount of resources.”
USAID also said it “continues to work with and seek input from all stakeholders, including members of Congress, nongovernmental organizations, the maritime and agriculture industries, to find a path forward to achieve food aid reform, while maintaining the right balance between U.S. commodities; local and regional purchase, and cash-based assistance.”
The memo also says that cash-based assistance has allowed USAID to reach additional beneficiaries and that it is responding to GAO’s criticism by strengthening is process of reviews and “exploring” third party monitoring.
Similar letters were sent to Paul Jaenichen Sr. the administrator of the U.S. Maritime Administration, which is a division of the Transportation Department, and Phil Karsting, the administrator of the Agriculture Department’s Foreign Agricultural Service.
USDA declined to comment on the letter.
The day after the letters were sent, Rouzer’s subcommittee held a hearing on accountability in food aid programs at which witnesses from GAO and USAID’s and USDA’s offices of Inspector General testified.
“While the 2014 farm bill struck a balance between in-kind and cash-based assistance, I am very concerned about reported efforts to further undermine in-kind food aid by shifting to additional cash-based assistance,” Rouzer said.
“Initial work by GAO has raised several red flags on USAID’s controls over cash-based assistance.”
Rep. Jim Costa, D-Calif., the ranking member on the subcommittee added, “I have a sense that the traditional direct food aid support is a much more meritorious support for those that need it than cash-based assistance.
“One of the problems I see in the in-kind donations is that locally sourced products are not adequate and do not come close to the quality of food that we produce in the United States,” Costa added.
Thomas Melito, director of international affairs and trade at GAO, testified that USAID lacks a system for making changes to contracts and “does not know how to respond to market conditions.”
Officials from the Inspector General’s offices at USAID and USDA testified about a range of problems in shipping commodities, but said they had not yet focused on cash-based food assistance.
At a Senate Appropriations Committee markup on the fiscal year 2016 Agriculture appropriations bill on Thursday, Sen. Barbara Mikulsksi, D-Md., the ranking member on the committee, signaled further congressional skepticism on cash assistance.
From the Port of Baltimore, Mikulski noted, “American ships flying the American flag take food to the hungry.”
In the letter to USAID Acting Administrator Alfonso Lenhardt, Conaway and Rouzer said they were concerned about a May 15 article in the American Shipper that said the administration was engaged in negotiations to increase the MSP stipend to the Merchant Marine fleet in exchange for allowing USAID to spend 45 percent of its food aid budget on local and regional purchases rather than buying food in the United States.
“This appears to be another attempt on the part of USAID to shift from U.S. in-kind commodity-based food aid to cash vouchers,” Conaway and Rouzer wrote, noting that the Government Accountability Office recently issued a report finding weaknesses in USAID’s financial oversight of cash-based international food assistance.
Current law, they noted, requires that at least 50 percent of U.S. agricultural commodities, financed by U.S. food aid programs, be shipped on privately-owned U.S.-flag commercial vessels.
“Unfortunately, this proposal would have dire consequences for U.S. farmers and taxpayers, generally,” Conaway and Rouzer wrote and asked USAID to send all documents and communication about this proposal to them by July 21.
In a talking-points memo sent to The Hagstrom Report by a USAID official, the agency said it is preparing a response to Conaway and Rouzer, but “supports food aid reform to provide more flexible humanitarian responses when appropriate, especially as the number of refugees and internally displaced persons (IDPs) rapidly increase around the world, to reach more people in need with the same amount of resources.”
USAID also said it “continues to work with and seek input from all stakeholders, including members of Congress, nongovernmental organizations, the maritime and agriculture industries, to find a path forward to achieve food aid reform, while maintaining the right balance between U.S. commodities; local and regional purchase, and cash-based assistance.”
The memo also says that cash-based assistance has allowed USAID to reach additional beneficiaries and that it is responding to GAO’s criticism by strengthening is process of reviews and “exploring” third party monitoring.
Similar letters were sent to Paul Jaenichen Sr. the administrator of the U.S. Maritime Administration, which is a division of the Transportation Department, and Phil Karsting, the administrator of the Agriculture Department’s Foreign Agricultural Service.
USDA declined to comment on the letter.
Hearing on accountability
The day after the letters were sent, Rouzer’s subcommittee held a hearing on accountability in food aid programs at which witnesses from GAO and USAID’s and USDA’s offices of Inspector General testified.
“While the 2014 farm bill struck a balance between in-kind and cash-based assistance, I am very concerned about reported efforts to further undermine in-kind food aid by shifting to additional cash-based assistance,” Rouzer said.
“Initial work by GAO has raised several red flags on USAID’s controls over cash-based assistance.”
Rep. Jim Costa, D-Calif., the ranking member on the subcommittee added, “I have a sense that the traditional direct food aid support is a much more meritorious support for those that need it than cash-based assistance.
“One of the problems I see in the in-kind donations is that locally sourced products are not adequate and do not come close to the quality of food that we produce in the United States,” Costa added.
Thomas Melito, director of international affairs and trade at GAO, testified that USAID lacks a system for making changes to contracts and “does not know how to respond to market conditions.”
Officials from the Inspector General’s offices at USAID and USDA testified about a range of problems in shipping commodities, but said they had not yet focused on cash-based food assistance.
At a Senate Appropriations Committee markup on the fiscal year 2016 Agriculture appropriations bill on Thursday, Sen. Barbara Mikulsksi, D-Md., the ranking member on the committee, signaled further congressional skepticism on cash assistance.
From the Port of Baltimore, Mikulski noted, “American ships flying the American flag take food to the hungry.”
- USAID — Talking Points in Response to the House Committee on Agriculture
- Conaway-Rouzer Letter to U.S. Agency for International Development
- — To Department of Transportation U.S. Maritime Administration
- — To USDA Foreign Agriculture Service
